In first decade of the 21st century we have witnessed the West’s embrace of the full spectrum of extremism in both domestic and foreign policy. Extremism is a common practice by self-styled conservatives, liberals and social-democrats. In the past, conservative implied preserving the status quo and, at most, tinkering with change at the margins. Today’s ‘conservatives’ demand the wholesale dismantling of entire social welfare systems and the elimination of traditional legal protection of workers and the environment. Liberals and social democrats, who in the past, occasionally, questioned colonial systems, are now in the forefront of prolonged multi-front colonial wars, which have killed and displaced millions in Iraq, Afghanistan, Libya and Syria.

Extremism, in terms of its methods, means and goals, has obliterated the distinctions between center left, center, and rightwing politicians. Moderates opposed to the current policies of subsidizing the major banks while impoverishing tens of millions of workers, are now labeled the ‘hard left,’ ‘extremists,’ or ‘radicals.’

In the wake of the government’s extremist policies, the respectable, prestigious print media have engaged in their own versions of extremism.¹ Colonial wars, devastating civil society and stable cultures while impoverishing millions in the colonized country, are justified, embellished and presented as lawful and humane advances in secular democratic values. Domestic wars on behalf of oligarchies and against wage and salaried workers, which concentrate wealth and deepen despair of the dispossessed, are described as rational, virtuous and necessary. The distinctions between the prudent, balanced, prestigious and serious media and the sensationalist, yellow press have disappeared. The fabrication of facts, blatant omissions and distortions of context are found in one just as well as the other.

To illustrate the reign of extremism in officialdom and among the prestigious press, we will examine two case studies. These involve US policies toward Colombia and Honduras and the Financial Times and New York Times coverage of the two nations.

Colombia: The “Oldest Democracy in Latin America” versus “The Death Squad Capital of the World”

Following the giddy eulogies of Colombia’s emergence as Latin America’s poster boy for democracy in an April issue of Time magazine, as well as the Wall Street Journal, New York Times, and Washington Post, the Financial Times ran a series of articles including a special insert on Colombia’s political and economic ‘miracle’ entitled, “Investing in Colombia.”² According to the FT’s leading Latin American journalist, John Paul Rathbone, Colombia is the ‘oldest democracy in the hemisphere.’³ Rathbone’s rapturous praise for Colombia’s President Santos extends from his role as an ‘emerging power broker’ for the South American continent, to making Colombia safe for foreign investors and ‘exciting the envy’ of other less successful regimes in the region. Rathbone gives prominence to one Colombia business leader who claims that Colombia’s second biggest city, Medellín, ‘is living through its best of times.’³ In line with the opinion of the foreign and business elite, the respectable print media describe Colombia as prosperous, peaceful, business friendly, charging the lowest mining royalty payments in the hemisphere, and a model of a stable democracy to be emulated by all forward-looking leaders.

Under President Santos, Colombia has signed a free trade agreement with President Obama, his closest ally in the hemisphere.⁴ During the term of Obama’s predecessor, George W. Bush, trade unions, human rights and church groups, as well as the majority of Congressional Democrats, were successful in blocking any similar agreement because of Colombia’s sustained human rights violations. Any such opposition from the AFL-CIO and Democratic legislators evaporated, when President Obama embraced free trade, claiming a vast improvement in human rights and President Santos commitment to ending the murder of trade union leaders and activists.⁴

Colombia’s peace, security, and prosperity, praised by the oil, mining, banking, and agro-business elite, are based on the worst human rights record in Latin America. With regard to the murder of trade unionists, Colombia exceeds the entire world. From 1986-2011 over 60% of the all killings of trade unionists in the world took place in Colombia by combined military-police-paramilitary death squads, largely at the behest of foreign and domestic corporate leaders.⁵ The ‘peace’, so enthusiastically praised by Rathbone and his colleagues at the Financial Times, comes with a heavy price tag: Over 12,000 arrests, attacks, assassinations and disappearances of trade unionists occurred between January 1, 1986 and October 1, 2010.⁵ In that time span nearly 3,000 trade union leaders and activists were murdered, hundreds more disappeared and are assumed dead. The current Colombian President Santos was the Defense Minister under the previous President Alvaro Uribe (2002-2010). In those years, over 762 trade union officials and activists were murdered by state or allied paramilitary forces.⁵

Under both Presidents Uribe and Santos (2002-2012), over 4 million peasants and rural dwellers were driven into internal exile and their homes and lands were taken over by big landlords, speculators and narco-traffickers.⁶ The Colombian government’s counter-insurgency strategy serves a dual function of repressing dissent and accumulating wealth for its supporters. The Financial Times journalists gloss over this aspect of Colombia’s ‘resurgent growth’ as they applaud the results of death-squad ‘security’, including the over $6 billion dollars of large-scale foreign investment which flowed into mining and oil regions in 2012 – in areas ‘formerly troubled by unrest.’⁷

Some leading drug lords, clearly linked to the Uribe-Santos regime, were jailed and extradited to the US. They have testified how they financed and elected one-third of the Congress members affiliated with Uribe-Santos party – in what the Financial Times describes as Latin America’s ‘oldest democracy.’ Salvatore Mancuso, ex-chief of the 30,000-member United Self-Defense of Colombia (AUC), described how he met with then-President Uribe in different regions of the country to give him money and logistical support for his re-election campaign of 2006. Mancuso, who led the largest paramilitary death squad army in Colombia (now fragmented but still active), also affirmed that national and multi-national corporations (MNC) financed the growth and expansion of the death squads.

What Rathbone and his fellow journalists at the FT celebrate as Colombia’s emergence as an investor’s paradise is writ large with the blood and torture of thousands of Colombian peasants, trade unionists and human rights activists. The brutal history of the Uribe/Santos reign of terror has been completely erased from the current account of Colombia’s ‘success story.’ Detailed records of the brutality of the killings and torture by Uribe/Santos sponsored death squads, describing the use of chain saws to mutilate peasants suspected of leftist sympathies are available to any journalist willing to consult Colombia’s leading human rights organizations.⁸

The death squads and military act in concert. The Colombian military is trained by over one thousand US Special Forces advisers. They wage counter-insurgency style war on the Colombian countryside, arriving in villages in waves of US-supplied helicopters, cordoning off targeted areas from the guerillas and then sending in the AUC and other death squads to destroy the villages, torturing and murdering peasant men, women and children suspected of being guerilla sympathizers and committing widespread rape. This state-sponsored terror campaign has driven millions of peasants out of the countryside allowing the generals and drug lords to seize their land.

Human rights advocates (HRA) are frequently targeted by the military and death squads. Presidents Uribe and Santos usually first accuse human rights workers of being active collaborators of the guerillas because of their work in exposing the regime’s crimes against humanity. Once labeled, the HRA became ‘legitimate targets’ for death squads and the military operating with complete impunity. From 2002-2011 there were 1,470 attacks against HRA, with a record number of 239 in 2011, including 49 killings under President Santos.⁹ Over half of the murdered human rights workers are Indian and Afro-Colombians.

State terrorism was and continues to be the main instrument of rule under Presidents Uribe and Santos. The Colombian ‘killing fields’, according to the Fiscalia General, include tens of thousands of homicides, 1,597 massacres and thousands of forced disappearances from 2005-2010.¹⁰

Courageous members of the Colombian press revealed a practice, known as ‘false positives’, numerous instances in which the military secretly kidnapped young peasants and poor urban males forcing them to dress as guerrillas, murdered them in cold blood and then displayed their bodies to the respectable Colombian and international press as ‘proof’ of Santos/Uribe’s combat successes against the guerrillas. There are 2,472 documented cases of military ‘false positive’ murders.¹¹

Honduras: New York Times and State Terrorism

The New York Times featured an article on Honduras, emphasizing the regime’s ‘co-operation’ with the US war on drugs.¹² The Times writer, Thom Shanker, describes a ‘partnership’ based on the expansion of three new US military bases and the stationing of US Special Forces in the country.¹²

Shanker reported on the successful operation of the Honduras Special Operations forces under the direction of US Special Forces trainers. In Shanker’s coverage, a US Congressional delegation praised the Honduran Special Operations forces ‘respect for human rights,’ quoting the US ambassador description of the Honduran regime as ‘eager and capable partners in this joint effort.’¹²

There are blatant parallels between the NY Times white-wash of the criminal extremist regime in Honduras and the Financial Times’ crude promotion of Colombia’s death squad democracy.

The current extremist Honduran regime, headed by ‘President’ Lobos, which invited the Pentagon to expand its military control over huge swathes of Honduran territory, is a product of the US-backed military coup that overthrew a democratically-elected liberal President on June 28, 2009, a recent historical point Shanker avoids in his coverage. Lobos, the predator president, retains control by killing, jailing and torturing his critics, including journalists, human rights advocates and lawyers, as well as now-landless peasants demanding a return of their properties after they were violently seized by Lobos’ big-landlord allies.

Following the military coup, thousands of Honduran pro-democracy demonstrators were killed, beaten and arrested. According to conservative estimates by Human Rights Watch, 20 pro-democracy dissidents were openly murdered by the military and police.¹³ From January 2010 to November 2011 at least 12 journalists, critical of the Lobos regime, were assassinated.

In the countryside, where NY Times reporter Shanker describes a love fest between the US Special Forces and their Honduran counterparts, 30 farm workers in northern Honduras Bajo Aguan valley were killed by death squads hired by Lobos powerful allies.¹⁴ Not one military, police or death squad assassin has been brought to justice. The original coup leader, Roberto Micheletti and his successor, President Lobos, repeatedly attacked pro-democracy demonstrations, particularly those led by school teachers, students and trade unionists. Hundreds of jailed political dissidents have been tortured. During the period of NY Times most euphoric articles on the cozy relations between the US and Honduras, the death toll among pro-democracy advocates rose precipitously: Eight journalists and a TV commentator were killed during the first 4 months of 2012.¹⁴ In late March and early April of 2012 nine farm workers and employees were murdered by pro-Lobos landlords.¹⁴ With impunity reigning in the Central American land of US military bases, no one has been arrest for these murders. The NY Times coverage of Honduras follows the Mafia rule of omega — silence and complicity.

Syria: How the Financial Times Absolves Al Qaeda Terrorists

As Western-backed Islamist terrorists savage the secular regime in Syria, the Western press, especially the Financial Times, continue to absolve the terrorists use of huge car bombs, which have killed and mutilated hundreds of Syrian citizens. With crude cynicism Western reporters shrug their shoulders and parrot the claims of the London-based anti-regime propagandists, that the Assad regime was destroying its own cities and killing its own citizens and security forces.¹⁵

Conclusion

As the Obama regime and its European allies publically embrace extremism, including state terror, targeted assassinations and the car bombings in crowded urban neighborhoods, the respectable press has joined in. Extremism takes many forms — from the refusal to report honestly about the use of mercenary force and violence to overthrow another anti-colonial regime to the blatant cover-up of the slaughter of tens of thousands of civilians and the dispossession of millions of peasants and farmers. The ‘educated classes’, the respectable affluent reading public are being continuously indoctrinated by the respectable Western media to believe that the smiling and pragmatic President Santos in Colombia and elected President Lobos in Honduras have succeeded in establishing peace, market-based prosperity, mutually beneficial free trade agreements, and military base concessions with the US — even as these two regimes currently lead the world in the murder of trade unionists and journalists. On May 15, 2012 the US Hispanic Congressional caucus awarded Lobos a leadership in democracy award – the same day the Honduran press reported the murder of the news director of radio station, HMT, Alfredo Villatoro, the 25th critical journalist killed between January 27, 2010 and May 15, 2012.¹⁶

The respectable press’ embrace of extremism and its use of demonological and vitriolic language to describe critical regimes opposed to imperialism are matched by its euphoric and effusive praise of state and pro-western mercenary brutality. The systematic cover-up of crimes by extremist journalism goes far beyond the cases of Colombia and Honduras. Financial Times reporter Michael Peel ‘covered’ the assault on the Libyan government of Gaddaffi without mentioning the NATO-led bombing campaign that destroyed Africa’s most advanced welfare state. Peel presented the rise of armed gangs of fanatical tribal and Islamic terrorists as a victory for democracy over a “brutal dictatorship.”¹⁷ Peel’s mendacity and cant is evident in his outrageous claims that the destruction of the Libyan economy and the mass torture and racially motivated murders, which followed NATO’s war, was a victory for the Libyan people.

The totalitarian twist in the respectable press is a direct consequence of its long-term toadying to the extremist policies pursued by the western regimes. Since extremist measures, like the use of force, violence, assassination and torture, have become routine by the incumbent presidents and prime ministers, the reporters have no choice but to fabricate lies to render ‘respectable’ such crimes, to spit out a constant flow of highly charged adjectives in order to convert victims into executioners and executioners into victims. Extremism in defense of pro-US regimes has led to the most grotesque accounts imaginable: Colombia and Mexico’s Presidents are the leaders of the most thoroughly narcotized economies in the hemisphere yet they are praised for their war on drugs, while Venezuela, the most marginal producer of any drug, is stigmatized as a major narco- pipeline.¹⁸

Articles with no factual basis, which are worthless as sources of objective information, direct us to seek an underlying rationale: Colombia has signed a free trade agreement, which will benefit US exports over Colombian by over a two to one ratio.¹⁹ Mexico’s free trade policy has benefited US agro-business and giant retailers by a similar ratio.

All forms of extremism permeate Western regimes and find justification and rationalization through the respectable media whose job is to indoctrinate civil society and turn citizens into uncritical accomplices to extremism. By endlessly prefacing ‘reports’ on Russia’s President Putin as an authoritarian Soviet-era tyrant, the respectable media avoid any discussion of the doubling of the Russian standard of living and Putin’s over 60% electoral triumph. By magnifying an authoritarian past, the murdered Libyan President Gaddafi’s vast public works, social welfare programs and generous immigration and foreign aid programs to sub-Sahara Africa can be relegated to the oblivion. The respectable press’s praise of death squad Presidents Santos and Lobos is part of a large-scale, long-term systematic shift from the hypocritical pretence of pursuing the virtues of a democratic republic to the open embrace of a virulent, murderous empire. The new journalists’ code reads ‘extremism in defense of empire is no vice.’

1. There’s a general consensus that the respectable print media include the Financial Times, the New York Times, the Washington Post and the Wall Street Journal.
2. Financial Times (FT) 5/8/12; See also FT (5/4/12) “Colombia looks to consolidate gainsin country of complexities.”
3. FT 5/8/12 (p. 1).
4. BBC News, May 5, 2012.
5. Renan Vega Cantor, Sindicalicidio! (Un cuento poco imaginativo) de Terrorismo Laboral Bogotá, Feb. 25, 2012.
6. Inforrme CODHES Novembre 2010.
7. FT, 5/8/12 p. 4.
8. See the Annual Reports of CODHES, Reiniciar and Human Rights Watch.
9. Claroscuro Informe Aual 2011; Programa Somos Defensores Bogota 2012; Corporacion Colectivo de Abogados. Jan-March 2012.
10. Fiscalia General, Informe 2012.
11. Falsos Positivos Blogspot.
12. Thom Shanker, “Lessons of Iraq Help US Fight a Drug War in Honduras,” New York Times, May 6, 2012.
13. Human Rights Watch, World Report 2012.
14. Honduran Human Rights, May 12m, 2012.
15. The notorious cover-up of the car bombing is the handiwork of the FT’s star middle east journalists. See Michael Peel and Abigail Fielding-Smith, “At Least 55 Die in two Damascus Explosions: Responsibility for Blasts Disputed,” FT, 5/11/12.
16. Honduras Human Rights, April 24, 2012.
17. Michael Peel, “The Colonels Last Stand,” FT, 5/12-13/12.
18. One of Colombia’s most notorious paramilitary narco traffickers described the close financial and political ties between the Colombian United Self Defense terrorists and the Uribe-Santos regime. See La Jornada, 5/12/12.
19. BBC News, 5/15/12. According to the US International Trade Commission estimates the value of US exports to Colombia could rise by $1.1 billion while Colombia’s exports could grow by $487 million.

Today, material conditions for the vast majority of working people have sharply deteriorated as the capitalist class shifts the entire burden of the crisis and the recovery of their profits onto the backs of wage and salaried classes. One of the striking aspects of this sustained and on-going roll-back of living standards is the absence of a major social upheaval so far. Greece and Spain, with over 50% unemployment among its 16-24 year olds and nearly 25% general unemployment, have experienced a dozen general strikes and numerous multi-million person national protests; but these have failed to produce any real change in regime or policies. The mass firings and painful salary, wage, pension and social services cuts continue. In other countries, like Italy, France, and England, protests and discontent find expression in the electoral arena, with incumbents voted out and replaced by the traditional opposition. Yet throughout the social turmoil and profound socio-economic erosion of living and working conditions, the dominant ideology informing the movements, trade unions and political opposition is reformist: Issuing calls to defend existing social benefits, increase public spending and investments, and expand the role of the state where private sector activity has failed to invest or employ. In other words, the left proposes to conserve a past when capitalism was harnessed to the welfare state.

The problem is that this ‘capitalism of the past’ is gone and a new more virulent and intransigent capitalism has emerged forging a new worldwide framework and a powerful entrenched state apparatus immune to all calls for ‘reform’ and reorientation. The confusion, frustration, and misdirection of mass popular opposition is, in part, due to the adoption by leftist writers, journalists, and academics of the concepts and language espoused by its capitalist adversaries: language designed to obfuscate the true social relations of brutal exploitation, the central role of the ruling classes in reversing social gains and the profound links between the capitalist class and the state. Capitalist publicists, academics and journalists have elaborated a whole litany of concepts and terms which perpetuate capitalist rule and distract its critics and victims from the perpetrators of their steep slide toward mass impoverishment.

Even as they formulate their critiques and denunciations, the critics of capitalism use the language and concepts of its apologists. Insofar as the language of capitalism has entered the general parlance of the left, the capitalist class has established hegemony or dominance over its erstwhile adversaries. Worse, the left, by combining some of the basic concepts of capitalism with sharp criticism, creates illusions about the possibility of reforming ‘the market’ to serve popular ends. This fails to identify the principle social forces that must be ousted from the commanding heights of the economy and the imperative to dismantle the class-dominated state. While the left denounces the capitalist crisis and state bailouts, its own poverty of thought undermines the development of mass political action. In this context the ‘language’ of obfuscation becomes a ‘material force’ – a vehicle of capitalist power, whose primary use is to disorient and disarm its anti-capitalist and working class adversaries. It does so by co-opting its intellectual critics through the use of terms, conceptual framework and language which dominate the discussion of the capitalist crisis.

Key Euphemisms at the Service of the Capitalist Offensive

Euphemisms have a double meaning: What terms connote and what they really mean. Euphemistic conceptions under capitalism connote a favorable reality or acceptable behavior and activity totally dissociated from the aggrandizement of elite wealth and concentration of power and privilege. Euphemisms disguise the drive of power elites to impose class-specific measures and to repress without being properly identified, held responsible and opposed by mass popular action.

The most common euphemism is the term ‘market’, which is endowed with human characteristics and powers. As such, we are told ‘the market demands wage cuts’ disassociated from the capitalist class. Markets, the exchange of commodities or the buying and selling of goods, have existed for thousands of years in different social systems in highly differentiated contexts. These have been global, national, regional and local. They involve different socio-economic actors, and comprise very different economic units, which range from giant state-promoted trading-houses to semi-subsistence peasant villages and town squares. ‘Markets’ existed in all complex societies: slave, feudal, mercantile and early and late competitive, monopoly industrial and finance capitalist societies.

When discussing and analyzing ‘markets’ and to make sense of the transactions (who benefits and who loses), one must clearly identify the principle social classes dominating economic transactions. To write in general about ‘markets’ is deceptive because markets do not exist independent of the social relations defining what is produced and sold, how it is produced and what class configurations shape the behavior of producers, sellers and labor. Today’s market reality is defined by giant multi-national banks and corporations, which dominate the labor and commodity markets. To write of ‘markets’ as if they operated in a sphere above and beyond brutal class inequalities is to hide the essence of contemporary class relations.

Fundamental to any understanding, but left out of contemporary discussion, is the unchallenged power of the capitalist owners of the means of production and distribution, the capitalist ownership of advertising, the capitalist bankers who provide or deny credit and the capitalist-appointed state officials who ‘regulate’ or deregulate exchange relations. The outcomes of their policies are attributed to euphemistic ‘market’ demands which seem to be divorced from the brutal reality. Therefore, as the propagandists imply, to go against ‘the market’ is to oppose the exchange of goods: This is clearly nonsense. In contrast, to identify capitalist demands on labor, including reductions in wages, welfare and safety, is to confront a specific exploitative form of market behavior where capitalists seek to earn higher profits against the interests and welfare majority of wage and salaried workers.

By conflating exploitative market relations under capitalism with markets in general, the ideologues achieve several results: They disguise the principle role of capitalists while evoking an institution with positive connotations, that is, a ‘market’ where people purchase consumer goods and ‘socialize’ with friends and acquaintances. In other words, when ‘the market’, which is portrayed as a friend and benefactor of society, imposes painful policies presumably it is for the welfare of the community. At least that is what the business propagandists want the public to believe by marketing their virtuous image of the ‘market’; they mask private capital’s predatory behavior as it chases greater profits.

One of the most common euphemisms thrown about in the midst of this economic crisis is ‘austerity’, a term used to cover-up the harsh realities of draconian cutbacks in wages, salaries, pensions and public welfare and the sharp increase in regressive taxes (VAT). ‘Austerity’ measures mean policies to protect and even increase state subsidies to businesses, and create higher profits for capital and greater inequalities between the top 10% and the bottom 90%. ‘Austerity’ implies self-discipline, simplicity, thrift, saving, responsibility, limits on luxuries and spending, avoidance of immediate gratification for future security – a kind of collective Calvinism. It connotes shared sacrifice today for the future welfare of all.

However, in practice ‘austerity’ describes policies that are designed by the financial elite to implement class-specific reductions in the standard of living and social services (such as health and education) available for workers and salaried employees. It means public funds can be diverted to an even greater extent to pay high interest rates to wealthy bondholders while subjecting public policy to the dictates of the overlords of finance capital.

Rather than talking of ‘austerity’, with its connotation of stern self-discipline, leftist critics should clearly describe ruling class policies against the working and salaried classes, which increase inequalities and concentrate even more wealth and power at the top. ‘Austerity’ policies are therefore an expression of how the ruling classes use the state to shift the burden of the cost of their economic crisis onto labor.

The ideologues of the ruling classes co-opted concepts and terms, which the left originally used to advance improvements in living standards and turned them on their heads. Two of these euphemisms, co-opted from the left, are ‘reform’ and ‘structural adjustment’. ‘Reform’, for many centuries, referred to changes, which lessened inequalities and increased popular representation. ‘Reforms’ were positive changes enhancing public welfare and constraining the abuse of power by oligarchic or plutocratic regimes. Over the past three decades, however, leading academic economists, journalists and international banking officials have subverted the meaning of ‘reform’ into its opposite: it now refers to the elimination of labor rights, the end of public regulation of capital and the curtailment of public subsidies making food and fuel affordable to the poor. In today’s capitalist vocabulary ‘reform’ means reversing progressive changes and restoring the privileges of private monopolies. ‘Reform’ means ending job security and facilitating massive layoffs of workers by lowering or eliminating mandatory severance pay. ‘Reform’ no longer means positive social changes; it now means reversing those hard fought changes and restoring the unrestrained power of capital. It means a return to capital’s earlier and most brutal phase, before labor organizations existed and when class struggle was suppressed. Hence ‘reform’ now means restoring privileges, power, and profit for the rich.

In a similar fashion, the linguistic courtesans of the economic profession have co-opted the term ‘structural’ as in ‘structural adjustment’ to service the unbridled power of capital. As late as the 1970’s, ‘structural’ change referred to the redistribution of land from the big landlords to the landless; a shift in power from plutocrats to popular classes. ‘Structures’ referred to the organization of concentrated private power in the state and economy. Today, however, ‘structure’ refers to the public institutions and public policies, which grew out of labor and citizen struggles to provide social security, for protecting the welfare, health and retirement of workers. ‘Structural changes’ now are the euphemism for smashing those public institutions, ending the constraints on capital’s predatory behavior and destroying labor’s capacity to negotiate, struggle or preserve its social advances.

The term ‘adjustment’, as in ‘structural adjustment’ (SA), is itself a bland euphemism implying fine-tuning , the careful modulation of public institutions and policies back to health and balance. But, in reality, ‘structural adjustment’ represents a frontal attack on the public sector and a wholesale dismantling of protective legislation and public agencies organized to protect labor, the environment and consumers. ‘Structural adjustment’ masks a systematic assault on the people’s living standards for the benefit of the capitalist class.

The capitalist class has cultivated a crop of economists and journalists who peddle brutal policies in bland, evasive and deceptive language in order to neutralize popular opposition. Unfortunately, many of their ‘leftist’ critics tend to rely on the same terminology.

Given the widespread corruption of language so pervasive in contemporary discussions about the crisis of capitalism the left should stop relying on this deceptive set of euphemisms co-opted by the ruling class. It is frustrating to see how easily the following terms enter our discourse:

Market discipline – The euphemism ‘discipline’ connotes serious, conscientious strength of character in the face of challenges as opposed to irresponsible, escapist behavior. In reality, when paired with ‘market’, it refers to capitalists taking advantage of unemployed workers and using their political influence and power lay-off masses workers and intimidate those remaining employees into greater exploitation and overwork, thereby producing more profit for less pay. It also covers the capacity of capitalist overlords to raise their rate of profit by slashing the social costs of production, such as worker and environmental protection, health coverage and pensions.

Market shock – This refers to capitalists engaging in brutal massive, abrupt firings, cuts in wages and slashing of health plans and pensions in order to improve stock quotations, augment profits and secure bigger bonuses for the bosses. By linking the bland, neutral term, ‘market’ to ‘shock’, the apologists of capital disguise the identity of those responsible for these measures, their brutal consequences and the immense benefits enjoyed by the elite.

Market Demands – This euphemistic phrase is designed to anthropomorphize an economic category, to diffuse criticism away from real flesh and blood power-holders, their class interests and their despotic strangle-hold over labor. Instead of ‘market demands’, the phrase should read: ‘the capitalist class commands the workers to sacrifice their own wages and health to secure more profit for the multi-national corporations’ – a clear concept more likely to arouse the ire of those adversely affected.

Free Enterprise – An euphemism spliced together from two real concepts: private enterprise for private profit and free competition. By eliminating the underlying image of private gain for the few against the interests of the many, the apologists of capital have invented a concept that emphasizes individual virtues of ‘enterprise’ and ‘freedom’ as opposed to the real economic vices of greed and exploitation.

Free Market – A euphemism implying free, fair and equal competition in unregulated markets glossing over the reality of market domination by monopolies and oligopolies dependent on massive state bailouts in times of capitalist crisis. ‘Free’ refers specifically to the absence of public regulations and state intervention to defend workers safety as well as consumer and environmental protection. In other words, ‘freedom’ masks the wanton destruction of the civic order by private capitalists through their unbridled exercise of economic and political power. ‘Free market’ is the euphemism for the absolute rule of capitalists over the rights and livelihood of millions of citizens, in essence, a true denial of freedom.

Economic Recovery – This euphemistic phrase means the recovery of profits by the major corporations. It disguises the total absence of recovery of living standards for the working and middle classes, the reversal of social benefits and the economic losses of mortgage holders, debtors, the long-term unemployed and bankrupted small business owners. What is glossed over in the term ‘economic recovery’ is how mass immiseration became a key condition for the recovery of corporate profits.

Privatization – This describes the transfer of public enterprises, usually the profitable ones, to well-connected, large scale private capitalists at prices well below their real value, leading to the loss of public services, stable public employment and higher costs to consumers as the new private owners jack up prices and lay-off workers — all in the name of another euphemism, ‘efficiency’.

Efficiency – Efficiency here refers only to the balance sheets of an enterprise; it does not reflect the heavy costs of ‘privatization’ borne by related sectors of the economy. For example, ‘privatization’ of transport adds costs to upstream and downstream businesses by making them less competitive compared with competitors in other countries; ‘privatization’ eliminates services in regions that are less profitable, leading to local economic collapse and isolation from national markets. Frequently, public officials, who are aligned with private capitalists, will deliberately disinvest in public enterprises and appoint incompetent political cronies as part of patronage politics, in order to degrade services and foment public discontent. This creates a public opinion favorable to ‘privatizing’ the enterprise. In other words ‘privatization’ is not a result of the inherent inefficiencies of public enterprises, as the capitalist ideologues like to argue, but a deliberate political act designed to enhance private capital gain at the cost of public welfare.

Conclusion

Language, concepts, and euphemisms are important weapons in the class struggle ‘from above’ designed by capitalist journalists and economists to maximize the wealth and power of capital. To the degree that progressive and leftist critics adopt these euphemisms and their frame of reference, their own critiques and the alternatives they propose are limited by the rhetoric of capital. Putting ‘quotation marks’ around the euphemisms may be a mark of disapproval but this does nothing to advance a different analytical framework necessary for successful class struggle ‘from below’. Equally important, it side-steps the need for a fundamental break with the capitalist system including its corrupted language and deceptive concepts. Capitalists have overturned the most fundamental gains of the working class and we are falling back toward the absolute rule of capital. This must raise anew the issue of a socialist transformation of the state, economy and class structure. An integral part of that process must be the complete rejection of the euphemisms used by capitalist ideologues and their systematic replacement by terms and concepts that truly reflect the harsh reality, that clearly identify the perpetrators of this decline and that define the social agencies for political transformation.

It can be argued that the concessions to the extractive MNC and local ‘leading’ classes assures stability, steady revenues and finances the incremental social expenditures which permit the re-election of the center-left regimes. In other words a de facto alliance between the “top” and “bottom” of the class structure is the unstated bases for center-left electoral successes despite the growing political divergence between the regimes and sections of the social movements.

The Progressive Camp

There is a general consensus that regimes in seven countries in Latin America form what can be called the “progressive camp”: Bolivia, Ecuador, Argentina, Brazil, Uruguay, Peru and Venezuela.

The identifying features usually attributable to regimes in these countries include: (1) their past political trajectory: most are led by former leaders and activists from social movements, trade unions or guerrilla formations; (2) their relatively independent foreign policy pronouncements especially regarding US intervention and sanctions policies; (3) their ideological rhetoric rejecting US-led regional bodies and favoring Latin American centered organizations; (4) their populist electoral campaign programs regarding social equity, environmentalism, and human rights; (5) their vehement rejection of ‘neo-liberalism’ and traditional neo-liberal personalities, parties and privatizations; (6) their strategic perspective that envisions a prolonged process of social transformation that emphasizes an agenda featuring modernization, developementalist priorities, and high levels of investment oriented toward global markets; (7) their prolonged political incumbency based on constitutional reforms permitting re-election justified by the need for completing the transformative vision.

The progressive camp has a self-image, projected inward to its electorate as representing a rupture or ‘historical’ break with the past, first with regard to the traditional neo-liberal oligarchy and secondly with the ‘statist’ left. In the case of Bolivia, Ecuador, and Venezuela they frequently resort to rhetoric evoking “21st century socialism”. The potency of the appeal to radical novelty has a limited time span dependent on the degree to which the regimes pursue policies in variance with the preceding neo-liberal regime.

The ‘Left-Right Division’ as Represented by the Progressive Camp (PC)

The perceptions of the objective and subjective divergence between the progressive camp and the right vary according to whether they emanate from official sources or from a critical empirical investigation.

According to the ideologues of the “Progressive Camp” (PC) there are at least five major policy areas which reflect the radical rupture with the traditional neo-liberal right.

(1) Nationalism: (a) the PC through renegotiations of contracts with extractive MNC secures a higher rate of taxation, increasing revenues for the national treasury; (b) via increased state investment it converts wholly owned private firms into public-private joint ventures; (c) through increases in royalty payments it lessens ‘foreign exploitation’; (d) through the greater presence of ‘local technocrats’ it increases national oversight of strategic economic decisions.
(2) Foreign Policy: The progressive camp has pursued an independent, if not explicitly anti-imperialist foreign policy. The progressive camp has established several Latin American and Caribbean regional organizations which deliberately exclude the presence of North American and European imperial countries such as ALBA (Bolivarian Alliance of the Americas) and UNASUR (Union of South American Nations). The PC has rejected sanctions against Cuba, Iran, Syria, and Gaza and opposed the US-backed NATO war against Libya. They criticized the US position at the Summit of the America’s meeting in April 2012 on at least three major issues – inclusion of Cuba, opposition to British colonial control of the Malvinas, and the de-penalization of drugs. The PC has expressed its opposition to US hegemony, to IMF “structural reforms” and Euro-US control over international lending institutions. With the exception of Venezuela, the PC has diversified its export markets. For example Brazil exports to the US only 12.5% of its goods and services, Argentina 6.9%, and Bolivia 8.2%.
(3) Social Policy: The PC has increased social expenditures, especially toward reducing rural poverty; increased the minimum wage; approved salary and wage increases. In a few countries they provide easy credit and financing to small and medium businesses, have given legal title to land squatters and distributed plots of uncultivated public lands as a kind of ‘agrarian reform’.
(4) Regulation: The PC has, with varying degree of consistency, imposed controls over the financial sector, regulating the flow of speculative capital and the volatility of financial markets. With regard to the extractive sector regulations have been relaxed to permit the large-scale inflow of capital and the pervasive use of toxic chemicals and genetically modified seeds by agro-business. They have permitted the expansion of mining, agriculture, and the timber industry into Indigenous people’s and natural reservations. They have financed large-scale infrastructure projects linking extractive enterprises to export outlets trespassing onto previously regulated, protected natural habitats. Regulatory norms have been harnessed to facilitate ‘productive’ extractive developmentalism and to limit the financialization of the economy.
(5) Labor Policy: has been based on a ‘corporatist model’ of business-state-trade union (tri partite) negotiations and conciliation to limit lockouts and strikes and maintain growth, exports and revenue flows. Labor policy has been conditioned by the policy of limiting budget deficits, fixing wage increases, to the rate of inflation. In line with orthodox fiscal policies, pensions for public sector workers have been frozen or reduced especially among the middle and high end functionaries. Traditional job security guarantees have been maintained not augmented and severance pay has not been raised. Strikes by public sector workers, especially among teachers, medical staff and social service workers have been frequent and have led to government mediation and marginal gains. Government policy has been oriented toward protecting managerial prerogatives, while respecting and upholding the legal status, collective bargaining rights of trade unions. Within nationalized firms, state-appointed directors rule; there is no move toward worker self-management or ‘co-management’-except in limited cases in Venezuela. The structure of labor relations follows the private corporate hierarchical model Labor has, at best, an advisory role regarding health and safety but no determining influences or investment within this corporate framework. Pressure via strikes and protest by trade unions have been necessary, frequently in alliance with community groups, to rectify the most egregious corporate violations of health and safety rules. While the progressive regimes publically eschew neo-liberal “labor flexibility” policies they have done little to expand and deepen labor prerogatives over the labor and productive process.

The principle difference in labor policy between the progressive regimes and the traditional right is the ‘open door’ to labor leaders, their willingness to mediate and grant incremental wage increases, especially of the minimum wage and generally, the reduction of harsh, violent repression.

Continuities and Similarities between Past Neoliberal and Contemporary Progressive Regimes

Writers, academics, and journalists on the Right and Center-left emphasize the difference between the progressive and the past neo-liberal regimes, overlooking the large-scale socio-economic and political structural continuities. A more nuanced, balanced, and objective analysis requires that these continuities be taken into account because they play a major role in discussing the limitations and emerging conflicts and crises facing the progressive regimes. Moreover, these limitations, based on the continuities, highlight the importance of alternative development models proposed by popular social movements.

The agro-mineral export model has demonstrated profound strategic deficiencies in its very structure and performance. The promotion of agro-mineral exports has been accompanied by the large-scale, long-term entrance of foreign capital which in turn determines the rates of investment, the sources for inputs of machinery, technology and ‘know-how’, as well as control over the marketing and processing of raw materials. The MNC “partners” of the progressive regimes have conditioned their involvement on the bases of (a) the de-regulation of environmental controls; (b) the termination of price controls and the introduction of “international prices” for sales to the domestic market; (c) freedom to control foreign exchange earnings and to remit profits overseas.

They also control decisions regarding the exploitation of mineral reserves. Expansion of production is dependent on their own global criteria rather on the needs of the ‘host’ country. As a result, despite the “re-negotiated” contracts, which the progressive regimes hail as a “giant advance” toward “nationalization”, the cumulative losses in revenues and in rebalancing the economy are substantial. If one looks beyond the agro-mineral enclave the negative impact to further development are substantial. The very limited impact that the agro-mineral model has on the economy as whole has led to occasional conflicts between the MNC and the progressive host governments. A case in point is the conflict between the nominally Spanish oil company Repsol and the Argentine government of Cristina Fernandez in April 2012. Repsol’s behavior illustrates all the pitfalls of collaboration with foreign overseas extractive corporations. Repsol refused to increase investments, claiming that local regulated prices reduced profit margins. As a result Argentina’s energy bill rose three-fold between 2010 and 2011 from $3 billion to $9 billion. Furthermore, Repsol repatriated its profits, paid high dividends to overseas stockholders and thus had little impact in creating domestic industries producing inputs or refineries to process petroleum. The attempt by the deceased President Kirchner to increase ‘national ownership’ by bringing in a local private capitalist, (the Peterson Group) had no positive impact, merely entrenching Repsol’s control. When Fernandez took majority shares in order establish public control and increase local production, the entire Eurozone leadership led by the Spanish government and the Western financial press launched a virulent campaign, threatened litigation and predicted economic disaster. The problem of ‘inviting’ foreign MNCs to invest is that it is hard to disinvite them. Once they enter a country no matter how unfavorable their performance, it is difficult to rectify or undo the damage and move onto a new public centered model of development.

All the progressive regimes with the possible exception of Venezuela have signed long-term large-scale contracts with major foreign extractive multi-nationals. Apart from the increase in royalties these agreements do not differ greatly from contracts signed by preceding right-wing neo-liberal regimes.

Evo Morales signed a large-scale exploitation contract with Jindal, an Indian multi-national to exploit the iron-mine Mutun with virtually all inputs — machinery, transport, etc. — imported and with very limited ‘industrializing’ of the raw iron ore, mostly simple iron ‘nuggets’. The bulk of Bolivia’s gas and oil is exploited by foreign MNC-public ‘joint ventures’ and is shipped abroad, leaving most of the 60% rural households without piped gas,and resulting in Bolivia’s importing most of its diesel.

Ecuador under President Correa, another leading progressive president, signed two big contracts with foreign oil groups in February 2012, despite the opposition of the majority of Indian organizations including CONAI. In Ecuador, as in Bolivia, big oil and gas companies, while raising objections to the re-negotiations of contracts leading to an increase in royalty payments and an increased presence of public officials, retain a privileged position in crucial decisions regarding management, marketing, technology and investment. Despite claims to the contrary, the leaders of the progressive regimes sign off on these strategic agreements without consulting the communities affected. Decisions are based exclusively on executive privilege. The style and substance of the distribution of the powers and privileges in the oil and gas agreements between the progressive governments and the multi-nationals are no different than what transpired under previous ‘neo-liberal’ regimes. Moreover, in both Ecuador and Bolivia many of the “technocrats” and administrators who worked under the previous neoliberal regimes play a prominent role in running the joint venture.

While progressive regimes have pursued anti-poverty programs and have registered some successes in reducing poverty levels, they do so as a result of the growth of the economy not via the redistribution of wealth. In fact, the progressive regimes have not pursued redistributive polices: income and land concentrations, including high levels of inequality remain intact. In fact the hierarchy of the class structure has not been altered and in most cases has been reinforced by the inclusion of new entrants into the upper and middle class. These include many former leaders and activists from the lower middle and working class who have entered the government as well as ‘new capitalists’ benefiting from state contract agreements with the progressive regime.

The financial system has remained intact and prospered under the progressive regimes, especially because of the regimes tight fiscal policies, build-up foreign reserves, control over government spending and low rates of inflation. Financial sector profits are especially high in Brazil, Uruguay, Peru, Bolivia, and Ecuador. Brazil, in particular, has attracted large inflows of speculative capital from Wall Streets and the City of London because of its high interest rates relative to the rates in North America and Europe.

Alongside the concentration of ownership in the extractive and financial sector, the progressive regimes have not introduced progressive taxes to reduce the disparities of wealth. The income of the agro-business elites in Bolivia, Argentina, Uruguay, Brazil, and Ecuador are several hundred times that of the bulk of subsistence farmers, peasants and rural laborers. Many of latter remain subject to brutal working and living conditions. In many cases, the progressive regimes have done little to enforce the labor and health codes in the giant agro-business plantations while workers are subject to unregulated toxic chemical sprays.

If the configuration of ownership and wealth remains relatively unchanged from the neo-liberal past, the progressive governments have accentuated the tendencies toward export specialization. Under the progressive governments the economies have become less diversified and more dependent on agro-mineral and energy exports, and more dependent on large-scale long-term foreign investments for growth. State revenue and growth are more dependent on primary product exports.

The free market policies of the progressive agro-mineral export regimes have stimulated the growth of large-scale commercial activity. The commercial sector is increasingly influenced by the large-scale entrance of foreign owned multi-nationals, like Wal-Mart, who source their products overseas, undermining local-small scale producers and retailers.

The appreciation of the currency has adversely affected traditional manufacturers and the transport industry causing significant job losses especially in textiles, footwear and automobiles in Brazil, Bolivia, Peru and Ecuador. Moreover, favorable polices promoting large-scale agro-mineral exporters has been accompanied by a credit squeeze on local small business people, especially, producers for local markets who have been bit hard by the import of cheap consumer goods (from Asia). Farmers producing food for local markets have been downgraded in the drive to expand cultivation of export crops like soya.

In summary, the progressive regimes have pursued a multi-faceted double discourse: an anti-imperialist, nationalist and populist rhetoric for domestic consumption while putting into practice a policy of fomenting and expanding the role of foreign extractive capital in joint ventures with the state and a rising new national bourgeoisie. The progressive regimes articulate a narrative of socialism and participatory democracy but in practice pursue policies linking development with the concentration and centralization of capital and executive power.

The progressive regimes preach a doctrine of social justice and equity and a practice of co-optation of social leaders and clientalism via poverty programs for the poorest sectors of society.

The progressive regimes have combined incremented income policies with large-scale structural changes, benefiting the extractive-primary sector. Stability of the PC is utterly dependent on the increasing demand for raw materials, high commodity prices, and open markets. The progressive regimes have successfully linked trade union and sectors of the peasant movement to the state and have undermined or weakened independent class organizations and replaced them with corporate tri-partite structures.

The progressives have successfully ‘reformed’ or replaced the chaotic, de-regulated, conflictual, racialist policies of their predecessors and institutionalized “normal capitalism.” They have introduced rules and procedures favorable to institutional stability, fiscal discipline, and incremental but unequal gains. In other words, the “parameters of neo-liberalism” are now effectively administered and legitimated by faux nationalism based on greater political autonomy and market diversification. Centralized executive decision making based on agreements which require extractive MNC to invest and develop the forces of production is legitimated by an electoral framework and a multi-class political coalition.

The domestic and foreign policies of the progressive extractive regimes reflect two contradictory experiences: their radical origins in the lead-up to taking power and their subsequent adoption of an agro-mineral developementalist export strategy, favored by neo-liberal technocrats. The “synthesis” of these two apparently “contradictory” experiences finds expression in the adoption of an independent, critical political position toward imperialist militarism and interventionism and economic collaboration with the agencies of economic imperialism, namely the signing of long-term and large-scale contracts with US-EU-Canadian agro-mining and energy multi-nationals. In other words, the progressive extractive regimes have ‘redefined’ or reduced imperialism to mean its state structures and policies rather than its economic components (MNC) which are engaged in the extraction of raw materials and exploitation of labor. In the same fashion, they redefine ‘anti-imperialism’ to mean opposition to political-military interventions and a ‘fair distribution’ of profits between the regime and its MNC “partner”. This redefinition allows the progressive regimes to claim popular legitimacy on the bases of periodical criticisms of the policies and practices of the imperial state while collaboration and agreements with the MNC allow the progressive regimes to retain support from domestic and overseas business interests. When a progressive regime, as is the case of Argentina ruled by Cristina Fernandez, decides to “nationalize” or more correctly secure the majority shares in Repsol, the nominally Spanish oil multi-national, the entire financial press, the European Union, and Washington denounce the move and threaten reprisals. In other words, the unstated pact between the progressive camp and the imperial regimes is that political differences are tolerable but nationalist economic measures are not acceptable. Renegotiations of contracts to increase state revenues may cause a temporary suspension of new investments but not a political confrontation. However, the public takeover of a foreign extractive firm evokes predictable hostility and retaliation from the imperial states. The Argentine progressive regime’s embrace of a policy of economic nationalism was, however, enterprise and sector specific. The Fernandez regime did not, and has no future plans, to expropriate other extractive firms, nor was the measure part of a general nationalist strategy to shift toward greater public ownership. Rather Repsol’s refusal to increase investments and production was increasing Argentina’s dependence on imported oil, which was deteriorating its balance of payments and foreign currency reserves. Repsol’s refusal to comply with Argentina’s developementalist agenda was based on the Fernandez policy of maintaining the retail price of oil for the domestic market below the international price. Repsol’s decline in production was a way of leveraging the regime to lift price controls. However, a higher petrol price would have a negative impact on industrial and private consumers, raising costs and reducing the competitiveness of the Argentine exporters and domestic producers. In effect, Repsol’s intransigence threatened to undermine the social and political balance of forces between labor and capital and between extractive exporters and popular consumers, which sustained the regimes majoritarian coalition. In brief, the measure was nationalist in form but capitalist developementalist in content.

Even so the measure polarized the global economy between the imperial west and the Latin American left, with the usual imperial satraps in Latin America (Mexico’s Calderon and Colombia’s Santos) backing Repsol.

Divisions between the Progressive Regimes and the Social Movements

Prior to coming to power via electoral processes, the progressive leaders maintained close ties and actively supported and participated in the ‘street action’ and mass struggle of the social movements. They embraced the banners of economic nationalism, ecological conservation and respect for the natural reserves of the Indigenous communities, social equality, and reconsideration of the foreign debt including the repudiation of ‘illegal debts’.

The social movements played a major role in politicizing and mobilizing the working and peasant classes to elect the progressive presidents. This convergence was short-lived. Once in power, the progressive regime appointed orthodox economic ministers to run the economy. They adopted the extractive strategy, shifted from a nationalist public sector economy, designed to diversify the economy, to a ‘mixed economy’ based on joint ventures with overseas extractive capital. First, the Indigenous communities of Peru, Ecuador, and some sectors in Bolivia went into opposition, on the bases that their interests were neglected and they were not consulted. Second, sectors of the working class and public employees struck demanding higher salaries, an increase in public spending. Small farmers and manufacturers demanded economic stimulus for family farms and local industry rather than subsidies for agro-mineral MNC, fiscal orthodoxy, and export strategies based on lower labor costs and neglect of the domestic market.

Radical trade union peasant and Indigenous leaders of the social movements called into question the entire agro-mineral extractive strategy, the distribution and administration of state revenues and expenditures. They reasserted their support for a social program embracing agrarian reform, including the expropriation of large plantations and the redistribution of land to landless peasants. Workers’ leaders called for an industrial policy to process ‘raw materials’ in order to create manufacturing jobs. Some trade unionists called for the nationalization of strategic industries and banks. However, despite some major protests, the bulk of the followers of the social movements and the majority of their leaders soon shifted from radical rejection of the extractive model to demands for a bigger share of the revenues. The progressive regimes attracted the bulk of the social leaders to tri-partite councils of conciliation to negotiate and secure incremental changes. The progressive regimes highlighted their opposition to “neo-liberalism.” They redefined it as unregulated capitalism based on low royalties and underfunding of social programs. The progressive regimes successfully divided the social movements between “utopian” radical opponents and progressive reformists. In time of social strife, the progressive regimes evoked a “left-right alliance,” charging their social critics of acting on behalf of imperialism, impervious to their own collaboration with imperial based multi-nationals. Presidential appeals, a nationalist populist discourse, and increased revenues which funded increased social expenditures weakened the left opposition. Moderate but sustained increases in anti-poverty programs and minimum wages neutralized the appeal of the radical leaders in the social movements. Despite the progressive regime’s break with its ‘radical egalitarian roots,’ it was more than able to secure large-scale mass-electoral support, based on the overall dynamic growth of the economy and steady growth of income. Both were underpinned by long-term high commodity prices.

Popular extractivist presidents repeatedly won elections by substantial majorities and were able to mobilize sectors of the moderate social movements to counter anti-extractivist social movements. The high prices of commodities and multiple opportunities for exploitation of resources attracted foreign investors despite higher royalty payments. Foreign investors were attracted by the social stability ensured by the progressive regimes in contrast to the instability of the previous neo-liberal regimes. The progressive regimes thrived on economic ties with the MNC and an electoral alliance with the lower classes.

Case Studies of Extractive Capitalism and the Progressive Camp

While the seven regimes which form the ‘progressive camp’ share a common development strategy based on the export of primary commodities there are significant differences in the levels of diversity of their economies, the nature and character of the commodities which they export, the degrees of social polarization and social cohesion and the size and scope of the opposition. In line with these differences there are also substantial differences in the degree to which the “progressive and extractive model” is sustainable or subject to upheaval or reversal.

The progressive camp can be divided in many ways: between those regimes based on charismatic leaders and extreme dependence on primary exports (Bolivia, Peru, Ecuador and Venezuela) and those with developed industrial sectors and ‘institutionalized political leadership (Brazil, Argentina, Uruguay). There are also significant differences in the degree of class and ethnic conflict: Peru, Bolivia and Ecuador are experiencing significant mass resistance from substantial Indigenous communities, while in Brazil, Argentina and Uruguay, where the Indigenous population is sparse, there is only isolated opposition. In terms of class struggles, Bolivia, has experienced widespread protests by health, education, mining, and factory workers. Venezuela has faced lockouts and boycotts organized by the economic elite (“class struggle from above”). Ecuador faced widespread protests from the police. Most of the rest of the countries (Brazil, Argentina, and Uruguay) faced limited strikes largely on wage issues. With the exception of Bolivia, the major trade union confederations work closely and collaborate with the progressive regimes; in contrast, the peasant and rural workers movements in Brazil, Ecuador, and Peru have retained a greater degree of independence and militancy largely because they have been the most prejudiced by the agro-mineral export strategies. In Venezuela and Brazil, landlord’s private armies have played a major role in combatting land reform beneficiaries with relative impunity.

The most pervasive and environmental degradation has occurred in Brazil, where millions of acres of rainforest have been “cleared” during the decade of Workers Party rule. Chemical exploitation of agriculture is strong in most countries especially in Brazil, Argentina, and Uruguay where soya production has become a dominant crop. All the major agro-industrial exporters (Brazil, Argentina and Uruguay) rely on toxic chemicals and GM seeds with numerous cases of toxic consequences for indigenous residents and their natural habitat. The issue of toxicity and environmental degradation resulting from the giant mining and timber companies has been well documented in Peru, Ecuador, and Uruguay. Overall, the greater the urban population and the more dispersed the rural communities adversely, affected, the smaller the environmental protest and the likelihood that NGO ecologists play a leading role in protest.

Since the extractive industries are outside of the major urban centers, since most of the major trade union confederations collaborate with the progressive regimes and secure incremental wage increases, and since the overall economy has been growing and unemployment has declined, macro-economic imbalances, commodity dependency and related structural vulnerabilities have not resulted in major confrontations between labor and capital. The most contentious conflicts which have occurred have been between the orthodox neoliberal elites backed by US and European powers and the progressive regimes. Several cases come to mind.

On April 12, 2002 and in December 2002-February 2003 the Venezuelan capitalist class backed by the US and Spain organized an abortive coup which was reversed and a petrol industry lockout that was defeated. An uprising in 2011 led by the police in Ecuador and an abortive coup in Bolivia were put down successfully, before they gained traction. A large-scale agro business protest in Argentina in 2008 which paralyzed the agro-export sector against an export tax ended with regime concessions.

In large part, these “class struggles from above” worked in favor of the progressive regimes because it allowed them to pose the issue as one between a popular democratic regime and a retrograde authoritarian oligarchy. As a result the progressive regimes were able to neutralize, at least temporarily, internal critics from the left. The defeat of “the Right” burnished the credentials of the progressive camp and raised their popularity.

While popular support was important in sustaining the progressive regimes against US and EU backed rightest destabilization campaigns, of equal or greater importance was the backing of the military, sectors of the business elite and extractive capitalists. The progressives by adopting “moderate policies” – including business subsidies and generous pay hikes to the military – were able to divide the elite, retain support of the military and isolate the right-wing opposition. The right-wing has remained electorally marginal and provide very limited leverage for US-EU interference and influence over the progressive agenda.

The degree of “progressiveness” within the progressive extractive capitalist camp varies substantially.

The Chavez government has advanced an anti-imperialist and socialist agenda involving the rejection of US coups, wars and blockade of independent states; it has supported the re-renationalization of oil, aluminum, and other raw material, mining, and energy sources. Its extensive agrarian reform benefiting 300,000 families is aimed at food self-sufficiency. Universal free public health and higher education and subsidized basic food prices via publicly owned supermarkets; and large-scale low-cost public housing for the poor along with literacy campaigns and the formation of thousands of neighborhood councils to adjudicate and resolve local issues have deepened and extended the socialization process

On a far lesser scale, Bolivia, Ecuador, and Argentina have pursued independent foreign policies. Their partial and selective nationalizations are designed to increase revenues rather than as part of a long-term, large-scale strategy of transformation. They have not followed Chavez’s lead on agrarian reform and on greater enhancement of social spending on health, housing, and higher education. They offer remote, public lands of dubious quality as “land reform.” They have been advocates of incremental changes involving wage and social benefits commensurate with the rise in revenues from commodity exports and in line with the rate of inflation, Bolivia and Ecuador have dislodged land squatters and defended the major agro-business land holdings. The least ‘reformist’ regimes with the most dubious ‘progressive’ credentials are Brazil, Uruguay, and Peru (under Ollanta Humala) which have adopted a free-market agenda; they actively promote large inflows of unregulated foreign investments, degrade millions of acres of the rain forests (Brazil especially), promote agro-business and oppose agrarian reform in all of its forms, relying on the dispersion of peasants and landless to the cities, towns where they serve as a labor reserve for capital or join the low paying informal sector. These “moderate” progressive regimes have signed military accords with the US, and adopt a low profile in opposition to US imperial policies in the Middle East. Their “progressiveness” is found in their support of regional integration, their opposition to US hemispheric hegemonism (opposing the US coup in Honduras, blockade of Cuba and interference in Venezuela), and the diversification of overseas markets. Brazil leads the way in catering to Wall Street speculators and in government anti-poverty spending on minimum food baskets. Poverty reduction is matched by the spectacular growth of millionaires linked to the finance and agro-mineral export sector. The “moderate” progressives have the most egregious (and well-documented) record of ongoing environmental degradation. In Peru, Humala has given the green light to mining exploitation threatening the livelihood of thousands of peasants and local business in Cajamarca; Presidents Lula da Silva and Dilma Rouseff, of the Workers Party, promoted the destruction of millions of acres of the Amazon rain forest and displacement of scores of Indian communities in a decade. In Uruguay, the Broad Front Presidents Tabaré Vasquez and Mujica promoted the highly polluting Botina cellulose factory contaminating the Parana River despite mass protests.

In summary, it is difficult to generalize about the performance of the progressive camp given the divergences in social and economic policies. But a “report card” of sorts can be drawn up.

All regimes have lowered poverty levels and increased dependence on agro-mineral exports and investments. All have signed and/or renegotiated contracts with extractive MNC’ few have diversified their economies. Those with a substantial industrial base (Argentina, Brazil, Peru) have suffered a severe decline in the manufacturing sector because of appreciating currencies and loss of competitiveness resulting from high prices for commodity exports. Incremental wage agreements have led to low level social conflicts in the cities (except in Bolivia), but displacement of peasants and degradation have intensified conflicts in the interior between rural communities and the MNC leading to state repression (Peru).

The social impact of the progressive regimes has the widest variation, with Venezuela registering the most far-reaching structural changes and the rest lacking any vision or project for redistributing wealth, income, or land. Their common support for regional integration is matched by important divergences in accommodation to US military policy. Venezuela, Ecuador, and Bolivia, the members of ALBA, reject military treaties, while Brazil, Uruguay, and Peru have signed military agreements with the Pentagon.

The overall economic performance is mixed. Brazil’s economy, especially its manufacturing sector, is stagnating with zero or negative growth in 2011-2012, Venezuela is recovering, but with over a 20% rate of inflation while the rest of the PC is experiencing steady growth, but increasing dependence on commodity exports to the Asian (China) market.

Alternatives to the status quo extractive economies vary enormously. In Venezuela, the regime has made diversification a high priority; the Brazilian and Argentine regimes are taking protectionist measures to promote industry with limited success especially as their policies are countermanded by the real expansion of acreage for soya production and exports. Uruguay, Peru, Ecuador, and Bolivia talk of diversification but have avoided taking measures to shift to food production and family farming and have yet to take concrete measures to stimulate local industry via a publicly funded industrialization policy.

The US propaganda war operates along two tracks: (1) the dominant message emphasizes the proximity of war and the willingness of the US to use force and violence. This message is directed at Iran and coincides with Israeli announcements of war preparations. (2) The second track targets the ‘liberal public’ with a handful of marginal ‘knowledgeable academics’ (or State Department progressives) playing down the war threat and arguing that reasonable policy makers in Tel Aviv and Washington are aware that Iran does not possess nuclear weapons or any capacity to produce them now or in the near future. The purpose of this liberal backpedaling is to confuse and undermine the majority public opinion, which is clearly opposed to more war preparations, and to derail the burgeoning anti-war movement.

Needless to say the pronouncements of the ‘rational’ warmongers use a ‘double discourse’ based on the facile dismissal of all the historical and empirical evidence to the contrary. When the US and Israel talk of war, prepare for war and engage in pre-war provocations – they intend to go to war – just as they did against Iraq in 2003. Under present international political and military conditions an attack on Iran, initially by Israel with US support, is extremely likely, even as world economic conditions should dictate otherwise and even as the negative strategic consequences will most likely reverberate throughout the world for decades to come.

US and Israeli Military Calculations on Iran’s Capability

American and Israeli strategic policy makers do not agree on the consequences of Iran’s retaliation against an attack. For their part, the Israeli leaders minimize Iran’s military capacity to attack and damage the Jewish state, which is their only consideration. They count on their distance, their anti-missile shield and protection from US air and naval forces in the Gulf to cover their sneak attack. On the other hand, US military strategists know the Iranians are capable of inflicting substantial casualties on US warships, which would have to attack Iranian coastal installations in order to support or protect the Israelis.

Israel intelligence is best known for its capacity to organize the assassination of individuals around the world: Mossad has organized successful overseas terrorists acts against Palestinian, Syrian, and Lebanese leaders. On the other hand Israeli intelligence has a very poor track record with regard to its estimates of major military and political undertakings. They seriously underestimated the popular support, military strength, and organizational capacity of Hezbollah during the 2006 war in Lebanon. Likewise, Israel intelligence misunderstood the strength and capacity of the Egyptian popular democratic movement as it rose up and overthrew Tel Aviv’s strategic regional ally, the Mubarak dictatorship. While Israeli leaders ‘feign paranoia’ – tossing clichés about ‘existential threats’ – they are blinded by their narcissistic arrogance and racism, repeatedly underestimating the technical expertise and political sophistication of their Arab and regional Islamic foes. This is undoubtedly true in their facile dismissal of Iran’s capacity to retaliate against a planned Israeli air assault.

The US government has now overtly committed itself to supporting an Israeli assault on Iran when it is launched. More specifically, Washington claims it will come to Israel’s defense ‘unconditionally’ if it is ‘attacked’. How can Israel avoid being ‘attacked’ when its planes are raining bombs and missiles on Iranian installations, military defenses and support systems, not to mention Iranian cities, ports and strategic infrastructure? Moreover, given the Pentagon’s collaboration and coordinated intelligence systems with the Israel Defense Forces, its role in identifying targets, routes and incoming missiles, as well as integrated weapons and ordinance supply chains will be critical to an IDF attack. There is no way that the US can dissociate itself from the Jewish State’s war on Iran, once the attack has begun.

The Myths of ‘Limited War’: Geography

Washington and Tel Aviv claim and appear to believe that their planned assault on Iran will be a ‘limited war,’ targeting limited objectives and lasting a few days or weeks – with no serious consequences.

We are told Israel’s brilliant generals have identified all the critical nuclear research facilities, which their surgical air strikes will eliminate without horrific collateral damage to the surrounding population. Once the alleged ‘nuclear weapons’ program is destroyed, all Israelis can resume their lives in full security knowing that another ‘existential’ threat has been eliminated. The Israeli notion of a war, limited in ‘time and space,’ is absurd and dangerous – and underlines the arrogance, stupidity and racism of its authors.

To approach Iran’s nuclear facilities Israeli and US forces will confront well-equipped and defended bases, missile installations, maritime defenses and large-scale fortifications directed by the Revolutionary Guards and the Iranian Armed Forces. Moreover, the defense systems protecting the nuclear facilities are linked by civilian highways, airfields, ports, and backed by a dual purpose (civilian-military) infrastructure, which includes oil refineries and a huge network of administrative offices. To ‘knock out’ the alleged nuclear sites will require expanding the geographic scope of the war. The scientific-technological capacity of the Iranian civilian nuclear program involves a wide swath of its research facilities, including universities, laboratories, manufacturing sites, and design centers. To destroy Iran’s civilian nuclear program would require Israel (and thus the US) to attack much more than research facilities or laboratories hidden under a remote mountain. It would require multiple, widespread assaults on targets throughout the country, in other words, a generalized war.

Iran’s Supreme leader Ayatollah Ali Khamenei has stated that Iran will retaliate with a war of equivalence. Iran will match the breadth and scope of any attack with a corresponding counter-attack: ‘We will attack them at the same level as they attack us’. That means Iran will not confine its retaliation to merely trying to shoot down US and Israeli bombers in its airspace or launch missiles at offshore US warships in its waters but will take the war to equivalent targets in Israel and in US-occupied countries in and around the Gulf. Israel’s ‘limited war’ will become a generalized war extending throughout the Middle East and beyond.

Israel’s current delusional fetish about its elaborate missile defense system will be exposed as hundreds of high-powered missiles are launched from Teheran, Southern Lebanon, and just beyond the Golan Heights.

The Myth of Limited War: Time Frame

Israeli military experts confidently expect to polish off their Iranian targets in a few days – some might think a mere weekend – and perhaps without the loss of even a single pilot. They expect the Jewish state will celebrate its brilliant victory in the streets of Tel Aviv and Washington. They are deluded by their own sense of superiority. Iran did not fight a brutal, decade-long war against the US-supplied Iraqi invaders and its western/Israeli military advisers, to just turn over and passively submit to a limited number of air and missile attacks by Israel. Iran is a young, educated, mobilized society, which can draw on millions of reservists from across the political, ethnic, gender, religious spectrum, galvanized in support of their nation under attack. In a war to defend the homeland, all internal differences disappear to confront the unprovoked Israeli-US attack threatening their entire civilization – its 5000-year culture and traditions, as well as its modern scientific advances and institutions. The first wave of US-Israeli attacks will lead to ferocious retaliation, which will not be confined to the original areas of conflict, nor are will any such act of Israeli aggression end when and if Iran’s nuclear research facilities are destroyed and some of its scientists, technicians and skilled workers killed. The war will continue in time and extend geographically.

Multiple Points of Conflict

Just as any US-Israeli attack on Iran will involve multiple targets, the Iranian military will also have a plethora of easily accessible strategic targets. Though it is difficult to predict exactly where and how Iran will retaliate, one thing is clear: The initial US-Israeli strike will not go unanswered.

Given Israeli-US supremacy in long and medium range sea and air power, Iran will probably rely on short-range objectives. These would include the highly valued US military facilities and supply routes in adjoining terrain (Iraq, Kuwait, and Afghanistan) and Israeli targets with missiles launched from Southern Lebanon and possibly Syria. If a few Iranian long-range missiles escape the Jewish State’s much vaunted ‘anti-missile dome,’ Israeli population centers may pay a heavy price for their leaders’ recklessness and arrogance.

The Iranian counter-strike will lead to an escalation by US-Israeli forces, extending and deepening their air and sea war to the entire Iranian national security system – military bases, ports, communication systems, command posts and government administrative centers – many in densely populated cities. Iran will counter by launching its greatest strategic asset: a coordinated ground attack involving the Revolutionary Guards together with their allies among the Iraqi Shia troops, against US forces in Iraq. It will coordinate attacks against US facilities in Afghanistan and Pakistan with the growing nationalist-Islamic armed resistance.

The initial conflict, centered on so-called military objectives (scientific research facilities), will spread rapidly to economic targets, or what US and Israeli military strategists refer to as ‘dual civilian-military’ targets. This would include oil fields, highways, factories, communications networks, television stations, water treatment facilities, reservoirs, power stations and administrative offices, such as the Defense Ministry and headquarters of the Republican Guard. Iran, faced with imminent destruction of its entire economy and infrastructure (which occurred in neighboring Iraq with the unprovoked US invasion of 2003), would retaliate by blocking the Straits of Hormuz and sending short range missiles in the direction of the principle oil fields and refineries of the Gulf States including Kuwait and Saudi Arabia, a mere 10 minute distance, crippling the flow of oil to Europe, Asia, and the United States — plunging the world economy into deep depression.

It should not be forgotten that the Iranians are probably more aware than anyone in the region of the total devastation suffered by Iraqis after the US invasion, which plunged that nation into total chaos and devastated its advanced infrastructure and civilian administrative apparatus, not to mention the systematic obliteration of its highly educated scientific and technical elite. The waves of Mossad-sponsored assassinations of Iranian scientists, academics and engineers are just a foretaste of what the Israelis have in mind for Iran’s outstanding scientists, intellectuals, and highly skilled technical workers. Iranians should have no illusions about the Americans and Israelis who seek to thrust Iran into the brutal dark ages of Afghanistan and Iraq. They will have no more role in a devastated Iran than their counterparts had in post-Saddam Iraq.

According to US General Mathis, who commands all US forces in the Middle East, Persian Gulf and Southwest Asia, ‘an Israeli first strike would be likely to have dire consequences across the region and for the United States there’ (NY Times, 3/19/12). General Mathis “dire cost” estimate only takes account of the US military losses, likely several hundred sailors on warships within missile distance of Iranian gunners.

However the most delusional and self-serving assessment of the outcome and consequences of an Israeli air attack on Iran, emanates from top Israeli leaders, academics and intelligence experts, who claim superior intelligence, superior defenses and supreme (if also racist) insight into the ‘Iranian mind.’ Typical is Israeli Defense Minister Barak who boasts that any Iranian retaliation will at worst inflict minimal casualties on the Israeli population.

The ‘Judeo-centric’ view of re-ordering the balance of power in the region, which is prevalent in leading Israeli war circles, overlooks the likelihood that war will not be decided by Israeli air strikes and anti-missile defenses. Iran’s missiles cannot be easily contained, especially if they arrive several hundred a minute from three directions, Iran, Lebanon, Syria and possibly from Iranian submarines. Secondly, the collapse of its oil imports will devastate Israel’s highly energy dependent economy. Thirdly, Israel’s principle allies, especially the US and the EU, will be severely strained as they are dragged into Israel’s war and find themselves defending the straits of Hormuz, their army garrisons in Iraq and Afghanistan, and their oil fields and military bases in the Gulf. Such a conflict could ignite the Shia majorities in Bahrain and in the strategic oil-rich provinces of Saudi Arabia. The generalized war will have a devastating effect on the price of oil and the world economy. It will provoke the fury of consumers and workers rage everywhere as factories close and powerful shocks throughout the fragile financial system result in a world depression.

Israel’s pathological ‘superiority complex’ results in its racist leaders consistently overestimating their own intellectual, technical and military capabilities, while underestimating the knowledge, capacity and courage of their regional, Islamic (in this case Iranian) adversaries. They ignore Iran’s proven capacity to sustain a prolonged, complex multi-front defensive war and to recover from an initial assault and develop appropriate modern weaponry to inflict severe damage on its attackers. And Iran will have the unconditional and active support of the world’s Muslim population, and perhaps the diplomatic backing of Russia and China, who will obviously view an attack on Iran as another dress rehearsal to contain their growing power.

Conclusion

War, especially an Israeli-US war against Iran is indissolubly linked to the asymmetrical US-Israeli relationship, which sidelines and censors any critical US military and political analysis. Because Israel’s Zionist power configuration in the US can now harness US military power in support of Israel’s drive for regional dominance, Israeli leaders and most of their military feel free to engage in the most outrageous military and destructive adventures, knowing full well that in the first and last instance they can rely on the US to support them with American blood and treasure. But after all of this grotesque servitude to a racist, isolated country, who will rescue the United States? Who will prevent the sinking of its ships in the Gulf and the death and maiming of hundreds of its sailors and thousands of its soldiers? And where will the Israelis and US Zionists be when Iraq is overrun by elite Iranian troops and their Iraqi Shia allies and a generalized uprising occurs in Afghanistan?

The self-centered Israeli policy-makers overlook the likely collapse of the world oil supply as a result of their planned war against Iran. Do their Zionist agents in the US realize that as a result of dragging the US into Israel’s war, that the Iranian nation will be forced to set the Persian Gulf oilfields ablaze?

How cheap has it become to ‘buy a war’ in the US? For a mere few million dollars in campaign contributions to corrupt politicians, and through the deliberate penetration of Israel-First agents, academics and politicians into the war-making machinery of the US government, and through the moral cowardice and self-censorship of leading critics, writers and journalists who refuse to name Israel and its agents as the key decision makers in our country’s Mid East policy, we head directly toward a war far beyond any regional military conflagration and toward the collapse of the world economy and the brutal impoverishment of hundreds of millions of people North and South, East and West.

The outrage expressed by politicians in the West and Gulf State and in the mass media, about the ‘killing of peaceful Syrian citizens protesting injustice’ is cynically designed to cover up the documented reports of violent seizure of neighborhoods, villages and towns by armed bands, brandishing machine guns and planting road-side bombs.

The assault on Syria is backed by foreign funds, arms and training. Because of a lack of domestic support, however, to be successful, direct foreign military intervention will be necessary. For this reason a huge propaganda and diplomatic campaign has been mounted to demonize the legitimate Syrian government. The goal is to impose a puppet regime and strengthen Western imperial control in the Middle East. In the short run, this will further isolate Iran in preparation for a military attack by Israel and the US and, in the long run, it eliminates another independent secular regime friendly to China and Russia.

In order to mobilize world support behind this Western, Israeli and Gulf State-funded power grab, several propaganda ploys have been used to justify another blatant violation of a country’s sovereignty after their successful destruction of the secular governments of Iraq and Libya.

The Larger Context: Serial Aggression

The current Western campaign against the independent Assad regime in Syria is part of a series of attacks against pro-democracy movements and independent regimes from North Africa to the Persian Gulf. The imperial-militarist response to the Egyptian democracy movement that overthrew the Mubarak dictatorship was to back the military junta’s seizure of power and murderous campaign to jail, torture, and assassinate over 10,000 pro-democracy protestors.

Faced with similar mass democratic movements in the Arab world, the Western-backed Gulf autocratic dictators crushed their respective uprisings in Bahrain, Yemen, and Saudi Arabia. The assaults extended to the secular government in Libya where NATO powers launched a massive air and sea bombardment in support of armed bands of mercenaries thereby destroying Libya’s economy and civil society. The unleashing of armed gangster-mercenaries led to the savaging of urban life in Libya and devastation in the countryside. The NATO powers eliminated the secular government of Colonel Gaddafi, along with having him murdered and mutilated by its mercenaries. Nato oversaw the wounding, imprisonment, torture, and elimination of tens of thousands of civilian Gaddafi supporters and government workers. NATO backed the puppet regime as it embarked on a bloody pogrom against Libyan citizens of sub-Saharan African ancestry as well a sub-Sahara African immigrant workers – groups who had benefited from Gaddafi’s generous social programs. The imperial policy of ruin and rule in Libya serves as “the model” for Syria: Creating the conditions for a mass uprising led by Muslim fundamentalists, funded and trained by Western and Gulf State mercenaries.

The Bloody Road From Damascus to Tehran

According to the State Department ‘The road to Teheran passes through Damascus’: The strategic goal of NATO is to destroy Iran’s principal ally in the Middle East; for the Gulf absolutist monarchies the purpose is to replace a secular republic with a vassal theocratic dictatorship; for the Turkish government the purpose is to foster a regime amenable to the dictates of Ankara’s version of Islamic capitalism; for Al Qaeda and allied Salafi and Wahabi fundamentalists a theocratic Sunni regime, cleansed of secular Syrians, Alevis, and Christians, will serve as a trampoline for projecting power in the Islamic world; and for Israel a blood-drenched divided Syria will further ensure its regional hegemony. It was not without prophetic foresight that the über-Zionist US Senator Joseph Lieberman demanded days after the ‘Al Qaeda’ attack of September 11, 2001: “First we must go after Iran, Iraq, and Syria” before considering the actual authors of the deed.

The armed anti-Syrian forces reflect a variety of conflicting political perspectives united only by their common hatred of the independent secular, nationalist regime which has governed the complex, multi-ethnic Syrian society for decades. The war against Syria is the principle launching pad for a further resurgence of Western militarism extending from North Africa to the Persian Gulf, buttressed by a systematic propaganda campaign proclaiming NATO’s democratic, humanitarian and ‘civilizing’ mission on behalf of the Syrian people.

The Road to Damascus is Paved with Lies

An objective analysis of the political and social composition of the principle armed combatants in Syria refutes any claim that the uprising is in pursuit of democracy for the people of that country. Authoritarian fundamentalist fighters form the backbone of the uprising. The Gulf States financing these brutal thugs are themselves absolutist monarchies. The West, after having foisted a brutal gangster regime on the people of Libya, can make no claim of ‘humanitarian intervention’.

The armed groups infiltrate towns and use population centers as shields from which they launch their attacks on government forces. In the process they force thousands of citizens from their homes, stores and offices which they use as military outposts. The destruction of the neighborhood of Baba Amr in Homs is a classic case of armed gangs using civilians as shields and as propaganda fodder in demonizing the government.

These armed mercenaries have no national credibility with the mass of Syrian people. One of their main propaganda mills is located in the heart of London, the so-called “Syrian Human Rights Observatory” where it coordinates closely with British intelligence turning out lurid atrocity stories to whip up sentiment in favor of a NATO intervention. The kings and emirs of the Gulf States bankroll these fighters. Turkey provides military bases and controls the cross-border flow of arms and the movement of the leaders of the so-called “Free Syrian Army”. The US, France and England provide the arms, training and diplomatic cover. Foreign jihadist-fundamentalists, including Al Qaeda fighters from Libya, Iraq and Afghanistan, have entered the conflict. This is no “civil war”. This is an international conflict pitting an unholy triple alliance of NATO imperialists, Gulf State despots, and Muslim fundamentalists against an independent secular nationalist regime. The foreign origin of the weapons, propaganda machinery and mercenary fighters reveals the sinister imperial, ‘multi-national’ character of the conflict. Ultimately the violent uprising against the Syrian state represents a systematic imperialist campaign to overthrow an ally of Iran, Russia, and China, even at the cost of destroying Syria’s economy and civil society, fragmenting the country and unleashing enduring sectarian wars of extermination against the Alevi and Christian minorities, as well as secular government supporters.

The killings and mass flight of refugees is not the result of gratuitous violence committed by a blood thirsty Syrian state. The Western backed militias have seized neighborhoods by force of arms, destroyed oil pipelines, sabotaged transportation and bombed government buildings. In the course of their attacks they have disrupted basic services critical to the Syrian people including education, access to medical care, security, water, electricity and transportation. As such, they bear most of the responsibility for this “humanitarian disaster”, (which their imperial allies and UN officials blame on Syrian security and armed forces). The Syrian security forces are fighting to preserve the national independence of a secular state, while the armed opposition commits violence on behalf of their foreign pay-masters – in Washington, Riyadh, Tel Aviv, Ankara, and London.

Conclusions

The Assad regime’s referendum last month drew millions of Syrian voters in defiance of Western imperialist threats and terrorist calls for a boycott. This clearly indicated that a majority of Syrians prefer a peaceful, negotiated settlement and reject mercenary violence. The Western-backed Syrian National Council and the Turkish and Gulf States-armed “Free Syrian Army” flatly rejected Russian and Chinese calls for an open dialogue and negotiations which the Assad regime has accepted. NATO and Gulf State dictatorships are pushing their proxies to pursue violent “regime change”, a policy which already has caused the death of thousands of Syrians. US and European economic sanctions are designed to wreck the Syrian economy, in the expectation that acute deprivation will drive an impoverished population into the arms of their violent proxies. In a repeat of the Libya scenario, NATO proposes to “liberate” the Syrian people by destroying their economy, civil society and secular state.

A Western military victory in Syria will merely feed the rising frenzy of militarism. It will encourage the West, Riyadh and Israel to provoke a new civil war in Lebanon. After demolishing Syria, the Washington-EU-Riyadh-Tel Aviv axes will move on to a far bloodier confrontation with Iran.

The horrific destruction of Iraq, followed by Libya’s post-war collapse provides a terrifying template of what is in store for the people of Syria: A precipitous collapse of their living standards, the fragmentation of their country, ethnic cleansing, rule by sectarian and fundamentalist gangs, and total insecurity of life and property.

Just as the “left” and “progressives” declared the brutal savaging of Libya to be the “revolutionary struggle of insurgent democrats” and then walked away, washing their hands of the bloody aftermath of ethnic violence against black Libyans, they repeat the same calls for military intervention against Syria. The same liberals, progressives, socialists and Marxists who are calling on the West to intervene in Syria’s “humanitarian crises” from their cafes and offices in Manhattan and Paris, will lose all interest in the bloody orgy of their victorious mercenaries after Damascus, Aleppo, and other Syrian cities have been bombed by NATO into submission.

China’s re-emergence as a world economic power raises important questions about what we can learn from its previous rise and fall and about the external and internal threats confronting this emerging economic superpower for the immediate future.

First we will outline the main contours of historical China’s rise to global economic superiority over West before the 19th century, following closely John Hobson’s account in The Eastern Origins of Western Civilization. Since the majority of western economic historians (liberal, conservative, and Marxist) have presented historical China as a stagnant, backward, parochial society, an “oriental despotism”, some detailed correctives will be necessary. It is especially important to emphasize how China, the world technological power between 1100 and 1800, made the West’s emergence possible. It was only by borrowing and assimilating Chinese innovations that the West was able to make the transition to modern capitalist and imperialist economies.

In part two we will analyze and discuss the factors and circumstances which led to China’s decline in the 19th century and its subsequent domination, exploitation and pillage by Western imperial countries, first England and then the rest of Europe, Japan and the United States.

In part three, we will briefly outline the factors leading to China’s emancipation from colonial and neo-colonial rule and analyze its recent rise to becoming the second largest global economic power.

Finally we will look at the past and present threats to China’s rise to global economic power, highlighting the similarities between British colonialism of the 18 and 19th centuries and the current US imperial strategies and focusing on the weaknesses and strengths of past and present Chinese responses.

China: The Rise and Consolidation of Global Power 1100-1800

In a systematic comparative format, John Hobson provides a wealth of empirical indicators demonstrating China’s global economic superiority over the West and in particular England. These are some striking facts:

As early as 1078, China was the world’s major producer of steel (125,000 tons); whereas Britain in 1788 produced 76,000 tons.

China was the world’s leader in technical innovations in textile manufacturing, seven centuries before Britain’s 18th century “textile revolution”.

China was the leading trading nation, with long distance trade reaching most of Southern Asia, Africa, the Middle East and Europe.

China’s “agricultural revolution” and productivity surpassed the West to the 18th century.

Its innovations in the production of paper, book printing, firearms, and tools led to a manufacturing superpower whose goods were transported throughout the world by the most advanced navigational system.

China possessed the world’s largest commercial ships. In 1588 the largest English ships displaced 400 tons, China’s displaced 3,000 tons. Even as late as the end of the 18th century China’s merchants employed 130,000 private transport ships, several times that of Britain. China retained this pre-eminent position in the world economy up until the early 19th century.

British and Europeans manufacturers followed China’s lead, assimilating and borrowing its more advanced technology and were eager to penetrate China’s advanced and lucrative market.

Banking, a stable paper money economy, manufacturing, and high yields in agriculture resulted in China’s per capita income matching that of Great Britain as late as 1750.

China’s dominant global position was challenged by the rise of British imperialism, which had adopted the advanced technological, navigational, and market innovations of China and other Asian countries in order to bypass earlier stages in becoming a world power.²

Western Imperialism and the Decline of China

The British and Western imperial conquest of the East, was based on the militaristic nature of the imperial state, its non-reciprocal economic relations with overseas trading countries and the Western imperial ideology which motivated and justified overseas conquest.

Unlike China, Britain’s industrial revolution and overseas expansion was driven by a military policy. According to Hobson, during the period from 1688-1815 Great Britain was engaged in wars 52% of the time.³ Whereas the Chinese relied on their open markets, their superior production, and sophisticated commercial and banking skills, the British relied on tariff protection, military conquest, the systematic destruction of competitive overseas enterprises as well as the appropriation and plunder of local resources. China’s global predominance was based on “reciprocal benefits” with its trading partners, while Britain relied on mercenary armies of occupation, savage repression and a “divide and conquer” policy to foment local rivalries. In the face of native resistance, the British (as well as other Western imperial powers) did not hesitate to exterminate entire communities.⁴

Unable to take over the Chinese market through greater economic competitiveness, Britain relied on brute military power. It mobilized, armed and led mercenaries, drawn from its colonies in India and elsewhere to force its exports on China and impose unequal treaties to lower tariffs. As a result China was flooded with British opium produced on its plantations in India — despite Chinese laws forbidding or regulating the importation and sale of the narcotic. China’s rulers, long accustomed to its trade and manufacturing superiority, were unprepared for the “new imperial rules” for global power. The West’s willingness to use military power to win colonies, pillage resources and recruit huge mercenary armies commanded by European officers spelt the end for China as a world power.

China had based its economic predominance on “non-interference in the internal affairs of its trading partners”. In contrast, British imperialists intervened violently in Asia, reorganizing local economies to suit the needs of the empire (eliminating economic competitors including more efficient Indian cotton manufacturers), and seized control of local political, economic, and administrative apparatus to establish the colonial state.

Britain’s empire was built with resources seized from the colonies and through the massive militarization of its economy.⁵ It was thus able to secure military supremacy over China. China’s foreign policy was hampered by its ruling elite’s excessive reliance on trade relations. Chinese officials and merchant elites sought to appease the British and convinced the emperor to grant devastating extra-territorial concessions opening markets to the detriment of Chinese manufacturers while surrendering local sovereignty. As always, the British precipitated internal rivalries and revolts further destabilizing the country.

Western and British penetration and colonization of China’s market created an entire new class: The wealthy Chinese “compradores” imported British goods and facilitated the takeover of local markets and resources. Imperialist pillage forced greater exploitation and taxation of the great mass of Chinese peasants and workers. China’s rulers were obliged to pay the war debts and finance trade deficits imposed by the Western imperial powers by squeezing its peasantry. This drove the peasants to starvation and revolt.

By the early 20th century (less than a century after the Opium Wars), China had descended from world economic power to a broken semi-colonial country with a huge destitute population. The principle ports were controlled by Western imperial officials and the countryside was subject to the rule by corrupt and brutal warlords. British opium enslaved millions.

British Academics: Eloquent Apologists for Imperial Conquest

The entire Western academic profession – first and foremost British imperialist historians – attributed British imperial dominance of Asia to English “technological superiority” and China’s misery and colonial status to “oriental backwardness”, omitting any mention of the millennium of Chinese commercial and technical progress and superiority up to the dawn of the 19th century. By the end of the 1920s, with the Japanese imperial invasion, China ceased to exist as a unified country. Under the aegis of imperialist rule, hundreds of millions of Chinese had starved or were dispossessed or slaughtered, as the Western powers and Japan plundered its economy. The entire Chinese “collaborator” comprador elitists were discredited before the Chinese people.

What did remain in the collective memory of the great mass of the Chinese people – and what was totally absent in the accounts of prestigious US and British academics – was the sense of China once having been a prosperous, dynamic and leading world power. Western commentators dismissed this collective memory of China’s ascendancy as the foolish pretensions of nostalgic lords and royalty – empty Han arrogance.

China Rises from the Ashes of Imperial Plunder and Humiliation: The Chinese Communist Revolution

The rise of modern China to become the second largest economy in the world was made possible only through the success of the Chinese communist revolution in the mid-20th century. The People’s Liberation “Red” Army defeated first the invading Japanese imperial army and later the US imperialist-backed comprador-led Kuomintang “Nationalist” army. This allowed the reunification of China as an independent sovereign state. The Communist government abolished the extra-territorial privileges of the Western imperialists, ended the territorial fiefdoms of the regional warlords and gangsters, and drove out the millionaire owners of brothels, the traffickers of women and drugs as well as the other “service providers” to the Euro-American Empire.

In every sense of the word, the Communist revolution forged the modern Chinese state. The new leaders then proceeded to reconstruct an economy ravaged by imperial wars and pillaged by Western and Japanese capitalists. After over 150 years of infamy and humiliation the Chinese people recovered their pride and national dignity. These socio-psychological elements were essential in motivating the Chinese to defend their country from the US attacks, sabotage, boycotts, and blockades mounted immediately after liberation.

Contrary to Western and neoliberal Chinese economists, China’s dynamic growth did not start in 1980. It began in 1950, when the agrarian reform provided land, infrastructure, credits and technical assistance to hundreds of millions of landless and destitute peasants and landless rural workers. Through what is now called “human capital” and gigantic social mobilization, the Communists built roads, airfields, bridges, canals and railroads as well as the basic industries, like coal, iron and steel, to form the backbone of the modern Chinese economy. Communist China’s vast free educational and health systems created a healthy, literate, and motivated work force. Its highly professional military prevented the US from extending its military empire throughout the Korean peninsula up to China’s territorial frontiers. Just as past Western scholars and propagandists fabricated a history of a “stagnant and decadent” empire to justify their destructive conquest, so too their modern counterparts have rewritten the first thirty years of Chinese Communist history, denying the role of the revolution in developing all the essential elements for a modern economy, state, and society. It is clear that China’s rapid economic growth was based on the development of its internal market, its rapidly growing cadre of scientists, skilled technicians, and workers and the social safety net which protected and promoted working class and peasant mobility were products of Communist planning and investments.

China’s rise to global power began in 1949 with the removal of the entire parasitic financial, comprador and speculative classes who had served as the intermediaries for European, Japanese and US imperialists draining China of its great wealth.

China’s Transition to Capitalism

Beginning in 1980 the Chinese government initiated a dramatic shift in its economic strategy: Over the next three decades, it opened the country to large-scale foreign investment; it privatized thousands of industries and it set in motion a process of income concentration based on a deliberate strategy of re-creating a dominant economic class of billionaires linked to overseas capitalists. China’s ruling political class embraced the idea of “borrowing” technical know-how and accessing overseas markets from foreign firms in exchange for providing cheap, plentiful labor at the lowest cost. The Chinese state re-directed massive public subsidies to promote high capitalist growth by dismantling its national system of free public education and health care. They ended subsidized public housing for hundreds of millions of peasants and urban factory workers and provided funds to real estate speculators for the construction of private luxury apartments and office skyscrapers. China’s new capitalist strategy as well as its double digit growth was based on the profound structural changes and massive public investments made possible by the previous communist government. China’s private sector “take off” was based on the huge public outlays made since 1949.

The triumphant new capitalist class and its Western collaborators claimed all the credit for this “economic miracle” as China rose to become the world’s second largest economy. This new Chinese elite have been less eager to announce China’s world-class status in terms of brutal class inequalities, rivaling only the US.

China: From Imperial Dependency to World Class Competitor

China’s sustained growth in its manufacturing sector was a result of highly concentrated public investments, high profits, technological innovations and a protected domestic market. While foreign capital profited, it was always within the framework of the Chinese state’s priorities and regulations. The regime’s dynamic “export strategy” led to huge trade surpluses, which eventually made China one of the world’s largest creditors especially for US debt. In order to maintain its dynamic industries, China has required huge influxes of raw materials, resulting in large-scale overseas investments and trade agreements with agro-mineral export countries in Africa and Latin America. By 2010 China displaced the US and Europe as the main trading partner in many countries in Asia, Africa and Latin America.

Modern China’s rise to world economic power, like its predecessor between 1100-1800, is based on its gigantic productive capacity. Trade and investment was governed by a policy of strict non-interference in the internal relations of its trading partners. Unlike the US, China did not initiate brutal wars for oil; instead it signed lucrative contracts. And China does not fight wars in the interest of overseas Chinese, as the US has done in the Middle East for Israel.

The seeming imbalance between Chinese economic and military power is in stark contrast to the US where a bloated, parasitic military empire continues to erode its own global economic presence.

US military spending is twelve times that of China. Increasingly the US military plays the key role shaping policy in Washington as it seeks to undercut China’s rise to global power.

China’s Rise to World Power: Will History Repeat Itself?

China has been growing at about 9% per annum and its goods and services are rapidly rising in quality and value. In contrast, the US and Europe have wallowed around 0% growth from 2007-2012. China’s innovative techno-scientific establishment routinely assimilates the latest inventions from the West (and Japan) and improves them, thereby decreasing the cost of production. China has replaced the US and European controlled “international financial institutions” (the IMF, World Bank, the Inter-American Development Bank) as the principle lender in Latin America. China continues to lead as the prime investor in African energy and mineral resources. China has replaced the US as the principle market for Saudi Arabian, Sudanese, and Iranian petroleum and it will soon replace the US as the principle market for Venezuela petroleum products. Today China is the world’s biggest manufacturer and exporter, dominating even the US market, while playing the role of financial life line as it holds over $1.3 trillion in US Treasury notes.

Under growing pressure from its workers, farmers and peasants, China’s rulers have been developing the domestic market by increasing wages and social spending to rebalance the economy and avoid the specter of social instability. In contrast, US wages, salaries and vital public services have sharply declined in absolute and relative terms.

Given the current historical trends it is clear that China will replace the US as the leading world economic power, over the next decade, if the US empire does not strike back and if China’s profound class inequalities do not lead to a major social upheaval.

Modern China’s rise to global power faces serious challenges. In contrast to China’s historical ascent on the world stage, modern Chinese global economic power is not accompanied by any imperialist undertakings. China has seriously lagged behind the US and Europe in aggressive war-making capacity. This may have allowed China to direct public resources to maximize economic growth, but it has left China vulnerable to US military superiority in terms of its massive arsenal, its string of forward bases, and strategic geo-military positions right off the Chinese coast and in adjoining territories.

In the nineteenth century British imperialism demolished China’s global position with its military superiority, seizing China’s ports – because of China’s reliance on “mercantile superiority”.

The conquest of India, Burma and most of Asia allowed Britain to establish colonial bases and recruit local mercenary armies. The British and its mercenary allies encircled and isolated China, setting the stage for the disruption of China’s markets and the imposition of the brutal terms of trade. The British Empire’s armed presence dictated what China imported (with opium accounting for over 50% of British exports in the 1850s) while undermining China’s competitive advantages via tariff policies.

Today the US is pursuing similar policies: US naval fleet patrols and controls China’s commercial shipping lanes and off-shore oil resources via its overseas bases. The Obama-Clinton White House is in the process of developing a rapid military response involving bases in Australia, Philippines, and elsewhere in Asia. The US is intensifying its efforts to undermine Chinese overseas access to strategic resources while backing “grass roots” separatists and “insurgents” in West China, Tibet, Sudan, Burma, Iran, Libya, Syria, and elsewhere. The US military agreements with India and the installation of a pliable puppet regime in Pakistan have advanced its strategy of isolating China. While China upholds its policy of “harmonious development” and “non-interference in the internal affairs of other countries”, it has stepped aside as US and European military imperialism have attacked a host of China’s trading partners to essentially reverse China’s peaceful commercial expansion.

China’s lack of a political and ideological strategy capable of protecting its overseas economic interests has been an invitation for the US and NATO to set-up regimes hostile to China. The most striking example is Libya where US and NATO intervened to overthrow an independent government led by President Gaddafi, with whom China had signed multi-billion dollar trade and investments agreements. The NATO bombardment of Libyan cities, ports and oil installation forced the Chinese to withdraw 35,000 Chinese oil engineers and construction workers in a matter of days. The same thing happened in Sudan where China had invested billions to develop its oil industry. The US, Israel, and Europe armed the South Sudanese rebels to disrupt the flow of oil and attack Chinese oil workers⁶ In both cases China passively allowed the US and European military imperialists to attack its trade partners and undermine its investments.

Under Mao Zedong, China had an active policy countering imperial aggression. It supported revolutionary movements and independent Third World governments. Today’s capitalist China does not have an active policy of supporting governments or movements capable of protecting China’s bilateral trade and investment agreements. China’s inability to confront the rising tide of US military aggression against its economic interests is due to deep structural problems. China’s foreign policy is shaped by big commercial, financial, and manufacturing interests who rely on their “economic competitive edge” to gain market shares and have no understanding of the military and security underpinnings of global economic power. China’s political class is deeply influenced by a new class of billionaires with strong ties to Western equity funds and who have uncritically absorbed Western cultural values. This is illustrated by their preference for sending their own children to elite universities in the US and Europe. They seek “accommodation with the West” at any price. This lack of any strategic understanding of military empire-building has led them to respond ineffectively and ad hoc to each imperialist action undermining their access to resources and markets. While China’s “business first” outlook may have worked when it was a minor player in the world economy and US empire builders saw the “capitalist opening” as a chance to easily takeover China’s public enterprises and pillage the economy. However, when China (in contrast to the former USSR) decided to retain capital controls and develop a carefully calibrated, state-directed “industrial policy” directing western capital and the transfer of technology to state enterprises, which effectively penetrated the US domestic and overseas markets, Washington began to complain and talked of retaliation. China’s huge trade surpluses with the US provoked a dual response in Washington. It sold massive quantities of US Treasury bonds to the Chinese and began to develop a global strategy to block China’s advance. Since the US lacked economic leverage to reverse its decline, it relied on its only “comparative advantage” – its military superiority based on a world wide system of attack bases, a network of overseas client regimes, military proxies, NGOers, intellectuals and armed mercenaries. Washington turned to its vast overt and clandestine security apparatus to undermine China’s trading partners. Washington depends on its long-standing ties with corrupt rulers, dissidents, journalists and media moguls to provide the powerful propaganda cover while advancing its military offensive against China’s overseas interests.

China has nothing to compare with the US overseas security apparatus because it practices a policy of non-interference. Given the advanced state of the Western imperial offensive, China has taken only a few diplomatic initiatives, such as financing English language media outlets to present its perspective, using its veto power on the UN Security Council to oppose US efforts to overthrow the independent Assad regime in Syria, and opposing the imposition of drastic sanctions against Iran. It sternly repudiated US Secretary of State Hilary Clinton’s vitriolic questioning of the “legitimacy” of the Chinese state when it voted against the US-UN resolution preparing an attack on Syria.⁷

Chinese military strategists are more aware and alarmed at the growing military threat to China. They have successfully demanded a 19% annual increase in military spending over the next five years (2011-2015).⁸ Even with this increase, China’s military expenditures will still be less than one-fifth of the US military budget and China has not one overseas military base in stark contrast to the over 750 US installations abroad. Overseas Chinese intelligence operations are minimal and ineffective. Its embassies are run by and for narrow commercial interests who utterly failed to understand NATO’s brutal policy of regime change in Libya and inform Beijing of its significance to the Chinese state.

There are two other structural weaknesses undermining China’s rise as a world power. This includes the highly ‘Westernized’ intelligentsia which has uncritically swallowed US economic doctrine about free markets while ignoring its militarized economy. These Chinese intellectuals parrot the US propaganda about the “democratic virtues” of billion-dollar Presidential campaigns, while supporting financial deregulation which would have led to a Wall Street takeover of Chinese banks and savings. Many Chinese business consultants and academics have been educated in the US and influenced by their ties to US academics and international financial institutions directly linked to Wall Street and the City of London. They have prospered as highly-paid consultants receiving prestigious positions in Chinese institutions. They identify the “liberalization of financial markets” with “advanced economies” capable of deepening ties to global markets instead of as a major source of the current global financial crisis. These “Westernized intellectuals” are like their 19th century comprador counterparts who underestimated and dismissed the long-term consequences of Western imperial penetration. They fail to understand how financial deregulation in the US precipitated the current crisis and how deregulation would lead to a Western takeover of China’s financial system – the consequences of which would reallocate China’s domestic savings to non-productive activities (real estate speculation), precipitate financial crisis and ultimately undermine China’s leading global position.

These Chinese yuppies imitate the worst of Western consumerist life styles and their political outlooks are driven by these life styles and Westernized identities which preclude any sense of solidarity with their own working class.

There is an economic basis for the pro-Western sentiments of China’s neo-compradors. They have transferred billions of dollars to foreign bank accounts, purchased luxury homes and apartments in London, Toronto, Los Angeles, Manhattan, Paris, Hong Kong, and Singapore. They have one foot in China (the source of their wealth) and the other in the West (where they consume and hide their wealth).

Westernized compradors are deeply embedded in China’s economic system having family ties with the political leadership in the party apparatus and the state. Their connections are weakest in the military and in the growing social movements, although some “dissident” students and academic activists in the “democracy movements” are backed by Western imperial NGO’s. To the extent that the compradors gain influence, they weaken the strong economic state institutions which have directed China’s ascent to global power, just as they did in the 19th century by acting as intermediaries for the British Empire. Proclaiming 19th Century “liberalism”, British opium addicted over 50 million Chinese in less than a decade. Proclaiming “democracy and human rights”, US gunboats now patrol off China’s coast. China’s elite-directed rise to global economic power has spawned monumental inequalities between the thousands of new billionaires and multi-millionaires at the top and hundreds of millions of impoverished workers, peasants and migrant workers at the bottom.

China’s rapid accumulation of wealth and capital was made possible through the intense exploitation of its workers who were stripped of their previous social safety net and regulated work conditions guaranteed under Communism. Millions of Chinese households are being dispossessed in order to promote real estate developer/speculators who then build high rise offices and the luxury apartments for the domestic and foreign elite. These brutal features of ascendant Chinese capitalism have created a fusion of workplace and living space mass struggle which is growing every year. The developer/speculators’ slogan “to get rich is wonderful” has lost its power to deceive the people. In 2011 there were over 200,000 popular encompassing urban coastal factories and rural villages. The next step, which is sure to come, will be the unification of these struggles into new national social movements with a class-based agenda demanding the restoration of health and educational services enjoyed under the Communists as well as a greater share of China’s wealth. Current demands for greater wages can turn to demands for greater work place democracy. To answer these popular demands China’s new comprador-Westernized liberals cannot point to their “model” in the US empire where American workers are in the process of being stripped of the very benefits Chinese workers are struggling to regain.

China, torn by deepening class and political conflict, cannot sustain its drive toward global economic leadership. China’s elite cannot confront the rising global imperial military threat from the US with its comprador allies among the internal liberal elite while the country is a deeply divided society with an increasingly hostile working class. The time of unbridled exploitation of China’s labor has to end in order to face the US military encirclement of China and economic disruption of its overseas markets. China possesses enormous resources. With over $1.5 trillion dollars in reserves China can finance a comprehensive national health and educational program throughout the country.

China can afford to pursue an intensive “public housing program” for the 250 million migrant workers currently living in urban squalor. China can impose a system of progressive income taxes on its new billionaires and millionaires and finance small family farmer co-operatives and rural industries to rebalance the economy. Their program of developing alternative energy sources, such as solar panels and wind farms – are a promising start to addressing their serious environmental pollution. Degradation of the environment and related health issues already engage the concern of tens of millions. Ultimately China’s best defense against imperial encroachments is a stable regime based on social justice for the hundreds of millions and a foreign policy of supporting overseas anti-imperialist movements and regimes – whose independence are in China’s vital interest. What is needed is a pro-active policy based on mutually beneficial joint ventures including military and diplomatic solidarity. Already a small, but influential, group of Chinese intellectuals have raised the issue of the growing US military threat and are “saying no to gunboat diplomacy”.⁹

Modern China has plenty of resources and opportunities, unavailable to China in the 19th century when it was subjugated by the British Empire. If the US continues to escalate its aggressive militaristic policy against China, Beijing can set off a serious fiscal crisis by dumping a few of its hundreds of billions of dollars in US Treasury notes. China, a nuclear power should reach out to its similarly armed and threatened neighbor, Russia, to confront and confound the bellicose rantings of US Secretary of State, Hilary Clinton. Russian President-to-be Putin vows to increase military spending from 3% to 6% of the GDP over the next decade to counter Washington’s offensive missile bases on Russia’s borders and thwart Obama’s regime change programs against its allies, like Syria.¹⁰

China has powerful trading, financial and investment networks covering the globe as well as powerful economic partners. These links have become essential for the continued growth of many of countries throughout the developing world. In taking on China, the US will have to face the opposition of many powerful market-based elites throughout the world. Few countries or elites see any future in tying their fortunes to an economically unstable empire-based on militarism and destructive colonial occupations.

In other words, modern China, as a world power, is incomparably stronger than it was in early 18th century. The US does not have the colonial leverage that the ascendant British Empire possessed in the run-up to the Opium Wars. Moreover, many Chinese intellectuals and the vast majority of its citizens have no intention of letting its current “Westernized compradors” sell out the country. Nothing would accelerate political polarization in Chinese society and hasten the coming of a second Chinese social revolution more than a timid leadership submitting to a new era of Western imperial pillage.

1. John Hobson, The Eastern Origins of Western Civilization (Cambridge UK: Cambridge University Press 2004).
2. Ibid, Ch. 9: 190-218.
3. Ibid, Ch. 11: 244-248.
4. Richard Gott, Britain’s Empire: Resistance, Repression and Revolt (London: Verso 2011) for a detailed historical chronicle of the savagery accompanying Britain’s colonial empire.
5. Hobson: 253-256.
6. Katrina Manson, “South Sudan puts Beijing’s policies to the test”, Financial Times, 2/21/12, p. 5.
7. Interview of Clinton NPR, 2/26/12.
8. La Jornada, 2/15/12 (Mexico City).
9. China Daily, 2/20/2012.
10. Charles Clover, ‘Putin vows huge boost in defense spending’, Financial Times, 2/12/2012.

There is good reason to believe that this political movement will succeed where others failed, in large part because of the width and breadth of the participants, the growing co-operation and unity in common struggles for land reform, participatory democracy, and near universal opposition to US backed militarism and the neo-liberal free trade agreement.

International Perspectives: A Promising Context

Never has the international climate, especially in Latin America, been so favorable for the growth of Colombia’s popular democratic initiative and the eventual political success of this “movement of movements”.

Throughout most of South America and the Caribbean a favorable historic moment of regional autonomy has taken organizational form, backed by almost all the major countries in the region. ALBA (Bolivarian Alternative for Latin America) links a dozen Caribbean and Andean countries in a pact of regional integration led by the dynamic, democratic, anti-imperialist government of Venezuelan President Hugo Chavez. UNASUR, (Union of South American Nations) MERCOSUR (Common Southern Market) and other regional organizations, are expressions of the growing political and economic independence of Latin America and a rejection of the US dominated OAS (Organization of American States). In practical terms, the growth of these independent regional organizations has meant a rejection of US-sponsored military intervention, as illustrated by their repudiation of the Washington-backed military coup in Honduras in 2009. Latin America’s opposition to Washington’s Free Trade of the America’s Agreement led to the growth of intra-regional trade and forced Washington to seek ‘bilateral’ free trade agreements’ with Chile, Colombia, Panama and Mexico.

The growth of autonomous regional integration provides two strategic advantages: it lessens economic dependence on the US and weakens Washington’s leverage in imposing economic sanctions against any nationalist, populist, or socialist government in the region. This is evident in Washington’s failure to secure any Latin American support for its blockade of Cuba or sanctions against Venezuela. The decline of US political influence and economic dominance opens a historic opportunity for a popular nationalist and democratic government in Colombia to realistically develop a new alternative development model centered on greater social equity.

The dynamic growth of Asian markets, especially China, provides Latin America with a historic opportunity to diversify its markets, increase trade and secure favorable prices for its exports. The advantage of Asian trade relations is that they are not encumbered by subversion by the CIA and the Pentagon – they are based on strictly mutually beneficial economic relations and non-intervention in the internal relations of each country. The diversification of trade is well advanced: China has replaced the US and the EU as the principle trading partner of Brazil, Argentina, Chile, Peru and the list is growing as Asia rapidly expands at over 8% and the US-EU economies wallow in recession.

Latin America is no longer subject to the cyclical volatility of US-EU financial markets. During the financial crises of 2008-2010 of the US and Europe, Latin America was able to turn increasingly to China for financing: China’s lending to Latin America grew from $1 billion dollars in 2008, to $18 billion in 2009, to $36 billion in 2010. Moreover, countries like Argentina and Ecuador, which cannot access private capital markets in the US and EU because of debt defaults,can draw loans from Chinese state banks. Between 2005-2010, China lent Latin America $75 billion and by 2010 Chinese loans exceeded the combined loans of the IMF, World Bank and BID.

Moreover, Chinese state banks do not impose harsh political and economic “conditions” to their Latin borrowers as does the IMF. In other words, Latin Americans intent on external financing, can borrow from China to finance structural changes including agrarian reform and the nationalization of banks without fearing economic reprisals from overseas lenders.

ALBA provides an important ‘sub-regional grouping’ and a forum representing a forceful rejection of imperial wars, an opportunity for deeper Caribbean integration and a defense against imperial political and military intervention as well as favorable subsidies on petroleum imports. ALBA provides Colombia with an opportunity to deepen its strategic ties with Venezuela and Ecuador, as they share a common frontier, highly complementary economies and a common historical and cultural Bolivarian legacy.

In contrast to the period between the late 1970’s to 2000 when Washington dominated Latin America via client military and civilian regimes and the neoliberal dogma enshrined in the so called Washington Consensus of 1996, and limited the freedom of action of an independent popular government, today, a free and independent Colombia would have an immensely more favorable international, political and economic environment.

The Decline of US Global Power

US influence is declining on a world scale: China and India have displaced the US as the major trading partners in Asia, Latin America, Africa, and in major countries in the Middle East. Russia’s economy and military has recovered from the catastrophic pillage during the Yeltsin era and is pursuing an independent policy. This is evident in Russia’s military sales and petroleum agreements with Venezuela, its UN Security Council veto of the NATO-backed mercenary assault of Syria, and its closer ties with China.

Along with the emergence of a multi-polar world of Russia-China-Latin America, the Middle East and North Africa is in the midst of a series of anti-imperialist and popular democratic rebellions which threaten US client dictatorships.

Equally important, the US’s prolonged, costly, and losing wars in Iraq and Afghanistan have been immensely unpopular internally, and along with the fiscal and trade deficits and financial crises, have undermined public support for new large scale ground wars.

In other words, the US is much less capable of sustaining a large scale military intervention against a major country like Colombia, if and when a new popular government is elected.

The Demise of the Neo-Liberal Capitalist Model

Today as never before in recent history, real existent “free-market capitalism” has, demonstrated on a world scale its failure to provide the essentials of the good life. In Greece, Spain, Portugal, and Italy youth unemployment hovers between 35% and 50%; and overall unemployment approaches or exceeds 20%. In the EU and the US, real unemployment and underemployment exceeds a quarter of the labor force.

Economic recession, financial crises and declining living and working conditions are the defining conditions of the US and Europe. In other words, the capitalist model in crises for five years offers no alternative for the great majority working in the “developed imperialist countries” or the so-called “developing countries”.

This presents a golden ideological opportunity to demonstrate that a socialist society based on democratic participation is a viable alternative to crises-ridden capitalism.

Class and National Struggles: The Emerging Reality

Throughout the world today, from Southern Europe to the Middle East, from Asia to North America, mass popular revolts, have taken prime of place. General strikes, mass demonstration and street fighting rage in the capitals of Greece, Portugal and Italy. Mass democratic movements confront dictators in Egypt, Tunisia, Bahrain, and the Gulf States. ‘Occupy movements’ in the US and Spain spread to new countries, rejecting class-based “austerity”. In the face of the recovery of profits at the expense of massive cuts in wages, public services, pensions, health care, new middle class sectors join the struggle.

Even in the high growth Asian capitalist countries, like China, the working class rebels against the inequalities and exploitation: over 200,000 strikes and protests in 2011 recall the popular rebellions of the Cultural Revolution against hierarchy and abuse. In summary, the regional and world correlation of forces is very favorable to the emergence of a new dynamic unified political movement in Colombia. However, there are dangers and obstacles that need to be taken into account.

Obstacles and Challenges

The decline and decay of US power and influence does not lessen the dangers of direct Special Forces assassinations, indirect military intervention via local military proxies and economic destabilization.

Washington has developed a clandestine army of special forces, armed assassin operations, in 75 countries. The US retains 750 military bases around the world. As we saw in Honduras, the US still has leverage over the military and allies among the oligarchs to overthrow a progressive government. The US has a reserve army of local politicians and NGOs ready to replace established dictators when they are overthrown.

Washington and NATO Europe provided air and naval support and supplied arms to local mercenaries and fundamentalists to overthrow independent leaders like Mouammar Gaddafi in Libya. Today they provide arms to mercenaries to assault President Assad in Syria. The US and EU are building a military armada surrounding Iran and promoting economic sanctions to strangle its economy. More ominously, Washington is encircling China and Russia with military bases, missiles, and warships.

In other words, imperialism in economic decline still retains military options to deter the advance of a pluralist global political system. Imperial states do not surrender power unless they face unified regional alliances and, equally important, governments with united mass popular support.

The positive development of Latin American integration is a step toward greater independence but it has strategic weaknesses: namely internal class contradictions and conflicts over development models. Economic growth and diversification of markets has lessened US dominance but it has also strengthened the power and wealth of the domestic ruling classes and multi-national agro-mineral corporations.

Inequalities of wealth, income, and landownership flourish in Brazil, Chile, Peru, Ecuador, Bolivia, and elsewhere, even as some of these regimes claim to be “popular governments”. Moreover, the “anti-imperialism” of ALBA countries like Bolivia does not extend to the dozens of foreign owned mineral extracting and petroleum exploiting multi-nationals which dominate the country. Argentina may promote an independent foreign policy but over one-third of its countryside is owned by foreign capital.

In other words, while the growth of independent governments in Latin America contributes to limiting the domination of the US, Colombian movements must also recognize the limitations and class contradictions of the “progressive” countries in the region. Only Venezuela has pursued strong redistributive and nationalist policies.

The principle obstacles facing the new Colombian political movements are domestic: the entrenched oligarchy and its allies in the state, especially within the military and paramilitary forces. If the external environment is largely favorable, the internal political regime presents a formidable obstacle, especially the continued assassination of dozens of prominent trade union, peasant and human rights activists.

The de-militarization of civil society beginning with the dismantling of the US military bases, the discontinuation of Plan Colombia and the demobilization of the armed forces (over 300,000 plus private paramilitary gangs) are major steps toward opening political space for the excrcise of democratic rights. The democratization of elections requires the termination of the state penetration and coercion of civil society.

The democratization of Colombia requires the growth of powerful independent social movements representing all popular sectors of Colombian society; judicial investigation and prosecution of ex-narco-President Álvaro Uribe and his closest collaborators, for political homicides, needs to extend to the present Santos regime. The recent “free trade agreement” between Obama and Santos must be repudiated as it is an obstacle to domestic development and deepening more promising economic relations with Venezuela and the rest of Latin America and Asia.

Above all over 4 million displaced Colombians, forcibly dispossessed by the Uribe regime, must be mobilized to repossess their lands and provided with credit, loans and an opportunity to escape their current misery and squalor.

Colombia’s current rulers cannot point to a single example of a successful neo-liberal model in Europe, Latin America, or the United States. Neo-liberal Mexico and Central America are over-run by drug cartels, with 80,000 plus homicides over the past 5 years and the lowest growth rates in the region. The US economy stagnates with over 20% un- and underemployed. The European Union is on the verge of disintegration. Clearly Marx’s critique of growing capitalist immiseration is being confirmed. It is time for the new political movements to consider a “Colombian road to socialism” built on public ownership of the commanding heights of the economy, agrarian reform, sustainable agriculture,and environmental protection under democratic control.

It is in this spirit of optimism and critical analysis that I send my solidarity and unconditional support to the organizers, activists, and militant participants attending this historic gathering. I am confident sooner rather then later they will lead Colombia to its “second and final independence”.

There is no doubt that, between 2008-2009, the capitalist system in Europe and the United States suffered a severe shock that shook the foundations of its financial system and threatened to bankrupt its ‘leading sectors’.

However, I will argue the ‘crises of capitalism’ was turned into a ‘crises of labor’. Finance capital, the principle detonator of the crash and crises, recovered, the capitalist class as a whole was strengthened, and most important of all, it utilized the political, social, ideological conditions created as a result of ‘the crises’ to further consolidate their dominance and exploitation over the rest of society.

In other words, the ‘crises of capital’ has been converted into a strategic advantage for furthering the most fundamental interests of capital: the enlargement of profits, the consolidation of capitalist rule, the greater concentration of ownership, the deepening of inequalities between capital and labor and the creation of huge reserves of labor to further augment their profits.

Furthermore, the notion of a homogeneous global crisis of capitalism overlooks profound differences in performance and conditions, between countries, classes, and age cohorts.

The Global Crises Thesis:The Economic and Social Argument

The advocates of global crises argue that beginning in 2007 and continuing to the present, the world capitalist system has collapsed and recovery is a mirage. They cite stagnation and continuing recession in North America and the Eurozone. They offer GDP data hovering between negative to zero growth. Their argument is backed by data citing double digit unemployment in both regions. They frequently correct the official data which understates the percentage unemployed by excluding part-time, long-term unemployed workers and others. The ‘crises’ argument is strengthened by citing the millions of homeowners who have been evicted by the banks, the sharp increase in poverty and destitution accompanying job loses, wage reductions and the elimination or reduction of social services. ‘Crises’ is also associated with the massive increase in bankruptcies of mostly small and medium size businesses and regional banks.

The Global Crises: The Loss of Legitimacy

Critics, especially in the financial press, write of a ‘legitimacy crises of capitalism’ citing polls showing substantial majorities questioning the injustices of the capitalist system, the vast and growing inequalities and the rigged rules by which banks exploit their size (“too big to fail”) to raid the Treasury at the expense of social programs.

In summary the advocates of the thesis of a Global Crises of Capitalism make a strong case, demonstrating the profound and pervasive destructive effects of the capitalist system on the lives of the great majority of humanity.

The problem is that a ‘crises of humanity’ (more specifically of salary ad wage workers) is not the same as a crisis of the capitalist system. In fact as we shall argue below growing social adversity, declining income and employment has been a major factor facilitating the rapid and massive recovery of the profit margins of most large scale corporations.

Moreover, the thesis of ‘global’ crises of capitalism amalgamates disparate economies, countries, classes and age cohorts with sharply divergent performances at different historical moments.

Global Crises or Uneven and Unequal Development?

It is utterly foolish to argue for a “global crises” when several of the major economies in the world economy did not suffer a major downturn and others recovered and expanded rapidly. China and India did not suffer even a recession. Even during the worst years of the Euro-US decline,the asian giants grew on average about 8%. Latin America’s economies especially the major agro-mineral export countries (Brazil, Argentina, Chile, ) with diversified markets, especially in Asia, paused briefly (in 2009) before assuming moderate to rapid growth (between 3% to 7%) from 2010-2012.

By aggregating economic data from the Euro-zone as a whole the advocates of global crises, overlooked the enormous disparities in performance within the zone. While Southern Europe wallows in a deep sustained depression, by any measure, from 2008 to the foreseeable future, German exports, in 2011, set a record of a trillion euros; its trade surplus reached 158 billion euros, after a155 billion euro surpluses in 2010.¹

While aggregate Eurozone unemployment reaches 10.4%, the internal differences defy any notion of ‘general crises.’ Unemployment in Holland is 4.9%, Austria 4.1% and Germany 5.5% with employer claims of widespread skilled labor shortages in key growth sectors. On the other hand in exploited southern Europe unemployment runs to depression levels, Greece 21%, Spain 22.9%, Ireland 14.5%, and Portugal 13.6%.² In other words, ‘the crises’ do not adversely affect some economies, that in fact profit from their market dominance and techno-financial strength over dependent, debtor and backward economies. To speak of ‘global crises’ obscures the fundamental dominant and exploitative relations that facilitate ‘recovery’ and growth of the elite economies over and against their competitors and client states. In addition global crises theorists wrongly amalgamated crises ridden, financial-speculative economies (US, England) with dynamic productive export economies (Germany, China).

The second problem with the thesis of ‘global crises’ is that it overlooks profound internal differences between age cohorts. In several European countries youth unemployment (16-25) runs between 30 to 50% (Spain 48.7%, Greece 47.2%, Slovakia 35.6%, Italy 31%, Portugal 30.8% and Ireland 29%) while in Germany, Austria and Holland youth unemployment runs to Germany 7.8%, Austria 8.2% and Netherlands 8.6%.³ These differences underlie the reason why there is not a ‘global youth movement’ of ‘indigenous’ and ‘occupiers.’ Five-fold differences between unemployed youth is not conducive to ‘international’ solidarity. The concentration of high youth unemployment figures explains the uneven development of mass street protests especially centered in Southern Europe. It also explains why the northern Euro-American “anti-globalization” movement is largely a lifeless forum which attracts academic pontification on the “global capitalist crises” and the impotence of the “Social Forums” are unable to attract millions of unemployed youth from Southern Europe .They are more attracted to direct action. Globalist theorists overlook the specific way in which the mass of unemployed young workers are exploited in their dependent debt ridden countries. They ignore the specific way they are ruled and repressed by center-left and rightist capitalist parties. The contrast is most evident in the winter of 2012. Greek workers are pressured to accept a 20% cut in minimum wages while in Germany workers are demanding a 6% increase.

If the ‘crises’ of capitalism is manifested in specific regions, so too does it affect different age/racial sectors of the wage and salaries classes. The unemployment rates of youth to older workers varies enormously: in Italy it is 3.5/1, Greece 2.5/1, Portugal 2.3/1, Spain 2.1/1 and Belgium 2.9/1. In Germany it is 1.5/1.⁴ In other words because of the higher levels of unemployment among youth they have a greater propensity for direct action ‘against the system’; while older workers with higher levels of employment (and unemployment benefits) have shown a greater propensity to rely on the ballot box and engage in limited strikes over job and pay related issues. The vast concentration of unemployed among young workers means they form the ‘available core’ for sustained action; but it also means that they can only achieve limited unity of action with the older working class experiencing single digit unemployment.

However, it is also true that the great mass of unemployed youth provides a formidable weapon, in the hands of employers to threaten to replace employed older workers. Today, capitalists constantly resort to using the unemployed to lower wages and benefits and to intensify exploitation (dubbed to “increase productivity”) to increase profit margins. Far from being simply an indicater of ‘capitalist crises,’ high levels of unemployment have served along with other factors’ to increase the rate of profit, accumulate income, widen income inequalities which augments the consumption of luxury goods for the capitalist class:the sales of luxury cars and watches is booming.

Class Crises: The Counter-Thesis

Contrary to the “global capitalist crises” theorists, a substantial amount of data has surfaced which refutes its assumptions. A recent study reports “US corporate profits are higher as a share of gross domestic product than at any time since 1950.”⁵ US companies cash balances have never been greater, thanks to intensified exploitation of workers, and a multi-tiered wage systems in which new hires work for a fraction of what older workers receive (thanks to agreements signed by ‘door mat’ labor bosses).

The “crises of capitalism” ideologues have ignored the financial reports of the major US corporations. According to General Motors 2011 report to its stockholders,they celebrated the greatest profit ever, turning a profit of $7.6 billion, surpassing the previous record of $6.7 billion in 1997. A large part of these profits results from the freezing of its underfunded US pension funds and extracting greater productivity from fewer workers–in other words intensified exploitation–and cutting hourly wages of new hires by half.⁶

Moreover the increased importance of imperialist exploitation is evident as the share of US corporate profits extracted overseas keeps rising at the expense of employee income growth. In 2011, the US economy grew by 1.7%, but median wages fell by 2.7%. According to the financial press “the profit margins of the S and P 500 leapt from 6% to 9% of the GDP in the past three years, a share last achieved three generations ago. At roughly a third, the foreign share of these profits has more than doubled since 2000.”⁷ If this is a “capitalist crises” then who needs a capitalist boom?

Surveys of top corporations reveal that US companies are holding 1.73 trillion in cash, “the fruits of record high profit margins.”⁸ These record profit margins result from mass firings which have led to intensifying exploitation of the remaining workers. Also negligible federal interest rates and easy access to credit allow capitalists to exploit vast differentials between borrowing and lending and investing. Lower taxes and cuts in social programs result in a growing cash pile for corporations. Within the corporate structure, income goes to the top where senior executives pay themselves huge bonuses. Among the leading S and P 500 corporations the proportion of income that goes to dividends for stockholders is the lowest since 1900.⁹

A real capitalist crisis would adversely affect profit margins, gross earnings and the accumulation of “cash piles.” Rising profits are being horded because as capitalists profit from intense exploitation, mass consumption stagnates.

Crises theorists confuse what is clearly the degrading of labor, the savaging of living and working conditions and even the stagnation of the economy, with a ‘crises’ of capital: when the capitalist class increases its profit margins, hoards trillions, it is not in crises. The key point is that the ‘crises of labor’ is a major stimulus for the recovery of capitalist profits. We cannot generalize from one to the other. No doubt there was a moment of capitalist crises (2008-2009) but thanks to the capitalist state’s unprecedented massive transfer of wealth from the public treasury to the capitalist class–Wall Street banks in the first instance–the corporate sector recovered, while the workers and the rest of the economy remained in crises, went bankrupt and out of work.

From Crises to Recovery of Profits: 2008/9 to 2012

The key to the ‘recovery’ of corporate profits had little to do with the business cycle and all to do with Wall Street’s large scale takeover and pillage of the US Treasury. Between 2009-2012 hundreds of former Wall Street executives, managers and investment advisers seized all the major decision-making positions in the Treasury Department and channeled trillions of dollars into leading financial and corporate coffers. They intervened financially troubled corporations,like General Motors, imposing major wage cuts and dismissals of thousands of workers.

Wall Streeters in Treasury elaborated the doctrine of Too Big to Fail to justify the massive transfer of wealth. The entire speculative edifice built in part by a 234 fold rise in foreign exchange trading volume between 1977-2010 was restored.¹⁰ The new doctrine argued that the state’s first and principle priority is to return the financial system to profitability at any and all cost to society, citizens, taxpayers and workers. Too Big to Fail is a complete repudiation of the most basic principle of the “free market” capitalist system: the idea that those capitalists who lose bear the consequences; that each investor or CEO, is responsible for their action. Financial capitalists no longer needed to justify their activity in terms of any contribution to the growth of the economy or “social utility”. According to the current rulers Wall Street must be saved because it is Wall Street, even if the rest of the economy and people sink.¹¹ State bailouts and financing are complemented by hundreds of billions in tax concessions, leading to unprecedented fiscal deficits and the growth of massive social inequalities. The pay of CEOs’s as a multiple of the average worker went from 24 to 1 in 1965 to 325 in 2010.¹²

The ruling class flaunts their wealth and power aided and abetted by the White House and Treasury. In the face of popular hostility to Wall Street pillage of Treasury, Obama went through the sham of asking Treasury to impose a cap on the multi-million dollar bonuses that the CEO’s running bailed out banks awarded themselves. Wall Streeters in Treasury refused to enforce the executive order, the CEO’s got billions in bonuses in 2011. President Obama went along, thinking he conned the US public with his phony gesture,while he reaped millions in campaign funds from Wall Street!

The reason Treasury has been taken over by Wall Street is that in the 1990’s and 2000’s, banks became a leading force in Western economies. Their share of the GDP rose sharply (from 2% in the 1950’s to 8% in 2010).¹⁰

Today it is “normal operating procedure” for President’s to appoint Wall Streeter’s to all key economic positions; and it is ‘normal’ for these same officials to pursue policies that maximize Wall Street profits and eliminate any risk of failure no matter how risky and corrupt their practioners.

The Revolving Door: From Wall Street to Treasury and Return

Effectively the relation between Wall Street and Treasury has become a “revolving door”: from Wall Street to the Treasury Department to Wall Street. Private bankers take appointments in Treasury (or are recruited) to ensure that all resources and policies Wall Street needs are granted with maximum effort, with the least hindrance from citizens, workers or taxpayers. Wall Streeters in Treasury give highest priority to Wall Street survival, recovery and expansion of profits. They block any regulations or restrictions on bonuses or a repeat of past swindles.

Wall Streeters ‘make a reputation’ in Treasury and then return to the private sector in higher positions, as senior advisers and partners. A Treasury appointment is a ladder up the Wall Street hierarchy. Treasury is a filling station to the Wall Street Limousine: ex Wall Streeters fill up the tank, check the oil and then jump in the front seat and zoom to a lucrative job and let the filling station (public) pay the bill.

Approximately 774 officials (and counting) departed from Treasury between January 2009 and August 2011.¹³ All provided lucrative “services” to their future Wall Street bosses finding it a great way to re-enter private finance at a higher more lucrative position.

A report in the Financial Times Feb. 6, 2012¹³ entitled appropriately Manhattan Transfer” provides typical illustrations of the Treasury-Wall Street “revolving door.”

Ron Bloom went from a junior banker at Lazard to Treasury, helping to engineer the trillion dollar bailout of Wall Street and returned to Lazard as a senior adviser. Jake Siewert went from Wall Street to becoming a top aide to Treasury Secretary Tim Geithner and then graduated to Goldman Sachs, having served to undercut any cap on Wall Street bonuses.

Michael Mundaca, the most senior tax official in the Obama regime came from the Street and then went on to a highly lucrative post in Ernst and Young a corporate accounting firm, having help write down corporate taxes during his stint in “public office”.

Eric Solomon, a senior tax official in the infamous corporate tax free Bush Administration made the same switch. Jeffrey Goldstein, who Obama put in charge of financial regulation and succeeded in undercutting popular demands, returned to his previous employer Hellman and Friedman with the appropriate promotion for services rendered.

Stuart Levey, who ran AIPAC sanctions against Iran policies out if Treasury’s so-called “anti-terrorist agency,” was hired as general counsel by HSBC to defend it from investigations for money laundering.¹³ In this case Levey moved from promoting Israels’ war aims to defending an international bank accused of laundering billions in Mexican cartel money. Levey, by the way spent so much time pursuing Israels’ Iran agenda that he totally ignored the Mexican drug cartels’ billion dollar money laundering cross-border operations for the better part of a decade.

Lew Alexander a senior advisor to Geithner in designing the trillion dollar bail out is now a senior official in Nomura, the Japanese bank. Lee Sachs went from Treasury to Bank Alliance, (his own “lending platform”). James Millstein went from Lazard to Treasury bailed out AIG insurance run into the ground by Greenberg and then established his own private investment firm taking a cluster of well-connected Treasury officials with him.

The Goldman-Sachs-Treasury “revolving door” continues today. In addition to past and current Treasury heads Paulson and Geithner, former Goldman partner Mark Patterson was recently appointed Geithner’s “chief of staff.” Tim Bowler, former Goldman managing director, was appointed by Obama to head up the capital markets division.

It should be abundantly clear that elections, parties and the billion dollar electoral campaigns have little to do with “democracy” and more to do with selecting the President and legislators who will appoint non-elected Wall Streeters to make all the strategic economic decisions for the 99% of Americans. The policy results of the Wall Street-Treasury revolving door are clear and provide us with a framework for understanding why the “profit crises” has vanished and the crises of labor has deepened.

The “Policy Achievements” of the Revolving Door

The Wall Street-Treasury conundrum (WSTC) has performed herculean and audacious labor for finance and corporate capital. In the face of universal condemnation of Wall Street by the vast majority of the public for its swindles, bankruptcies, job losses and mortgage foreclosures, the WSTC publically backed the swindlers with a trillion dollar bailout. A daring move on the face of it; that is if majorities and elections counted for anything. Equally important the WSTC dumped the entire “free market” ideology that justified capitalist profits based on its “risks”, by imposing the new dogma of “too big to fail” in which the state treasury guarantees profits even when capitalists face bankruptcy, providing they are billion dollar firms. The WSTC dumped the capitalist principle of “fiscal responsibility” in favor of hundreds of billions of dollars in tax cuts for the corporate-financial ruling class, running up record peace time budget deficits and then having the audacity to blame the social programs supported by popular majorities. (Is it any wonder these ex-Treasury officials get such lucrative offers in the private sector when they leave public office?) Thirdly, Treasury and the Central Bank (Federal Reserve) provide near zero interest loans that guarantees big profits to private financial institution which borrow low from the Fed and lend high, (including back to the Government!) especially in purchasing overseas Government and corporate bonds. They receive anywhere from four to ten times the interest rates they pay. In other words the taxpayers provide a monstrous subsidy for Wall Street speculation. With the added proviso, that today these speculative activities are now insured by the Federal government, under the Too Big to Fail doctrine.

Under the ideology of “regaining competitiveness” the Obama economic team (from Treasury, the Federal Reserve, Commerce, Labor) has encouraged employers to engage in the most aggressive shedding of workers in modern history. Increased productivity and profitability is not the result of “innovation” as Obama, Geithner and Bernache claim; it is a product of a state labor policy which deepens inequality by holding down wages and raising profit margins. Fewer workers producing more commodities. Cheap credit and bailouts for the billion dollar banks and no refinancing for households and small and medium size firms leading to bankruptcies, buyouts and ‘consolidation’ namely, greater concentration of ownership. As a result the mass market stagnates but corporate and bank profits reach record levels. According to financial experts under the WSTC “new order” “bankers are a protected class who enjoy bonuses regardless of performance, while relying on the taxpayer to socialize their losses.”¹² In contrast labor, under Obama’s economic team, faces the greatest insecurity and most threatening situation in recent history: “in what is unquestionably novel is the ferocity with which US business sheds labor now that executive pay and incentive schemes are linked to short term performance targets.”¹⁴

Economic Consequences of State Policies

Because of the Wall Street “ takeover” of strategic economic policy positions in Government we can now understand the paradox of record profit margins in the midst of economic stagnation. We can comprehend why the capitalist crises has, at least temporarily, been replaced by a profound crises of labor. Within the power matrix of Wall Street-Treasury Dept. all the old corrupt and exploitative practices that led up to the 2008-2009 crash have returned: multi-billion dollar bonuses for investment bankers who led the economy into the crash; banks “snapping up billions of dollars of bundled mortgage products that resemble the sliced and diced debt some (sic) blame for the financial crises.”¹⁵ The difference today is that these speculative instruments are now backed by the taxpayer (Treasury). The supremacy of the financial structure of the pre-crises US economy is in place and thriving … “only” the US labor force has sunk into greater unemployment, declining living standards, widespread insecurity and profound discontent.

Conclusion: The Case Against Capitalism and for Socialism

The profound crises of 2008-2009 provoked a spate of questioning of the capitalist system, even among many of its most ardent advocates¹⁶ criticism abounded. ‘Reform, regulation and redistribution’ were the fare of financial columnists. Yet the ruling economic and governing class took no heed. The workers are controlled by door mat union leaders and lack a political instrument. The right-wing pseudo populists embrace an even more virulent pro capitalist agenda, calling for across the board elimination of social programs and corporate taxes. Inside the state a major transformation has taken place which effectively smashed any link between capitalism and social welfare, between government decision-making and the electorate. Democracy has been relaced by a corporate state, founded on the revolving door between Treasury and Wall Street, which funnels public wealth to private financial coffers. The breach between the welfare of society and the operations of the financial architecture is definitive.

The activity of Wall Street has no social utility, its practioners enrich themselves with no redeeming activity. Capitalism has demonstrated conclusively, that it thrives through the degradation of tens of millions of workers and rejects the endless pleas for reform and regulation. Real existing capitalism cannot be harnessed to raising living standards or ensuring employment free of fear of large scale, sudden and brutal firings. Capitalism, as we experience it over the past decade and for the foreseeable future, is in polar opposition to social equality, democratic decision-making, and collective welfare.

Record capitalist profits are accrued by pillaging the public treasury, denying pensions and prolonging ‘work till you die’, bankrupting most families with exorbitant private corporate medical and educational costs.

More than ever in recent history, record majorities reject the rule by and for the bankers and the corporate ruling class.¹⁷ Inequalities between the top 1% and the bottom 99% have reached record proportions. CEO’s earn 325 times that of an average worker.¹² Since the state has become the ‘foundation’ of the economy of the Wall Street predators, and since ‘reform’ and regulation has dismally failed, it is time to consider a fundamental systemic transformation that begins via a political revolution which forcibly ousts the non-elected financial and corporate elites running the state for their own exclusive interests. The entire political process, including elections, are profoundly corrupt: each level of office has its own inflated price tag.The current Presidential contest will cost $2 to $3 billion dollars to determine which of the servants of Wall Street will preside over the revolving door.

Socialism is no longer the scare word of the past. Socialism involves the large-scale reorganization of the economy, the transfer of trillions from the coffers of predator classes’ of no social utility to the public welfare. This change can finance a productive and innovative economy based on work and leisure, study and sport. Socialism replaces the everyday terror of dismissal with the security that brings confidence, assurance and respect to the workplace. Workplace democracy is at the heart of the vision of 21st century socialism. We begin by nationalizing the banks and eliminating Wall Street. Financial institutions are redesigned to create productive employment, to serve social welfare and to preserve the environment. Socialism would begin the transition, from a capitalist economy directed by predators and swindlers and a state at their command, toward an economy of public ownership under democratic control.

1. BBC News, Feb. 8 2012.
2. FT 1/19/12, p7.
3. Financial Times (FT) 2/1/12, p2.
4. FT 2/1/12.
5. FT 1/30/12.
6. Earthlink News, 2/16/12.
7. FT 2/13/12 P9.
8. FT 1/30/12 p6.
9. FT 1/30/12, p6.
10. FT 1/10/12, p7.
11. FT 1/20/12, p11.
12. FT 1/9/12, p5.
13. FT 2/6/12, p7.
14. FT 1/9/2012, p5.
15. FT 2/8/12, p1.
16. FT 1/8/12 to 1/30/12
17. FT 2/6/12, p6.

In the modern capitalist era, the ideologies of imperialist rulers vary over time, from the early appeals to “the right” to wealth, power, colonies and grandeur to later claims of a ‘civilizing mission’. More recently imperial rulers have propagated, many diverse justifications adapted to specific contexts, adversaries, circumstances and audiences.

This essay will concentrate on analyzing contemporary US imperialist ideological arguments for legitimizing wars and sanctions to sustain dominance.

Contextualizing Imperial Ideology

Imperialist propaganda varies according to whether it is directed against a competitor for global power, or whether as a justification for applying sanctions, or engaging in open warfare against a local or regional socio-political adversary.

With regard to established imperialist (Europe) or rising world economic competitors (China), US imperialist propaganda varies over time. Early in the 19th century, Washington proclaimed the “Monroe Doctrine”, denouncing European efforts to colonize Latin America, privileging its own imperial designs in that region. In the 20th century when the US imperial policymakers were displacing Europe from prime resource based colonies in the Middle East and Africa, it played on several themes. It condemned ‘colonial forms of domination’ and promoted ‘neo-colonial’ transitions that ended European monopolies and facilitated US multi-national corporate penetration. This was clearly evident during and after World War 2, in the Middle East petrol-countries.

During the 1950s as the US assumed imperial primacy and radical anti-colonial nationalism came to the fore, Washington forged alliances with the declining colonial power to combat a common enemy and to prop up post-colonial powers to combat a common enemy. Even with the post-World War II economic recovery, growth and unification of Europe, it still works in tandem and under US leadership in militarily repressing nationalist insurgencies and regimes. When conflicts and competition occur, between US and European regimes, banks and enterprises, the mass media of each region publish “investigatory findings” highlighting the frauds and malfeasance of its competitors — and US regulatory agencies levy heavy fines on their European counterparts, overlooking similar practices by Wall Street financial firms.

In recent times the rising tide of militarist imperialism and colonial wars fueled by Israeli proxies in the US state has led to some serious divergencies between US and European imperialism. With the exception of England, Europe made a minimum symbolic commitment to the US wars and occupation of Iraq and Afghanistan. Germany and France concentrated on expanding their export markets and economic capacities; displacing the US in major markets and resource sites. The convergence of US and European empires led to the integration of financial institutions and the subsequent common crises and collapse but without any coordinated policy of recovery. US ideologists propagated the idea of a “declining and decaying European Union”, while the European ideologues emphasized the failures of Anglo-American de-regulated, ‘free markets’ and Wall Street swindles.

Imperialist Ideology, Rising Economic Powers and Nationalist Challengers

There is a long history of imperialist “anti-imperialism”, officially sponsored condemnation, exposés and moral indignation directed exclusively against rival imperialists, emerging powers or simply competitors, who in some cases are simply following in the footsteps of the established imperial powers.

English imperialists in their heyday justified their world-wide plunder of three continents by perpetuating the “Black Legend”, of Spanish empire’s “exceptional cruelty” toward indigenous people of Latin America, while engaging in the biggest and most lucrative African slave trade. While the Spanish colonists enslaved the indigenous people, the Anglo-American settlers exterminated them.

In the run-up to World War II, European and US imperial powers, while exploiting their Asian colonies condemned Japanese imperial powers’ invasion and colonization of China. Japan, in turn claimed it was leading Asia’s forces fighting against Western imperialism and projected a post-colonial “co-prosperity” sphere of equal Asian partners.

The imperialist use of “anti-imperialist” moral rhetoric was designed to weaken rivals and was directed to several audiences. In fact, at no point did the anti-imperialist rhetoric serve to “liberate” any of the colonized people. In almost all cases the victorious imperial power only substituted one form colonial or neo-colonial rule for another.

The “anti-imperialism” of the imperialists is directed at the nationalist movements of the colonized countries and at their domestic public. British imperialists fomented uprisings among the agro-mining elites in Latin America promising “free trade” against Spanish mercantilist rule; they backed the “self-determination” of the slave-holding cotton plantation owners in the US South against the Union; they supported the territorial claims of the Iroquois tribal leaders against the US anti-colonial revolutionaries — exploiting legitimate grievances for imperial ends.

During World War II, the Japanese imperialists supported a sector of the nationalist, anti-colonial movement in India against the British Empire. The US condemned Spanish colonial rule in Cuba and the Philippines and went to war to “liberate” the oppressed peoples from tyranny and remained to impose a reign of terror, exploitation and colonial rule.

The imperialist powers sought to divide the anti-colonial movements and create future “client rulers” when and if they succeeded. The use of anti-imperialist rhetoric was designed to attract two sets of groups. A conservative group with common political and economic interests with the imperial power, which shared their hostility to revolutionary nationalists and which sought to accrue greater advantage by tying their fortunes to a rising imperial power. A radical sector of the movement tactically allied itself with the rising imperial power, with the idea of using the imperial power to secure resources (arms, propaganda, vehicles and financial aid) and, once securing power, to discard them. More often than not, in this game of mutual manipulation between empire and nationalists, the former won out, as is the case then and now.

The imperialist “anti-imperialist” rhetoric was equally directed at the domestic public, especially in countries like the US which prized its 18th anti-colonial heritage. The purpose was to broaden the base of empire building beyond the hard line empire loyalists, militarists and corporate beneficiaries. Their appeal sought to include liberals, humanitarians, progressive intellectuals, religious and secular moralists, and other “opinion-makers” who had a certain cachet with the larger public, the ones who would have to pay with their lives and tax money for the inter-imperial and colonial wars.

The official spokespeople of empire publicize real and fabricated atrocities of their imperial rivals, and highlight the plight of the colonized victims. The corporate elite and the hardline militarists demand military action to protect property, or to seize strategic resources; the humanitarians and progressives denounce the “crimes against humanity” and echo the calls “to do something concrete” to save the victims from genocide. Sectors of the Left join the chorus and, finding a sector of victims who fit in with their abstract ideology, plead for the imperial powers to “arm the people to liberate themselves” (sic). By lending moral support and a veneer of respectability to the imperial war, by swallowing the propaganda of “war to save victims” the progressives become the prototype of the “anti-imperialism of the fools”. Having secured broad public support on the bases of “anti-imperialism”, the imperialist powers feel free to sacrifice citizens’ lives and the public treasury, to pursue war, fueled by the moral fervor of a righteous cause. As the butchery drags on and the casualties mount, and the public wearies of war and its cost, progressive and leftist enthusiasm turns to silence or worse, moral hypocrisy with claims that “the nature of the war changed” or “that this isn’t the kind of war that we had in mind …” As if the war makers ever intended to consult the progressives and left on how and why they should engage in imperial wars!

In the contemporary period the imperial “anti-imperialist wars” and aggression have been greatly aided and abetted by well-funded “grass roots” so-called “non-governmental organizations” which act to mobilize popular movements which can “invite” imperial aggression.

Over the past four decades US imperialism has fomented at least two dozen “grass roots” movements which have destroyed democratic governments, or decimated collectivist welfare states or provoked major damage to the economy of targeted countries.

In Chile throughout 1972-73 under the democratically elected government of Salvador Allende, the CIA financed and provided major support — via the AFL-CIO — to private truck owners to paralyze the flow of goods and services. They also funded a strike by a sector of the copper workers union (at the El Tenient mine) to undermine copper production and exports, in the lead up to the coup. After the military took power, several “grass roots” Christian Democratic union officials participated in the purge of elected leftist union activists. Needless to say, in short order the truck owners and copper workers ended the strike, dropped their demands and subsequently lost all bargaining rights!

In the 1980’s the CIA via Vatican channels transferred millions of dollars to sustain the “Solidarity Union” in Poland, making a hero of the Gdansk shipyards worker-leader Lech Walesa, who spearheaded the general strike to topple the Communist regime. With the overthrow of Communism so also went guaranteed employment, social security, and trade union militancy: the neo-liberal regimes reduced the workforce at Gdansk by fifty percent and eventually closed it, giving the boot to the entire workforce. Walesa retired with a magnificent Presidential pension, while his former workmates walked the streets and the new “independent” Polish rulers provided NATO with military bases and mercenaries for imperial wars in Afghanistan and Iraq.

In 2002 the White House, the CIA, the AFL-CIO and NGOs, backed a Venezuelan military-business — trade-union bureaucrat-led “grass roots” coup that overthrew democratically elected President Chavez. In 48 hours, a million strong authentic grass roots mobilization of the urban poor backed by constitutionalist military forces defeated the US backed dictators and restored Chavez to power. Subsequently, oil executives directed a lockout backed by several US-financed NGOs. They were defeated by the workers’ takeover of the oil industry. The unsuccessful coup and lockout cost the Venezuelan economy billions of dollars in lost income and caused a double digit decline in GNP.

The US backed “grass roots” armed jihadists to liberated “Bosnia” and armed the “grass roots” terrorist Kosovo Liberation Army to break-up Yugoslavia. Almost the entire Western Left cheered as, the US bombed Belgrade, degraded the economy and claimed it was “responding to genocide”. Kosovo “free and independent” became a huge market for white slavers, housed the biggest US military base in Europe, with the highest per-capita out migration of any country in Europe.

The imperialist “grass roots” strategy combines humanitarian, democratic, and anti-imperialist rhetoric and paid and trained local NGOs, with mass media blitzes to mobilize Western public opinion and especially “prestigious leftist moral critics” behind their power grabs.

The Consequence of Imperial Promoted “Anti-Imperialist” Movements: Who Wins and Who Loses?

The historic record of imperialist promoted “anti-imperialist” and “pro-democracy” “grass roots movements” is uniformly negative. Let us briefly summarize the results. In Chile ‘grass roots’ truck owners strike led to the brutal military dictatorship of Augusto Pinochet and nearly two decades of torture, murder, jailing and forced exile of hundreds of thousands, the imposition of brutal “free market policies” and subordination to US imperial policies. In summary, the US multi-national copper corporations and the Chilean oligarchy were the big winners and the mass of the working class and urban and rural poor the biggest losers. The US backed “grass roots uprisings” in Eastern Europe against Soviet domination, exchanged Russian for US domination; subordination to NATO instead of the Warsaw Pact; the massive transfer of national public enterprises, banks and media to Western multi-nationals. Privatization of national enterprises led to unprecedented levels of double-digit unemployment, skyrocketing rents and the growth of pensioner poverty. The crises induced the flight of millions of the most educated and skilled workers and the elimination of free public health, higher education and worker vacation resorts.

Throughout the now capitalist Eastern Europe and USSR highly organized criminal gangs developed large scale prostitution and drug rings; foreign and local gangster ‘entrepeneurs’ seized lucrative public enterprises and formed a new class of super-rich oligarchs Electoral party politicians, local business people and professionals linked to Western ‘partners’ were the socio-economic winners. Pensioners, workers, collective farmers, the unemployed youth were the big losers along with the formerly subsidized cultural artists. Military bases in Eastern Europe became the empire’s first line of military attack of Russia and the target of any counter-attack.

If we measure the consequences of the shift in imperialist power, it is clear that the Eastern Europe countries have become even more subservient under the US and the EU than under Russia. Western induced financial crises have devastated their economies; Eastern European troops have served in more imperialist wars under NATO than under Soviet rule; the cultural media are under Western commercial control. Most of all, the degree of imperialist control over all economic sectors far exceeds anything that existed under the Soviets. The Eastern European “grass roots” movement succeeded in deepening and extending the US Empire; the advocates of peace, social justice, national independence, a cultural renaissance and social welfare with democracy were the big losers.

Western liberals, progressives and leftists who fell in love with imperialist-promoted “anti-imperialism” are also big losers. Their support for the NATO attack on Yugoslavia led to the break-up of a multi-national state and the creation of huge NATO military bases and a white slavers paradise in Kosova. Their blind support for the imperial promoted “liberation” of Eastern Europe devastated the welfare state, eliminating the pressure on Western regimes’ need to compete in providing welfare provisions. The main beneficiaries of Western imperial advances via “grass roots” uprisings were the multi-national corporations, the Pentagon and the right-wing free market neo-liberals. As the entire political spectrum moved to the right, a sector of the left and progressives eventually jumped on the bandwagon. The Left moralists lost credibility and support, their peace movements dwindled, and their “moral critiques” lost resonance. The left and progressives who tail-ended the imperial backed “grass roots movements”, whether in the name of “anti-Stalinism”, “pro-democracy”, or “anti-imperialism” have never engaged in any critical reflection; no effort to analyze the long-term negative consequences of their positions in terms of the losses in social welfare, national independence or personal dignity.

The long history of imperialist manipulation of “anti-imperialist” narratives has found virulent expression in the present day. The New Cold War launched by Obama against China and Russia, the hot war brewing in the Gulf over Iran’s alleged military threat, the interventionist threat against Venezuela’s “drug-networks”, and Syria’s “bloodbath” are part and parcel of the use and abuse of “anti-imperialism” to prop up a declining empire. Hopefully, the progressive and leftist writers and scribes will learn from the ideological pitfalls of the past and resist the temptation to access the mass media by providing a ‘progressive cover’ to imperial dubbed “rebels”. It is time to distinguish between genuine anti-imperialism and pro-democracy movements and those promoted by Washington, NATO, and the mass media.

Many of the major institutions and economic relations which were cause and consequence of world and regional capitalist expansion over the past three decades are in the process of disintegration and disarray. The previous economic engines of global expansion, the US and the European Union, have exhausted their potentialities and are in open decline. The new centers of growth, China, India, Brazil, Russia, which for a ‘short decade’ provided a new impetus for world growth have run their course and are de-accelerating rapidly and will continue to do so throughout the new year.

The Collapse of the European Union

Specifically, the crises-wracked European Union will break up and the de facto multi-tiered structure will turn into a series of bilateral/multi-lateral trade and investment agreements. Germany, France, the Low and Nordic countries will attempt to weather the downturn. England – namely the City of London, in splendid isolation, will sink into negative growth, its financiers scrambling to find new speculative opportunities among the Gulf petrol-states and other ‘niches’. Eastern and Central Europe, particularly Poland and the Czech Republic, will deepen their ties to Germany but will suffer the consequences of the general decline of world markets. Southern Europe (Greece, Spain, Portugal and Italy) will enter into a deep depression as the massive debt payments fueled by savage assaults on wages and social benefits will severely reduce consumer demand.

Depression level unemployment and under-employment running to one-third of the labor force will detonate year-long social conflicts, intensifying into popular uprisings. Eventually a break-up of the European Union is almost inevitable. The euro as a currency of choice will be replaced by or return to national issues accompanied by devaluations and protectionism. Nationalism will be the order of the day. Banks in Germany, France and Switzerland will suffer huge losses on their loans to the South. Major bailouts will become necessary, polarizing German and French societies, between the tax-paying majorities and the bankers. Trade union militancy and rightwing pseudo-‘populism’ (neo-fascism) will intensify the class and national struggles.

A depressed, fragmented and polarized Europe will be less likely to join in any Zionist inspired US-Israeli military adventure against Iran (or even Syria). Crisis ridden Europe will oppose Washington’s confrontationalist approach to Russia and China.

The US: The Recession Returns with a Vengeance

The US economy will suffer the consequences of its ballooning fiscal deficit and will not be able to spend its way out of the world recession of 2012. Nor can it count on ‘exporting’ its way out of negative growth by turning to previously dynamic Asia, as China, India, and the rest of Asia are losing economic steam. China will grow far below its 9% moving average. India will decline from 8% to 5% or lower. Moreover, the Obama regime’s military policy of ‘encirclement’, its economic policy of exclusion and protectionism will preclude any new stimulus from China.

Militarism Exacerbates the Economic Downturn

The US and England will be the biggest losers from the Iraqi post war economic reconstruction. Of $186 billion dollars in infrastructure projects, US and UK corporations will gain less than 5% (Financial Times, 12/16/11, p 1 and 3). A similar outcome is likely in Libya and elsewhere. US imperial militarism destroys an adversary, plunging into debt to do so, and non-belligerents reap the lucrative post-war economic reconstruction contracts.

The US economy will fall into recession in 2012, and the “jobless recovery of 2011” will be replaced by a steep increase of unemployment in 2012. In fact, the entire labor force will shrink as people losing their unemployment benefits will fail to register.

Labor exploitation (“productivity”) will intensify as capitalists force workers to produce more, for less pay, thus widening the income gap between wages and profits.

The economic downturn and growth of unemployment will be accompanied by savage cuts in social programs to subsidize financially troubled banks and industries. The debates among the parties will be over how large the cuts to workers and retirees will be to secure the ‘confidence’ of the bondholders. Faced with equally limited political choices, the electorate will react by voting out incumbents, abstaining and via spontaneous and organized mass movements, such as the “occupy Wall Street” protest. Dissatisfaction, hostility, and frustration will pervade the culture. Democratic Party demagogues will scapegoat China; the Republican Party demagogues will blame the immigrants. Both will fulminate against “the Islamo-fascists” and especially against Iran.

New Wars in the Midst of Crises: Zionists Pull the Trigger

The “52 Presidents of the Major American Jewish Organizations” and their “Israel First” followers in the US Congress, State Department, Treasury, and the Pentagon will push for war with Iran. If they are successful it will result in a regional conflagration and world depression. Given the extremist Israeli regime’s success in securing blind obedience to its war policies from the US Congress and White House, any doubts about the real possibility of a major catastrophic outcome can be set aside.

China: Compensatory Mechanisms in 2012

China will face the global recession of 2012 with several possibilities of ameliorating its impact. Beijing can shift toward producing goods and services for the 700 million domestic consumers currently out of the economic loop. By increasing wages, social services, and environmental safety, China can compensate for the loss of overseas markets. China’s economic growth, which is largely dependent on real estate speculation, will be adversely affected when the bubble is burst. A sharp downturn will result, leading to job losses, municipal bankruptcies and increased social and class conflicts. This can result in either greater repression or gradual democratization. The outcome will profoundly affect China’s market-state relations. The economic crisis will likely strengthen state control over the market.

Russia Faces the Crisis

Russia’s election of President Putin will lead to less collaboration in backing US promoted uprisings and sanctions against Russian allies and trading partners. Putin will turn toward greater ties with China and will benefit from the break-up of the EU and the weakening of NATO.

The western media backed opposition will use its financial clout to erode Putin’s image and encourage investment boycotts though they will lose the Presidential elections by a big margin. The world recession will weaken the Russian economy and will force it to choose between greater public ownership or greater dependency on state funds to bail out prominent oligarchs.

The Transition 2011-2012: From Regional Stagnation and Recession to World Crises

The year 2011 laid the groundwork for the breakdown of the European Union. The crises began with the demise of the Euro, stagnation in the US and the outbreak of mass protests against the obscene inequalities on a world scale. The events of 2011 were a dress rehearsal for a new year of full scale trade wars between major powers, sharpening inter-imperialist struggles and the likelihood of popular rebellions turning into revolutions. Moreover, the escalation of Zionist-orchestrated war fever against Iran in 2011 promises the biggest regional war since the US-Indo-Chinese conflict. The electoral campaigns and outcomes of Presidential elections in the US, Russia and France will deepen the global conflicts and economic crises.

During 2011 the Obama regime announced a policy of military confrontation with Russia and China and policies designed to undermine and degrade China’s rise as a world economic power. In the face of a deepening economic recession and with the decline of overseas markets, especially in Europe, a major trade war will unfold. Washington will aggressively pursue policies limiting Chinese exports and investments. The White House will escalate its efforts to disrupt China’s trade and investments in Asia, Africa and elsewhere. We can expect greater US efforts to exploit China’s internal ethnic and popular conflicts and to increase its military presence off China’s coastline. A major provocation or fabricated incident in this context is not to be excluded. The result in 2012 could lead to rabid chauvinist calls for a costly new ‘Cold War’. Obama has provided the framework and justification for a large-scale, long-term confrontation with China. This will be seen as a desperate effort to prop up US influence and strategic positions in Asia. The US military “quadrangle of power” – US-Japan-Australia-South Korea – with satellite support from the Philippines, will pit China’s market ties against Washington’s military build-up.

Europe: Deeper Austerity and Intensified Class Struggle

The austerity programs imposed in Europe, from England to Latvia to southern Europe will really take hold in 2012. Massive public sector firings and reduced private sector salaries and job opportunities will lead to a year of permanent class warfare and regime challenges. The ‘austerity policies’ in the South, will be accompanied by debt defaults resulting in bank failures in France and Germany. England’s financial ruling class, isolated from Europe, but dominant in England, will insist that the Conservatives ‘repress’ labor and popular unrest. A new tough neo-Thatcherite style of autocratic rule will emerge; the Labor-trade union opposition will issue empty protests and tighten the leash on the rebellious populace. In a word, the regressive socio-economic policies put in place in 2011 have set the stage for new police-state regimes and more acute and possibly bloody confrontations with workers and unemployed youth with no future.

The Coming Wars that End America “As We Know It”

Within the US, Obama has laid the groundwork for a new and bigger war in the Middle East by relocating troops from Iraq and Afghanistan and concentrating them against Iran. To undermine Iran, Washington is expanding clandestine military and civilian operations against Iranian allies in Syria, Pakistan, Venezuela, and China. The key to the US and Israeli bellicose strategy toward Iran is a series of wars in neighboring states, worldwide economic sanctions, cyber-attacks aimed at disabling vital industries, and clandestine terrorist assassinations of scientists and military officials. The entire push, planning, and execution of the US policies leading up to war with Iran can be empirically and without a doubt attributed to the Zionist power configuration occupying strategic positions in the US Administration, mass media and ‘civil society’. A systematic analysis of American policymakers designing and implementing economic sanctions policy in Congress finds prominent roles for such mega-Zionists (Israel-Firsters) as Ileana Ros-Lehtinen and Howard Berman, Dennis Ross in the White House, Jeffrey Feltman in the State Department, and Stuart Levy, and his replacement David Cohen, in the Treasury. The White House is totally beholden to Zionist fund raisers and takes its cue from the 52 Presidents of the Major American Jewish Organization.

The Israeli-Zionist strategy is to encircle Iran, weaken it economically and attack its military. The Iraq invasion was the US’s first war for Israel; the Libyan war the second; the current proxy war against Syria is the third. These wars have destroyed Israel’s adversaries or are in the process of doing so. During 2011, economic sanctions, which were designed to create domestic discontent in Iran, were the principle weapon of choice. The global sanctions campaign engaged the entire energies of the major Jewish-Zionist lobbies. They have faced no opposition from the mass media, Congress or the White Office. The Zionist Power Configuration (ZPC) has been virtually exempt from criticism by any of the progressive, leftist and socialist journals, movements or grouplets – with a few notable exceptions.

The past year’s re-positioning of US troops from Iraq to the borders of Iran, the sanctions and the rising Big Push from Israel’s Fifth Column in the US means expanded war in the Middle East. This likely means a “surprise” aerial and maritime missile attack by US forces. This will be based on a concocted pretext of an “imminent nuclear attack” concocted by Israeli Mossad and faithfully transmitted by the ZPC to their lackeys US Congress and White House for consumption and transmission to the world. It will be a destructive, bloody, prolonged war for Israel; the US will bear the direct military cost by itself and the rest of the world will pay a dear economic price. The Zionist-promoted US war will convert the recession of early 2012 into a major depression by the end of the year and probably provoke mass upheavals.

Conclusion

All indications point to 2012 being a turning point year of unrelenting economic crisis spreading outward from Europe and the US to Asia and its dependencies in Africa and Latin America. The crisis will be truly global. Inter-imperial confrontations and colonial wars will undermine any efforts to ameliorate this crisis. In response, mass movements will emerge moving over time from protests and rebellions, and hopefully to social revolutions and political power.

This essay analyzes the changing contemporary context of imperial domination, especially the demise of longstanding client regimes.  It then examines the previous significant ties between western imperial powers and Islamist movements and regimes and the basis of ‘historical collaboration’.

The third part of the paper will outline the political circumstances in which the imperial powers embrace “moderate” Islamists in government and utilize “armed fundamentalists” in opposition to secular regimes.  We will critically analyze how “moderate” Islam is defined by the Western imperialist powers.  Is this a tactical or strategic alliance?  What are the political “trade-offs”?  What do imperialism’s neo-liberal clients and their new ‘moderate’ Muslim allies have in common and how do they differ?

In conclusion, we will evaluate the viability of this alliance and its capacity to contain and deflect the popular democratic movements and repress the burgeoning class and national struggles, especially in regard to the ‘obstacles’ posed by the Israel-US-Zionist ties and the continued IMF policies which promise to worsen the crises in the Muslim countries.

The Transition from Neo-Liberal Client Rulers to Power-Sharing with Moderate Islamists

The key motivation in Washington’s and the European imperial troika’s (England, France and Germany) embrace of what their press and officialdom hail as “moderate” Islamist parties has been the collapse or weakening of their long-term client rulers.  Faced with the ouster of Mubarak, in Egypt, Ali in Tunisia and Saleh in Yemen, mass protests in Morocco and Algeria, the US-EU turned to conservative Muslim leaders who were willing to work within the existing state institutional framework (including the army and state police), uphold the capitalist order and align with the empire against anti-imperial movements and states.  In Egypt, the Freedom and Justice Party (FJP) (the political arm of the Muslim Brotherhood), in Tunisia the Renaissance Party, in Morocco the Justice and Development Party have all indicated their willingness to serve as reliable partners in blocking the pro-democracy movements that challenge the socio-economic status quo and the long-standing military-imperial linkages.

The Islamist collaborators are called “moderate and respectable” because they agree to participate in elections within the boundaries of the established political and economic order; they have dropped any criticism of imperial and colonial treaties and trade agreements signed by the previous client regions – including ones which collaborate with Israel’s colonization of Palestine.

Equally important “moderate” means supporting imperial wars against nationalist and secular Arab republics, such as Syria and Libya, and isolating and/or repressing class based trade unions and secular-left parties.

“Moderate” Islamists have become the Empire’s ‘contraceptive of choice’ against any chance the massive Arab peoples’ revolt might give birth to substantive egalitarian social changes and bring those brutal pro-western officials, responsible for so many crimes against humanity, to justice.

The West and their client officials in the military and police have agreed to a kind of “power-sharing’ with the moderate/respectable (read ‘reactionary’) Islamist parties.  The Islamists would be responsible for imposing orthodox economic policies and re-establishing ‘order’ (i.e. bolstering the existing one) in partnership with pro-multinational bank economists and pro US-EU generals and security officials.  In exchange the Islamists could take certain ministries, appoint their members, finance electoral clientele among the poor and push their ‘moderate’ religious, social and cultural agenda.  Basically, the elected Islamists would replace the old corrupt dictatorial regimes in running the state and signing off on more free trade agreements with the EU.  Their role would keep the leftists, nationalists and populists out of power and from gaining mass support.  Their job would substitute spiritual solace and “inner worth” via Islam in place of redistributing land, income and power from the elite, including the foreign multi-nationals to the peasants, workers, unemployed and exploited low-paid employees.

Why the Empire Arms Fundamentalist Anti-Secular Muslims

While the US and EU have backed respectable “moderate Islam” in heading off a popular upheaval of the young and unemployed, in other contexts they have enlisted violent, fundamentalist Islamic terrorists to overthrow secular independent anti-imperialists regimes – like Libya, Syria — just as they had done earlier in Afghanistan and Yugoslavia.  The US, Qatar and the European troika financed and armed Libyan fundamentalist militias and then engaged in a murderous eight months air and sea assault to ensure their client’s ‘victory’ over the secular Gaddafi regime.  Fresh from NATO’s success, the US, the European ‘Troika’ and Turkey, with the backing of the League of Arab collaborator princes and emirs, have financed a violent Muslim Brotherhood insurrection in Syria, intent on destroying the nationalist economy and modern secular state.

The US and EU have openly unleashed their fundamentalists allies in order to destroy independent adversaries in the name of “democracy” and ‘humanitarian intervention’, a laughable claim in light of decade long colonial wars of occupation in Iraq and Afghanistan.  All target regimes have one crime in common:  Using their national resources to develop modern secular states – independent of imperial dictates.

NATO  implements its campaigns through conservative ‘moderate’ or armed fundamentalist Islamist movements depending on the specific needs, circumstances and range of options in any given target nation.  With the fall of  pro-Empire ‘secular dictatorships’ in Egypt and Tunisia, pliable conservative Islamist leaders are the fall back “lesser evil”.  When the opportunity to overthrow an independent secular or nationalist regime arises, armed and violent fundamentalist mercenaries become the political vehicle of choice.

As with European empires in the past, the modern Western imperial countries have relied on retrograde religious parties and leaders to collaborate and serve their economic and military interests and to provide mercenaries for imperial armies to savage any anti-imperialist social revolutionaries.  In that sense US and European rulers are neither ‘pro nor anti’ Islam, it all depends on their national and class position.  Islamists who collaborate with Empire are “moderate” allies and if they attack an anti-imperialist regime, they become ‘freedom fighters’.  On the other hand, they become “terrorists” or “fundamentalists” when they oppose imperial occupation, pillage or colonial settlements.

Contemporary History of Islamist-Imperial Collaboration

The historical record of western imperial expansion reveals many instances of collaboration and co-optation as well as conflict with Islamist regimes, movements and parties.  In the early 1960’s the CIA backed a brutal military coup against the secular Indonesian nationalist regime of Sukarno, and encouraged their puppet dictator General Suharto to unleash Muslim militia in a veritable “holy war” exterminating nearly one million leftist trade unionists, school teachers, students, farmers, communists or suspected sympathizers and their family members.  The horrific ‘Jakarta Option’ became a model for CIA operations elsewhere.  In Yugoslavia the US and Europe promoted and financed fundamentalists Muslims in Bosnia, importing mujahedeen who would later form part of Al Qaeda, and then backed the Kosovo Liberation Army, a known terrorist organization, in order to completely break-up and ethnically ‘cleanse’ a modern secular multi-national state – going so far as to have Americans and NATO bomb Belgrade for the first time since the Nazis in the Second World War.

During President Carter’s administration, the CIA joined with Saudi Arabia’s ruling royalty, providing billions of dollars in arms and military supplies to Afghan Muslim fundamentalists in their brutal but successful Jihad overthrowing a modern, secular nationalist regime backed by the USSR.  The murderous fate of school teachers and educated women in the aftermath was quickly covered up.

Needless to say, wherever US imperialism faces leftists or secular, modernizing anti-imperialist regimes, Washington turns to retrograde Islamic leaders willing and able to destroy the progressive regime in return for imperialist support.  Such coalitions are built mainly around fundamentalist and moderate Islamist opposition to secular, class-based politics allied with the Empire’s hostility to any anti-imperialist challenge to its domination.

The same ‘coalition’ of Islamists and the Empire has been glaringly obvious during the NATO assault on Libya and continues against Syria:  The Muslims provide the shock troops on the ground; NATO provides the aerial bombing, funds, arms, sanctions, embargoes and propaganda.

These Islamist-Imperialist coalitions are usually temporary, based on a common secular or nationalist enemy and not on any common strategic interest.  After the defeat of a secular anti-imperialist regime, militant Muslims may find themselves attacked by the colonial neo-liberal regime most favored by the imperial west.  This happened in Afghanistan and elsewhere after the overseas Islamist fighters (Afghan Arabs) returned to their own neo-colonized, collaborating home countries, like Saudi Arabia, Algeria, Egypt and elsewhere.

Contemporary History of Islamist-Imperial Conflict

The relation between Islamist regimes and imperialism is complex, changing and  full of examples of bloody conflict.

The US backed the “modernizing” free market dictatorship of the Shah in Iran, overthrowing the nationalist Mosaddegh regime. They provided arms and intelligence for the Savak, the Shah’s monstrous secret police as it hunted down and murdered tens of thousands of nationalist-Islamists and leftist resistance fighters and critics in Iran and abroad.  The rise to power of the fundamentalist-anti-imperialist Khomeini regime fueled US armed attacks and provoked retaliatory moves:  Iran backed and financed anti-colonial Islamist groups in Lebanon (Hezbollah), Palestine (Hamas) and Iraq (the Shia parties).

Subsequent to 9/11 the US invaded and overthrew the Islamist Taliban regime, re-colonized the country, establishing a puppet regime under US-European auspices.  The Taliban and allied Islamist and nationalist resistance fighters organized and established a mass guerrilla army which has engaged in a decade long war with armed support from Pakistani Islamist forces responding to US military incursions.

In Palestine, Washington, under the overweening control of Israel’s Zionist fifth column, has armed and financed Israel’s war against the popularly elected Palestinian Islamist Hamas government in Gaza.  Washington’s total commitment to the Jewish state and its colonial expansion and usurpation of Palestinian (Muslim and Christian) lands and property in Jerusalem and elsewhere reflects the profound and pervasive influence of the Zionist power configuration throughout the US political system .They secure 90% votes in Congress, pledges of allegiance from the White House, and senior appointments in Treasury, State Department and the Pentagon.

What determines whether the US Empire will have a collaborative or conflict-ridden relation with Islam depends on the specific political context.  The US allies with Islamists when faced with nationalist, leftist and secular democratic regimes and movements, especially where their optimal choice, a military-neo-liberal alternative is relatively weak.  However, faced with a nationalist, anti-colonial Islamist regime (as is the case of the Islamic Republic of Iran), Washington will side with pro-western liberals, dissident Muslim clerics, pliable tribal chiefs, separatist ethnic minorities and pro-Western generals.

The key to US-Islamist relations from the White House perspective is based on the Islamists’ attitude toward empire, class politics, NATO and the “free market” (private foreign investment).

Today’s ‘moderate’ Islamist parties in Tunisia, Egypt, Turkey, Morocco (and elsewhere), which have offered their support to NATO and its wars against Libya and Syria, uphold ‘private property’ (i.e. foreign and imperialist client control of key industries) and repress independent working class and anti-imperialist parties.  They are the Empire’s “new partners” in the pillage of the resource-rich Middle East and North Africa.

The US-brokered counter-revolutionary alliance among moderate Islamists, the previous military rulers and Washington is fraught with tensions.  The military demands total impunity and a continuation of its economic privileges; this includes a veto on any legislation addressing the previous regime’s brutal crimes against its own people.  On the other hand, the Islamist parties uphold their electoral victories and demand majority rule.  Washington insists the alliance adhere to its policy toward Israel and abandon their support for the Palestinian national struggle.  As these tensions and conflicts deepen, the alliance could collapse ushering in a new phase of conflict and instability.

Emblematic of “moderate Islamist” collaboration with US-EU imperialism is the role of Qatar, home to the ‘respectable’ Arabic media giant, Al-Jazeera, and the demagogic Qatari “spiritual guide” Sheik Youssef  al-Qaradawi.  Sheik Youssef quotes the Koran and Islamic moral principles in defense of NATO’s 8-month aerial bombing of Libya, which killed over 50,000 pro-regime Libyans (themselves Muslims).  He calls for armed imperial intervention in Syria to overthrow the secular Assad regime, a position he shares comfortably with the state of Israel. He urges the “moderate Islamists” in Egypt and Tunisia to cease any criticism of the existing economic order, ( see “Spiritual guide steers Arabs to moderation”, Financial Times, December 9, 2011 – p5).  In a word, this respectable Muslim cleric is NATO’s perfect Koran-quoting “moderate Islamist” partner – a dream come true.

The Strategic Utility of “Moderate” Islamist Parties

Islamist parties are approached by the Empire’s policy elites only when they have a mass following and can therefore weaken any popular, nationalist insurgency.  Mass-based Islamist parties serve the empire by providing “legitimacy”, by winning elections and by giving a veneer of respectability to the pro-imperial military and police apparatus retained in place from the overthrown client state dictatorships.

The Islamist parties compete at the “grass roots” with the leftists.  They build up a clientele of supporters among the poor in the countryside and urban slums through organized charity and basic social services administered at the mosques and humanitarian religious foundations.  Because they reject class struggle and are intensely hostile to the left (with its secular, pro-feminist and working-class agenda), they have been ‘half-tolerated’ by the dictatorship, while the leftist activists are routinely murdered.  Subsequently, with the overthrow of the dictatorship, the Islamists emerge intact with the strongest national organizational network as the country’s ‘natural leaders’ from the religious-bazaar merchant political elite.  Their leaders offer to serve the empire and its traditional native military collaborators in exchange for a ‘slice of power’, especially over morality, culture, religion and households (women); in other words, the “micro-society”.

For their part, they offer to marginalize and undermine the left, anti-imperialist secular democrats in the streets.  In the face of mass popular rebellion calling into question the imperial order, a ‘moderate’ Islamist-imperial partnership is a ‘heavenly deal’ praised in Washington, Paris or London (as well as Riyadh and Tel Aviv).

Conclusion:  How Viable is the Imperial-Islamic Coalition?

Those who thought that the spontaneous pro-democracy movements spelled the end of the imperial order left out the role of organized “moderate” Islamist electoral parties as able collaborators of Empire.  The brutally repressed mass mobilization of unemployed youth was no match for the well-funded grass roots community organization of the moderate Islamists.  This is especially true when politics shifted from the street to the ballot box, a process that the Islamist parties facilitated.  In the absence of a mass revolutionary party seeking state power, the existing military-police state was able to work around the mass protesters and put together a power sharing agreement at least in the short-run.

In the November 2011 elections, the radical Egyptian Islamist party, Nour, gathered one-quarter of the vote in Cairo and Alexandria.  Their showing was even higher among the urban poor districts, which promises even greater support among poor rural constituencies in the coming elections. Essentially a Salafist Islamist party, Nour, unlike the Muslim Brotherhood, combined denunciations of class abuses and elite corruption with mass appeals to a return to a mythic harmonious life.  They used effective grass roots organizing around basic services in order to gain a greater proportion of the working class vote than all the leftist parties combined.  Nour’s message of “class retribution against the …abuses of Egypt’s elite fueled Nour’s new found popularity”, (Financial Times, December 10, 2011 p6).

Despite the successes of the Islamist-Imperial partnership, the world economic crises and especially the growing unemployment and misery in the Arab countries will make it difficult for the ‘respectable moderate’ Islamists to stabilize their societies. They are inextricably constrained by their alliances to function within the confines of the ‘orthodox neo-liberal framework’ imposed by the Empire.  For that reason, the “moderate” Islamists will try to co-opt some secular liberals, social democrats and even a few leftists as ‘minority partners’, so that they won’t be held solely responsible for dashing the expectations of the poor in their countries.

The fact of the matter is that the pro-imperial Islamist parties have absolutely no answer to the current crises:  Charities delivered from the mosque during the dictatorship won them mass support; now more austerity programs imposed from their ministerial posts will certainly alienate and infuriate their mass base.  What will follow depends on who is best organized:  Liberals are limited to media campaigns and tied to economic orthodoxy; the leftists have to advance from protest movements in the downtown squares to organized political units operating in popular neighborhoods, workplaces, markets, villages and slums.  Otherwise radical fundamentalist, like the Salafists, will exploit the people’s outrage with moderate Islamist betrayals and promote their own version of a closed clerical society, opposing the West while repressing the Left.

The US and EU may have ‘temporarily’ avoided revolution by accommodating electoral reforms and adapting to alliances with “moderate” Islamists, but their ongoing military interventions and their own growing economic crisis will  simply postpone a more decisive conflict in the near future.

After going from defeat to defeat on the periphery of world power and not satisfied with running treasury-busting deficits in pursuit of empire building against economically weak countries, Obama has embraced a policy of encirclement and provocations against China, the world’s second largest economy and the US’s most important creditor, and Russia, the European Union’s principle oil and gas provider and the world’s second most powerful nuclear weapons power.

This paper addresses the Obama regime’s highly irrational and world-threatening escalation of imperial militarism. We examine the global military, economic and domestic political context that gives rise to these policies. We then examine the multiple points of conflict and intervention in which Washington is engaged, from Pakistan, Iran, Libya, Venezuela, Cuba and beyond. We will then analyze the rationale for military escalation against Russia and China as part of a new offensive moving beyond the Arab world (Syria, Libya) and in the face of the declining economic position of the EU and the US in the global economy. We will then outline the strategies of a declining empire, nurtured on perpetual wars, facing global economic decline, domestic discredit and a working population reeling from the long-term, large-scale dismantling of its basic social programs.

The Turn from Militarism in the Periphery to Global Military Confrontation

November 2011 is a moment of great historical import: Obama declared two major policy positions, both having tremendous strategic consequences affecting competing world powers.

Obama pronounced a policy of military encirclement of China based on stationing a maritime and aerial armada facing the Chinese coast – an overt policy designed to weaken and disrupt China’s access to raw materials and commercial and financial ties in Asia. Obama’s declaration that Asia is the priority region for US military expansion, base-building and economic alliances was directed against China, challenging Beijing in its own backyard. Obama’s iron fist policy statement, addressed to the Australian Parliament, was crystal clear in defining US imperial goals.

Our enduring interests in the region [Asia Pacific] demands our enduring presence in this region … The United States is a Pacific power and we are here to stay … As we end today’s wars [i.e. the defeats and retreats from Iraq and Afghanistan] … I have directed my national security team to make our presence and missions in the Asia Pacific a top priority … As a result, reduction in US defense spending will not … come at the expense of the Asia Pacific.¹

The precise nature of what Obama called our “presence and mission” was underlined by the new military agreement with Australia to dispatch warships, warplanes and 2500 marines to the northernmost city of Australia (Darwin) directed at China. Secretary of State Clinton has spent the better part of 2011 making highly provocative overtures to Asian countries that have maritime border conflicts with China. Clinton has forcibly injected the US into these disputes, encouraging and exacerbating the demands of Vietnam, Philippines, and Brunei in the South China Sea. Even more seriously, Washington is bolstering its military ties and sales with Japan, Taiwan, Singapore and South Korea, as well as increasing the presence of battleships, nuclear submarines and over-flights of war planes along China’s coastal waters. In line with the policy of military encirclement and provocation, the Obama-Clinton regime is promoting Asian multi-lateral trade agreements that exclude China and privilege US multi-national corporations, bankers and exporters, dubbed the “Trans-Pacific Partnership.” It currently includes mostly smaller countries, but Obama has hopes of enticing Japan and Canada to join …

Obama’s presence at the APEC meeting of East Asian leaders and his visit to Indonesia in November 2011 all revolve around efforts to secure US hegemony. Obama-Clinton hope to counter the relative decline of US economic links in the face of the geometrical growth of trade and investment ties between East Asia and China.

A most recent example of Obama-Clinton’s delusional, but destructive, efforts to deliberately disrupt China’s economic ties in Asia, is taking place in Myanmar (Burma). Clinton’s December 2011 visit to Myanmar was preceded by a decision by the Thein Sein regime to suspend a China Power Investment-funded dam project in the north of the country. According to official confidential documents released by WilkiLeaks the “Burmese NGO’s, which organized and led the campaign against the dam, were heavily funded by the US government.”² This and other provocative activity and Clinton’s speeches condemning Chinese “tied aid” pale in comparison with the long-term, large-scale interests which link Myanmar with China. China is Myanmar’s biggest trading partner and investor, including six other dam projects. Chinese companies are building new highways and rail lines across the country, opening southwestern China up for Burmese products and China is constructing oil pipelines and ports. There is a powerful dynamic of mutual economic interests that will not be disturbed by one dispute.³ Clinton’s critique of China’s billion-dollar investments in Myanmar’s infrastructure is one of the most bizarre in world history, coming in the aftermath of Washington’s brutal eight-year military presence in Iraq which destroyed $500 billion dollars of Iraqi infrastructure, according to Baghdad official estimates. Only a delusional administration could imagine that rhetorical flourishes, a three-day visit and the bankrolling of an NGO is an adequate counter-weight to deep economic ties linking Myanmar to China. The same delusional posture underlies the entire repertoire of policies informing the Obama regime’s efforts to displace China’s predominant role in Asia.

While any one policy adopted by the Obama regime does not, in itself, present an immediate threat to peace, the cumulative impact of all these policy pronouncements and the projections of military power add up to an all out comprehensive effort to isolate, intimidate and degrade China’s rise as a regional and global power. Military encirclement and alliances, exclusion of China in proposed regional economic associations, partisan intervention in regional maritime disputes and positioning technologically advanced warplanes, are all aimed to undermine China’s competitiveness and to compensate for US economic inferiority via closed political and economic networks.

Clearly White House military and economic moves and US Congressional anti-China demagogy are aimed at weakening China’s trading position and forcing its business-minded leaders into privileging US banking and business interests over and above their own enterprises. Pushed to its limits, Obama’s prioritizing a big military push could lead to a catastrophic rupture in US-Chinese economic relations. This would result in dire consequences, especially but not exclusively, on the US economy and particularly its financial system. China holds over $1.5 trillion dollars in US debt, mainly Treasury Notes, and each year purchases from $200 to $300 billion in new issues, a vital source in financing the US deficit. If Obama provokes a serious threat to China’s security interests and Beijing is forced to respond, it will not be military but economic retaliation: the sell-off of a few hundred billion dollars in T-notes and the curtailment of new purchases of US debt. The US deficit will skyrocket, its credit ratings will descend to ‘junk,’ and the financial system will ‘tremble onto collapse.’ Interest rates to attract new buyers of US debt will approach double digits. Chinese exports to the US will suffer and losses will incur due to the devaluation of the T-notes in Chinese hands. China has been diversifying its markets around the world and its huge domestic market could probably absorb most of what China loses abroad in the course of a pull-back from the US market.

While Obama strays across the Pacific to announce his military threats to China and strives to economically isolate China from the rest of Asia, the US economic presence is fast fading in what used to be its “backyard”: Quoting one Financial Times journalist, “China is the only show [in town] for Latin America.”⁴ China has displaced the US and the EU as Latin America’s principle trading partner; Beijing has poured billions in new investments and provides low interest loans.

China’s trade with India, Indonesia, Japan, Pakistan and Vietnam is increasing at a far faster rate than that of the US. The US effort to build an imperial-centered security alliance in Asia is based on fragile economic foundations. Even Australia, the anchor and linchpin of the US military thrust in Asia, is heavily dependent on mineral exports to China. Any military interruption would send the Australian economy into a tailspin.

The US economy is in no condition to replace China as a market for Asian or Australian commodity and manufacturing exports. The Asian countries must be acutely aware that there is no future advantage in tying themselves to a declining, highly militarized, empire. Obama and Clinton deceive themselves if they think they can entice Asia into a long-term alliance. The Asian’s are simply using the Obama regime’s friendly overtures as a ‘tactical device,’ a negotiating ploy, to leverage better terms in securing maritime and territorial boundaries with China.

Washington is delusional if it believes that it can convince Asia to break long-term large-scale lucrative economic ties to China in order to join an exclusive economic association with such dubious prospects. Any ‘reorientation’ of Asia, from China to the US, would require more than the presence of an American naval and airborne armada pointed at China. It would require the total restructuring of the Asian countries’ economies, class structure, and political and military elite. The most powerful economic entrepreneurial groups in Asia have deep and growing ties with China/Hong Kong, especially among the dynamic transnational Chinese business elites in the region. A turn toward Washington entails a massive counter-revolution, which substitutes colonial ‘traders’ (compradors) for established entrepreneurs. A turn to the US would require a dictatorial elite willing to cut strategic trading and investment linkages, displacing millions of workers and professionals. As much as some US-trained Asian military officers, economists, and former Wall Street financiers and billionaires might seek to ‘balance’ a US military presence with Chinese economic power, they must realize that ultimately advantage resides in working out an Asian solution.

The age of Asian “comprador capitalists” willing to sell out national industry and sovereignty in exchange for privileged access to US markets is ancient history. Whatever the boundless enthusiasm for conspicuous consumerism and Western lifestyles, which Asia and China’s new rich mindlessly celebrate, whatever the embrace of inequalities and savage capitalist exploitation of labor, there is recognition that the past history of US and European dominance precluded the growth and enrichment of an indigenous bourgeoisie and middle class. The speeches and pronouncements of Obama and Clinton reek of nostalgia for a past of neo-colonial overseers and comprador collaborators – a mindless delusion. Their attempts at political realism, in finally recognizing Asia as the economic pivot of the present world order, takes a bizarre turn in imagining that military posturing and projections of armed force will reduce China to a marginal player in the region.

Obama’s Escalation of Confrontation with Russia

The Obama regime has launched a major frontal military thrust on Russia’s borders. The US has moved forward missile sites and Air Force bases in Poland, Rumania, Turkey, Spain, Czech Republic and Bulgaria: Patriot PAC-3 anti-aircraft missile complexes in Poland; advanced radar AN/TPY-2 in Turkey; and several missile (SM-3 IA) loaded warships in Spain are among the prominent weapons encircling Russia, most only minutes away from it strategic heartland. Secondly, the Obama regime has mounted an all-out effort to secure and expand US military bases in Central Asia among former Soviet republics. Thirdly, Washington, via NATO, has launched major economic and military operations against Russia’s major trading partners in North Africa and the Middle East. The NATO war against Libya, which ousted the Gaddafi regime, has paralyzed or nullified multi-billion dollar Russian oil and gas investments, arms sales and substituted a NATO puppet for the former Russia-friendly regime.

The UN-NATO economic sanctions and US-Israeli clandestine terrorist activity aimed at Iran has undermined Russia’s lucrative billion-dollar nuclear trade and joint oil ventures. NATO, including Turkey, backed by the Gulf monarchical dictatorships, has implemented harsh sanctions and funded terrorist assaults on Syria, Russia’s last remaining ally in the region and where it has a sole naval facility (Tartus) on the Mediterranean Sea. Russia’s previous collaboration with NATO in weakening its own economic and security position is a product of the monumental misreading of NATO and especially Obama’s imperial policies. Russian President Medvedev and his Foreign Minister Sergey Lavrov mistakenly assumed (like Gorbachev and Yeltsin before them) that backing US-NATO policies against Russia’s trading partners would result in some sort of “reciprocity”: US dismantling its offensive “missile shield” on its frontiers and support for Russia’s admission into the World Trade Organization. Medvedev, following his liberal pro-western illusions, fell into line and backed US-Israeli sanctions against Iran, believing the tales of a “nuclear weapons program.” Then Lavrov fell for the NATO line of “no fly zones to protect Libyan civilian lives” and voted in favor, only to feebly “protest,” much too late, that NATO was “exceeding its mandate” by bombing Libya into the Middle Ages and installing a pro-NATO puppet regime of rogues and fundamentalists. Finally when the US aimed a cleaver at Russia’s heartland by pushing ahead with an all-out effort to install missile launch sites 5 minutes by air from Moscow while organizing mass and armed assaults on Syria, did the Medvedev-Lavrov duet awake from its stupor and oppose UN sanctions. Medvedev threatened to abandon the nuclear missile reduction treaty (START) and to place medium-range missiles with 5 minute launch-time from Berlin, Paris and London.

Medvedev-Lavrov’s policy of consolidation and co-operation based on Obama’s rhetoric of “resetting relations” invited aggressive empire building: Each capitulation led to a further aggression. As a result, Russia is surrounded by missiles on its western frontier; it has suffered losses among its major trading partners in the Middle East and faces US bases in southwest and Central Asia.

Belatedly Russian officials have moved to replace the delusional Medvedev for the realist Putin, as next President. This shift to a political realist has predictably evoked a wave of hostility toward Putin in all the Western media. Obama’s aggressive policy to isolate Russia by undermining independent regimes has, however, not affected Russia’s status as a nuclear weapons power. It has only heightened tensions in Europe and perhaps ended any future chance of peaceful nuclear weapons reduction or efforts to secure a UN Security Council consensus on issues of peaceful conflict resolution. Washington, under Obama-Clinton, has turned Russia from a pliant client to a major adversary.

Putin looks to deepening and expanding ties with the East, namely China, in the face of threats from the West. The combination of Russian advanced weapons technology and energy resources and Chinese dynamic manufacturing and industrial growth are more than a match for crisis-ridden EU-USA economies wallowing in stagnation.

Obama’s military confrontation toward Russia will greatly prejudice access to Russian raw materials and definitively foreclose any long-term strategic security agreement, which would be useful in lowering the deficit and reviving the US economy.

Between Realism and Delusion: Obama’s Strategic Realignment

Obama’s recognition that the present and future center of political and economic power is moving inexorably to Asia, was a flash of political realism. After a lost decade of pouring hundreds of billions of dollars in military adventures on the margins and periphery of world politics, Washington has finally discovered that is not where the fate of nations, especially Great Powers, will be decided, except in a negative sense – of bleeding resources over lost causes. Obama’s new realism and priorities apparently are now focused on Southeast and Northeast Asia, where dynamic economies flourish, markets are growing at a double digit rate, investors are ploughing tens of billions in productive activity and trade is expanding at three times the rate of the US and the EU.

But Obama’s ‘New Realism’ is blighted by entirely delusional assumptions, which undermine any serious effort to realign US policy.

In the first place Obama’s effort to ‘enter’ into Asia is via a military build-up and not through a sharpening and upgrading of US economic competitiveness. What does the US produce for the Asian countries that will enhance its market share? Apart from arms, airplanes and agriculture, the US has few competitive industries. The US would have to comprehensively re-orient its economy, upgrade skilled labor, and transfer billions from “security” and militarism to applied innovations. But Obama works within the current military-Zionist-financial complex: He knows no other and is incapable of breaking with it.

Second, Obama-Clinton operate under the delusion that the US can exclude China or minimize its role in Asia, a policy that is undercut by the huge and growing investment and presence of all the major US multi-national corporations in China, who use it as an export platform to Asia and the rest of the world.

The US military build-up and policy of intimidation will only force China to downgrade its role as creditor financing the US debt, a policy China can pursue because the US market, while still important, is declining, as China expands its presence in its domestic, Asian, Latin American and European markets.

What once appeared to be New Realism is now revealed to be the recycling of Old Delusions: the notion that the US can return to being the supreme Pacific Power it was after World War Two. The US attempts to return to Pacific dominance under Obama-Clinton with a crippled economy, with the overhang of an over-militarized economy, and with major strategic handicaps. Over the past decade the United States foreign policy has been at the beck and call of Israel’s fifth column (the Israel “lobby”). The entire US political class is devoid of common, practical sense and national purpose. They are immersed in troglodyte debates over “indefinite detentions” and “mass immigrant expulsions”. Worse, all are on the payrolls of private corporations who sell in the US and invest in China.

Why would Obama abjure costly wars in the unprofitable periphery and then promote the same military metaphysics at the dynamic center of the world economic universe? Does Barack Obama and his advisers believe he is the Second Coming of Admiral Commodore Perry, whose 19th century warships and blockades forced Asia open to Western trade? Does he believe that military alliances will be the first stage to a subsequent period of privileged economic entry?

Does Obama believe that his regime can blockade China, as Washington did to Japan in the lead up to World War Two? It’s too late. China is much more central to the world economy, too vital even to the financing of the US debt, too bonded up with the Forbes Five Hundred multi-national corporations. To provoke China, to even fantasize about economic “exclusion” to bring down China, is to pursue policies that will totally disrupt the world economy, first and foremost the US economy!

Conclusion

Obama’s ‘crackpot realism,’ his shift from wars in the Muslim world to military confrontation in Asia, has no intrinsic worth and poses extraordinary extrinsic costs. The military methods and economic goals are totally incompatible and beyond the capacity of the US, as it is currently constituted. Washington’s policies will not ‘weaken’ Russia or China, even less intimidate them. Instead it will encourage both to adopt more adversarial positions, making it less likely that they lend a hand to Obama’s sequential wars on behalf of Israel. Already Russia has sent warships to its Syrian port, refused to support an arms embargo against Syria and Iran, and (in retrospect) criticized the NATO war against Libya. China and Russia have far too many strategic ties with the world economy to suffer any great losses from a series of US military outposts and “exclusive” alliances. Russia can aim just as many deadly nuclear missiles at the West as the US can mount from its bases in Eastern Europe.

In other words, Obama’s military escalation will not change the nuclear balance of power, but will bring Russia and China into a closer and deeper alliance. Gone are the days of Kissinger-Nixon’s “divide and conquer” strategy pitting US-Chinese trade agreements against Russian arms. Washington has a totally exaggerated significance of the current maritime spats between China and its neighbors. What unites them in economic terms is far more important in the medium and long-run. China’s Asian economic ties will erode any tenuous military links to the US.

Obama’s “crackpot realism” views the world market through military lenses. Military arrogance toward Asia has led to a rupture with Pakistan, its most compliant client regime in South Asia. NATO deliberately slaughtered 24 Pakistani soldiers and thumbed their nose at the Pakistani generals, while China and Russia condemned the attack and gained influence.

In the end, the military and exclusionary posture toward China will fail. Washington will overplay its hand and frighten its business-oriented erstwhile Asian partners who only want to play off a US military presence to gain tactical economic advantage. They certainly do not want a new US instigated Cold War dividing and weakening the dynamic intra-Asian trade and investment. Obama and his minions will quickly learn that Asia’s current leaders do not have permanent allies — only permanent interests. In the final analysis, China figures prominently in configuring a new Asia-centric world economy. Washington may claim to have a ‘permanent Pacific presence,’ but until it demonstrates it can take care of its “basic business at home,” like arranging its own finances and balancing its current account deficits, the US Naval command may end up renting its naval facilities to Asian exporters and shippers, transporting goods for them, and protecting them by pursuing pirates, contrabandists and narco-traffickers. Come to think about it, Obama might reduce the US trade deficit with Asia by renting out the Seventh Fleet to patrol the Straits, instead of wasting US taxpayer money bullying successful Asian economic powers.

1. CNN.com, Nov. 16, 2011.
2. Financial Times, Dec. 2, 2011, p. 2.
3. FT, December 2, 2011, p.2.
4. FT, Nov. 23, 2011, p.6.

The second half of the essay will detail the politics of CTD, the regime which has moved furthest from the notion of a sovereign representative democracy. We will clarify the differences and similarities between traditional military-civilian and fascist dictatorships and the up-to-date CTD, focusing on the ideology of apolitical expertise and technocratic rule as a preliminary to an exploration of the profoundly colonial hierarchical chain of decision making.

The penultimate section will highlight the reason why the imperial ruling classes and their national collaborators have overturned the pre-existing “democratic” oligarchical ruling formulas of “indirect rule” in favor of a naked power grab. The turn to direct colonial rule (a coup by any other name) was consumated by the major financial ruling classes of Europe and the US.

We will evaluate the socio-economic impact of rule by imperial appointed colonial technocrats, the reason for rule by fiat and force over the previous process of persuasion, manipulation and co-optation.

In the concluding section we will evaluate the polarization of the class struggle in a time of colonial dictatorship, in the context of hollowed out electoral institutions and radical regressive social policies. The essay will address the twin issues of struggle for political freedom and social justice in the face of fiat rule by emerging technocratic colonial rulers.

What is at stake goes beyond the current regime changes to identifying the most basic institutional configurations which will define the life chances, personal and political freedoms of future generations, for decades to come.

Decaying Democracies and the Transition to Oligarchical Democracies

The decay of democracy is evident in every sphere of politics. Corruption is all pervasive, as parties and leaders vie for financial contributions from the wealthy and powerful; congressional and executive positions have a price tag; each piece of legislation is influenced by powerful corporate “lobbies” which spend millions writing the laws and engineering their approval. Prominent influence peddlers like the US felon Jack Abramoff boast that “every congressperson has their price.” The vote of citizens counts for nothing: the politician’s campaign promises have no relation to their behavior in office. Lies and deceptions are considered “normal” in the political process. The exercise of political rights are increasingly under police surveillance and active citizens are subject to arbitrary arrest. The political elite depletes the public treasury subsidizing colonial wars and pays for their military adventures by eliminating basic social programs, public agencies and services.

Legislators engage in vitriolic demagogy in virtual Punch and Judy puppet conflicts as public displays of partisanship while in private they feast together at the public trough. In the face of the discredited legislative institutions and the overt, gross buying and selling of public office, executive officials, elected and appointed, seize legislative and judicial powers.

Decaying democracy evolves into an “oligarchical democracy” as executive officials rule by fiat; overriding democratic rules and ignoring the interests of the majority. An executive junta, of elected and non-elected officials, resolves questions of war and peace, allocates billions of dollars or euros to a financial oligarchy, and reduces living standards of millions of citizens via class-biased “austerity packages.” The legislature abdicates its legislative and oversight function and submits to the executive junta’s “accomplished facts.” The citizenry is assigned the role of passive spectators – even as anger, disgust and hostility spreads and deepens. Isolated voices of dissenting representatives are drowned out by the cacophony of mass media contracted prestigious “experts” and academics shilling for the financial oligarchy and advising the executive junta. No longer do citizens look to the legislatures for relief or redress from the executive siezure and abuse of power. To fortify their absolute power, the oligarchies emasculate the constitutions, citing economic catastrophes and all pervasive “terrorist” threats. A vast and growing police state apparatus, with unlimited powers, enforces constraints on civic and political opposition. As legislative powers are sapped and executive authorities enlarge their sphere of action, the remaining democratic freedoms are curtailed via “bureaucratic restrictions” on time, place, and forms of political action. The purpose is to minimize the critical minority from mobilizing a sympathetic majority. As the economic crises worsen and the bondholders and investors demand higher interest rates, the oligarchy extends and deepens their austerity measures. Inequalities widen, exposing the oligarchical nature of the executive junta. The social bases of the regime narrows. The well-paid skilled workers and middle class employees and professionals begin to feel the acute erosion of wages, salaries, pensions, working conditions, and future career prospects. The narrowing of social support undermines the junta’s claim to democratic legitimacy. Faced with mass discontent and discredit and with strategic sections of the civil bureaucracy in revolt, factional strife breaks out among rival cliques within the “official parties” of government. The “democratic oligarchy” is pushed and pulled in several directions: it decrees social cuts but can only find limited support in implementing them. It decrees regressive taxes but cannot collect them. It launches colonial wars but cannot win them. The executive junta alternates between force and compromise; robust promises to the international bankers and then, under mass pressure, backsliding.

Over time oligarchical democracy is no longer useful as to the financial elite. Its democratic pretensions no longer can deceive the masses. Prolonged elite factional warfare erodes its willingness to impose the financial oligarchy’s full agenda. At this point oligarchical democracy as a political formula has run its course.

The financial elite are ready and willing to discard all pretenses of ruling via democratic oligarchs. They are seen as willing but too weak; too subject to domestic pressure from factional rivals and not willing to proceed to savage cuts in social budgets, even greater reductions in living standards and working conditions.

The real power behind the executive juntas comes to the fore. The international bankers discard the “native junta” and impose non-elected bankers to rule – dubbing their private bankers as technocrats.

The Transition to a Colonial “Technocratic” Dictatorship

The naked rule by foreign bankers is disguised by an ideology which describes it as rule by technocrats who are experts, apolitical and above private interests. The reality behind the technocratic rhetoric is that the officials appointed have a career of working with and for big financial private and international interests. Lucas Papdemos, the appointed Greek Prime Minister, worked for the Federal Reserve Bank of Boston and, as head of the Greek Central Bank, was responsible for cooking the books covering up the fraudulent budgetary accounts leading Greece to financial disaster. Mario Monti, the appointed Prime Minister of Italy was employed by the European Union and Goldman Sachs. These appointments by the banks are based on their total loyalty and unstinting commitments to impose the harshest regressive policies on the working populations of Greece and Italy. The so-called technocrats are not subject to party factions, nor remotely responsive to any social protests. They are free of all political commitments … except one, to secure the payment of the debt to foreign bondholders – especially the loans owed to major European and North American financial institutions. The technocrats are totally dependent on the foreign banks for their appointments and tenure in office. They have not a smattering of a political organizational base in the countries they govern. They rule because, foreign bankers threatened to bankrupt the countries if they were not appointed. They have zero independence, in the sense that the “technocrats” are merely instruments and direct representatives of the Euro-American bankers.

The “technocrats” by the nature of their appointments are colonial officials explicitly appointed at the behest of imperial bankers and sustained by them. Secondly, neither they nor their colonial mentors were elected by the people over whom they govern. They are imposed by economic coercion and political blackmail. Thirdly, the measures they adopt are designed to inflict the maximum pain by totally altering the basic relation-between labor and capital, by maximizing the power of the latter to hire, fire, fix salaries and working conditions. In other words, the technocratic agenda imposes a political and economic dictatorship.

The social institutions and political processes associated with a democratic-capitalist welfare state, corrupted by decadent democracies, eroded by oligarchical democracies are threatened with total demolition by the emerging colonial technocratic dictatorships (CTD). The language of social regression is full of euphemisms but the substance is clear. Social programs regarding public health, education, pensions, and disabilities are slashed or eliminated and the “savings” transferred into tributary payments to foreign bondholders (banks).

Public employees are fired, their retirement age extended and their salaries reduced and their tenure eliminated. Public enterprises are sold to foreign and domestic capitalist oligarchs with services curtailed and employees shed. Employers shred collective bargaining agreements. Workers are fired and hired at the whim of the owners. Vacations, severance pay, starting salaries and overtime pay are drastically reduced. These pro-capitalist regressive policies are dubbed “structural reforms.” Consultative processes are replaced by the dictatorial powers of capital – “legislated” and implemented by the appointed technocrats. Not since the time of Mussolini and fascist rule and the Greek military junta (1967-1973) has such a regressive assault on popular organizations and democratic rights taken place.

Comparing Fascist and Technocratic Dictatorships

The earlier fascist and military dictatorships have much in common with the current technocratic despots regarding the capitalist interests they defend and the social classes they oppress. But there are important differences which disguise the continuities.

The military junta in Greece and Mussolini in Italy seized power by force and violence, outlawed all opposition parties, press trade unions and closed the elected parliament. The current “technocratic” dictatorship is handed power by the political elites of the oligarchical democracy – a “peaceful” transition at least in its initial phase. In contrast to the earlier dictatorships, the current despotic regimes retain the hollowed out and emasculated electoral facades, as rubber stamp entities to provide a kind of “pseudo-legitimacy,” which beguiles the financial press but fools few public citizens.

From the very first day of technocratic rule the key slogans of the organized movements in Italy was, “No to a government of bankers”; while in Greece the slogan that greeted the puppet pragmatist Papdemos was “European Union, IMF, Get Out.”

The earlier dictatorships began as full blown police states, arresting pro-democracy movement activists and trade unionists before pursuing their pro-capitalist policies. The current technocrats first launch their vicious all-out assault on living and working conditions, with parliamentary assent and then in the face of sustained and determined resistance by the “parliaments of the street”, proceed to escalate police state repression by degree … practicing incremental police state rule.

Policies of the Technocratic Dictatorships: Scope, Depth and Method

The dictatorial organization of a technocratic regime is derived from its policies and political mission. In order to impose policies that result in massive transfers of wealth, power and legal rights from labor and households to capital, especially foreign capital, an authoritarian regime is essential, especially in anticipation of sustained resistance. The international financial oligarchy cannot secure “stable and sustainable” long term extraction of wealth with any semblance of democratic governance, even a decaying oligarchic democracy. Hence the last resort for the bankers in the EU and USA is to directly appoint one of their own to push, shove and impose a sequence of comprehensive large scale, long-term regressive changes. The mission of the technocrats is to impose an enduring institutional framework which will guarantee long-term, high interest payments based on decades of impoverishment and popular exclusion.

The mission of the “technocratic dictatorship” is not to put in place a single regressive policy of short duration, such as a salary freeze or dismissal of a few thousand school teachers. Their intent is to convert the entire state apparatus into an efficient press to continuously extract and transfer tax revenues and income from workers and employees to bond holders. To maximize the power and profits of capital over labor, the technocrats grant the capitalists absolute power to fix the terms of labor contracts, as far as hiring, firing, longevity, hours and working conditions.

The technocrats “method of rule” is to have an ear only for the foreign bankers, bondholders and private investors. The decision process is closed and limited to the coterie of bankers and technocrats without the least transparency. Above all, under colonial rules the technocrats must ignore the protestors if possible or, if necessary break heads. Under pressure from the banks, there is no time for mediation, compromise or delays as was the case under decaying and oligarchical democracies.

Ten historic transformations dominate the agenda of the technocratic dictatorships and their colonial mentors.

1) Massive shifts in budgetary allocations from welfare to bond and bank payments.

2) Large scale changes in income policies from wages to profits, interest payments and rents.

3) Highly regressive tax policies, increasing consumer (VAT) and wage taxes and lowering taxes on bondholders and investors.

4) Eliminating employment security (“labor flexibility”), increasing the reserve army of unemployed to lower wages, intensifying the exploitation of employed labor (“higher productivity”).

5) Rewriting labor codes, undermining the balance of power between organized labor and capital. Wages, working conditions and health issues are taken out of the hands of rank and file unionists and put in the hands of technocratic “corporate commissions.”

6) The dismantling of a half century of public enterprises and institutions and privatizing telecommunications, energy, health, education and pension funds. Trillion dollar privatizations are windfall profits on a world historic scale. Private monopolies replace public and provide fewer jobs and services without adding any new productive capacity.

7) The economic axis shifts from production and services for mass consumption in the domestic market, to exports of specialized goods and services to overseas markets. This new dynamic requires lower wages to “compete” internationally but shrinks the domestic market. The new strategy translates into an increase in hard currency earnings from exports to pay the debt to the bondholders but results in greater misery and unemployment for domestic labor. Under the technocratic “model,” prosperity accrues to vulture investors buying lucrative but financially strapped local producers and real estate on the cheap.

8) The technocratic dictatorship by design and policy aims at a “bipolar class structure” in which the bulk of the skilled workers and the middle class is impoverished and suffers downward mobility while enriching a strata of local bondholders and business owners who cash in on interest payments and the low cost of labor.

9) Deregulation of capital, privatization and the centrality of financial capital leads to greater colonial (foreign) ownership of land, banks, strategic economic sectors and “social” services. National sovereignty is replaced by imperial sovereignty in the economy as well as politics.

10) The unified power of colonial technocrats and imperial bondholders dictating policy concentrates power in a non-elected power elite. They rule with a narrow social base and no popular legitimacy. They are politically vulnerable, therefore, constantly dependent on economic threats or physical force.

Three Stages of Technocratic Dictatorial Rule

The historic task of the technocratic dictatorship is to roll-back the political, social and economic advances gained by the working class, public employees and pensioners since the defeat of fascist capitalism in 1945. The unmaking of over sixty years of history is no easy task, least of all in the midst of a deep ongoing socio-economic crises, in which the working class has already experienced severe cuts in wages and benefits and the number of young unemployed (18-30 years) throughout the EU and North America ranges between 25 to 50 percent.

The proposed agenda of the “technocrats” – parroting their colonial mentors in the banks – is ever more severe reductions in living and working conditions.The proposed “austerity” occurs in the face of growing economic inequalities between the wealthy 5% and the bottom 60% between Southern Europe and Northern Europe. Faced with downward mobility and heavy indebtedness, the middle class and especially their ‘educated children’, are outraged by the technocrats call for even greater social cuts. Outrage spreads from the lower middle class to business and professionals on the verge of bankruptcy and loss of status.

The technocratic rulers, constantly play on mass insecurity and fear of a “catastrophic collapse” if their ‘bitter medicine’ is not swallowed by the anguished middle classes who fear the prospect of sinking into the working class or worse.

The technocrats call on the present generation to sacrifice, to commit virtual suicide, to save future generations. With gravity and humble posturing they speak of “equal sacrifices”, a message belied by the firing of tens of thousands of employees and the selling of billions of euros/dollars of the national patrimony to foreign bankers and investors. Lowering public expenditures to pay bondholders and entice private investors erodes any appeal for “national unity” and “equal sacrifice” ..The technocratic regime strives to act decisively and quickly to impose its brutal regressive agenda, the rollback of sixty years of history before the masses have time rise up and bring them down.

To preclude political opposition the technocrats demand “national unity”, (the unity of bankers and oligarchs), the backing of the decadent electoral parties and their leaders and their total submission to the colonial bankers’ demands.

The technocrats’ political trajectory will be short lived given the draconian systemic changes and repressive structures they propose, the best they can accomplish is to dictate and implement policies and then return to their lucrative sanctuaries in the overseas banks.

Technocratic Rule: Stage One

With the unanimous backing of the mass media and the full backing of the powerful bankers, the technocrats take advantage of the downfall of the despised and discredited politicians of the past electoral regimes. They project a clean government image which speaks to a regime which is efficient and competent, capable of decisive action. They promise to put an end to deteriorating living conditions and partisan political paralyses. At the onset of their rule the technocratic dictators exploit the justified popular disgust with privileged “do-nothing” politicians to secure a measure of popular consent or at least passive acquiescence from the majority of the citizens drowning in debt and in search of a “savior.”

It should be noted that among the most politically aware and social conscious minority, the bankers resort to a colonized “technocratic regime” cuts no ice: they immediately identify the technocratic regime as illegitimate deriving powers from foreign bankers. They affirm the rights of citizens and national sovereignty. From the beginning, even under the cloak of emergency powers, the technocrats face a core of mass opposition.

The bankers realistically recognize the technocrats must move quickly and decisively.

Stage Two: Technocrats’ Shock Policies

The technocrats launch 100 days of the most egregious class warfare against the working class since the military/fascist regimes. In the name of the Free Markets, the Bondholder and the Unholy Alliance of political oligarchs and bankers dictate edicts, and laws are passed, immediately firing tens of thousands of public employees. Scores of public enterprises are rushed to the auction block. Job security is abolished and firing without cause becomes the law of the land. Regressive taxes are decreed and households are impoverished. The entire income pyramid is turned on its head. The technocrats widen inequalities and deepen immiseration.

The initial euphoria greeting technocratic rule is replaced by bitter reproaches. The lower middle class looking for a paternal dictatorial resolution of their condition, recognize “another political swindle”. As the technocratic regime races to fulfill its mission to the foreign bankers, the popular mood sours, bitterness spreads even among its ‘passive collaborators’. There are no crumbs from the table of a colonial regime empowered to maximize the outflow of state revenues to bondholders.

The compromised political oligarchy tries to revive their fortunes and “questions” the particularities of the technocratic “tsunami” smashing the social fabric of society. The scale and scope of the dictatorship’s extremist agenda and the ongoing build-up of mass frustrations frightens the political party collaborators, while the bankers urge them on to bigger and deeper social cuts. The technocrats in the face of the burgeoning popular storm begin to cower.

The bankers call for greater backbone and offer new loans for “keeping the course.” The technocrats bunker down – alternating between pleas for time and sacrifice with promises of prosperity “around the corner.” Mostly they rely on constant police mobilization and de facto militarization of civil society.

Mission Accomplished: Civil War or the Return of Oligarchical Democracy?

The outcome of the “experiment” with a colonial dictatorial technocratic regime is difficult to predict. One reason is because the measures adopted are so extreme and extensive, that they unify almost all important social classes (except the top 5%) against them at the same time. The concentration of power in an “appointed” elite further isolates them and unifies most citizens in favor of democracy against colonial submission and unelected rulers. The measures approved by the technocrats face the unlikely prospect of full implementation, especially by civil servants and public employees facing firings, pay cuts and reduced pensions. The across the board cuts undermine “divide and conquer” tactics. Given the scope and depth of the downgrading of the public sector and the indignity of serving a regime clearly under colonial tutelage, it is possible that breaks and fissures will take place in the military and police apparatus especially if they provoke popular uprisings which turn violent. The technocratic juntas cannot ensure that their policies will be implemented. If not, revenues will falter; strikes and protests will scare off predator buyers of public firms. The big squeeze will undermine local business, production will decline the recession will deepen.

Technocratic rule is by its nature transitory. Under threat of a mass revolt the new rulers will flee to their overseas financial sanctuaries. Local oligarchical collaboraters will hasten to augment their billion dollar euro overseas bank accounts in London, New York and Zurich.

The technocratic dictatorship will make every effort to hand power back to the oligarchical democratic politicians with the proviso that they retain the regressive changes in place. Technocratic rule will end up with “paper victories” unless the overseas bankers insist the “return to democracy” operates within the “new order.”

The application of force could boomerang. The technocrats and democratic oligarchs renewed threats of an economic catastrophe for non-compliance will be counter-manded by the reality of real existing misery and mass unemployment. For millions the living catastrophe resulting from technocratic policies will outweigh any future threats. The rebellious majority may choose to rise up and overthrow the old order and take its chances in an independent democratic socialist republic. One of the unforeseen consequences of imposing radical colonial appointed technocratic dictatorship is that it clears the political landscape of parasitic political oligarchies and lays the groundwork for a clean break. It facilitates renouncing the debt and reconstituting the social fabric of an independent democratic republic.

The serious danger is that the discredited politicians of the old order will demagogically attempt to seize the democratic banners of the “anti-dictatorial anti-technocrat” struggle to bring back what Marx called “the old crap of the previous order.” The recycled political oligarchs will adapt to the “restructured” new order of eternal debt payments as part of a deal to maintain the ongoing process of unending social regression. The revolutionary struggle against the colonial technocratic rulers must continue and deepen, to block the restoration of the democratic oligarchs.

The relation of information technology (IT), and more specifically the internet, to politics is a central issue facing contemporary social movements.  Like many previous scientific advances the IT innovations have a dual purpose:  on the one hand, it has accelerated the global flow of capital, especially financial capital and facilitated imperialist ‘globalization’.  On the other hand, the internet has served to provide alternative critical sources of analysis as well as easy communication to mobilize popular movements.

The IT industry has created a new class of billionaires, from Silicon Valley in California to Bangalore, India.  They have played a central role in the expansion of economic colonialism via their monopoly control in diverse spheres of information flows and entertainment.

To paraphrase Marx “the internet has become the opium of the people”.  Young and old, employed and unemployed alike, spend hours passively gazing at spectacles, pornography, video games, online consumerism and even “news” in isolation from other citizens, fellow workers and employees.

In many cases the “overflow” of “news” on the internet has saturated the internet, absorbing time and energy and diverting the ‘watchers’ from reflection and action.  Just as too little and biased news by the mass media distorts popular consciousness, too many internet messages can immobilize citizen action.

The internet, deliberately or not, has “privatized” political life.  Many otherwise potential activists have come to believe that circulating manifestos to other individuals is a political act, forgetting that only public action, including confrontations with their adversaries in public spaces in city centers and in the countryside, is the basis of political transformations.

IT and Financial Capital

Let us remember that the original impetus for the growth of “IT” came from the demands of big financial institutions, investment banks and speculative traders who sought to move billions of dollars and euros with the touch of a finger from one country to another, from one enterprise to another, from one commodity to another.

Internet technology was the motor force for the growth of globalization at the service of financial capital.  In some ways IT played a major role in precipitating the two global financial crises of the past decade (2001-2002, 2008–2009).  The  bubble in IT stocks of 2001 was a result of the speculative promotion of overvalued “software firms” de-linked from the ‘real economy’.  The global financial crash of 2008-2009 and its continuation today, was induced by the computerized packaging of financial swindles and underfunded real estate mortgages.  The ‘virtues’ of the internet, its rapid relay of information in the context of speculator capitalism turned out to be a major contributing factor to the worse capitalist crises since the Great Depression of the 1930s.

The Democratization of the Internet

The internet became accessible to the masses as a market for commercial enterprise and then spread to other social and political uses. Most importantly it became a means of informing the larger public of the exploitation and pillage of countries and people by multi-national banks.  The internet exposed the lies which accompany US and EU imperialist wars in the Middle East and Sothern Asia.

The internet has become contested terrain, a new form of class struggle, engaging  national liberation and pro-democracy movements.  The major movements and leaders from the armed fighters in the mountains of Afghanistan to the pro-democracy activists in Egypt, to the student movements in Chile and including the poor peoples’ housing movement in Turkey, rely on the internet to inform the world of their struggles, programs, state repression and popular victories.  The internet links peoples’ struggles across national boundaries – it is a key weapon in creating a new internationalism to counter capitalist globalization and imperial wars.

To paraphrase Lenin, we could argue that 21st century socialism can be summed up by the equation:  “soviets plus internet = participatory socialism”.

The Internet and Class Politics

We should remember that computerized information techniques are not ‘neutral’ – their political impact depends on their users and overseers who determine who and what class interests they will serve.  More generally the internet must be contextualized in terms of its insertion in public space.

The internet has served to mobilize thousands of workers in China and peasants in India against corporate exploiters and real estate developers.  But computerized aerial warfare has become the NATO weapon of choice to bomb and destroy independent Libya. The US drones which send missiles that kill civilians in Pakistan and Yemen are directed by computer ‘intelligence’.  The location of Colombian guerrillas and the deadly aerial bombings are computerized.  In other words, IT technology has dual uses:  for popular liberation or imperial counter revolution.

Neo-liberalism and Public Space

The discussion of “public space” has frequently assumed that “public” means greater state intervention on behalf of the welfare of the majority; greater regulation of capitalismand increased protection of the environment.  In other words, benign “public” actors are counter-posed to exploitative private market forces.

In the context of the rise of neo-liberal ideology and policies, many progressive writers argue about the “decline of the public sphere”. This argument overlooks the fact that the “public sphere” has increased its role in society, economy and politics on behalf of capital, especially financial capital, and foreign investors.  The “public sphere”, specifically the state, is much more intrusive in civil society as a repressive force, particularly as neo-liberal policies increase inequalities.  Because of the intensification and deepening of the financial crises, the public sphere (the state) has undertaken a massive role in bailing out bankrupt banks.

Because of large scale fiscal deficits provoked by capitalist class tax evasion, colonial war spending and public subsidies to big business, the public sphere (state) imposes class based “austerity” program-cutting social expenditures and prejudicing public employees, pensioners, and private wage and salaried employees.

The public sphere diminished its role in the productive sector of the economy.  However, the military sector has grown with expansion of colonial and imperial wars.

The basic issue underlying any discussion of the public sphere and the social opposition is not its decline or growth but rather the class interests which define the role of the public sphere.  Under neo-liberalism, the public sphere is directed by the use of public treasury to finance bank bailouts, militarism and expanded police state intervention.  A public sphere directed by the “social opposition” (workers, farmers, professionals, employees) would enlarge the scope of public sphere activity with regard to health, education, pensions, environment and employment.

The concept of the “public sphere” has two opposing faces (Janus-like): one facing capital and the military; the other labor/social opposition.  The role of the internet is also subject to this duality: on the one hand the internet facilitates large scale movements of capital and rapid imperial military interventions; on the other hand it provides rapid flow of information to mobilize the social opposition.  The basic question is what kind of information is transmitted to what political actors and for what social interest?

The Internet and the Social Opposition:  The Threat of State Repression

For the social opposition the internet is first and foremost a vital source of alternative critical information to educate and mobilize the “public” – especially among progressive opinion — leaders, professionals, trade unionists and peasant leaders, militants and activists.  The internet is the alternative to the capitalist mass media and its propaganda, a source of news and information that relays manifestos and informs activists of sites for public action.  Because of the internet’s progressive role as an instrument of the social opposition it is subject to surveillance by the repressive police-state apparatus.  For example, in the USA over 800,000 functionaries are employed by the “Homeland Security” police agency to spy on billions of emails, faxes, telephone calls of millions of US citizens.  How effective the policing of tons of information each day is another question.  But the fact is that the internet is not a “free and secure source of information, debate and discussion”.  In fact, as the internet becomes more effective in mobilizing the social movements in opposition to the imperial and colonial state, the greater is the likelihood of police-state intervention under the pretext “combating terrorism”.

The Internet and Contemporary Struggle:  Is it Revolutionary?

It is important to recognize the importance of the internet in detonating certain social movements as well as relativizing its overall significance.

The internet has played a vital role in publicizing and mobilizing “spontaneous protests” like the ‘indignados’ (the indignant protestors) mostly unaffiliated unemployed youth in Spain and the protestors involved in the US “Occupy Wall Street”.  In other instances, for example, the mass general strikes in Italy, Portugal, Greece and elsewhere the organized trade union confederations played a central role and the internet had a secondary impact.

In highly repressive countries like Egypt, Tunisia and China, the internet played a major role in publicizing public action and organizing mass protests.  However, the internet has not led to any successful revolutions – it can inform, provide a forum for debate, and  mobilize, but it cannot provide leadership and organization to sustain political action let alone a strategy for taking state power.  The illusion that some internet gurus foster, that ‘computerized’ action replaces the need for a disciplined, political party, has been demonstrated to be false:  the internet can facilitate movement but only an organized social opposition can provide the tactical and strategic direction which can sustain the movement against state repression and toward successful struggles.

In other words, the internet is not an “end in itself” – the self-congratulatory posture of internet ideologues in heralding a new “revolutionary” information age overlooks the fact that the NATO powers, Israel and their allies and clients now use the internet to plantviruses to disrupt economies, sabotage defense programs and promote ethno-religious uprisings.  Israel sent damaging viruses to hinder Iran’s peaceful nuclear program; the US, France and Turkey incited client social opposition in Libya and Syria.  In a word, the internet has become the new terrain of class and anti-imperialist struggle.  The internet is a means not an end in itself.  The internet is part of a public sphere whose purpose and results are determined by the larger class structure in which it is embedded.

Concluding Remarks:  “Desktop Militants” and Public Intellectuals

The social opposition is defined by public action:  the presence of collectivities in political meetings, individuals speaking at public meetings, activists marching in public squares, militant trade unionists confronting employers, poor people demanding sites for housing and public services from public authorities…

To address an active assembled public meeting, to formulate ideas, programs and propose programs and strategies through political action defines the role of the public intellectual. To sit at a desk in an office, in splendid isolation, sending out five manifestos per minute defines a “desktop militant”.  It is a form of pseudo-militancy that isolates the word from the deed.  Desktop “militancy” is an act of verbal inaction, of inconsequential “activism”, a make-believe revolution of the mind.

The exchange of internet communications becomes a political act when it engages in public social movements that challenge power.  By necessity that involves risks for the public intellectual:  of police assaults in public spaces and economic reprisals in the private sphere.  The desktop “activists” risk nothing and accomplish little.  The public intellectual links the private discontents of individuals to the social activism of the collectivity.  The academic critic comes to a site of action, speaks and returns to their academic office.  The public intellectual speaks and sustains a long-term political educational commitment with the social opposition in the public sphere via the internet and in face to face daily encounters.

In response to major military and political losses as well as new opportunity, the White House is fashioning a new doctrine of imperial conquest based on intensified aerial warfare, greater extra-territorial intervention, and, when circumstances allow, alliances with collaborators.  This includes the arming and financial backing of retrograde despotic regimes in the Gulf city-states, fundamentalists, opportunist defectors, mercenaries , academic exiles gangsters and other rabble willing to serve the empire for a price.

Whether these ‘changes’ add up to a new post-colonial “Obama doctrine” or simply reflects a series of improvisations resulting from past losses (“making a virtue of necessity” remains to be seen.

We will proceed by outlining the strategic failures which set the context for the “rethinking” of the Bush-Obama policies in mid-2011. We will then point out the ‘reality principle’ – the deep crises and rising pressures – which forced the Obama regime to modify its methods of imperial warfare.  Obama’s changes are designed to retain levers of power under conditions of limited resources and with dubious allies.  The third section will describe these changes as they have occurred; emphasizing their reactive nature – improvised – as unfavorable circumstances evolve and favorable opportunities arose.

The final section will critically evaluate Obama’s new imperial policies, their impact on targeted countries and peoples as well as the consequences for the US.

The Bush-Obama Continuum 2009-2011

Obama took his lead from the Bush administration and ran with it.  He expanded war budgets to over $750 billion; increased ground troops by 30,000 in Afghanistan; expanded expenditures on base building and mercenary troop recruitment in Iraq; multiplied US air and ground incursions in Yemen, Pakistan, Somalia, Libya.  As a result the budget deficit reached $1.6 trillion; the trade deficit reached unsustainable levels and the recession deepened.  Public support for Obama and the Democrats plummeted. Parallel to Obama’s skyrocketing external imperial expenditures, he spent hundreds of billions of dollars in dozens of internal security agencies further depleting the treasury.  Greater debts abroad and deficits at home were accompanied by the trillion dollar bailout of Wall Street while 10 million homes were foreclosed and  unemployment reached double digits.

Obama retained and expanded the Bush era wars, bailouts, millionaire tax exemptions and proposed draconian cuts in social security, federal funded medical programs and education.  Despite massive military commitments, Obama could not secure a single major military victory.  By the beginning of the third year of his regime, it was abundantly clear that amidst the wreckage of the domestic economy and the demise of key overseas collaborator regimes, the US Empire was under siege.

The Reality Principle

The reality of massive expenditures in losing wars and faltering support at home and abroad, finally penetrated even the most dogmatic and intransigent militarist ideologues in the Obama regime.  Nationalist Islamists were a “shadow” government throughout Afghanistan, inflicting increasing casualties on US-NATO forces even in the capital, Kabul.  In Iraq even the puppet regime rejected a minimum US military presence, as warring factions sharpened their knives, preparing for a post-colonial showdown between willing colonial collaborators, resistance fighters, sects, tribes, death squads, ethnic separatists and mercenaries.  Despite US military threats and Zionist designed economic sanctions, Iran gained influence throughout the region, eroding US influence in Iraq, Syria, western Afghanistan, the Gulf, Lebanon and Palestine (especially Gaza).

The fall of major US client regimes in Egypt and Tunisia (Mubarak and Ali), and mass uprisings threatening other puppets in Yemen, Somalia, Bahrain finally forced the Obama regime to acknowledge that the Israeli ‘model’ of war, occupation and colonial rule via puppet regimes was not viable.  The reality principle finally penetrated even the densest fog surrounding imperial advisers and strategists:  the US empire was in retreat, Obama-Clinton were not custodians of an expanding empire, but the masters of imperial defeats. The  empire-building project of the post-Cold War period, premised on unilateral action and military supremacy launched by Bush senior, continued by Clinton, expanded by Bush junior and multiplied by Obama was a total and unmitigated failure by any imperial standards.

Prolonged losing wars were accompanied by a vast wave of pro-democracy uprisings dumping prized imperial clients. As colonial wars depleted the imperial treasury, impoverished citizens and undermined the “will to sacrifice” for the chimera of Global Greatness.  The national mood was deeply disturbed by the cost of empire but also by the loss of global markets to new Asian competitors in China, India and elsewhere.  Nowhere was the decline of the US more evident than in Latin America where new nationalist reform and developmental regimes, secured divergent policies on key foreign policy issues, generated high growth, collaborated with new trading partners, decisively rejected several US backed coups and repudiated Geithner’s recycled free market dogma. There was nowhere in the world where the Obama regime could claim military victory, economic success or greater political influence.

As the reality of the deficits, losses and discontent entered the consciousness of key policymakers, a new imperial policy agenda took shape, not fully elaborated but improvised as circumstances dictated.

The Making of the “Obama Doctrine”

The first and foremost “recognition of reality” among the Obamites was that in a world of sovereign states, colonial land wars based on territorial armies of occupation were not viable.  They led to prolonged resistance, extended budget over-runs, continuing casualties and were definitely not “self-financing” as the Zionist geniuses in the Pentagon once claimed.  New forms of imperial warfare were needed to sustain the empire and destroy adversaries.

The hard choice facing the Obama regime with regard to Iraq was whether to admit defeat and retreat (in the sense that the US can not retain a colonial presence and will leave behind an unreliable military and political configuration expanding tieswith Iran and hostile to Israel), or to claim “victory´ in the sense of overthrowing Saddam Hussein and weakening Iraq’s role in the Middle East.  The retreat and defeat reality is now rationalized as a “repositioning” of 20,000 troops in the tiny city states run by despotic Gulf monarchies and the posting of war vessels in the Persian Gulf.  Obama-Clinton claim the troops, warships and aircraft carriers would re-enter Iraq if the current regime falls and a new nationalist movement comes to power.  This is a doubtful proposition – as any “re-entry” would return the US to a prolonged, costly war.  The main purpose of the repositioning is to protect the Gulf client dictatorships from their internal pro-democracy movements and to launch a joint US-Israeli air and sea attack on Iran.  In other words, troop retrenchment (as an occupying colonial power) is replaced by a build-up and concentration of air and sea power for attack and destruction of military and economic bases of the Iranian state.

The US retreat is a product of defeat; a departure under duress.  The relocation of troops to petrol-despot mini-states is a downsizing of the US presence and a move to prop-up highly vulnerable corrupt clan-based despots.  The shift from Iraq to the Gulf states is a move to small, safe, sanctuaries from a highly volatile conflictual major state, with a history of resistance and independence.  Since the US can no longer afford an unending large troop presence and cannot secure a ‘residual force’ its retreat to the Gulf states is making a virtue of necessity, a fall-back position to retain a launch pad for the next aerial war.

The Libyan war marks the key imperial formula for retaining Obama’s imperial pretensions.  The pretext for the war was just as phony as the cause bellicose in Iraq: in place of weapons of mass destruction, in Libya charges of genocide and rape were fabricated.   A UN resolution claiming the right to militarily intervene to “protect civilians” was cooked up, and NATO launched an 8 month war based on nearly 30,000 air attacks, to overthrow the established government and destroy the economy.  Obama’s Libyan policy was based on air and naval bombardment and Special Forces advisers; the use of a mercenary army and client ex-pats as the ‘new leaders’; a multi-lateral coalition of European empire builders (NATO) and Gulf state petrol-oligarchs.  In contrast to Iraq and Afghanistan sustained massive air attacks took the place of a large invasion army.  Already Obama’s military strategists have embraced and promulgated the Libyan experience as a new “Obama doctrine” for successfully rolling back independent Arab regimes and movements.  Despite massive propaganda efforts to puff up the role of the mercenary ‘rebels’, the fact is that Gaddafi loyalists were only defeated by the combined air power of the NATO military command.

Obama-Clinton’s celebration of the Libyan victory is premature:  the means to victory involved the thorough destruction of the economy, from ports to irrigation systems, to roads and hospitals; the disarticulation of the labor force, with the forced flight of hundreds of thousands of sub-Sahara African workers and North African professionals.  In other words, it was a “pyrrhic victory”. Washington defeated an adversary it has not won a viable state.

Even more serious, Washington’s client mercenary ground forces include an amalgam of fundamentalist, tribal, gangster, opportunist clan and neo-liberal operators who have few interests in common. And all are armed and ready to carve up competing fiefdoms.  The parallel is with Afghanistan where the US armed and financed drug traffickers, clan chiefs, war lords and fundamentalists to fight the secular pro-Soviet regime.  Subsequent to destroying the regime, the same forces turned against the US and proceeded to spread a kind of pan-Islamic mobilization against pro-US client states and the US military presence throughout South-Central Asia, the Gulf states, the Middle East and North Africa.

Obama’s Libyan formula of using disparate mercenaries to achieve short term military success has boomeranged. Islamic fundamentalist militias and contrabandists are sending tons of ground to air missiles, machine guns and automatic rifles seized from Gaddafi’s arms depots to Egypt, Syria, Somalia, Sudan and all points east, west, south and north.

In a word, the volatile social and military conflicts among the collaborator “rulers” in Libya has all the markings of a failed regime. Neither NATO bases nor oil companies can pretend to establish firm bases of operation and exploitation.

The resort to missile warfare, especially the drone attacks on insurgents challenging US client regimes which figure so prominently in the “Obama doctrine” have succeeded in killing a few local commanders, but at a cost of alienating entire clans, villagers, townspeople and the general public in targeted countries.  Drones’ missiles are killing hundreds of civilians, causing relatives and ethnic kinspeople to join resistance groups. Up to the present, after three years of intensified “missile air warfare” the Obama regime has not secured a single major triumph over any of the targeted insurgencies.  The data available demonstrates the opposite.  In Pakistan not only has the entire northwest tribal areas embraced the Islamic resistance but the vast majority of Pakistanis (80%) resent US drone violations of national sovereignty, forcing even otherwise docile officials to call into question their military ties with Washington.  In Somalia and Yemen, drone and Special Forces’ operations have had no impact in weakening the mass opposition to incumbent client regimes.  Obama’s long distance, high tech warfare has been an ineffective substitute for failed large scale land wars.

The third dimension of the Obama doctrine, the heavy reliance on “third party” military intervention and/or multi-lateral armed interventions, was not successful in Afghanistan and Iraq and was of limited effectiveness in Libya.  The  European multi-lateral forces retired early on in Iraq, unwilling to continue to spend on a war with no end and with virtual no support on the home front.  The same process of short-term low level military multi-lateralism took place in Afghanistan. Most NATO soldiers will be out before the US withdraws.  The Libyan experience with “multi-lateral” air force collaboration in defeating Libya’s armed forces destroyed the country, undermining any post-war reconstruction for decades.  Moreover, “aerial multi-lateralism” followed the formula of “easy entry and fast exit” – leaving the mercenary predators in control on the ground with a documented record of excelling in rape, pillage, torture and summary executions.  Only a brainless and morally depraved Hilary Clinton could sing the praises and dance a jig celebrating the victory of a knife wielding sodomist, torturing a captured President as “a victory for democracy”.

The fourth dimension of the “Obama doctrine” the use of foreign mercenary armies has been tried and failed in a number of cases where incumbent client rulers are under siege from resistance forces.  The US financed the Ethiopian dictatorship’s armed invasion of Somalia to prop up a corrupt, isolated regime holed up in the capital.  After a prolonged futile effort to reverse the tide, the Ethiopian mercenary forces  performed no better. They were followed by the entry of the US-backed Kenyan armed forces which has only led to massacres and starvation of hundreds of thousands of Somalian refugees in Northern Kenya and Southern Somalia and deadly ambushes by the Islamic national resistance. These third party mercenary invasions have totally failed to secure the puppet regime; in fact, they have aroused greater nationalist opposition.

US backed “Third Party” mercenary armed interventions in Bahrain, where Saudi Arabian military forces put down a majoritarian uprising, has temporarily propped up the despotic monarchy but without dealing with the underlying demands of the pro-democracy mass movements.

The fifth dimension of the Obama doctrine is to use highly trained heavily armed “Special Forces” (SF) contingents of 500 more to assassinate insurgent leaders, to terrorize their rural supporters and to “give backbone” to the local military officials.  Obama’s dispatch of a brigade of SF to Uganda is a case in point.  Up to now there is no reports of any decisive victories, even in this tiny country.  The prospects for future use of this imperial tactic is probably limited to locales of limited geo-political and economic significance with weak resistance movements, and only as a “complement” to local standing armies.

The final and probably most important element in the Obama doctrine is the promotion of civil-military mass uprisings and the reshuffle of elite figures to ‘co-opt’ popular pro-democracy movements in order  to derail them from ending their countries’ client relationship to Washington.

Washington and the EU have incited and armed sectarian regional mass and armed movements aimed at overthrowing the authoritarian nationalist Assad regime in Syria.  Playing off of legitimate democratic demands and harnessing fundamentalist hostility to a secular state, the US and EU, with the collaboration of Turkey and the Gulf states, have engaged in a triple policy of external sanctions, mass uprisings and armed resistance against the secular civilian majority and nationalist armed forces backing Basher Assad.  Obama policy relies heavily on mass media propaganda and the exploitation of regional grievances to gain leverage for an eventual “regime change”.

Parallel to the “outsider” political strategy in Syria, the Obama doctrine has adopted an insider strategy in Egypt and Tunisia. Faced with a nationalist-pro-democracy-pro-workers social upheavals in Egypt, Washington financed and backed a military takeover and rule by an autocratic military junta which follows the basic foreign and domestic policies sustaining the economic structures under the Mubarak dictatorship.  While cynically evoking the “spirit” of the Arab spring, Obama and Clinton, have backed the military tribunals which prosecute, torture and jail thousands of pro-democracy activists.  A similar process of “internal subversion” financed by the EU has put in place a coalition of “Islamic free marketers” and pro-NATO politicos who have more in common with the White House then they have with the original pro-democracy mass movements.

In the immediate period the Obama doctrines’ use of ‘external’ and ‘internal’ civilian-military subversion has succeeded in derailing the promising anti-imperial movements that erupted in the early months of 2011.  However, the great gulf that has opened between the recycled new client rulers and the pro-democracy movements has already led to calls for a ‘second round’ of uprisings to oust the opportunists “who have stolen the revolt” and betrayed the democratic principles of those who sacrificed to oust the client dictators.  All the conditions which underlay the “Arab spring” are in place or have been exacerbated: unemployment, police repression, crony capitalism, inequalities and corruption.  The experience of successful rebellion is still fresh and alive among the increasingly disenchanted youth.  Like all of the new Obama imperial policies, the propping up of co-opted officials does not promise a reconsolidation of empire.

Conclusion:  The “Obama Doctrine”

Reactive, improvised policies, with no overarching strategic framework, the so-called “Obama doctrine” shows few signs of reversing the decline of the US Empire.  The deterioration of US “forward positions” in the Arab heartland is not linear nor without tactical advances, especially in light of the Obama regimes’ co-optation of several Islamic leaders in Libya, Syria and Tunisia and the recycling of Mubarak era generals in Egypt.

Under cover of political euphemisms the Obama regime understates the scale and significance of its political and diplomatic losses: the forced withdrawal from Iraq is presented as a “successful mission in regime change”, notwithstanding the burgeoning civil and regime violence between rival sectarian and secular factions.  The US “withdrawal” from Afghanistan, is, in reality, a military retreat as the Taliban and related forces form a shadow government throughout the country and the huge mercenary army funded by billions of Pentagon dollars is infiltrated by Islamic Nationalist militants.

The “drone attacks” presented as a successful new counter-terror weapon crossing frontiers is hyped as an effective cost-effective alternative to large scale ground invasions subject to prolonged armed resistance.  In fact, the “drones” and killings mainly provide sensational propaganda and public relations successes – having little impact revising the larger defeatist political reality.

On the diplomatic front US imperial decline is even more dramatic. The UN General Assembly votes against the US on Cuba, and the UNESCO vote on the admission of Palestine are overwhelmingly hostile to the Obama regime.  Totally isolated, Washington’s “retaliatory” posture of cutting off financial resources further reduces US institutional leverage.

As Obama submits to greater subservience to Israel’s political arm in the US, the 52 “Presidents of the Major American Jewish Organizations”, and prepares a joint military attack on Iran, even NATO refuses to follow suit.

The great danger of the “Obama doctrine” is that it looks at short term ‘local’ consequences. Air and sea power can successfully bomb Iranian nuclear and military facilities, please the head of the Israeli ruling junta and guarantee American Zionist financial backing for Obama’s re-election campaign.  What is overlooked is the military capacity of Iran to close the world’s most important waterway (the Strait of Hormuz) shipping oil to Europe, Asia and the US.

Obama’s air war successes in Iran would be overwhelmed by Iranian ground and missile attacks of US forces throughout the Gulf.  All US petrol allies in the region would be vulnerable to attack.  Long range Iranian missiles would send millions of Israeli’s scurrying for bomb shelters, even before Obama’s Zionist advisers uncork their champagne to celebrate their “air victory” over Teheran.

The ‘Obama doctrine’ of extra territorial air wars with impunity turned against Iran would provoke a catastrophic conflagration, which would far surpass the disastrous outcome of the land wars in Iraq and Afghanistan. The “Obama doctrine” is, in reality, a set of improvised policies designed to deal with specific sets of circumstances based on a common overall problem:  how to retain imperial domination in the face of failed colonial-occupation policies.  The tactical success in the air war against Libya and the opportunities opened by a Muslim led uprising in Syria has given rise to the need to formulate a new overall strategy.  Local collaborators are central, especially those with an institutional power base (Egyptian military) or with levers of regional influence in civil society (Islamic movements in Syria).

The attempt to generalize these ‘tactical’ gains into a general offensive strategy, however, flounder on the fallacy of “misplaced concreteness”.  Iran is not Libya:  it has the military power, geographic proximity and economic resources to demolish the weak and vulnerable ‘peripheral’ US client states.  Israel can start a US war against the Islamic world – but it cannot win it. Netanyahu’s losses in the UN cannot be explained away as 193 “anti-semitic” countries.  The Zionist-US-Israeli troika are mutually masturbating in a closet.  They can rant and rave and even precipitate an apocalyptic war, but Obama and Netanyahu are increasingly on the margin of world changes. Their policies are impotent reactions to popular movements envisioning historical transformations, which have even began to enter into the center of empires: Wall Street and Tel Aviv. Ultimately the “Obama doctrine” is doomed to failure as it is incapable of recognizing that the problem of decline is not simply a problem of ‘tactics’ but a basic systemic breakdown of empire building: the cracks and fissures abroad have ignited revolts at home.

1. Thomas Shanker and Steven Lee Myers “US Planning Troop Buildup in Gulf After Exit from Iraq”, New York Times, October 29, 2011.

Methodology

In comparing the performance of Fernandez and Obama it is necessary to locate them in an historical context.  More specifically, both presidents and their immediate predecessors, George Bush in the US and Nestor Kirchner (deceased husband of Fernandez) in Argentina confronted major economic and social crises. What is telling, however, are the diametrically opposing responses to the crises and the divergent results.  On the one hand sustained growth with equity in Argentina and deepening crises and failed policies in the US.

Historical Context:  Argentina:  Depression, Revolt and Recovery

Between 1998–2002, Argentina experienced the worse socio-economic crises in its history.  The economy nose-dived from recession to full scale depression, culminating in double digit negative growth in 2001–2002.  Unemployment reached over 25% and in many working class neighborhoods, over 50%.  Tens of thousands of impoverished middle class professional lined up to receive bread and soup only blocks away from the Presidential palace.  Hundreds of thousands of unemployed workers, ‘piqueteros’ (picketers), blocked major highways and some raided trains shipping cattle and grain overseas.  Banks closed depriving millions of depositors of their savings.  Millions of middle class protestors organized radical neighborhood councils and linked up with unemployed assemblies.  The country was heavily indebted, the people deeply impoverished.  The popular mood was moving toward a revolutionary uprising.  Incumbent President Fernando De la Rua was overthrown (2001), scores of protestors were killed and wounded, as a popular rebellion threatened to seize the Presidential palace.  By the end of 2002, hundreds of bankrupt factories were ‘occupied’, taken over and run by workers.  Argentina defaulted on its external debt.  In early 2003, Nestor Kirchner was elected President, in the midst of this systemic crisis, and proceeded to reject efforts to enforce debt payment or repress the popular movements.  Instead he inaugurated a series of emergency public works programs.  He authorized payments to unemployed workers (150 pesos per month) to meet the basic needs of nearly half the labor force.

The most popular slogan of the multitudinous movements occupying the financial districts factories, public buildings and the streets was “Que se vayan todos” (“All politicians get out’).  The entire political class, parties and leaders, Congress and presidents were rejected outright.  But while the movements were vast, militant and united in what they rejected, they had no coherent program for taking state power, nor national political leadership to lead them.  After two years of turmoil, the populace turned to the ballot box and elected Kirchner with a mandate to produce or perish.  Kirchner heard the message, at least the part which demanded growth with equity.

Context:  The US under Bush-Obama

The last years of the Bush administration and the Obama presidency presided over the worse socio-economic crises since the Great Depression of the 1930s.  Unemployment and underemployment rose to almost a third of the labor force by 2009.  Millions of homes were foreclosed.  Bankruptcies multiplied and banks were on the verge of collapse.  Negative growth rates and a sharp decline in income, increased poverty and multiplied the number of food stamp recipients.  Unlike Argentina, discontented citizens took to the ballot box.  Attracted by the demagogic “change” rhetoric of Obama, they placed their hopes in the new president. The Democrats won the Presidency and a majority in both houses of Congress.  The first priority of Obama and Congress was to pour trillions of dollars in bailing out the banks, even as unemployment deepened and the recession continued.  Their second priority was to deepen and expand overseas imperial wars.

Obama increased the number of troops in Afghanistan by 30,000; expanded the military budget to $750 billion dollars; launched new military operations in Somalia, Yemen, Libya, Pakistan and elsewhere; augmented military aid to Israeli colonial armed forces; signed military pacts with Asian countries (India, Philippines, Australia) proximate to China.

In sum, Obama gave maximum priority to expanding the militarized empire, depleting the public treasury of funds to finance the recovery of the domestic economy and reducing unemployment.

In contrast, Kirchner/Fernandez curtailed the power of the military, cut military spending and channeled state revenues toward employment programs, productive investments and non-traditional exports.

Under Obama the crises became an opportunity to revive and consolidate the financial power of Wall Street.  The White House augmented the military budget to expand imperial wars by deepening the budget deficit and then proposed to cut essential social programs to ‘reduce the deficit’.

Argentina from Crises to Dynamic Growth

In Argentina the economic catastrophe and popular uprising provided Kirchner with an opportunity to bring about a basic shift from militarism and speculative pillage to social programs and sustained economic growth.

The electoral victories of both Kirchner and Fernandez reflect their success in creating a ‘normal’ capitalist welfare state.  After 30 years of US backed predator neo-liberal regimes, this was a great positive change.  Between 1966 and 2002, Argentina suffered brutal military dictatorships culminating in the genocidal generals who murdered 30,000 Argentines from 1976 to 1982. From 1983 to 1989 Argentina suffered under a neo-liberal regime (Raul Alfonsin) which failed to deal with the dictatorial legacy and which presided over triple digit hyper-inflation.  From 1989–1999 under President Carlos Menem Argentina witnessed the biggest sell-off of its most lucrative public firms, natural resources (petrol included), banks, highways, zoo and public toilets to foreign investors and kleptocratic cronies for bargain basement prices.

Last but not least, Fernando De la Rua (2000–2001), promised change and proceeded to deepen the recession that led to the final catastrophic crash of December 2001 and the closing of the banks, the bankruptcy of 10,000 firms and the collapse of the economy.

Against this background of total and unmitigated failure and the human disaster of US–IMF promoted “free-market” policies, Kirchner/Fernandez defaulted on the external debt, re-nationalized several privatized firms and the pension funds, intervened the banks and doubled social spending, expanded public investment in production and increased popular consumption, on the road to economic recovery.  By the end of 2003 Argentina turned from negative to 8% growth.

Human Rights, Social Programs and Independent Foreign Economic Policy

Argentina’s economy has grown over 90% from 2003–2011, over three times that of the United States. Its recovery has been accompanied by a tripling of social spending, especially on programs reducing poverty.  The percentage of poor Argentines has declined from over 50% in 2001 to less than 15% in 2011.  In contrast US poverty has risen over the same decade from 12% to 17% and is on an upward trajectory over the same period.

The US has become the country with the greatest inequalities in the OECD with 1% controlling 40% of the country’s wealth, (up from 30% in less than a decade).  In contrast, Argentina’s inequalities have shrunken by half.  The US economy has failed to recover from the deep recession of 2008-2009, during which it declined by over 8%.  In contrast Argentina declined less than 1% in 2009, and has been growing at a healthy 8% (2010-2011).  Argentina has nationalized pension funds, doubled basic pensions and introduced a universal child welfare program to counter malnutrition and guarantee school attendance.

In contrast 20% of children in the US are now suffering from poor diets, drop-out rates are increasing for adolescents and malnutrition affects over 25% of minority children.  With more social cuts in health/education under way, social conditions can only worsen.  In Argentina the income of wage and salaried workers has increased over 50% over the decade in real terms, while in the US they have declined by nearly 10%.

Argentina’s dynamic growth of GNP has been fueled by growing domestic consumption and dynamic export earnings.  Argentina has a consistent large trade surplus based on favorable market prices and increased competitiveness.  In contrast domestic consumption has stagnated in the US, the trade deficit is close to $1.5 trillion dollars and revenues are wasted on non-productive military expenditures of over $900 billion a year.

While in Argentina the impulse for a policy of default with growth came about because of a popular rebellion and mass movements.  In the US popular discontent was channeled toward the election of a Wall Street financial con-man named Obama.  He proceeded to pour resources into rescuing the financial elite instead of letting them go bankrupt and funding growth, competitiveness and social consumption.

The Argentine Alternative to Bailouts and Poverty

The Argentine experience goes counter to all the precepts of the international financial agencies (the IMF, World Bank), their political backers, and publicists in the financial press.  From the first year (2003) of Argentina’s recovery to the present, the economic experts have “predicted” that its growth was “not sustainable” – it has continued robustly for over a decade.  The financial writers claimed the default would lead to Argentina being shut out of financial markets and that its economy would collapse.  Argentina relied on self-financing based on export earnings and re-activation of the domestic economy and confounded the prestigious economists.

As growth continued, the critics in the Financial Times and the Wall Street Journal claimed it would end once “unused capacity was exhausted”.  Instead growth earnings financed the expansion of the domestic market and created new capacity for growth especially to new markets in Asia and Brazil.

Even as late as October 25, 2011, Financial Times columnists still prattle about “the coming crises” in the manner of messianic fundamentalists who predict the pending apocalypse.  They harp on “high inflation”, “unsustainable social programs”, “overvalued currency”, and more predictions of “the end of prosperity”. All these dire warnings occur in the face of continued growth of 8% in 2011 and the overwhelming electoral victory of President Fernandez. Anglo-American financial scribes should focus on the demise of their free market regimes in Europe and North America instead of denigrating an economic experience from which they might learn.

In refutation of the Wall Street critics, Mark Weisbrot and his associates point out¹ that Argentina’s growth was based on the expansion of domestic consumption, increased manufacturing exports to regional trading partners as well as traditional agro-mineral exports to Asia.  In other words, Argentina is not totally dependent on primary exports; it has balanced trade and is not over-dependent on commodity prices.  In regard to high inflation, Weisbrot points out that “inflation may be high in Argentina but it is real growth and income distribution that matter with regard to the well-being of the vast majority of population”, (page 14) (my emphasis).

The US under Bush-Obama has pursued a totally perverse and divergent path to that of Kirchner-Fernandez.  They have prioritized military spending and expanded the security apparatus over the productive economy. Obama and Congress have vastly increased the police state apparatus, reinforced their political influence over regressive budgetary policies while increasingly violating human and civil rights.  In contrast Kirchner/Fernandez have prosecuted dozens of human rights violators in the military and police and weakened the military’s political power.

In other words, the Argentine Presidents have weakened the militarist pressure bloc which demands greater arms and security expenditures. They created a state more accommodative to their political project of financing economic competitiveness, new markets and social programs.  Bush-Obama revived the parasitical financial sector further unbalancing the economy.

Kirchner/Fernandez ensured that the banking sector financed the growth of the export sector, manufactures and domestic consumption.  Obama slashes social consumption to pay creditors.  Kirchner-Fernandez imposed a 75% “haircut” on bondholders in order to finance social spending.

Kirchner-Fernandez have won three presidential elections, each by a larger margin.  Obama may be a one-term president, even with the billion dollar campaign funding from Wall Street, the military industrial complex and the pro-Israel power configuration.

The popular opposition to Obama, especially the “Occupy Wall Street movement” has a long way to go to emulate the success of the Argentine movements that rousted incumbent presidents, blocked highways paralyzing production and circulation and imposed a social agenda that prioritized production over finance, social consumption over military expenditures.  The “Occupy Wall Street Movement” has taken a first step toward mobilizing millions of active participants necessary to creating the social muscle that turned Argentina from a US style client state into a dynamic independent welfare state.

1. The Argentina Success Story, Center for Economic Bad Policy Research, Oct. 2011

In the past, however, many theorists of imperialism of varying political persuasion, ranging from Max Weber to Vladimir Lenin, argued that imperialism unified the country, reduced internal class polarization and created privileged workers who actively supported and voted for imperial parties.  A historical, comparative survey of the conditions under which imperialism and democratic institutions converge or diverge can throw some light on the challenges and choices faced by the burgeoning democratic movements erupting across the globe.

The Nineteenth Century

During the 19th century, European and US imperial expansion covered the world.  In tandem, democratic institutions took root, the franchise was extended to the working class, competitive parties emerged, social legislation was passed, and the working class increased its representation in the legislative chambers.

Was the simultaneous growth of democracy and imperialism a spurious correlation reflecting divergent and conflicting underlying forces, one favoring overseas conquest and another promoting democratic politics? In fact, there was a great deal of overlap between pro-imperialist and democratic politics and not simply among the elites.

Throughout the 19th and especially in the 20th century, important sectors of the labor and social democratic parties and numerous prominent leftists and revolutionary socialists, at one time or another, combined support for workers’ demands and imperial expansion.  None other than Karl Marx, in his early journalistic writings in the New York Herald Tribune critically supported the British conquest of India as a “modernizing force” breaking down feudal barriers, even as he supported (with criticism) the European revolutions of 1848.

The ruling classes, the driving force of imperialism, were divided. Some saw the democratic reforms, “citizenship”, as a means of raising mass conscriptions for imperial wars; others feared that the democratic reforms would enhance social demands and undercut the accumulation of capital and rule by the elite.  Both were right.  Along with greater popular participation came virulent modern nationalism, which fueled empire building.  At the same time  mass access to democratic rights led to heightened class organizations, which threatened or challenged class rule. Within the ruling classes, democratic institutions were seen as an arena to peacefully resolve conflicts between competing sectoral elites. But once they took a mass character they were perceived as political threats.

Imperial and class-based parties competed for voters among the newly enfranchised urban workers and rural poor.  In many cases, imperial and class allegiances “co-existed” within the same individuals.  The question of which of the two – imperialist or class consciousness – would become ‘operative’ or ‘salient’ was, in part, contingent on the success or failures of the larger competing political projects.

In other words, when imperial expansion succeeded in easy conquests resulting in lucrative colonies (especially settler colonies) democratic workers embraced the empire.  This was the case because empire enhanced trade; namely, profitable exports and cheap imports, while protecting local markets and manufacturers.  These in turn expanded employment and wages for substantial sectors of the working class.  As a result, labor and social democratic parties and trade unions did not oppose imperialism.  Indeed many supported it.

In contrast, when imperialist wars led to prolonged bloody and costly conflicts, the working class shifted from initial chauvinist enthusiasm to disenchantment and opposition.  Democratic demands to ‘end the war’ led to strikes challenging unequal sacrifice.  Democratic and anti-imperialist sentiments tended to fuse.

The conflict between democracy and imperialism became even more apparent in the case of an imperial defeat and military occupation.  Both the defeat of France in the German-French war of 1870-71 and the German defeat in the First World War led to massive democratic socialist uprisings (the Paris Commune of 1871 and the German revolution of 1918) attacking militarism, ruling class domination and the entire imperial capitalist institutional framework.

The Imperialism and Democracy Debate and “History from Below”

Historians, especially practitioners of the fashionable “history from below”, exaggerated the democratic values and struggles of the working class and understated the prolonged and deep felt support among important sectors for successful imperial expansion and conquest.  The notion of ‘inherent’ or ‘instinctual’ class solidarity is belied by the active role of workers in imperial conquest as soldiers, overseas settlers, merchant mariners and overseers.  Imperial collaborators and empire loyalists were numerous among English and French workers and, especially later, within the US labor movement.

The theoretical point is that the pre-eminence of democratic over imperial consciousness and action among workers is contingent on the practical material outcomes of imperial policies and democratic struggles.

Workers and Imperialism

Empire building makes demands on workers to produce more for less in order to export and invest profitably in colonized regions.  This led to capital-labor conflict, especially in the initial phase of imperial expansion.  As imperial rulers consolidated their control over the colonized countries they intensified exploitation of markets, labor and resources.  Imperial exports destroyed local competitors.  Profits rose, wages increased and workers turned from initial opposition toward imperialism to demanding a share of the increasing income of the export oriented manufacturers.  Labor leaders and trade unionists approved of the policies of ‘imperial preference’, which protected local industries from competition and privileged monopoly control of colonial markets.  They did so because imperial policies protected jobs and raised living standards.

Workers who were active in social struggles, blacklisted or jailed, voluntarily moved or were exiled to colonized countries.  Once settled overseas, they were given privileged access to better paying jobs as overseers, skilled employees or promoted to managerial positions.  Imperial based militant workers, once overseas, became colonial collaborators.  Many encouraged former workmates, relatives and friends to join them as successful settlers or contract workers.  The ‘domestication’ of workers and the reconciliation of democratic and imperialist sentiments was a cause and consequent of successful imperialism.

Empire Loyalism:  Not by Bread Alone

While material benefits accruing to workers from “successful imperialism” are one factor enhancing workers’ imperial consciousness, this was reinforced by symbolic gratification, the sense of being a member of the “leading country in the world” where “the sun never sets on the empire”, was equally important.  It is rare to find a country where the majority of workers express “solidarity” with the exploited miners, plantation workers or displaced peasants and indigenous small landholders in the ‘colonies’.  The stronger the hold of the colonial power, the greater the ‘colonial opportunities’, the longer the colonial ties, the deeper the economic penetration, and the stronger the sense of imperial superiority among the imperial states’ workers.

It is not surprising that the British workers, the unions and Labor Party raised few objections to the savagery of the imperial opium wars against China, the imperial-induced genocidal famines in Ireland in the 19th century and India in the 20th century.  Likewise, the French workers’ parties – Socialists especially – were in the forefront of the post WWII colonial wars against Indo-China and Algeria only turning against them in the face of imminent defeat and internal disintegration.

In the same vein, US successful colonial wars against Cuba and the Philippines, its invasions of Caribbean and Central American countries were supported by the American Federation of Labor and many ‘ordinary workers’, even as a minority of radicalized workers opposed these wars.  The ‘partial turn’ of labor against US colonial wars occurred during the Korea, Vietnam and Afghanistan wars, and was a result of prolonged losses and high economic costs with no victory in sight.  It should be added that US workers, in opposing the imperial wars, expressed no solidarity with the national liberation and workers movements of the colonized countries.

Imperialism and the “True Democrats”

To argue, as some on the Left have, that imperialism does not co-exist with “true” democracy, is to argue that the last 150 years have been devoid of free elections, party competition and citizens’ rights, however abbreviated, especially over the past decade.  The reality is that imperial intervention and expansion has drawn precisely from citizens’ sense of “obligation” to uphold the democratic institutions, which has enabled imperial leaders to elicit legitimacy and active citizen support or compliance in waging bloody, even genocidal, colonial wars.

If democracy has not usually been an obstacle to imperial expansion – indeed a facilitator under certain circumstances – under what conditions have workers and citizens movements turned against imperial wars?  What has been the political response of the ruling class when the majority of the electorate has turned against imperial wars?  In other words, when the democratic institutions no longer function as vehicles for imperial policies, what gives?

From Imperial Democracy to Imperial Police State

The past ten years provide important lessons on the relation between imperialism and democracy in the United States.

Beginning with the controversial political circumstances surrounding known terrorists’ gaining access to the US and subsequently hijacking the airplanes on 9/11/2001, the US government launched two major colonial wars and numerous overt ‘clandestine’ ground and air attacks in Somalia, Yemen, Pakistan, Libya and other countries.  The “global war on terror”, launched under the Bush regime, and implemented by non-elected senior militarist–Zionist officials in co-operation with NATO and Israel was supported by the democratically elected Congress.  For that matter the vast majority of the electorate, influenced by an immense propaganda campaign of fear, media manipulation and lies endorsed the wars on terror.

Given the unprecedented scope and breadth of the wars, (a global war on terror), the vast increase in military spending and the huge outlays for an all encompassing internal repressive (security) apparatus (Homeland Security), a new executive-centered police state was constructed which superseded the existing democratic institution and rights of citizens.

The trajectory of imperial politics moved from early military successes to problematic prolonged occupation.  This led to escalating resistance, growing state expenditures , a deepening fiscal crises , social decay and rising political opposition.

As in the past, contemporary imperial wars that are prolonged, costly and with no decisive victory in sight, have led to citizen disenchantment, followed by increased open rejection.  The wage and salaried majorities who voted for imperial policymakers and backed their enabling legislation, including laws (Patriot Act) which suspended basic civil and constitutional rights, have turned away from the imperial agenda.  Today the democratic majority prioritize their class, economic interests, especially in the face of a prolonged recession and unemployment and underemployment of close to 20%.  Beginning in 2008-2011 endless wars and prolonged crises have set in motion a conflict between democracy and imperialism.

In other words, the democratic majority has become an obstacle to the implementation and pursuit of imperial wars.  Imperial military activity in Iraq, Afghanistan, Libya, etc. did not lead to quick victories, the conquest of lucrative export markets and take-over of natural resource.  Jobs were not created and no benefit accrued to employees and workers in the imperial country.  High expenditures for arms undercut public investments in labor-intensive employment in critically overdue infrastructure projects.  The small number of dangerous jobs in occupied countries was unattractive and too risky for the unemployed.

In other words, unlike most previous imperial-colonial wars, none of the plundered wealth was used to secure workers loyalty to the empire.  The burden of empire progressively undercut wage and salaried workers’ living standards.  Over time, regressive taxation gradually eroded any sense of chauvinist grandeur or superiority.  Instead citizens of the empire developed a political inferiority complex.  Faced with determined Islamic opposition and China’s rising economic power, exaggerated bellicosity among a minority and critical introspection among the majority took hold.  Popular consciousness of “something basically wrong” in Washington and Wall Street took over.  The earlier war chants and mindless flag-waving, as the armies of Empire marched to Afghanistan and Iraq, were replaced by angry defeatism directed at misleaders.  Over 80% of the public now articulates a negative view of Congress, rejecting both war parties.  Similar negative views are held toward the White House, the Pentagon and Homeland Security.

After a decade of war and four years of economic crisis, mass protests erupted.  The “Occupy Wall Street” movement puts new options on the table, displacing the imperial agenda with a powerful denunciation of the militarist-financial elite.

The executive rulers, especially the judicial, intelligence and police apparatuses increasingly implemented arbitrary police state measures.  Tens of millions are subject to surveillance by Homeland Security.  The police state intercepts billions of faxes, e-mails, web sites and taps telephone calls.  The link between imperialism and democracy broke at the point where declining empire no longer could secure the electorate’s support or compliance.

More and more bizarre terrorist plots were fabricated by the intelligence agencies.  The Iranian bomb plot against the Saudi Arabian ambassador to Washington was the most primitive and crude effort to regain public support for imperial militarism in the Gulf region.  Apart from the politically influential, but infinitely small, pro-Israel Zionist power configuration, US public opinion is not distracted from its domestic agenda, its quest for jobs at home and opposition to Wall Street.

As the conflict between imperialism and democracy intensifies, the previous ‘consensus” fractured.  The White House and Congress opt for imperialism backed by a profoundly anti-democratic police state.  The majority of the electorate presses forward, utilizing their remaining democratic rights to change the political agenda from empire toward a social republic.

Conclusion

We have argued that empire and democracy have been complementary in times of ascendant imperialism.  We have shown that when wars of conquest have been short and inexpensive, and when the results have been lucrative for capital and job-creating for labor the democratic majorities joined in support of imperial elites.  Democratic institutions flourished when overseas empires provided markets, cheap resources and raised living standards.  Workers voted for imperial parties, held positive opinions of executive and legislative officials, and applauded the colonial war veterans (our troops).  Some even volunteered and joined the military.  With vast citizen support for empire, the state more or less ‘abided’ by the constitutional guarantees.  But the marriage of democracy and imperialism is not ‘structural’.  It is contingent on a series of variable conditions, which can cause a profound rupture between the two, as we are witnessing today.

Prolonged, losing, costly imperial wars that increasingly erode living standards for over a generation have undermined the consensus between imperial rulers and democratic citizens.  Early signs of this potential divergence were evident during the latter period of the Korean War, when public opinion turned against President Truman, architect of the Cold War and the US invasion of Korea.  More evidence emerged during the Vietnam War.  Faced with a prolonged, losing war, which imperiled the lives and opportunities of tens of millions of draft age Americans, millions in civilian life and the military opted to end the war and question imperial interventions.  The repressive state was still not organized sufficiently to terrorize and contain the democratic upsurge of the 1970’s.  The end of the Vietnam war represented the high point in democratic America’s quest to counter imperialism and rebuild the republic.

Subsequent small, quick, low cost and militarily successful imperial interventions in Panama, Grenada, Haiti and elsewhere did not provoke any conflict between imperialism and democracy.  Nor did imperial clandestine and surrogate wars in Nicaragua, El Salvador, Guatemala, Angola, Mozambique, Afghanistan and the Balkans elicit any significant democratic opposition since they were low cost (in lives and funding) and were not accompanied by any sharp cuts in social expenditures and incomes.

The onset of the current Afghanistan, Iraq, and global offensive wars were seen by some imperial strategists in the same light: Quick, low cost victories with few domestic costs.  One highly placed pro-Israel official in the Pentagon even argued that the invasion and occupation of Iraq would be “self-financing” via an oil grab.

The 21st century wars turned out otherwise:  They followed the Korean-Vietnam pattern, not the Central American/Caribbean pattern.  Immensely costly, the 21st century wars have not led to quick victories and, worse still, occurred in the midst of an unprecedented economic crisis, without the manufacturing and market boom of the 1950’s/1960’s which had cushioned the retreat from Korea and Vietnam.

The divergence between imperialism and democracy has become acute.  Democratic dissent has increased and the police state has become more prominent and direct.  Imperialism increasingly relies on “fabricated domestic and external terror plots” to augment the powers of the repressive machinery and rule by fiat.  White House exhortations ring hollow.  The public puts less and less credence in their rulers’ claims of ‘justifiable’ arbitrary detentions, massive surveillance and extrajudicial assassinations of US citizens (and even their children).

We now face long-term, large-scale dangers, inherent in imperial democracies.  Not because of “internal contradictions” but because sooner or later imperial powers meet their match in the form of protracted struggles by anti-imperialist and national liberation movements.  Only when imperials wars take their toll on the wage and salaried majority, does the rupture between democracy and imperialism take place.  Then, and only then, are democratic forces set in motion to create a democratic republic, with social justice and without empire.

The present danger is that imperial structures are deeply embedded in all the key political institutions and are backed by an unprecedented vast and sprawling police state apparatus, called Homeland Security.  Perhaps it will take a major external political-military shock to ignite the kind of mass democratic uprising needed to transform an imperial police state into a democratic republic.  A growing sense of isolation and impotence affects the ruling regime in the face of overseas military defeats and unyielding, deepening domestic economic crisis.  The danger is that these fears and frustrations could induce the White House to attempt to regain popular support by attacking Iran under a manufactured pretext.

A US/Israeli assault on Iran will result in a world-wide conflagration.  Iran could and would retaliate.  Saudi and Gulf oil wells would go up in flames.  Vital shipping lanes would be blocked.  Gas prices would skyrocket while Asian, EU and US economies crash.  Iranian troops with their Iraqi allies would lay siege to the US garrisons in Baghdad.  Afghanistan, Pakistan and the rest of the Moslem world will take up arms.  US forces would surrender or retreat.  The war would shatter the US Treasury.  Deficits would spiral out of control.  Unemployment would double.  This likely sequence of events would trigger a massive democratic movement and a decisive struggle between an emerging republic struggling to give birth and a decaying empire threatening to drag the world into the inferno of its own demise.

The White House’s blatant parroting of Israel’s position to continue bilateral negotiations, while Tel Aviv continued to colonize Palestinian land and forcibly evict its residents, alienated the 1.5 billion Muslims throughout the world.  Obama’s refusal to even mention the return to the 1967 borders as a basis for a “peace settlement” totally undermined any pretext that the US could act as an “honest broker” in Mid-East peace negotiations, even in the eyes of its most slavish supporters in the PLO.  His one-sided reference to Israel’s minimal casualties in maintaining the Occupation, while omitting any mention of the 12,000 Palestinian political prisoners, thousands of assassinations, every day humiliation, routine torture of suspects and frequent defacement of Palestinian religious centers (mosques and churches, cemeteries and shrines), undermined any US effort to win favor among the millions of people involved in the pro-democracy social movements sweeping the Arab world from Tunisia, Egypt to the Gulf states.

Washington’s insistence that its NATO allies line-up with it in supporting continued “bilateral” negotiations, has led to the German government’s public humiliation when it followed Obama’s line of pressuring Abbas back to ‘negotiations’ only to have the Israeli Prime MInister Netanyahu announce the construction of 1,100 illegal Jews-only housing units in occupied Palestinian East Jerusalem.

Obama’s blatant and overt pandering to Israel before the representative of 193 independent nations, which had followed the standing ovation for Abbas’ call for Palestinian recognition, highlights one of the greatest US diplomatic defeats since the founding of the UN over 60 years ago.

But was Obama’s groveling before Israeli Prime Minister Binyamin Netanyahu really a ‘failure’ in the eyes of the White House?  Or was his speech really a carefully crafted appeal to a domestic audience in order to raise hundreds of millions of dollars from pro-Israel billionaires to finance his re-election campaign?

There is a wealth of documentary evidence showing that Obama deliberately and forcefully sacrificed US international standing in order to satisfy the major American Jewish organizations who were demanding nothing less than total and unconditional backing for Netanyahu’s phony position of “peace negotiations” and colonization from Obama.

From the angle of satisfying the US Zionist power configuration (ZPC) and securing a massive flow of re-election financing, Obama’s UN speech was a smashing success.

Obama’s Rejection of World Opinion and the Zionist Payoff

Obama’s re-election campaign from April to the end of September has received tens of millions of dollars from wealthy pro-Israeli Jewish fund raisers and contributors, as well as endorsements from right wing US Jewish and Israeli politicians.

In the run-up to Obama’s UN speech, Zionist lobbyists adopted “good cop bad cop” tactics. Liberal Zionist Democratic Party advisers emphasized that he was “losing the Jewish vote and funding”, highlighting the recent resignation of a disgraced Democratic Congressman from a district of Orthodox Jews because of his internet porno-exhibitionism as a sign of Obama’s growing unpopularity among Jews.  Some campaign strategists emphasized the “crucial Jewish vote in swing states” like Ohio and Pennsylvania (where non-Jews, who represent well over 80% of the voters, are not “crucial” in the eyes of these election experts!).

The 52 Presidents of the Major American Jewish Organizations took turns accusing Obama of “slandering Israel”, for disobeying Netanyahu and “backing the Arabs” for protesting Israeli land grabs, even as Obama raised US government aid to Israel to an un-paralleled $3 billion per annum, in the midst of a US economic recession with 18% of American workers unemployed or underemployed. Obama’s pro-Israel critics overlooked his $205 million gift to Tel Aviv to build the Iron Dome rocket defense system together with the US military’s latest fighter jets.  The Zionist power configuration demanded total surrender even as they extracted more political and economic concessions.  They ignored the enormous military imbalances in the Middle East in Israel’s favor and the degradation of US standing in the region.

Hardball threats to end Jewish financial support by the right wing Zionists was “complemented” by fund raising by liberal Zionists and promises of more to come if Obama ended his “public feuding” with Israel and vetoed Palestinian admission to the UN.  Obama performed his well-rehearsed shuffle and song routine of the “absolute defender”, now and forever, of every Israeli violation of Palestinian human rights.

Obama’s Rush for the Gold

On June 20, 2011, months prior to Obama’s speech opposing Palestinian admission to the UN, a pro-Israel Washington fund raising event for his re-election campaign raised over $1.5 million, assuring Obama that “Jewish donors” were not wavering, as long as he followed Israeli Prime Minister Netanyahu’s line of peace negotiations and land grabs (Forward, June 29 2011).  During the fund raiser Obama reiterated his unconditional support for Israel’s policies, including the settlements in the Palestinian West Bank. Following the dinner he met behind closed doors to elaborate on how far he was willing to go in opposing the Palestinian initiative at the UN, (Forward, June 29, 2011).  A month earlier on May 22, 2011, Obama spoke at the annual meeting of the American Israel Public Affairs Committee (AIPAC), directly appealing for funds in exchange for the United States’ total submission to the AIPAC agenda.

Obama’s dependence on Zionist funding was evident between April to June 2011:  Of the $68 million raised for his campaign, $37 million was raised by 244 “big cash bundlers” – individuals who round up multi-millionaire contributors.  According to one count of the 244 bundlers approximately 120 were identified as pro-Israel Jews.  Among the Zionist “bundlers” are Penny Pritzker bagging contributions between $100,000 – $200,000, Jeffrey Katzenberg putting the touch on contributors for $500,000 plus; Mark Gilbert $500,000 plus, and Mark Stanley $100,000 to $200,000.

Obama’s fund raising and organizational success among Israeli right wingers and US Zionists multiplied following his UN speech opposing the recognition of Palestine.  As the New York Times (September 30, 2011) noted “. . . Democratic officials maintain that they do not think that Mr. Obama is in danger of losing the Jewish vote – particularly given the President’s muscular defense of Israel at the United Nations General Assembly last week”.

Following his UN speech Obama raised several million from wealthy Zionists in Manhattan and Hollywood at dinners ranging up to $35,800 a plate. The extremist right wing Israeli Foreign Minister, Avigdor Lieberman (influential among billionaire US Zionists), signaled his enthusiastic support for Obama, as did Abe Foxman, the notorious Israeli Firster and head of the Anti-Defamation League, and former New York City Mayor Ed Koch, another fanatical Zionist (NY Times, September 30, 2011).  Thanks to pro-Israel  bundlers and hustlers, Obama had out-fund raised the leading Republican candidate, former Massachusetts Governor Mitt Romney, by more than a 4 to 1 margin by September 2011, (Reuters, Sept. 27, 2011).

The Consequences of Obama’s Embrace of Netanyahu and Rejection of World Opinion

Immediately following Obama’s UN speech, Netanyahu announced that Israel would build 1,100 new ‘Jews-only’ housing units in occupied Arab East Jerusalem with additional plans to displace tens of thousands of Bedouins from their villages to make way for new Jewish settlements.  With firm assurances that American Zionist Jews have the American Presidency and Congress in their pocket, Netanyahu feels free to advance his long-stated policy of ethnic cleansing. Violent extremist Jewish colonial settlers, funded by millionaire US donors to Obama, feel free to continue their practice of defacing and burning mosques and subjecting Palestinians to daily humiliations.  The US Congress and AIPAC wrote legislations eliminating S200 million dollars in funding to the Palestinian Authority because of its ‘crime’ of seeking admission for the Palestinian people to the United Nations.  Obama’s “muscular” knee bends for Israel at the UN have opened the door to more intense and brutal Israeli aggression against the Palestinians, new military threats toward Iran and increased pressure on Egypt’s military rulers.

The White House’s goal is to raise a billion dollars for the re-election campaign.  This involves keeping the spigot open for big bucks from Zionist millionaires in Hollywood and Silicon Valley, as well as from smaller contributors among lawyers, dentists, doctors, professors and local business people in Florida, Pennsylvania, Ohio and elsewhere.  Obama’s strategy at the UN is designed to maximize Zionist loyalty and fund raising for his re-election.  The White House has organized a campaign to delay any Security Council decision, removing the Palestinian issue from the limelight and putting it behind closed doors via procedural haggling.  At the same time, Washington is pressuring Security Council members, especially Bosnia and Colombia, to block a three-fifths majority vote, which would then force the US to use its veto.  If the White House does not secure the votes, Obama has promised Zionist fundraisers he will use the US veto to exclude Palestine from admission to the UN.

Obama will focus on his power to use the UN veto in order to increase fund raising among wealthy Zionists and to activate the Presidents of the 52 Major American Jewish Organizations to “get out the vote” among the electorate at large.  The re-election campaign will remind Zionist mass media pundits (CNN, FOX, CBS, NBC) of how Obama “courageously stood up to” world public opinion – including that of leaders representing 90% of the world’s population – in order to “defend Israel”.

If foreign policy is an extension of domestic policy, as is clearly illustrated by Obama’s truckling to Zionist fund-raisers by acting on behalf of Israel in the United Nations, so too is domestic policy an extension of foreign policy.  US overseas businesses cannot expect any “favored treatment” in Muslim countries. Increased political hostility to the US and Israel will result in greater military spending leading to more fiscal deficits and more painful cuts in domestic social programs for the American people.  This will increase domestic social and political polarization. In the short-run, Obama’s sell-out to the Zionist power configuration has succeeded in filling the coffers of his re-election campaign.  But in the near future it has raised insurmountable difficulties in dealing with overseas political conflicts and domestic economic crises.

Above all, Obama’s game of mutual manipulation with the Zionist Lobby has further degraded US democratic political institutions and our international standing as a free and independent country.

The Freeing of Jonathan Pollard and Obama’s Re-election: The Dirtiest Quid Pro Quo

In his gross servility to Israel and the American Zionist Lobby, President Barak Obama has surpassed all four of his predecessors with regard to the most egregious episode in Israel’s many violations of US security.  According to recent news reports, Vice-President Joe Biden announced that “President Obama was considering clemency for Jonathan Pollard” (New York Times, September 30, 2011; Jerusalem Post, October 2, 2011).  While Biden originally claimed to have initially opposed this move, a week later, under intense pressure from Obama, he agreed to meet and discuss Pollard’s release with American Jewish leaders, including the executive vice chairman of the Presidents of the Major American Jewish Organizations, Malcolm Hoenlein (Globe, October 8, 2011 – a major Israeli business publication.)

Reagan, Bush-Senior and Junior and Clinton, all refused to re-open the Pollard case because the confessed American spy for Israel (who was awarded Israeli citizenship and a high military rank while in US Federal prison) did more damage to US national security than any spy in our history.  At his trial, the FBI and Naval Intelligence revealed the Pollard, then a High Security Naval Intelligence analyst, had turned over tens of thousands of classified documents to his Israeli handler.  Many were ‘sold’ to the Soviet Union.  For his ‘service to the Jewish State of Israel’, a building, illegally built in occupied Arab East Jerusalem, is named Beit Yonatan.

All Israeli leaders, from Rabin to Netanyahu, have pressed US Presidents to free their spy.  But threats of mass protests and resignation from the US intelligence community prevented any serious discussion of releasing the traitor.  Now, the entire spectrum of Zionist opinion – from ‘left to right’ – from ‘liberal’ Congressman Barney Frank to extremist Israel Firster, Alan Dershowitz of Harvard, and including hundreds of Rabbis are pressuring Obama to free their ‘hero’.  Only a few prominent American Jews, like former US Navy Admiral Shapiro are outraged and chagrined by the ‘Jewish Community’s defense of a traitor”.

In a tight presidential election this 2012 we can expect Obama to trade on Pollard’s release, in exchange for a big cash injection by Zionist contributors to fund his last-minute media blitz.  After all, if Obama can sell out US integrity in front of the 193 nations of the UN, what is to stop him from freeing a master Israeli spy, who imperiled US security, in order to gain a few thousand sound bites and TV slots in the run-up to the November 2012 elections?

There is ample evidence to suggest that the publicity surrounding the killing of al-Awlaki has greatly exaggerated his political importance and is an attempt to cover up the declining influence of the US in the Islamic world.  The State Department’s declaration of a major victory serves to exaggerate US military capacity to defeat its adversaries.  The assassination serves to justify Obama’s arbitrary use of death squads to execute overseas US critics and adversaries by executive fiat denying the accused elementary judicial protections.

Myths About al-Awlaki

Al-Awlaki was a theological blogger in a small, poor Islamic country (Yemen).  He was confined to propagandizing against Western countries, attempting to influence Islamic believers to resist Western military and cultural intervention.  Within Yemen, his organizational affiliations were with a minority sector of the mass popular opposition to US backed dictator Ali Abdullah Saleh.  His fundamentalist group was largely influential in a few small towns in southern Yemen.  He was not a militaryor political leader in his organization, dubbed by the West as “Al-Qaeda in the Arabian Peninsula” (AQAP).

Like most of what the CIA calls “Al-Qaeda”, AQAP was a local autonomous organization, meaning that it was organized and controlled by local leaders even as it expressed agreement with many other loosely associated fundamentalist groups.  Awlaki had a very limited role in the Yemeni groups’ military and political operations and virtually no influence in the mass movement engaged in ousting Saleh.  There is no evidence, documented or observable, that he was “a very effective propagandist” as ex-CIA and now Brookings Institution member Bruce Riedal claims.  In Yemen and among the mass popular movements in Tunisia, Egypt, Bahrain or elsewhere his followers were few and far between.  One “expert” cites such intangibles as his “spiritual leadership”, which is as good a way as any to avoid the test of empirical evidence:  apparently a crystal ball or a tarot read will do.

Given the paucity of evidence demonstrating Awlaki’s political and ideological influence among the mass movements in North Africa, the Middle East or Asia, the US intelligence agencies claim his “real influence was among English-speaking jihadi, some of whom he groomed personally to carry out attacks on the US.”

In other words Washington’s casting Awlaki as an “important threat” revolves around his speeches and writings, since he had no operational role in organizing suicide bomb attacks – or at least no concrete evidence has been presented up to now.

The intelligence agencies “suspect” he was involved in the plot that dispatched bombs in cargo aircraft from Yemen to Chicago in October 2010.  US intelligence claims he provided a “theological justification” via e-mail for US army Major Nidal Malik’s killing of 13 people at Fort Hood.  In other words, like many US philosophical writers and legal experts like Princeton’s Michael Walzer and Harvard’s Alan Dershowitz, Awlaki discussed “just wars” and the “right” of violent action.  If political writings and speeches of publicists are cited by an assassin as the bases for their action, should the White House execute, leading US Islamophobes like Marilyn Geller and Daniel Pipes, cited as inspiration by Norwegian mass murderer Anders Behring Brevik?  Or does their Zionist affiliation provide them immunity from Navy Seal assaults and drone missiles?

Even assuming that the unsubstantiated “suspicions” of the CIA, MI 16 and the Al Qaeda “experts” are correct and Awlaki had a direct or indirect hand in “terrorist action” against the US, these activities were absurdly amateurish and abject failures, certainly not a serious threat to our security.  The “underwear bomber” Umar Farouk Abdul Mutallab’s effort to ignite bomb materials on a flight to Detroit, December 25, 2009, led to roasting his testicles!  Likewise the bombs dispatched in cargo aircraft from Yemen to Chicago in October 2010 were another bungled job.

If anything, the Yemenite AQAP’s hopeless, hapless operational planning served to highlight its technical incompetence.  In fact, according to Mutallab’s own admission, published on NBC news at the time, Awlaki played no role in the planning or execution of the bomb attack.  He merely served to refer Mutallab to the Al Qaeda organization.

Clearly, Awlaki was a minor figure in Yemen’s political struggles.  He was a propagandist of little influence in the mass movements during the “Arab Spring”.  He was an inept recruiter of English-speaking would be bombers.  The claims that he planned and “hatched” two bomb plots (Financial Times, October 1 and 2, page 2) are refuted by the confession of one bomber and the absence of any corroboratory evidence regarding the failed cargo bombs.

The mass media inflate the importance of Awlaki to the stature of a major al-Qaeda leader and subsequently, his killing as a “major psychological blow” to world-wide jihadists.  This imagery has no substance.  But the puff pieces do have a very important propaganda purpose.  Worse still, the killing of Awlaki provides a justification for extra-judicial state serial assassinations of ideological critics of Anglo-American leaders engaged in bloody colonial wars.

Propaganda to Bolster Flagging Military Morale

Recent events strongly suggest that the US and its NATO allies are losing the war in Afghanistan to the Taliban:  top collaborator officials are knocked off at the drop of a Taliban turban.  After years of occupation, Iraq is moving closer to Iran rather than the US.  Libya in the post-Gaddafi period is under warring mercenary forces squaring off for a fight for the billion dollar booty.  Al Qaeda prepares battle against neo-liberal expats and Gaddafi renegades.

Washington and NATO’s attempt to regain the initiative via puppet rulers in Egypt, Tunisia, Bahrain and Yemen is being countered by a “second wave” of mass pro-democracy movements.  The “Arab Spring” is being followed by a “hot autumn”.  Positive news and favorable outcomes for Obama are few and far between.  He has run out of any pseudo-populist initiative to enchant the Arab-Islamic masses.  His rhetoric rings hollow in the face of his UN speech, denying recognition of an independent Palestinian state.  His groveling before Israel is clearly seen as an effort to bolster his re-election campaign financing by wealthy Zionists.

Diplomatically isolated and domestically in trouble over failed economic policies, Obama pulls the trigger and shoots an itinerant Muslim preacher in Yemen to send a “message” to the Arab world.  In a word he says, “If you, the Arabs, the Islamic world, won’t join us we can and will execute those of you who can be labeled “spiritual mentors” or are suspected of harboring terrorists.”

Obama’s defense of systematic killing of ideological critics, denying US constitutional norms of judicial due process to a U.S citizen and in blatant rejection of international law defines a homicidal executive.

Let us be absolutely clear what the larger implications are of political murder by executive fiat.  If the President can order the murder of a dual American-Yemeni citizen abroad on the bases of his ideological-theological beliefs, what is to stop him from ordering the same in the US?  If he uses arbitrary violence to compensate for diplomatic failure abroad, what is to stop him from declaring a “heightened internal security threat” in order to suspend our remaining freedoms at home and to round up critics?

We seriously understate our “Obama problem” if we think of this ordered killing merely as an isolated murder of a “jihadist” in strife torn Yemen … Obama’s murder of Awlaki has profound, long term significance because it puts political assassinations at the center of US foreign and domestic policy.  As Secretary of Defense Panetta states, “eliminating home grown terrorists” is at the core of our “internal security”.

In contrast the same opinion makers, plus their academic counterparts, project images of the United States and the European Union as stable societies, with steady economic growth, incremental expansion of social welfare programs, resolving issues via consensual compromises and practicing sound fiscal policies.

In recent times, the better part of the current decade, these images have taken on the character of ideological dogmas – they no longer correspond to reality. In fact, a good argument can be made that the roles have been reversed: the US and EU are in perpetual crises and Latin America, at least most of the major countries, have experienced stability and growth which is the envy (or should be) of Washington pundits and financial commentators.

This ‘role reversal’ has been recognized by many US, EU and Asian investors and multinationals, even as respectable journalistic hacks for the Financial Times, NY Times and Wall Street Journal still write about vulnerabilities, imbalances and other weaknesses while grudgingly acknowledging the dynamic growth of the region.

Progressive opinion is equally at fault, focusing on the ‘advances’ of the left regimes but overlooking the underlying dynamics affecting most of the region and thus losing sight of the new points of conflict and contention.

We will proceed to outline the contrasting realities between the crises ridden “North” (US/EU) and the sustained growth of the “South” (South America). The analysis will raise questions of whether the South American experience is transferable to the North and what ‘structural adjustments’ would be necessary to pull the US and EU out of the downward spiral of stagnation and violent conflicts which have characterized these regions for the better part of the past decade.

The Lost Decade, US and EU Style

The Latin American countries during the 1980’s experienced a deep and persistent crises, manifested in negative growth, increased poverty levels and heavy indebtedness, which allowed creditors (like the IMF) to impose harsh and regressive austerity measures and “structural adjustment” policies which came to be known as neo-liberalization. These included the privatization of most strategic, lucrative public enterprises, and the ending of any semblance of state-directed industrial strategies.

For the peasants and the working and middle class the short-lived neo-liberal “boom” of the 1990s was a continuation of the ‘lost decade’ of the 1980s. The neo-liberal policies of the 1990s were based on fundamentally flawed structural foundations and polarizing income and public expenditures involving huge transfers of income to capital and downward pressures on wages and welfare. The neo-liberal regimes went into a deep crisis early in 2000 provoking major popular upheavals. The outcome resulted in a new set of political configurations and social power equations, which evolved into new post-neo-liberal regimes, at least in most of the major countries in Latin America.

In contrast and, in part thanks to the profitable opportunities opened by the debt crises and neo-liberalization of Latin America in the 1990s (and in the ex-Soviet Union, Eastern Europe and the Baltic/Balkan states) the US and EU prospered. In Latin America over 5,000 lucrative extractive resource-based industries, banks, tele-communications and other industries passed into the hands of foreign private MNC and local capital. High returns on bonds and loans and rents from technology transfers enriched the Northern capitalists even as poverty multiplied in the South. The 1990s was the “golden age” of Western capital as profits rose and leftist parties and the traditional urban trade unions appeared unable to withstand the ‘wave’ of predatory capitalism capturing the commanding heights of the economy.

The very successes of the US and EU countries, the enormous easy gains from pillage, speculation, and exploitation led to the dominance of financial capital and the belief in an irrevocable “new world order”. The dominance of the US and EU was built on their military superiority backed by pliant, collaborative, neo-liberal client regimes. The ‘new order’ lasted less than a decade: the economic crises of 1999/2000 smashed the illusions of a century of imperial grandeur. As markets collapsed so too did the Latin American oligarchic electoral regimes (dubbed “democracies”) which along with the financial elite and the military formed the triple alliance that defined Western supremacy. The final blow was the economic crises of 2001-2002 in the US and EU which steeply eroded their capacity to intervene and prop up their collapsing Latin clients ousted by rebellious masses.

The first decade of the new millennia has been the “lost decade”  of the North.   Over the course of the past eleven years the North has witnessed stagnation and recessions which have not given way to recoveries. The capitalist states temporarily saved the bankers but were powerless to set in motion economic growth.

The credit rating of the US economy was downgraded by the risk agencies. Unemployment and underemployment hovers close to one-fifth of the labor force, figures comparable to stagnant Third World countries. Social programs  are severely slashed in the US and throughout the European Union, reversing decades of incremental gains. Trade and budget deficits in the US have become chronic, while private and public lenders are becoming increasingly reticent to lend in the face of deep-seated recessionary tendencies.

The financial sector in the US and EU is rife with large scale fraud, swindles, mismanagement and falsified balance sheets, conditions previously prevalent among Latin economies. Wars proliferate. Military spending far exceeds productive investments, draining the US economy in a fashion reminiscent of the weapons spending during the reign of the warlords of Africa and the military dictators of Latin America.

In the EU, faced with brutal cuts in wages, pensions and jobs millions of workers and unemployed youth in Greece, Portugal, Spain and Italy have taken to the streets. General strikes threaten the stability of increasingly isolated regimes, reminiscent of the popular rebellions which resulted in regime changes in Latin America in the late 1990s and early 2000s. In the US, public protests reflect deepening private discontent: over 75% of the population expresses negative views of the Congress and 60% of the White House. Deepening political alienation of the US electorate is comparable to the loss of popular faith in Latin governments during the “lost decades”, 1980-2000.

Both the US and the EU have been radically transformed for the worse during the lost decade of the current century. Economically, politically and socially the ‘North’ has been “Latin Americanized”: social instability, economic stagnation, political alienation, growing class inequalities and poverty is presided over by corrupt political elites.

Signs of the Better Times: Latin America

Recently the finance minister of Brazil raised the possibility that the BRICs (Brazil, Russia, India and China) might take a hand in a “rescue plan” to prop up the crises-ridden economies of Europe. While the statement had greater symbolic rather substantive consequences, it does reflect a certain reality: while the North plunges into deeper, unending crises, the Latin economies are doing reasonably well.

Except for the Latin countries still under US dominance, especially Mexico and most of Central America, the rest of Latin America has not only avoided the crises afflicting the North but have been growing at a healthy rate, three times that of the US over the decade. The new millennium, especially between 2003-2011 (except for a brief interlude in 2009) has been a period of high growth, general prosperity, booming exports, rising imports, greater inter-regional co-operation, and large scale poverty reduction.

Brazil alone has reduced the number of poor by 30 million. Regular elections, relatively honest and competitive, result in stable legitimate transfers of political power. Except for US-backed coups in Honduras and intervention in Haiti and Venezuela, violent seizures of power have disappeared over the past decade. Regional institution–building has prospered with the advent of UNASUR and a Latin American regional bank.  Because of fiscal controls and banking regulations, both results of the lessons learned from the crisis of the lost decades (1980-2000), Latin America was only slightly affected by the US-EU financial crash of 2008-2011.

Latin American trade has doubled, especially with Asia, aided by China’s double digit growth. Demand for agro-mineral commodities has tripled. The key to this new export-powered growth is Latin America’s growing economic independence. This has led to the diversification of its markets, taking advantage of new opportunities and reducing their dependence on the US. Latin America’s emphasis on economic growth, new markets and investments has led it to avoid entanglements in the proliferating and costly colonial wars which engage the US and EU.

While the US and EU print more money and increase indebtedness to cover trade deficits, Latin America has quadrupled its foreign reserves. These cushion any downturns and avoid any dependence on the IMF, architect of the lost decades of the 1980s and 1990s.

Within Latin America, the issue of poverty reduction has been tackled with varying degrees of effectiveness. With Venezuela under President Chavez leading the way the general direction has been toward increasing social payments, by increments in most cases, but with greater efforts in others. Except for Mexico, nothing resembling the social cuts of the US-EU has taken place in Latin America. The most striking structural advances have occurred in Venezuela and to a lesser degree in Argentina. They have significantly increased the minimum wage and pensions and increased welfare payments to the most vulnerable (single mothers, the disabled, those in extreme poverty).

With the exception of Colombia (the US’s principle military ally in the region) which is still the murder capital of the world for human rights advocates, trade unionists and peasant activists, human rights violations have declined. While the US-EU have vastly increased their human rights violations geometrically via multiple colonial wars in Iraq, Afghanistan, Libya, Pakistan, Somalia, Yemen and clandestine death squad ‘operations’, Latin America’s overseas human rights violations are largely limited to its occupation forces in Haiti – at the behest of the US and EU. Nevertheless repression of popular movements, especially indigenous peoples and peasant movements and students has increased in Bolivia, Chile, Brazil and elsewhere as the high growth policies on community rights and social expenditures.

Because of Latin America’s current political stability and dynamic growth, institutional and corporate investment is pouring into the region. In contrast the US and EU are suffering from disinvestment and declining rates of private investment. In other words, the development of Latin America is the other side of the coin of the US-EU under-development.

Latin America: New Contradictions

The class struggle is still the motor force in the social progress of Latin America. But unlike EU-US, Latin America’s class struggle is directed at increasing social and monitory wages, even if incrementally, as part of an offensive strategy to capture a greater share of rising income. In the US and EU the class struggle is ‘defensive’: an effort to stop declining income shares, limit job losses and cuts in pensions.

While militant class action including land occupations, street demonstrations and strikes are still part of the repertory of working class social weapons, they take place within the political parameters of democratic institutions. In Europe the elites have increasingly ignored mass street protests and strikes, largely pursuing austerity policies dictated by non-elected domestic and foreign bankers and creditors.

The limitations and ‘contradictions’ affecting all Latin American countries are located in the internal class inequalities. As national income has increased and exports boom, the inequalities between the ruling investor class and the mass of wage earners has increased. While initially the problem of class inequality was papered over by the general rise in living standards and employment, over time the employed and productive classes are no longer satisfied with incremental gains which barely surpass inflation rates. The rising standards of living have raised expectations. The percentage of poor may have declined but subsisting just above $4 dollars a day is increasingly unacceptable. Growth brings forth its own set of contradictions and a new set of demands. Formerly excluded classes included in the system, but exploited, have only their class organizations as their weapons to advance their socio-economic interests.

This is clearly the case in contemporary Chile where long term growth is accompanied by deeply entrenched inequalities comparable to the worse in the OECD. Beginning in July 2011 massive student protests over the high cost of public and private education and low levels of social expenditures have detonated mass activity from trade unions covering the gamut of economic sectors from teachers to copper miners.

The new and explosive issue confronting rulers and ruled in most of high growth Latin America is raising incomes for whom? The class issues are front and foremost in the current period and immediate future.

Growth, stability and democratic class struggles characterize most of the major countries, but not all. In several countries, the authoritarian and violent legacy of the dictatorial regimes continues robust. Colombia’s practice of murdering trade unionists, peasant leaders, journalists and human rights activists continues unabated: over 30 trade unionists were murdered during the first eight  months of 2011.

Honduras’ ruling regime, product of a US-backed coup and its allies among the paramilitary private armies of landowners, have killed scores of peasants and dozens of pro-democracy political and social activists.

Mexico’s killing fields are notorious: over 40,000 people have been killed by the police, military and drug gangs in a ‘war on drugs’ promoted by Obama and implemented by President Calderon.

What these three retro-regimes have in common is that they continue to follow the dictates of Washington, remain highly militarized states, with a strong US military and police presence in the form of bases, overseas advisers, and an intrusive role in setting policy. All three have failed to diversify markets and continue with a high degree of dependence on the stagnant US market. All have secured, or are in the process of signing, bi-lateral free trade agreements at the expense of exploring greater links with the dynamic Asian markets.

The three retro-regimes have never experienced the kind of popular rebellions and resultant center-left regimes which have emerged in most of Latin America. In Mexico pro-democracy candidates were twice defrauded of electoral victories, first in 1988 and later in 2006. In Honduras, a progressive liberal democratic President seeking to diversify markets was ousted by a military coup backed by the Obama regime in 2010. In Colombia, the murder of 5,000 activists and leaders of the pro-democracy Patriotic Union between 1984-86, the subsequent assassination of several thousand social activists, blocked a democratic opening. The abrupt termination of peace negotiations in 2002 and the total militarization of the country (2002-2011) funded by $6 billion in US military aid precluded the emergence of the political and social changes, which have dynamized the rest of Latin America’s sustained growth and opened the door for ‘democratic class struggle’.

While most of Latin America has forged ahead, thus far largely avoiding the instability and economic crises of the US and EU, past legacies and present inequities present a new set of structural impediments to the consolidation of long-term growth and political and social stability. The biggest structural contradiction is found in the high growth/increasing inequalities, socio-economic model based on the “3 ½ alliance”: foreign capital-national capital-the developmental state and the co-opted trade union/peasant leaders.

The profits and investments of this power configuration has been driven by the growth of agro-mineral exports, rising commodity prices, easy consumer credit and state regulation of financial markets. The economic returns on growth have been disproportionately appropriated by the “big three” with incremental payoffs to a minority of better paid organized workers. The ‘residuals’ are used to “lift the poor” from abject poverty to subsistence.

These growing inequalities have been “papered over” by the general rise of income, easy credit and improved public services. But rising incomes have set in motion a new set of class conflicts which will be exacerbated when the prices of commodities decline and the governments can no longer fund incremental improvements. Even today, severe conflicts have emerged between predator mining and timber, multi nationals and Indian/peasants in Peru, Ecuador, Bolivia, Brazil, Colombia and Chile. These sometimes violent struggles between the state/MNC and peasants in the “periphery of the countryside” can detonate a larger conflict in the central cities, if export revenues decline.

The second contradiction is between the “marginalized working poor” and a new class of local middle and business class investors who have invested their “savings” in shares of the foreign and locally-owned mining companies. Conservative and closely aligned with the rapacious multi-nationals, these new middle class investors have enriched themselves on the bases of unregulated plunder of natural resources and contamination of the adjoining rural communities. If, and when, commodity prices nose dive, the regimes will face a bankrupt hysterical middle class looking for a political savior where none exist, at least among the existing civilian parties.

The rightward drift of the center-left regimes and their opportune links to big business especially in Brazil, Uruguay, Bolivia, Ecuador and Paraguay has led to corruption in high places. Liberalization and exorbitant executive salaries has been accompanied by “unofficial payoffs” to public officials. Corruptions has eroded the social ethic of center-left politicians and replaced it with the ethos of “bringing in new and bigger investments”, whatever shortcuts and payoffs it requires. Corruption at the top spreads downwards greasing the wheels for foreign investors, but certainly lowering the trust and loyalties of employees and formal and informal workers not in the ‘magic circle’, a bribe takers and givers. “Patronage” and poverty reduction payouts can limit the fallout from corruption in high places among poverty-funded recipients. However, in time of economic downturn, it can turn social protests toward political regime change.

The third contradiction is found between the high level of dependency on commodity exports (which heretofore have been the dynamic element of growth) and the relative and absolute decline of manufacturing exports and production. The growth of income from commodities has led to the appreciation of the currency which has lessened the competitiveness of nationally produced manufactured products, leading to a sharp decline in profits and even bankruptcy.

Asian manufacturer-exporters – especially in China and to a lesser extent India and Korea – are increasingly penetrating Latin markets with lower cost finished products “de-industrializing” the Latin economies. In some cases, Latin American capitalists are looking to investing in Asia to lower costs and exporting back to their “home markets”. Brazilian industry, which has been hardest hit, has initiated “protectionist” measures including tariffs, 65% local content rules and state subsidies to counter the de-diversification of the economy.

The fourth contradiction is found precisely in the successful economic growth and high returns, which has attracted both speculative and “takeover” capital as well as productive investments. Speculative capital will flee and destabilize the financial system at the first sign of slowdown. Foreign ownership will lessen the government’s ability to leverage investment decisions in time of crises. Productive investments respond to expanding markets. They do not create them.

In summary, Latin America’s decade long dynamic growth has certainly out-performed the US and EU on a whole series of important economic, social and political dimensions. Yet, out of this growth have emerged a new set of contradictions and the need to correct increasingly grave “imbalances”: popular demands for a shift in income distribution, industrialist pressure for a rebalancing of the economy from dependence on finance and commodities to manufacturing and the urban poor demand improved social services especially in public health care and crowded classrooms.

These changes require a structural adjustment in the power structure. The economic imbalances reflect the growing concentration of political power among the extractive capitalists, bankers and local middle class investors of the major cities. Public employees, labor, the urban poor, the peasants and environmentally concerned Indians and ecologists, are marginalized from the key economic posts. They need to once again take to the streets with new independent movements which raise two basic questions: What kind of growth and growth for whom?

Lessons of Latin America: Listen Yankees and Eurocrats

Can the positive lessons of the dynamic Latin American experience provide a ‘model’ for the US and Europe? Is the “model”, in whole or part, transferable to the North or are the two regions so different that the lessons are not applicable?

Granted there are vast historical, cultural, economic and political differences between the regions yet some lessons from the Latin America’s decade of dynamic growth provides new ideas to counter the negative, self-defeating economic formulas put forth and practiced by US and EU experts, economists and policymakers.

Let us start from the beginning. The rise of Latin America was precipitated by a deep economic crisis, the breakdown of the economy, large scale unemployment and the impoverishment of the middle class. The crises led to the total discrediting of what has been called alternately the “free market”, “neo-liberal” and “de-regulated” capitalist model. So far so good: the US and EU likewise are experiencing a prolonged and deepening economic crises which has bankrupted Southern Europe, plunged the US into a double dip recession and led to a 20% un and underemployment rate. The entire “political class” in the US and Europe is largely discredited. From there forward the regions diverge.

In Latin America, the crises led to mass protests, popular uprisings and regime changes. Post neo-liberal center-left regimes, under mass pressure, subsequently launched employment generating investments and aid poverty reducing public works programs. Argentina, facing a financial crisis similar to Greece, Portugal and Spain today, defaulted on its foreign debt – channeling public revenues into reviving the economy. Because financial speculation linked to Wall Street and the City of London precipitated the crises, the Latin regimes instituted financial controls and regulations which limited financial volatility. The new regimes, influenced by the commodity boom, diversified their trading partners, entering dynamic Asian markets, reaping high returns and stimulating local consumption and public investments. What lessons can the crises-ridden US and EU learn from the Latin America’s successful recovery and expansion?

First, the beginning of a successful response depends on a political transformation. Regime change, a complete break with the ‘neo-liberal’ free market, and the political leaders and parties who are totally embedded in failed institutions and policies. Regime change presupposes the eruption of dynamic mass organizations, new, old, improvised and organized, capable of moving from protest and resistance to political power.

The object is to rebalance the US and EU economies from “financialization” and “militarism” to large scale, long term investments in manufacturing, applied technology, civilian infrastructure and social services. Direct public investments and loans applied to concrete employment-generating projects; total rejection of trickle down, monetary policies which never move from private banks to public works.

The entire militarist- Zionist-permanent war mentality is entirely vulnerable to change: doing so, will create jobs, the top priority for over two-thirds of the US public. The “war on terrorism”, the banner of the warlords in office, is considered a priority by only 3% of Americans. Once again the shift from militarism to the civilian economy in Latin America was a result of popular civilian upheavals via the street and the ballot box.

Of course, the Latin American republics had an easier time in rebalancing their economic priorities from failed military rulers and discredited neo-liberal policies. Citizen movements in the US and EU imperial states will have a harder time in closing down hundreds of military bases, ousting militarist politicians backed by powerful domestic and foreign lobbies and converting the empires to productive republics. Yet, Latin American exporters have prospered by avoiding entanglement in overseas imperial wars. They continue to pursue new markets in the Middle East and elsewhere instead of destroying adversaries of Israel as the EU and US have done through colonial wars in Iraq and Libya and sanctions against Iran, Syria and Venezuela.

The contrasting performance between Latin American republics and Euro-American empire builders is striking. The US and EU should shed their self-centered images of “successful” developed countries and outdated stereotype of Latin America as a collection of “volatile”, coup prone underdeveloped countries. The US is in deep trouble and it is heading into a deeper, less manageable economic crisis with few resources to counter it. Internationally it is increasingly isolated and in conflict with potential economic partners. Washington sides with Israel, alienating over 1.5 billion rich and poor Islamic peoples, from Saudi Arabia to Pakistan and all points east, west and south. It antagonizes Brazil via financial pump priming, overpricing the real (Brazilian currency) without helping US recovery.
Domestic and international failures multiply as the crisis deepens and nothing proposed by the blighted incumbents and besotted opposition offers any programmatic solution.

As in Latin America during the first years of this decade we need a popular rebellion: we need a profound regime change; we need to think of productive public investments not monumental loss of capital via Wall Street speculation and the waste of public resources via expenditures in weapons of destruction.