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World Perspectives: Capitalist System Faces Political and Social Upheavals

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The underlying crisis of world capitalism has, as we predicted, significantly deteriorated in the year. In the decisive sphere of the world economy a new crisis looms, the timing and character of which are not certain. In world relations Trump has enormously ratcheted up tensions with the repudiation of the Iran nuclear deal and its political fallout, increased conflict with China both economically and militarily, and now with Russia in a proposed new “great power” nuclear arms race, in relations with the EU and practically the whole of the rest of the world.

We publish below the final, agreed and amended version of the World Perspectives document approved at the Committee for a Workers’ International (CWI) International Executive Committee meeting, held for one week in Belgium, in November 2018.

[Note: the World Perspectives document was completed before the eruption of the “yellow vest” mass protests in France, which are reported on and analyzed elsewhere on]

The underlying crisis of world capitalism has, as we predicted, significantly deteriorated in the year since the last International Executive Committee (IEC) meeting. In the decisive sphere of the world economy a new crisis looms, the timing and character of which are not certain. In world relations Trump has enormously ratcheted up tensions with the repudiation of the Iran nuclear deal and its political fallout, increased conflict with China both economically and militarily, and now with Russia in a proposed new “great power” nuclear arms race, in relations with the EU and practically the whole of the rest of the world.

This was reflected in the general outburst of laughter and jeering which greeted Trump’s speech at the recent United Nations General Assembly where he nakedly reasserted U.S. imperialism’s doctrine of unilateralism to “make America great again.” This was in place of previous so-called “rules-based” international “cooperation” – a softer form of U.S. capitalism’s power and domination. Moreover, his repudiation of the Paris agreement on climate change flies in the teeth of increased worldwide concern reflected in significant mass movements and heightened consciousness in some of the countries and continents most immediately affected by the likely terrible repercussions of an increase in the world’s temperature, which is indisputable and can lead to a world climate catastrophe. This will only be completely avoided through the ultimate replacement of uncontrolled and ruinous capitalism by a new democratic socialist world. This in turn is only possible through the methods of revolutionary and socialist struggle for which the CWI stands.

The world economy remains central to perspectives. The capitalist “experts” claim that in 2017 there was a “synchronized economic acceleration” – with every major advanced economy except Britain on a “growth path,” signified by a drop in official levels of unemployment not seen for decades. For instance, in the U.S. it is officially at a 49-year low. However, the reality is that this “boom” is very uneven – not all countries have experienced this, even in some of the economically developed countries. As we have commented many times, it was based on unprecedented levels of part-time and casual workers – very often cheated out of wages for weeks and months – and therefore was extremely lopsided.

It was also founded on a continuation of low wages and generalized wage repression with little real substantial long-term benefit accruing to the working class. In Britain for instance wage stagnation is the worst since the Napoleonic wars at the beginning of the 19th century, while austerity is still continuing in Europe and for the majority of the working class in the U.S. The neo-colonial world has in general suffered a severe crisis, with an economic contraction unprecedented since the Second World War in Brazil, and a significant dimming of economic prospects in Argentina, Turkey, and South Africa.

However, where there has been even a slight economic upturn in some countries this has encouraged the working class to move to “take back” some of what they lost in the Great Recession and its aftermath. This has the been the case in a number of countries in Europe, including Eastern Europe, where low-level strikes are taking place, but most notably in the U.S., with a powerful re-emergence of the working class in a series of strikes including militant teachers’ strikes in West Virginia and elsewhere. At UPS there has been a rank-and-file revolt against a contract negotiated by the union leadership. These and other disputes are leading towards the biggest number of workers taking strike action since the 1980s. After fast food strikes popularized the idea of a $15 per hour minimum wage, our co-thinkers in Seattle led the way in building the movement that won the first tremendous victory for this demand in a major city which then spread like wildfire throughout the U.S., winning concrete gains for the working class.

Our co-thinkers in the U.S. have also now very energetically intervened in this process with tremendous results. This in turn has led to a very beneficial beginning of a change in their social composition – more weight internally to workers, their outlook politically, emphasis on the importance of the trade unions. This has allowed us to dig firmer roots and begin the process of establishing already a pole of attraction for some of the best sections of the working class in the U.S.

This boom, we should remind ourselves, is founded on a massive extension of debt, including household debt which has risen in general in the advanced industrial countries. Global government debt skyrocketed to 60% of gross world product while total debt rose from $173 trillion in 2010 to over $250 trillion today. Moreover, a continual and colossal increase of inequality, together with intensified geopolitical factors have contributed to the highly unstable character of this “boom.” As the French say: “The more things change, the more they stay the same.”

Promises to severely regulate the banks and to clip the wings of the parasitic “financial aristocracy” were not effectively carried through. Minor increases in bank regulation were tried, but these have now been scrapped in the U.S. One result is the return of financial instability with the heat lightning flashes indicating a serious crisis in the offing, with the collapse of share prices. Blackrock, the world’s largest asset manager, has seen its share price fall by more than a fifth in 2018, with revenues significantly down. While the coming crisis may not be exactly like the last one, which began in the financial sector but spread to the “real economy,” this coming crisis might be reflected in the real economy much earlier.

Another outcome of the last 10 years has been the colossal further growth of inequality: “Billionaires made more money in 2017 than in any year in recorded history … The past 30 years have seen far greater wealth creation than the Gilded Age of the late 19th century,” comments the UBS Billionaires Report. This was, as we know, a prelude to the mass discontent which, with other factors, ultimately led to the Russian Revolution and, following this, the prospects of world revolution. The consequences of this widening of the wealth gap means that the class divide has ineluctably grown in the advanced industrial countries, in Eastern Europe and China and also in the neocolonial world. In other words, there is an unprecedented worldwide gulf between the classes, which has grown enormously and is having already huge political consequences with the prospect of revolution and elements of counter-revolution now inherent in the world situation.

Incipient Trade Wars

This is before the fallout from the effects of the incipient trade war between the U.S. and China, Canada, and Mexico is felt. The EU and Asia could also be increasingly drawn into economic hostilities. Implicit in Trump’s “America First” doctrine are conflicts even with U.S. capitalism’s traditional “allies” and not only its “foes.” But it is now clear that the main economic and strategic focus of U.S. policy is its conflict with China. This goes beyond trade issues and is increasingly a strategy, particularly in the field of new technologies, to block China from achieving parity with and surpassing the U.S. It is even possible that a deal could be reached over Trump’s tariff war with China, or a truce agreed, but this is likely to be a temporary cessation of hostilities with new clashes erupting over technology imports, Xi Jinping’s “Made in China 2025” modernization plan, and China’s state capitalist “structure,” which are the real core of this dispute. A currency war and economic sanctions cannot be ruled out.

If this breaks out into a full-blown trade war it will have severe consequences for the world including its main protagonists the U.S., China, and Europe. The unofficial common front which existed between Mexico and Canada against Trump’s bullying has been broken, with Mexico seeking peace but Canada still seemingly locked in confrontation. However, it has already spooked the world’s money markets and stock exchanges with record plunges in share and bond prices and the scaling down of growth prospects for the world economy. There is a general expectation among the bourgeois that the current “bull market” is coming to an end. This was summed up by the Economist headline to a special report: “The Next Recession.” However, they take comfort in the fact that the financial sector – particularly the banks – have been recapitalized and therefore there will not be a repeat of the big collapse but only a “mild recession.”

But they have already used up many of the measures to counter even a “mild” economic contraction. The massive injection of “liquidity” in the U.S. – quantitative easing – has risen to an estimated 20% of GDP. They have been joined in this by the European Central Bank and by the Bank of England. Trump is more willing to increase spending through tax cuts, to satisfy both the bourgeois and, indirectly through wage increases, his “base.” These however have already had a short-term deleterious financial effect by increasing the government deficit to over 4% of GDP and have led moreover to the danger of an inflationary wave. The step-by-step increase in interest rates by the Fed has earned the ire of Trump but they have been forced to act because “the economy is already hot.”

The U.S. will not avoid the fallout from Trump’s $250 billion tariff on Chinese goods. Retaliation will undoubtedly be undertaken by China to a larger extent than the relatively restrained counter-measures of the present time if this “war” continues. Farmers in the Midwest and elsewhere – an important base for Trump – will be seriously affected by counter-measures against U.S. agricultural exports, particularly soya, to China. In order to mollify his base, Trump claims “it is easy to win a trade war,” but that is not the experience of the 1930s with the Smoot Hawley Act which aggravated the depression.

The world escaped from this partly through the policies of a more farsighted bourgeois representative, Franklin Roosevelt, who better represented the long-term interests of the capitalists, by standing up to his own class and implementing policies aimed at stimulating demand.” Even The Economist admits: “Recessions occur where there is too little spending to keep an economy’s resources from falling idle. Economists have spent the past decade thinking up ways to boost spending and escape recession when interest rates are at zero, as they almost certainly will be during the next global slump.” This is the argument that we have raised, that the present organic crisis of capitalism is reflected not in a crisis of “profitability” but “demand.” Roosevelt in the 1930s was even prepared to partially lean on the trade unions – more precisely the trade union leaders – to stimulate trade union membership, which in turn led to a series of strikes that boosted wages and had the effect of boosting demand.

Trump is completely incapable of adopting such measures, concentrating on boosting the profits of the most voracious but short-sighted capitalists, who have already gorged on super-profits but have been unable to restore the “former prosperity.” He hopes that this will lead to a continuous jobs boost, which will in turn escalate his chances of success in the mid-term elections, and then allow him to cruise to victory in the 2020 presidential elections.

One of the factors which allowed U.S. capitalism to escape from the 1930s depression was the boost given by war production and then the post-World War II situation with rebuilding, the growth of world trade and the development and use of new technology – paradoxically among them the development of plastics, which is now a curse for the environment and threatens life on the planet. No such lifeline exists for world and U.S. capitalism today. Furthermore, while not immediately posed, any clash between the major powers would be catastrophic, far worse for humanity than the horrible effects of the World Wars of the twentieth century.

There has also been an enormous concentration and centralization of capitalism through a big increase in mergers and acquisitions since 2007. Despite this, the strategists of capital in reality are pessimistic about prospects for a sustained upswing. The Financial Times (FT) speculates that price falls in financial assets have induced fear in markets. “How far might unfolding events exacerbate the worries? A long way is the answer.” Moreover, “valuations of risky assets are, in many cases, stretched and balance sheet vulnerability is pandemic, as the Global Financial Stability Report makes plain.” More to the point is their conclusion: “The world’s economy and financial systems are fragile — nobody can know how fragile until they are really tested. Yet the most important source of fragility is political; a lagged legacy of the financial crisis. In country after country, populists and nationalists are in, or close to, power.”

Most alarming for the bourgeois is the likely fallout from an “open-ended trade war with China.” The U.S. administration seems set on a new “cold war” with China, the FT concludes. This will be both economic and military. Trump, unrealistically, is even talking of stopping the Chinese economy from “becoming bigger than us,” the U.S. But even if this conflict remains a cold war, and not a “hot” one resulting in military clashes – the fallout could be catastrophic for the rest of the world. The conclusion of the serious bourgeois is: “The open world economy might collapse. These are dangerous times – far more so than many now recognize. The IMF’s warnings are timely but predictably understated” (“Politics puts the skids under the bull market,” Martin Wolf, FT, 10/17/18).

Even a small trade war will seriously impact both on the U.S. and China. China is undergoing an economic slowdown to around 6% annual growth, which would be considered spectacular for the U.S. or Europe, but signifies growing problems for the Chinese economy and therefore the regime. The Belt and Road Initiative – with massive investments largely from the “state-owned” investment houses of China, as U.S. spokespersons have emphasized, is of course meant to enhance the international economic reach of China. However, China has met resistance to the Initiative in a number of countries in the neocolonial world because of the imperialist character of such projects.

This has inevitably resulted in a clash with the U.S., largely economic at this stage, but implicit in the situation is the possibility of armed clashes and a tussle between China and the U.S. and its allies, along with other rival powers contesting ownership of the South China Sea. This has taken place after what the Chinese regime has emphasized was a “century of humiliation” by imperialist powers that carved China into “special interests.” It has been referred to as a “new cold war,” although the protagonists are not based on different social systems but fundamentally similar capitalist regimes; the Chinese largely, as we have analyzed, is state capitalist.

However, the retention of a large state sector – some reports and analyses put it as formally larger than the defined privatized part of the economy – gives the Chinese state much greater leeway to intervene and affect the direction of the economy. It allows the injection of massive liquidity to avoid economic collapse, which is what has happened in the last 10 years. There is a “rentier” aspect of the way that the capitalist sector leeches on the choicest bits of the state.

The Chinese state has also brushed aside Deng’s maxim of “hide and bide,” a policy of only slowly building up the economic and military might of the Chinese elite in the post-Tiananmen Square period, for what is now a new imperialist assertiveness. This has in turn inevitably conjured up analogies with wars from the past, particularly ancient Greece: the Thucydides Paradox. This pitted Sparta (the U.S.) against a rising Athens (China), which led to the Peloponnese wars. However, as we have explained, the conditions – the relationship of class forces – for another generalized direct conflict involving the great powers is ruled out at the present time, particularly as tensions between the major imperialist powers are being deliberately ramped up by the U.S. Trump has announced the U.S. withdrawal from 1987 treaty signed by Gorbachev and Reagan to freeze strategic nuclear weapons. This even provoked an 87-year-old Gorbachev from retirement to denounce the proposed revocation.

Regional Wars

However, as Syria and the Middle East have revealed, localized, regional, devastating wars can take place involving the great world powers but largely fought by proxies with military hardware supplied from outside. Yet a serious head-on confrontation, of small, or even “accidental” military clashes are rooted in the situation, particularly as tensions between the major imperialist powers are being deliberately ramped up by the U.S. between the imperialist powers, including Russia. The Chinese elite have gone from being a potential “strategic partner” to a “strategic rival,” while Russia has come in for the same treatment on the military front. Thus, Trump has announced the U.S. withdrawal from the 1987 treaty signed by Gorbachev and Reagan to freeze strategic nuclear weapons. This even provoked an 87-year-old Gorbachev from retirement to denounce the proposed revocation.

Trump’s aggressive approach has to some degree pushed China and Russia into closer cooperation. Bilateral trade between the two countries has been growing at 20% a year to top $100 billion in 2018 and there has been increasing security and military cooperation between the two powers. Following the conduct by the U.S. and its NATO allies of military maneuvers on Russia’s borders against an unspecified “enemy invasion,” Russia in September organized its “largest ever” military training maneuvers in the country’s Far East. It claimed the involvement of 300,000 Russian troops and 3,000 Chinese, although military analysts estimate that no more than 50,000 took part. Cooperation can however quickly turn into its opposite – the Russian media has highlighted recent suggestions from a section of the Chinese elite that Siberia is relatively unpopulated and full of natural resources suitable for Chinese exploitation!

The Russia regime, lacking the economic power of the Chinese, is using its military machine, not only dealing significant blows to western imperialist interests in Ukraine and Syria, but, increasingly, as demonstrated by the conflict in the Central African Republic, DRC, the Sudan, Yemen, and in other parts of the world, too. Russia, second only to the U.S., is aggressively selling armaments abroad and scandals around the use of “deniable assets” – military contractors are unfolding. A group of mercenaries have now appealed to the International Criminal Court in an attempt to force the Kremlin to compensate them for what they claim are hundreds of deaths in Ukraine, Syria, and elsewhere. Now the Kremlin is setting its sights on Libya, hoping to repeat its success in Syria there.

A feature of this period is that right-wing populist forces are on the rise across the transatlantic world, highlighted by the election of Bolsonaro in Brazil. They supposedly “delivered” the vote in favor of Brexit in the UK, the election of La Lega and other right-wing forces in Italy, and the authoritarian populist control of Hungary and Poland. The right-wing Alternative for Germany (AfD) is on the rise. Right-wing populists are also well entrenched in Austria, France, the Netherlands, and Sweden.

French President Macron has even gone back to the German philosopher Hegel and his idea of a “world spirit” to explain this phenomenon. Trump is supposed to embody world forces which he himself only half understands, instruments of “something greater.” Napoleon and other historical figures may have come to nasty ends, through exile in the case of the “little corporal,” but they nevertheless, according to Macron, acted as supposedly “unconscious instruments of progress.” This was undoubtedly true of Napoleon who, despite his dictatorship, based himself on the gains of the French Revolution and carried these ideas – the elimination of the remnants of feudalism – through armed force into Europe and elsewhere. But there is no comparison between Napoleon and Trump today, with one representing the confident youth of the bourgeois and the other its senile decay. Trump, as does Macron, acts in a period of economic decline and stagnation of world capitalism. Trump and right-wing populists reflect counter-revolution in all spheres: on the economy with policies which massively favor the rich at the expense of the poor, attacks on welfare, opposition to gun control which has outraged big sections of workers and young people in the U.S., on democratic rights, and so on.

The talk of a new “civil war” developing in the U.S. is not far from reality, but this will be a class war. This may not be an all that exaggerated scenario given the recent violent attacks on Trump’s perceived enemies. He conjures up not revolution but the opposite, counter-revolution, encouraging the right-wing forces in the U.S. and worldwide; but also, without intending to, has given an enormous impulse to the left and the ideas of socialism, with DSA growing to over 50,000 members and our organization continuing to develop its influence among workers and young people. Even bigger opportunities will be posed for Marxists in the U.S. in the coming months and years.

The rise of politically nebulous populism is rooted in the enduring legacy of the world economic crisis of 2007-08. Bourgeois analysts, including Francis Fukuyama and an array of commentators, in effect jeer that it was not this left but the right who mostly gained from the political fallout from this crisis. This turns reality completely on its head. The working class did initially in many countries turn towards the labor movement and the left for an explanation and solutions to the crisis. The left could have gained substantially given the severity of the recession, which led to the discrediting of both capitalism and its political agents.

Some commentators described this crisis as worse in its lasting economic effects than even the depression of the 1930s. Huge layers of the population, not just the working class, but swathes of the middle class, confronted with the impossibility of them and their children acquiring even modest wealth, and the decimation through austerity of decent housing, education and social services, initially inclined towards the left. Support for left reformist and reformist ideas have also grown in this period, as shown by the initial support for Bernie Sanders, then Jeremy Corbyn in Britain, and others.

However, they were confronted mainly by the spectacle of social democracy in Europe and elsewhere pursuing the same policies of austerity, as did the Democrats in the U.S. under Obama and Hillary Clinton. Their program in the last U.S. presidential elections amounted to “more of the same.” It was this that provided the opening for Trump and the variegated populist forces internationally of the right to gain a significant foothold. However, the long-term growth of the right is very tenuous, as witnessed in Germany at the present time. It is true that the right and far right have gained electorally, but so did the Greens in regional elections in Bavaria and Hesse. Moreover, as our comrades have pointed out in their material, at the same time as the right was chalking up these successes, gaining massive publicity for their demonstrations, even larger left demonstrations – for instance of a quarter of a million in Berlin – marched opposing the far right and the racist attacks on immigrants. So already the whip of counter-revolution has moved significant sections of workers, women, and young people into action.

Obscene Trump

Trump’s presidency is playing that role in the U.S.; he is the great unconscious teacher of the working class. Alongside Trump’s policies, the polarization of wealth is a germ of new “anti-trust” movements in the U.S. and elsewhere. This year’s U.S. mid-term elections saw a high turnout and a defeat for Republicans, with the Democrats being over 9.6 million votes ahead in the nationwide House vote. The Republicans won around 45% of the vote. However, this vote was more against Trump than for the policies of the Democrats.

This anti-Trump vote indicates how he will be undermined by these revolts that have been brewing for a long time in the U.S. and which will grow. Trump, of course, is not a fascist; the conditions for such a regime do not exist anywhere in the world at the present time, let alone in the U.S. or even in Brazil with the coming to power of would-be Bonapartist strongman, Bolsonaro. Trump is an exponent of “post-truth” reaction, known in the previous period as the policies of the “big lie.” He does not tell the occasional untruth, but systematically lies. The Democratic Party is now the party of “crime” which threatens to “turn the U.S. into another Venezuela.” By such methods he is preparing the ground for a huge radicalization adding that “if you don’t vote for me socialism looms,” which can only further popularize socialism for millions!

Of course bourgeois politicians systematically lie, but Trump outdoes them all. In one recent rally it was estimated that there were 74 verifiable falsehoods! With the systematic building up of a hate campaign against all opponents has now come the first attempts at right-wing terrorism.

This obscene, pampered bourgeois, who was officially a millionaire at the age of eight (!), managed to scrape an election win with 3 million fewer votes than Hillary Clinton because of the built-in bias and gerrymandering of the American constitution. Bernie Sanders, if he had not been blocked by the Democratic establishment, according to polls, would have beaten Trump. In the absence of a real left candidate Trump was able to successfully pose as a champion of the “left behind,” particularly in the deindustrialized areas, the so-called Rust Belt. His attack on NAFTA and “globalism” did, and still does, resonate with unemployed workers outraged at the runaway industries relocated to other countries with lower wages. This has left workers in these areas stranded in poverty and despair. Even his attacks on China and others who were allegedly “raping” U.S. industry, stealing its technology and its markets are echoed by many workers and the middle class in the current election, and not all of them on the right. This is combined with Trump’s utopian promise to make the U.S. “great again.” This is not the first time in history, including U.S. history, that a populist demagogue has been able to fool sections of the population for a time.

Something similar existed in Britain, and still persists when one third of the working class were regularly seduced into supporting the Tories at elections because they were led to believe that as ‘businessmen’ they better understood the workings of the system, capitalism, and therefore would be a safer bet than the ‘meddling” Labour leadership! With the decline of British capitalism and the resulting hammer blows to living standards, that electoral base has now been largely eroded as the reality of the savage austerity that has affected all sections of the working class and middle class has come home.

Incredibly, when questioned about the difference between him and his supporters, the so-called “white trash” – slang for white workers – Trump replied that “they are like me, only poor.” Trump inherited $400 million from his father and is 259th on the Forbes rich list! The conflict over the Supreme Court nominee Kavanaugh opened up colossal social divisions, which massively alienated women but also produced a sense of revulsion throughout the U.S.

This act of stuffing his toadies into the Supreme Court is the first step of Trump to restrict the right to abortion in the U.S. The magnificent revolt of the Irish working class, with our comrades playing a leading role, against the relics of Catholic feudal and semi-feudal reaction, particularly in the social field, can be repeated in the U.S., in Spain, and in Argentina, and win mass support from other sectors of the working class. The recent strike of women workers in Glasgow, Scotland for equal pay led to the active support of their brothers, the male refuse workers.

Revolutions can often begin with the movement of the most oppressed layers, particularly indicated by the women in the Russian Revolution. They can act before the heavy battalions of the working class move into struggle and indeed can become a beacon and catalyst for them. In this sense the current movements of women can be powerful precursors for a period of revolution, even, and particularly, in the U.S. There is pent-up anger and frustration which have accumulated over decades among women, the working class, and young people moving into struggle, over student debt, over U.S. capitalism and Trump’s gun culture, over low wages, and many other social issues. We are poised to make our biggest breakthroughs, so long as we get our tactics and orientation correct, in the U.S. and elsewhere.

The neo-colonial world – Latin America, Africa, and Asia – faces in the next period even more intensified economic and social upheaval. This arises from the generalized character of this crisis which does not allow for one significant region to escape the maladies of crisis-ridden capitalism. It is symbolized by the desperate surge of refugees from all these continents, be it from the Middle East and sub-Saharan Africa, or now from drug-riven countries in Latin America with millions desperately searching for “peace” and a “better life” for them and their families. They have come up against the hard fist of the Trump regime which thinks nothing of separating infants and other children from their parents, sometime for long periods. Trump’s wife even pretends to be “upset” at the malevolent cruelty of the White House. It should be noted that this process was first initiated by Obama who deported a record number of “illegal” immigrants from the U.S.!

Following the world crisis of 2007-08 there was a certain relocation of capital investment from the crisis-ridden developed capitalist world to the “emerging” – now submerging – countries of Latin America, Africa, and Asia, raising expectations of a substantial economic “bounce.” That has now dissipated in the neo-colonial world. The promise of “First World” living standards being within the grasp of the masses has been replaced by economic collapse with elements of barbarism in the situation.

Victory of Bolsonaro

No country typifies this more than Brazil, the biggest and most industrialized country in Latin America. The victory of Bolsonaro in the recent presidential elections represents a new form of right-wing populism clearly intending to rule through a form of militarized parliamentary Bonapartism. Unfortunately, the ground has been prepared for this regime by the failure of Lula’s PT (Workers’ Party). and The massive corruption which scars Brazilian society had come to be symbolized, for significant sections of the masses, with the PT regime of Lula and Dilma.

One measure of this terrifying collapse is that Brazil in 2018 has experienced as many murders, most of them drug-related, as the annualized average for the Syrian civil war. This led to the intervention of the army even before the election, which legitimized its possible use after the election on a broader scale against the mass movement. This in turn has led to the yearning for some kind of order, even from layers who have voted for the left in the past and should have done this time, including women and a layer of the LGBTQI community. They will now reap the whirlwind as will the masses in the persecution and murders that will follow, probably through the death squads that have already been spoken about by the right.

Bolsonaro has openly supported the last military dictatorship that lasted from 1964 to 1985. He has lauded torture and intends to extirpate “communism” – by which he means democracy and workers’ rights – including measures against the trade unions. Our organization has made the call for mass resistance committees of action against the open militarist and fascist elements that will be given license to conduct a murder campaign against the left, members of the LGBTQI community, and militant workers. Our Brazilian organization has criticized in the recent past some on the left who took an abstentionist position towards the reactionary plan to remove Dilma undemocratically from power in a parliamentary coup, which was successful. In this situation we advocated an element of a united front where, in the words of Lenin, we could use the PT as a “gun rest” on which to oppose the forces of reaction gathered behind first Temer and now Bolsonaro.

The bourgeois have wistfully looked back to the military regime which ended only in 1985 in Brazil. In the last few years they have in effect tested out the water by engaging in a “slow coup,” largely parliamentary, achieved through stages: first, the removal of PT president Dilma and then the imprisonment of Lula himself, one of the founders of the party, on the grounds of corruption. Without excusing the PT corruption, our comrades pointed out that the PT’s accusers were in fact up to their necks in even greater corruption themselves!

The lessons of Brazil must be absorbed by us and all those revolutionary cadres in the country and in Latin America as a whole. Many will no doubt be legitimately fearful about the imminent imposition of a military regime, and some of even “fascism” in Brazil. There are undoubtedly elements of this in the situation where the new regime could lean primarily on extra-parliamentary and military measures in order to attack and weaken the left. However, for all the reasons that we have explained previously, this regime does not have a sufficient social base – a mass middle class that could be mobilized to atomize the working class – for the consolidation of this government or even a strong military regime equivalent to the last military junta, let alone fascism.

Moreover, its coming to power can act like a crack of thunder to awaken the Brazilian masses – and not just them but in the whole of Latin America – to the real danger that they confront. Therefore, it can lay the basis for a mass mobilization. Our forces must be to the fore in this process, utilizing the mass political parties, particularly P-SoL (Partido Socialismo e Liberdade – Socialism and Liberty Party), and defending the MTST (Movimento dos Trabalhadores Sem Teto – Homeless Workers Movement) which Bolsonaro singled out during the election campaign as a “terrorist organization,” a signal for attacks and murder of MTST activists. Events in the biggest and most important country in Latin America, Brazil, will be watched avidly both by the rest of the continent and internationally. We must do everything, both politically and materially, to assist our comrades in this crucial struggle.

Argentina is not far behind Brazil in terms of a conflict between the classes. In March of this year what appeared to be the whole of Argentina took to the streets in Buenos Aires and elsewhere. This was a protest against the neoliberal policies of the reactionary Macri government. Once the ninth richest country in the world, Argentina has gone through a process of collapse and instability. Macri came to power as a bourgeois solution to the chronic instability which has plagued the country. Within months he faced a general strike in protest against his cuts, but he still continued with counter-reforms, although seeking to soften their impact. At any time there can be a social explosion; an indication of the radicalization in the country was in the electoral success of the FIT (Frente de Izquierda y de los Trabajadores – ‘Workers Left Front’). This is a coalition of specifically different Trotskyist organizations who have a small number of deputies in the Parliament. We have had discussions with the PTS, one of the parties in this organization, advocating they should aim to go wider, involving left forces within Peronism, which still holds sway amongst a significant section of Argentinian workers.

The election of Andrés Manuel López Obrador (AMLO) in Mexico represents an historic point of departure. Mexico is crucial for developments throughout Central and Latin America and for developments in the U.S. It is not in the same cycle of the class struggle as other Latin American countries like Brazil, Venezuela, Ecuador, etc. AMLO has moved to the right and is trying to appease both Mexican capitalism and U.S. imperialism. It cannot be excluded that under the impact of serious economic crisis and big social upheavals that AMLO will be forced back into a more radical direction at a certain stage and be compelled to strike some blows against the ruling class. This is not certain. However, his election opens a new chapter of struggle as already demonstrated by the tremendous movement of the students at UNAM where our comrades made an outstanding intervention. The failures of the other left governments in Venezuela, Brazil, etc., are a warning for the Mexican masses. Our Mexican comrades will have an important role and big opportunities in the period now opening up there.

We also have influential forces in Chile and contacts throughout the continent. Particularly important is the current situation in Venezuela. The country, with the richest oil reserves in the world, could have charted out a different path if a bold socialist programme had been implemented by Hugo Chavez; this would have got enthusiastic mass support in the country and throughout the continent. Those who generated illusions in Chavez, who largely remained within the framework of Venezuelan and world capitalist markets, instead of advocating the spreading the revolution to the region and internationally, bear some responsibility for the current situation. Trump, the British, and the bourgeois generally, seek to utilize the current chaos in Venezuela in order to discredit socialism: “Corbyn embodies the same approach as Chavez and will create the same disastrous results,” say the British Tories. Just replace “Corbyn” with “the Democrats” and it is the same message from Donald Trump.

The deaths of Fidel Castro and Chavez symbolized the passing of an era which witnessed the breakthrough of the Cuban masses and the establishment of a workers’ state in Cuba – albeit one that was not directly managed and controlled through a system of workers’ democracy – but gave a glimpse of what was possible in an undeveloped country on the basis of planning: the health service, big improvements in workers’ living standards initially before the imperialist blockade.

It is an open question whether Cuba can now hold out against the pressures of capitalism. In the absence of a political revolution, the demands of the new generation of Cubans for “democracy,” freedom to travel, and access to consumer goods can be a powerful magnet for a generation with only loose ties to the heroic struggles of the past. For socialists, Marxists, and the working class, any decisive move towards a capitalist restoration in Cuba would represent a backward step. Moreover, the conditions of a new international capitalist crisis with its deepening in Latin America will be keenly felt and can halt or reverse the movement towards capitalist restoration in Cuba.

Indeed, so acute is the crisis in Latin America and the neocolonial world in general that new breakthroughs against capitalism and landlordism are possible, which will even put in the shade the tremendous Cuban revolution itself. The huge wagon train from Guatemala to the U.S. is symptomatic. Imagine the effects of another recession or slump which will ultimately lead to revolutionary convulsions in Latin America and throughout the neo-colonial world.

The CWI must take what is positive from the experience of Cuba’s planned economy, but also emphasize that any new “Cubas” must have a system of workers’ democracy at all levels in any workers’ state which develops, as the precondition for any transition from capitalism to the beginnings of socialism. We should always link this to our international perspectives of a socialist confederation of Latin America and the world socialist confederation.


In the Middle East, the Syrian war appears to be in its last military throes with the expected bloody defeat and eviction from the country of the last sizeable jihadi military structures. This has been at the cost of significant devastation not only of Syria, but also of the neighboring countries that have been inundated with hundreds of thousands, if not millions, of refugees. A peaceful and stable situation in the region on the basis of capitalism is excluded and it will take some time for a modicum of civilization – including a functioning labour movement – to reappear in some countries.

However, the strikes and protests in Iran over the past year mark an important development in the rebuilding of an independent workers’ movement there. Especially significant are the recent demands of the Haft-Tappeh workers for re-nationalization of their company under workers’ control,

The Trump regime, with its repudiation of the Iran nuclear deal and further sanctions both against Iran and those who dare to trade with the country, guarantees a further period of chronic instability and a poisoning of relations between the U.S. and Iran. This will spill over into the Middle East as a whole. It will not, as Trump seems to believe, encourage the “liberal” opposition – let alone the working class who have also moved independently against the regime – to step up their opposition to the enriched ruling group of mullahs and the Revolutionary Guards. It is now more likely that the opponents of the regime will be reluctant to open the door to Trump, with his support for Israel, Saudi Arabia, and the “Sunni bloc” in opposition to predominantly Shi’a Iran. The militarist, interventionist neocon John Bolton, Trump’s national security secretary, has revealed that his real plans for Iran are regime change and the turning back of the clock to the times of the Shah!

The recent nauseating murder and subsequent dismemberment in Turkey of Jamal Khashoggi, who became an opposition bourgeois figure, by the blood-soaked Saudi regime, illustrates the murderous character of the semi-feudal regime in the country. Saudi Arabia is in the grip of Mohammad bin Salman (MBS), whose initials in the grisly light of the murder and its aftermath now stand for “Mister Bone Saw”! The Prime Minister of Lebanon was kidnapped last year and only released when he bowed to Saudi demands! Moreover, the Turkish President, Recip Erdoğan, is a hypocrite, who denounced the Saudi regime and its role in this gruesome murder yet has himself jailed without proper trials tens of thousands of teachers, civil servants and journalists, for their alleged links to the coup “attempt” of 2016.

Erdoğan is mainly concerned to increase his own role as a rival for the leadership of the Sunni bloc. He has not revealed the whole truth about the execution in order to force big concessions from Saudi Arabia. In a four-month period Riyadh beheaded 48 people and executed another 150 others while resorting to public whipping of opponents of the regime. Even the feudals – and the bourgeois supporting the regime – live in fear of their lives from the erratic behavior of MBS and would probably welcome attempts to cut him down to size. The U.S., for its part, enormously benefits from Saudi oil and the sale of massive amounts of military hardware. It is doing everything to try and square the circle by wishing away the actions of the brutal ruling clique in order to re-establish “business as usual.”

Socialists, while condemning the murder of any opponent of the Saudi regime, are particularly concerned about the far more bloody and disgusting genocide of the virtually defenceless people of Yemen at the hands of the bloodthirsty Saudi ruling group. The Saudi regime, with its indiscriminate bombing and embargo on food supplies to the country, with 8.5 million people in the Yemen dependent on the outside supply of food, has left an estimated 6.5 million in danger of dying of starvation. The September 2018 protests, both in areas controlled by the Saudi-backed regime and the often corrupt Houthi regime, were small but significant developments towards building an independent movement of workers and the poor, as was this year’s founding of a new independent trade union by energy workers who have been engaged in a long struggle for back wages.

The conflict between the Palestinians and the Israeli regime, with the denial of even the Palestinians’ basic rights, continues with regular bloody outbreaks. Our section in Israel/Palestine has made heroic attempts to find a road to the oppressed Palestinian workers, keeping the flame of class unity alight which, at a certain stage, will come into its own in Israel, throughout the Palestinian areas, and in the Arab world as a whole. The example of the 2011 Arab Spring revolution is not dead, nor are the lessons of that great event, which shook not just the Arab world but the advanced industrial countries as well.

Nigeria and South Africa are the main sections of the CWI in Africa. In Nigeria the election of Buhari in 2015 was the first democratic transfer of power from one party to another in Nigeria’s history. He was seen as something different. There were illusions, fueled by the trade union leaders, that he would tackle the endemic corruption in Nigeria, evident throughout the African continent. Now he could face defeat in the 2019 elections.

Nigerian Economy Contracts

In 2016 the Nigerian economy officially contracted for the first time in 25 years with official inflation at 18%, but for many people the rise in prices for the necessities of life was far higher. As with many of the countries of the neocolonial world and increasingly in the economically advanced countries, many workers, particularly in the public sector in over 20 states, are owed several months of back salaries. These conditions generated massive discontent, with the trade union leaders compelled to call nine general strikes between 2000 and 2012. But without any end results from this colossal exertion of energy by the masses, there was less and less support for more general strikes without clear aims. However, the economic crisis combined with the failure of the trade union leaders to show a way forward generated an increase in national and religious tensions especially in the north-east where Boko Haram is based, and in violent repeated clashes between Muslim herdsmen and largely Christian arable farmers in central Nigeria. This year saw a partially successful general strike called on the issue of increasing the minimum wage, but the trade union leaders called it off simply on the basis of a promise of negotiations which have, so far, produced nothing.

A central issue, as with many countries in Africa, is the struggle to build a political point of reference for the working class. Previous attempts to establish such an organized party failed or were half-hearted. For a time in the 1990s and early 2000s, the radical National Conscience Party (NCP), in which we played a key role, was able to mobilize sections of the working class and poor both in struggle and on the electoral field. This party collapsed but it did not dissuade our comrades, given the refusal of the Labour leaders to build the party they themselves launched, from attempting to build at least the outline of a new workers’ party. The latest effort is the organization of the Socialist Party of Nigeria (SPN), which may not win large numbers of votes at first but if it digs roots can offer a real alternative to the Nigerian working class.


After Zuma was ousted in South Africa, Cyril Ramaphosa took over as president. But “Ramaphoria” was a very limited phenomenon. Ultimately, the corruption of the Zuma years was a symptom of rotten South African capitalism, not its underlying cause. On the fundamentals, Ramaphosa is offering the same old neoliberal diet. The economy remains stagnant and there have been tens of thousands of job losses since he took office. Ramaphosa is also remembered as the “butcher of Marikana.”

Our South African section has built a small but important base in the unions, working in the newly-formed South African Federation of Trade Unions (Saftu). We have played a key role in ensuring that the creation of a new mass workers party has been a major discussion within the new federation. Significantly, the federation, again with us playing an important role, has drawn around it a layer of community and youth organizations, and other campaigns, in a Working Class Summit (WCS). Both Saftu and the WCS have passed resolutions in support of creating a new workers’ party. A complicating factor in this has been the determination of a section of the leadership of the metalworkers’ union (NUMSA) to forge ahead with their own sectarian Stalinist political project – the Socialist Revolutionary Workers Party. This has been done in isolation from, and in competition to, the broader, more democratic, and generally politically healthier process that is unfolding around Saftu. There is a danger that the SRWP could become a further obstacle to building the broader working-class unity, entirely possible at this stage, which would give any new formation the greatest chance of a breakthrough. We believe that only an open and democratic process, built on the basis of a federal structure, can persuade other working-class formations to unite under one banner in time for the 2019 general elections.


In China, Xi Jinping’s regime is encountering its most serious tests just months after his “coronation” as lifetime ruler. Mass unrest has broken out involving tens of thousands of army veterans, Muslims, and victims of collapsed financial companies, as well as over new pollution threats. There is a pronounced political radicalization among Chinese youth and greater open criticisms of the regime on the heavily censored internet. Discontent among the urban middle-class, previously an important base of Xi’s support, over declining freedom, is now widespread. Most importantly, the rising wave of (non-unionized) workers’ struggles has reached a new level with the advent of “cross-provincial” strikes of crane drivers, delivery workers, truck drivers, and others. In the Jasic workers’ struggle in southern China, our Chinese comrades, supported by solidarity actions from the whole International, have made an important intervention. Our demands for independent trade unions, against the regime’s ‘police trade union’, are winning an echo among what is a very significant layer of left-moving youth who identify themselves as “Marxists” and “revolutionaries” and are moving into collision with the regime.

Asia has been affected by natural disasters – prompted by climate change – as well as the slowdown in world growth. Pakistan is in deep economic crisis and has turned to Saudi Arabia and China for bailouts and is seeking talks once more with the International Monetary Fund – having had 13 bailouts before – with the inevitably harsh conditions that would be imposed if a loan is agreed. This is the “gift” – a desperate economic scenario – which was presented to the recently elected prime minister, former cricketer Imran Khan, who is widely seen as being elected as a front man for the military elite which has effectively ruled Pakistan, mainly from behind-the-scenes, for the 70 years of Pakistan’s existence. Recently the country has also become dependent on China’s Belt and Road projects for infrastructure development and the building of a massive port in the south-west of the country. Big upheavals impend in Pakistan which will present opportunities for us to grow, particularly in the development of a new mass party. At the same time, the recent protests against blasphemy organized by the right-wing fundamentalists across the country is a warning of the persistent danger of reaction.

India is claimed to be the fastest growing large economy in the world with a “stable government,” but, as The Financial Times comments, “it has joined the ranks of emerging markets for taking a beating.” The Indian rupee has fallen in value by 15% against the dollar just this year. Yet the Indian economy and the Modi government have failed to use the devaluation of the currency to increase sales in international markets. This reflects the weakness of Indian capitalism with evidence to show that the real situation has been covered up by the government. Modi’s promise to create quality jobs is dead in the water. Only a paltry handful of jobs have been created and with a huge number of youth entering the labour market, this is a guarantee of protest and upheavals. Our forces will be presented with new opportunities to increase our strength and influence.

Malaysia also faces turmoil after the elections which saw the eviction from power of Najib Razak and the UMNO party for the first time in 57 years since independence was won from the British. The new government is led by the former UMNO prime minister 93-year-old Mahathir Mohammed. No viable mass workers’ party exists and this demand is the main propaganda weapon for our section in the country. We are also trying to establish a firm base in Indonesia and elsewhere in Asia.

Our comrades in Sri Lanka are also struggling against great odds – the legacy of the communal Civil War and the difficult economic situation which is significantly impacting on the masses – but nevertheless maintaining an important presence. In October the country was plunged into a constitutional crisis with the president ‘sacking’ the democratically elected prime minister, Ranil Wickremasinghe, with the unelected Sinhala chauvinist and former president, Rajapaksa. As we write, the conflict is still unresolved and could result in serious, maybe even a dangerous confrontation, even including racial conflict breaking out.

Although geographically Australia is in Asia, it is economically a “First World” country which has enjoyed a “benign” situation, a boom, for over 25 years. However, it has recently faced big demonstrations against low pay, with over 100,000 rallying in Melbourne in October, which indicates a lopsided economic development much like Europe, the U.S., and the rest of the “developed world.” Therefore the “lucky country” may not be so in the future as it catches up economically and socially with the rest of the world. The working class will confront the same economic scenario of stunted growth, low pay, and attacks on past gains. This is taken together with the threat of climate change which will particularly impact on Australia; it will now be possible for us to build substantial forces in Australia and the region as a whole.

Putin’s support drops

Even though Putin, re-elected in May, expects to rule at least until 2024, his poll ratings have dropped sharply to levels last seen at the start of the global crisis. The euphoria over the Crimea is being replaced by the realization that the economy is now stagnant. Over half of workers earn less than 350 euros a month and over 70% of the population opposed the increase in the retirement age. Sanctions, the war in Ukraine, the scandals around the poisonings in Britain, and the U.S. elections have been used by Putin to bolster his support in the past, but they are beginning to turn into the opposite. And while he courts right-wing populists such as Salvini, Le Pen, and Kneissl in the EU, his actions in Ukraine have alienated other authoritarian leaders such as Belarus’ Lukashenko.

Our Russian comrades foresaw and were prepared for the explosive youth protests which followed the online exposures by Navalny, a petit bourgeois opposition leader, of the endemic corruption around Putin and his entourage and was not surprised by Navalny’s use of more left-wing demands reflecting the moods of these youth, who have grown up knowing only Putin’s capitalism. Although still a minority, the fearless way in which the youth, some as young as 11, defied police batons and faced thousands of arrests has given confidence to other layers. The largest protests against the pension reforms were by young people and workers. The official pro-Kremlin parties, including the misnamed Communist Party, did all they could to disarm the protests. It is essential that our Russian organization continues to build support among young workers and students to establish an energetic organization to intervene in the struggles of the wider working class that will inevitably break out at some stage.

Huge Churning in the Ranks of Working Class

There is now no area of the world where there are not political or social upheavals either taking place or expected. We have been able to make dramatic gains in some areas, particularly in the U.S. However, in other regions and areas, there appears to be a certain malaise or pause, particularly in the task of winning and recruiting significant forces to our banner. But there is huge churning in the ranks of the working class, with millions looking for answers to the multitude of problems which the crisis of capitalism has created for them. We must be there with them, with our sections sharing their problems and difficulties, but also preparing to intervene wherever a significant movement is taking place, or where there is an anticipation of such a movement. Many times in our history, never mind those in the great internationals which have preceded us, small propaganda groups have been rapidly transformed into significant large organizations which can then form the basis for a small party and mass forces at a later stage. Preparing for this in the next period is an urgent task for the CWI.

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