After a century of scheming in the Middle East and Central Asia by first Britain and then the US, the tables turned much faster than anyone could have imagined. As the pivotal 2011 draws to a close, it is the perfect moment to look at how we got here. The rollercoaster ride has been long and terrifying, and it is vital to understand where it is taking us.

From the 19th century on, it was clear to imperial strategists such as Cecil Rhodes and Halford MacKinder, motivated by the desire to conquer the world, that the “heartland”, Eurasia, was the key to securing the proposed world empire. WWI was supposed to clinch the deal, with the collapse of the Ottoman Caliphate leaving the Levant “free” to be carved up and secured. The Indian Raj was the empire’s base for securing Central Asia and the Far East .

But the horrors of the war led to an unforeseen result: revolution in Russia, inspiring a growing anti-imperial movement across Eurasia. Inspired by Russian revolutionaries, the Raj seethed in discontent, demanding freedom from the British yoke, and Chinese patriots coalesced around their own rapidly growing Communist movement. Historic Turkestan was now off limits, part of the Soviet Union or in the case of Afghanistan, unconquerable.

WWII erupted as Germany attempted to snatch the world empire from the British and destroy its Russian nemesis, but this merely accelerated the decline of the Euro-imperialists, their schemes exposed as relying on mass slaughter and cold, calculating privilege for the elite of the imperial centre.

When the war ended, there were hopes that imperialism would end too. The empire had been forced to ally with the Communists to defeat the Germans, and to promise to dismantle the imperial system after WWII. This new world order was to be one of independent nations competing on a level playing field. But what should have been the last gasp of this inhuman system of “free trade” in the service of empire gained a new lease on life, as the US had escaped the 20th century’s cataclysms unscathed, and its capitalists were eager to take on the mantle of empire ceded by the bankrupt Brits.

Moreover, a new, subtle but key force in the new empire was the Jewish state established by the British and Americans in the heart of the Middle East, a blatant colonial entity which draped its imperial role in the language of anti-colonial liberation. This, despite the fact that it was created by dispossessing the native Arabs, even as neighbouring Arabs in Syria, Lebanon, Jordan and North Africa were gaining nominal independence from their colonial masters.

This new playing field witnessed a long, bloody match, pitting the empire’s forces against both Communists and anti-colonial forces. After millions of deaths, it culminated in the defeat of the Communists in 1991, and a new game began, with world control once again the prize.

The dreams of revolution and an end to empire were dashed, and this new world order was once again baldly imperial, as planners accelerated their plans, epitomised by the rise of the neoconservatives with their Project for a New American Century, combining market fundamentalism and imperial aggression in a deadly cocktail where there were no longer any geographical limits.

The former Communist union, especially Turkestan, with its strategic location and oil wealth, was quickly brought into the imperial orbit. Even China was accommodated, as it acceded to the world economic order established by the empire after WWII.

But the baggage of empire continued to complicate the picture. The Islamists, so useful in the destruction of the Communist bloc, resisted imperial designs. Israel, also useful throughout the post-WWII struggle against both the Communists and the 3rd world liberation forces, established itself as an independent player and even posed as the new imperial coach, penetrating to the heart of the empire and asserting its own goals of expansion and hostility against its Muslim neighbours.

At its beheast, the resulting wars have been against the Arab and Muslim world, but two decades of attempts to subdue them have merely hardened Muslims’ opposition to empire, even as the devastation caused by imperial designs increases.

Hence, the Arab Spring of 2011 and the accession to power of Islamists via the ballot box across the Middle East . Hence, the unwinnable war against the Afghan people, that brought empire to its knees in fateful 2011, even as the slaughter of insurgents and civilians increased. Yes, the imperialists managed a clever ruse, invading Libya to depose the clownish Gaddafi, but the Islamists and fiercely independent tribes there are unlikely allies of empire.

The tsunami of resistance to imperialism surged throughout 2011 around the world, while the empire’s leaders put a worldwide “missile defence” system in place. But even as radars and missiles were installed in Europe, the rising tide reached the empire’s shores in 2011, as financial crisis led to rising poverty and unrest in the imperial centre itself.

Taking inspiration from the Arab Spring, mass demonstrations in Greece and Spain erupted and Wall Street, the empire’s “heartland”, was occupied. The “99 per cent” entered the political lexicon as the people vs the ruling elite (the 1 per cent who own half of the country’s assets). Even Israel and newly capitalist Russia witnessed mass demonstrations, as ordinary citizens began to realise how the system works, or rather doesn’t work for them. How increasing disparity of wealth is the logical result of market fundamentalism and control of the economy by financial capital.

2011 will go down in history as a year as fateful as 1917, when the blinkers fell away from the common people’s eyes in Russia and they rose up against their oppressors. But while 1917 witnessed a Communist revolution against capitalism and imperialism by a small corps of professional revolutionaries, 2011 has witnessed a mass, leaderless revolution facilitated by telecommunications, and in the case of the key Middle East, inspired by Islam.

There is no Lenin, not even a Gamal Abdel-Nasser, the one Arab leader who managed to slow down the imperial steamroller in the Middle East and is still revered for his defiance. Unlike Communist revolutionaries of yore, the new leaders in the Middle East of what must be called the Islamic revolution of 2011 are not the object of veneration, something that Islam as a religion warns against.

Revolutions always start in the weakest links. Thus, the Middle East has a head start on the revolutionary process over the West, though through the growing Palestinian solidarity movement, notably the global Boycott Divestment and Sanctions campaign, the struggles of East and West are increasingly seen to be one and the same. What will be the decisive test for the new revolutionaries in the Middle East and the West itself is how well they can navigate the political shoals and landmines laid by a century of empire.

How to dismantle apartheid Israel without it unleashing nuclear war on the world? How to put an end to US world financial blackmail centred on the dollar without the US strategists taking everyone else down with them? While the empire is on the defensive, it is still powerful and as its star wanes, it will only become more lethal.

The foes of empire are popping up faster than the empire’s drones can knock them off. They are found not only in Arab (and Persian) lands, or even in a skeptical Russia and still-Communist China. As the links in the system continue to fray, they are increasingly in the heart of the empire itself. Americans and Europeans will continue to develop alternatives to empire, financially, economically and politically, in their own communities and continue to link up with their comrades-against-arms in the heart of the supposed enemy in Eurasia .

More and more Americans are involved in co-ops, worker-owned companies and other alternatives to capitalism. Some 130 million Americans are part owners of co-op businesses and credit unions. As Obama cuts funding to states, the latter considers establishing their own banks and use public pensions to fund state economic development.

There is a wealth of expertise in the “heartland” of the empire that can help show the whole world the way out of the imperial dead end. The new generation in America lacks the Cold War paranoia about socialism: Americans under 30 years old are “essentially evenly divided” as to whether they preferred “capitalism” or “socialism”, according to a 2009 Rasmussen poll.

Even as the world environment degrades, even as imperial arms continue to kill, maim and choke demonstrators and insurgents both at the heart of the empire and in the heart of the “enemy”, we can take heart in the new sense of human dignity which 2011 spawned, and fight the intrigues of empire with new vigour in 2012.

The 1989 novel, titled The Third Reich, is the diary of a German office worker named Udo Bergen and his vacation in Spain. There is a girlfriend, a couple they meet, the hotel owner Frau Else, a man named Quernado who rents paddle boats to tourists and has grotesque burn scars on his body. The girlfriend leaves after a fright; the man in the couple drowns and the hotel owner’s husband is taken away to hospice with terminal cancer. The presence of a board game based on the second world war and also called The Third Reich hangs over the story like a surreal presence. Udo is an expert in board games based on World War Two and even makes extra money writing about strategies for different gaming magazines. For most of the book he and Quernado are engaged in a the Third Reich game. Udo is hoping that he can win as Germany while Quernado’s pieces represent the allies. It is as if the game is as real as life and life is only a game. Bergen even says to his game-playing friend Conrad upon his return from Spain: “We (are) all essentially ghosts on a ghostly General Staff.”

It seems that Quernado identifies Bergen as not only an opponent in the game, but as a potential embodiment of Nazi Germany itself. This is despite Bergen stating specifically to Quernado that he is much more of an anti-Nazi than any Nazi at all. Quernado ignores Bergen and plays the game as if he were fighting the war. Like much of Europe and certainly Germany, the fact of World War Two’s horrors defines everything, albeit in a rather murky manner. The game is nothing but a game except when it becomes more, as it does in the mind of Quernado. History has a similar trajectory. As long as it remains in books and museums (or games) it has little threat. It is when history becomes real that it constitutes something potentially more dangerous.

Like most of Bolano’s novels, The Third Reich comes across as if it were written in a detached fog. Although the narrator Bergen is part of every scene that occurs, his narration of the life he is in the middle of is simultaneously distant and intimate. Like fog, the closer one gets to the situation or person being described, the clearer Bergen’s tale become. Observations about the other characters in the novel are provided with an omniscience that, once considered, are mostly Bergen’s selfish perceptions. As one follows the interactions of the various characters in Bergen’s beach vacation, the egocentric nature of modern individuated society becomes apparent. Every single person portrayed lives alone amongst the crowd in the Spanish resort town. Relationships easily formed are just as easily dismissed. Friendships seem to be anything but that and love is barely more meaningful than renting a room.

Bolano is a master of style and story. The seemingly innocuous life of Udo Bergen the office worker and gamer is on second glance not what it appears. Death, sex, intrigue and the threat of violence simmer beneath the thin flesh of Bolano’s tale. After all is said and done little has changed. That is our curse. I am reminded of the line from Eliot’s The Waste Land: “Oed’ und leer das Meer.” Post industrial equals post-meaningful. Nothing plus nothing is still nothing. The charm is in the telling, not necessarily in the living. Bolano comprehends this fact and tells his story well.

As she assumes the role of keystone for the world’s major economies, the Allies who were ranged against her are now knocking at her door asking for assistance or offering gifts – or both. The foreign minister of Poland went public with a passionate plea for Germany to step in and save his country.

Her suitors are not only her former opponents but also past allies like Japan and Italy. And, in a surprising twist, Switzerland’s perennial neutrality — at least in financial matters — has also been breached. The gifts do not come wrapped in goodwill. They are simply efforts by the central banks and governments of the donors to stave off the worst effects of their own short-sighted policies and decisions.

No one will deny that Germany deserves this victory. Time and time again the country has shown its ability to rise phoenix-like from the ashes of apparent total defeat. Half way through the Series Germany’s position looked perilous as she faced financial ruin. In the third quarter she was broken in half. Yet, masterfully, despite setbacks, through rearmament and rebuilding, she revitalized her economy and reenergized her offense. But, as with every successful outcome, she had the benefit of luck and good timing.

The Western Allies and most of their trading partners, who seemed set to coast home to victory in the final moments, are now being overrun by the actions of international bankers and their own greedy but gullible politicians and populations. As a result partly from rash military engagements abroad, the buildup elephantine security structures at home, plus the need to rescue the same selfsame bankers, most are already so heavily into deficit spending they can’t revitalize their “main street” economies. Instead they glibly pretended that nothing is really wrong. Meanwhile Germany continued to protect its people, its manufacturing base and its markets, pushing its annual exports to over €1 trillion, as it waited for the ideal time to grab the prize. That time has now arrived and Germany is ready to collect.

France, once a client state of Germany during the Series, would like to pretend that it is partnering with her in this moment of victory. France’s Presient is bird-dogging the German Chancellor in much the same way as the British Prime Minister trotted after GW Bush prior to the invasion of Iraq. This is wishful thinking, as even a casual review of the circumstances will reveal that France together with most other states in the Euro Zone will soon move to client status. Germany is already controlling those who have already accepted bailouts like Greece and Ireland with little regard for their sovereignty. Italy, one of Europe’s major economies, is now being run by bureaucrats well versed in the Bundesbank’s strict approach to financial affairs. The British PM, not a member of the Euro club and facing a swelling backlash at home against austerity and tighter EU integration, can only watch irrelevantly from the sidelines as another vestige of the UK’s Great Power status moves to Germany.

NATO too has had to rewrite its goals set out by the first NATO secretary-general, Lord “Pug” Ismay, who coined a the mantra according to which the Atlantic bloc should “keep the Russians out, the Americans in and the Germans down.”

The EU summit at which Germany will set out the treaty changes needed for Germany to step in and shore up the Euro is scheduled for Dec 9. Chancellor Angela Merkel could be forgiving for wondering if the meeting should be held in the historic railway carriage at Compiegne that hosted the signing of the armistice ending WWI in 1918 and France’s capitulation to Germany in 1940. But that would probably too hasty. Time enough for that when the signatures are being attached to the EU treaty changes she is demanding and the game is finally over.

To some people, the European Central Bank seems like a fire department that is letting the house burn down to teach the children not to play with matches.

So wrote Jack Ewing in the New York Times last week.  He went on:

The E.C.B. has a fire hose — its ability to print money. But the bank is refusing to train it on the euro zone’s debt crisis.

The flames climbed higher Friday after the Italian Treasury had to pay an interest rate of 6.5 percent on a new issue of six-month bills . . . the highest interest rate Italy has had to pay to sell such debt since August 1997 . . . .

But there is no sign the E.C.B. plans a major response, like buying large quantities of the country’s bonds to bring down its borrowing costs.

Why not?  According to the November 28th Wall Street Journal, “The ECB has long worried that buying government bonds in big enough amounts to bring down countries’ borrowing costs would make it easier for national politicians to delay the budget austerity and economic overhauls that are needed.”

As with the manufactured debt ceiling crisis in the United States, the E.C.B. is withholding relief in order to extort austerity measures from member governments—and the threat seems to be working.  The same authors write:

Euro-zone leaders are negotiating a potentially groundbreaking fiscal pact . . . [that] would make budget discipline legally binding and enforceable by European authorities. . . . European officials hope a new agreement, which would aim to shrink the excessive public debt that helped spark the crisis, would persuade the European Central Bank to undertake more drastic action to reverse the recent selloff in euro-zone debt markets.

The Eurozone appears to be in the process of being “structurally readjusted” – the same process imposed earlier by the IMF on Third World countries.  Structural demands routinely include harsh austerity measures, government cutbacks, privatization, and the disempowerment of national central banks, so that there is no national entity capable of creating and controlling the money supply on behalf of the people.  The latter result has officially been achieved in the Eurozone, which is now dependent on the E.C.B. as the sole lender of last resort and printer of new euros.

The E.C.B. Serves Banks, Not Governments

The legal justification for the E.C.B.’s inaction in the sovereign debt crisis is Article 123 of the Lisbon Treaty, signed by EU members in 2007.  As Jens Eidmann, President of the Bundesbank and a member of the E.C.B. Governing Council, stated in a November 14 interview:

The eurosystem is a lender of last resort for solvent but illiquid banks. It must not be a lender of last resort for sovereigns because this would violate Article 123 of the EU treaty.

The language of Article 123 is rather obscure, but basically it says that the European central bank is the lender of last resort for banks, not for governments.  It provides:

1.  Overdraft facilities or any other type of credit facility with the European Central Bank or with the central banks of the Member States (hereinafter referred to as ‘national central banks’) in favour of Union institutions, bodies, offices or agencies, central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of Member States shall be prohibited, as shall the purchase directly from them by the European Central Bank or national central banks of debt instruments.

2.  Paragraph 1 shall not apply to publicly owned credit institutions which, in the context of the supply of reserves by central banks, shall be given the same treatment by national central banks and the European Central Bank as private credit institutions.

Banks can borrow from the E.C.B. at 1.25%, the minimum rate available for banks.  Member governments, on the other hand, must put themselves at the mercy of the markets, which can squeeze them for “whatever the market will bear”—in Italy’s case, 6.5%.

The Real Reason Eurozone Countries Are Drowning in Debt

Why should banks be able to borrow at 1.25% from the E.C.B.’s unlimited fountain of euros, while the tap is closed for governments?  The conventional argument is that for governments to borrow money created by their own central banks would be “inflationary.”  But private banks create the money they lend just as government-owned central banks do.  Private banks issue money in the form of “bank credit” on their books, and they often do this before they have the liquidity to back the loans.  Then they borrow from wherever they can get funds most cheaply.  When banks borrow from the E.C.B. as lender of last resort, the E.C.B. “prints money” just as it would if it were lending to governments directly.

The burgeoning debts of the Eurozone countries are being blamed on their large welfare states, but these social systems were set up before the 1970s, when European governments had very little national debt.  Their national debts shot up, not because they spent on social services, but because they switched bankers.  Before the 1970s, European governments borrowed from their own central banks.  The money was effectively interest-free, since they owned the banks and got the profits back as dividends.  After the European Monetary Union was established, member countries had to borrow from private banks at interest—often substantial interest.

And the result?  Interest totals for Eurozone countries are not readily accessible; but for France, at least, the total sum paid in interest since the 1970s appears to be as great as the French federal debt itself.  That means that if the French government had been borrowing from its central bank all along, it could have been debt-free today.

The figures are nearly as bad for Canada, and they may actually be worse for the United States.  The Federal Reserve’s website lists the sums paid in interest on the U.S. federal debt for the last 24 years.  During that period, taxpayers paid a total of $8.2 trillion in interest.  That’s more than half the total $15 trillion debt, in just 24 years.  The U.S. federal debt has not been paid off since 1835, so taxpayers could well have paid more than $15 trillion by now in interest.  That means our entire federal debt could have been avoided if we had been borrowing from our own government-owned central bank all along, effectively interest-free.  And that is probably true for other countries as well.

To avoid an overwhelming national debt and the forced austerity measures destined to follow, the Eurozone’s citizens need to get the fire hose of money creation out of the hands of private banks and back into the hands of the people.  But how?

Governments Cannot Borrow from the E.C.B., but Government-owned Banks Can

Interestingly, Paragraph 2 of Article 123 of the Lisbon Treaty carves out an exception to the rule that governments cannot borrow from the E.C.B.  It says that government-owned banks can borrow on the same terms as privately-owned banks.  Many Eurozone countries have publicly-owned banks; and as nationalization of insolvent banks looms, they could soon find themselves with many more.

One solution might be for the publicly-owned banks of Eurozone governments to exercise their right to borrow from the E.C.B. at 1.25%, then use that liquidity to buy up the country’s debt, or as much of it as does not sell at auction.  (The Federal Reserve does this routinely in open market operations in the U.S.)   The government’s securities would be stabilized, keeping speculators at bay; and the government would get the interest spread, since it would own the banks and would get the profits back as dividends.

Taking a Stand in the Class War

In a November 25th article titled “Goldman Sachs Has Taken Over,” Paul Craig Roberts writes:

The European Union, just like everything else, is merely another scheme to concentrate wealth in a few hands at the expense of European citizens, who are destined, like Americans, to be the serfs of the 21^st century.

He observes that Mario Draghi, the new president of the European Central Bank, was Vice Chairman and Managing Director of Goldman Sachs International, a member of Goldman Sachs’ Management Committee, a member of the governing council of the European Central Bank, a member of the board of directors of the Bank for International Settlements, and Chairman of the Financial Stability Board.  Italy’s new prime minister Mario Monti, who was appointed rather than elected, was a member of Goldman Sachs’ Board of International Advisers, European Chairman of the Trilateral Commission (“a US organization that advances American hegemony over the world”), and a member of the Bilderberg group.  And Lucas Papademos, an unelected banker who was installed as prime minister of Greece, was Vice President of the European Central Bank and a member of America’s Trilateral Commission.

Roberts points to the suspicious fact that the German government was unable to sell 35% of its 10-year bonds at its last auction; yet Germany’s economy is in far better shape than that of Italy, which managed to sell all its bonds.  Why?  Roberts suspects an orchestrated scheme to pressure Germany to back off from its demands to make the banks pay a share of their bailout.

Europe is in the process of being “structurally readjusted” by a private banking cartel.  If its people are to resist this silent conquest, they need to rise up and, using the ballot box and public banks, throw out the new banking hegemony before it is too late.

According to official figures released by the Bahrain Center for Human Rights website, so far 44 Bahraini citizens were killed at the hands of the mercenaries of Al Khalifa regime. The Bahraini martyrs include the 6-year-old Mohammed Farhan, 14-year-old Ali Jawad Alshaikh and 15-year-old Sayed Ahmad Saeed Shams. The Bahraini organization has reported that many of these martyrs were killed while in custody. The Center has also published documents indicating that more than 1,500 Bahrainis, including about 100 women, were incarcerated since the eruption of turmoil in the Persian Gulf country on February 14, 2011 and that more that 90 journalists face life threat.

It’s also said that the Bahraini government has blocked the citizens’ access to more than 1000 opposition websites which are mainly used to organize and plan protests and mass demonstrations.

The Bahraini regime commits all of these aggressive and brutal actions with the direct involvement of Saudi Arabia and the implicit support and backing of NATO and the United States. The author of the Hidden Harmonies China blog in a March 14, 2011 post referred to the abuses of human rights in Bahrain with the flagrant, duplicitous support of the White House: “the Entry of Saudi security forces to crack down on the protesters with deadly force is a complication for U.S. policies, to say the least, since U.S. is reluctant to criticize its oil ally dictators in the region.”

He also called Bahrain the “Las Vegas” of the Middle East, host to the U.S. 5th Fleet and a haunt for the rich Saudis who are forbidden by Islamic laws at home from indulging in alcohol and other immoral enjoyments, “but who often vacation in Bahrain for these reasons.”

Bahraini citizens have uploaded several video files on the internet, showing the cruel and ruthless torturing and persecuting of the protesters by the Al Khalifa lackeys. These videos depict the Bahraini forces using tear gas and rubber bullets to disperse protesters and killing many of them straight away. Some of these videos also show the Saudi and Bahraini cars nonchalantly running over Bahraini children and women, killing them at once.

The U.S.-Saudi project of crackdown on the Bahraini people was also empowered by many of the European cronies of Washington. In July 2011, Germany sold a set of 200 62-ton Leopard tanks to Saudi Arabia which sparked a huge controversy among the German parliamentarians and anti-war activists. According to the Daily Telegraph, Wolfgang Gerhardt, former leader of the Free Democrats, the junior collation member to Chancellor Angela Merkel’s Christian Democrats, said it was “unacceptable” the deal went through without the knowledge of his party’s MPs. However, the agreement which was worth around USD 1,252 million was concluded and the Saudi government dispatched many of these newly-bought tanks to Bahrain to accelerate and facilitate the bloody clampdown on the protesters.

The situation in Yemen, however, is far more deplorable and appalling. Allvoices.com has reported that as of September 25, 1,870 Yemenis were killed in the revolution and the majority of the martyrs were unarmed civilians taking part in anti-government demonstrations.

The Yemeni dictator who has remained defiant in the face of frequent calls by the tribal leaders, opposition groups and demonstrators to step down and give up power has turned his country into a bloodbath and made the Yemeni uprising the longest, most devastative revolution in the revolutionary wave of protests in the Middle East. The protests in Yemen started on February 3, 2011 and have continued so far. The only reaction of the international community to the brutality in Yemen was an indecisive and faltering resolution by the UNSC which called for “an end to violence” and asked President Ali Abdullah Saleh to accept a peace deal brokered by the Persian Gulf Cooperation Council. However, Abdullah Saleh, who is tacitly supported by the U.S., kept up with the brutalities and according to Yemen Times, 94 protesters were killed after the Security Council adopted the resolution 2014.

In a report published on Yemen Times on November 17, it was revealed that “ninety-four Yemenis were killed and over 800 injured since UN Resolution 2014 was issued on October 21.”

“Tentative reports show that over the last three weeks in Yemen, 124 homes, seven mosques, six public institutions including one hospital, two community wells, and 17 vehicles were effectively destroyed,” Yemen Times reported.

In the days leading to the detainment and death of Moammar Gaddafi, the Western mainstream media were only talking about the Libyan civil war, and the reason was clear: NATO had secured a UNSC resolution to enact a no-fly zone over Libya and it was in the interests of the U.S. and its European partners to give coverage to the tumultuous situation in the North African country. However, the reports and news regarding the carnage in Bahrain and Yemen were predominantly shunned and boycotted, simply because these two despotic regimes were close allies of the U.S. in the Middle East.

In a report published on Independent Australia, Zaid Jiani alluded to the violent crackdown on the protesters in Bahrain and Yemen and posed the question: “is the media downplaying these events because the two dictatorships are firm allies of the West?”

A Think Progress analysis of press coverage by the three major U.S. cable news networks – CNN, MSNBC, and Fox News – from March 14 to March 18 finds that Bahrain received only slightly more than ten percent as many mentions as Libya and that Yemen received only six percent as many mentions as Libya.

Now what concerns the independent thinkers, scholars, university professors, journalists and peace activists is that Syria has become the target of international pressure, simply because it has strong ties with Iran and resistant groups in Lebanon and Palestine, while the reactionary regimes of Bahrain and Yemen are getting away with the felonies which they commit by the virtue of their alliance with the United States.

The Arab League has vindictively suspended the participation of Syria while it has taken no practical step to normalize the situation in the turbulent and chaotic Yemen and Bahrain in which innocent people are being killed on a daily basis by their tyrannical rulers and their loyalists.

All that can be said is that the performance of the Arab League in neglecting the situation in Yemen and Bahrain and exaggerating the unrest in Syria, which is mainly caused by the foreign intervention and the West’s indifference toward the plight of the suppressed nations in Yemen and Bahrain, is an all-out hypocrisy and a clear, undeniable exercise of double standards. Who can really devise a clear-cut solution for this unsolvable dilemma?

The popular perception is that the ordinary people have been living “beyond their means”, a false and invidious conventional wisdom which masks the real nature of the crisis. For it is the elites across Europe and the Americas who have benefited most from the European Union, built on Reaganite neoliberalism, which in turn was fashioned to meet the needs of business. The neoliberal policies of all Western governments, “left” or “right” during the past three decades are the direct cause of the current highly skewed income distribution – by some accounts, worse than in any previous era of human history.

The supposed generous patriarch of this big happy family is Germany, with its hard workers and tidy streets. But while the Aesopian Greek hares are told they must tighten their belts and make do with less health and education, the fact that the Greek arms imports continue to grow — importing German weapons and “defence” systems (against what threat?) — is not mentioned. And it is not only weapons, but consumer goods from Germany that have displaced Greek products in the anonymous Euro-market, as Greece increasingly becomes northern Europeans’ decadent playground, albeit with more than its fair share of un- and under-employed.

As long as banks were lending freely to governments to finance this fool’s paradise, the lower classes were not made to feel the pinch, and the system kept chugging along. Now that government debts and bank reserves have approached their limit and reckless banks are going bankrupt, the struggle is on over who should pay for the untenable system. Since the economic elites are also the political elites, naturally they want the broad people to pay with social service cuts, reduced and delayed pensions, regressive sales taxes and the like. The intense propaganda campaign now underway is to convince the poor in the Euro-laggards that they are the guilty ones, not their own elites or the Euro-elites in Frankfurt or Berlin or wherever.

The EU was a project to end the prospect of war in Europe and to gather the broken pieces of shattered empires into a workable collective economic-political force in the world. To a surprising extent it succeeded, but without facing hard choices and a frank debate about who benefits. As the problems sharpen, any sense of collective goodwill evaporates, and chauvinist, even racist parties gain rapidly in popularity, hearkening back to faux-halcyon days of distant imperial privilege. But as history shows, the ability of individual European countries to extract surplus from colonies is not guaranteed indefinitely. The same goes for the ability of Germany to lord it over its Euro-partners. As the knives come out, the very existence of the European project comes into question.

The rich standard of living that Europe has enjoyed over the past few decades is directly a result of first the import of Third World workers (to a large extent Muslim) and then the incorporation of the ex-Socialist bloc after the collapse of the Soviet Union in 1991. As the financial crisis plays itself out, these immigrant workers, the very ones who have served Europeans so well, are now targeted and racially profiled, as the elites try to deflect attention from their own hidden role in the ongoing crisis. This is the First World/Third World extension of the above argument about Euro-laggards, with the victims no longer the Greek hares, but Nigerian and Egyptian immigrants.

A similar tale can be told for the US , with its large immigrant population, its Tea Partiers and Islamophobes, unable or unwilling to face the underlying problems resulting from decades of neoliberal policies. In the Americas, it is China that provides the manufactured goods which are paid for by US treasury bonds piling up in Chinese bank vaults, and no one in particular is accused of being the carefree Aesopian hare — state governments merely use their deficits as the deus ex machina — but the pattern is the same.

As the people who have woken up to the reality are arrested and booted out of Trafalgar Square, Zuccotti Park, Chapman Square (Oakland) and dozens of other city commons around the world, the long cold winter of discontent sets in. However, the problems are going nowhere and the people are just waiting for the next opportunity to express their outrage.

The toppling of governments means nothing in this scenario. Italy’s Silvio Berlusconi and Greece’s George Papandreou only handed over power on the explicit understanding that the “fresh faces” would carry out the austerity plans imposed by the EU heavyweights. Berlusconi’s replacement is 68-year-old, ex-EU commissioner Mario Monti, an economics professor steeped in the dogmas that brought Italy to its current impasse. Papandreou’s replacement is ex-European Central Bank vice president Lucas Papademos who immediately announced, “Our membership of the euro is our only choice.” Not much thinking outside the box from these folks, the very ones who got their people into their present fix.

Some Americans at the top are already awake. The 138 members of “Patriotic Millionaires for Fiscal Strength” (0.005% of all US millionaires) have been lobbying President Barack Obama and congressional leaders for a year now pleading with them: “Please do the right thing, raise our taxes.” Not surprisingly, no response from a president and Congress beholden to the 3.1 million other millionaires — the proverbial 1%.

Occupy Washington DC published their no-brainer proposals 17 November: redistribute income through progressive taxation, end the wars, expand health care, democratise business. This will end the budget deficit overnight, create full employment through stimulating local demand, eventually ending the foreign trade deficit, making America strong and once again the envy of the world. But, of course, Congress is captive to the current military industrial complex, and can and will do nothing.

The slow-motion drift into oblivion is surreal. Clearly momentous changes are in store for both Europe and America, and the sooner thinkers and actors get to work coming to grips with hard, cold reality, the better for the people — and for the elites, who are living on borrowed time, too. How long before the revolution?

Commentators and journalists hardly ever ask the two most important questions. Why? How?

The Euro as the currency of seventeen diverse countries with their different cultures, lifestyles, traditions, tax and spend regimes is dead.  The sooner we realise that, the better it will be for everyone.  Research by the Centre for Economic and Business Research (CEBR) predicts a rosier future after a short sharp shock of eurozone collapse.

In an article in the Telegraph, headlined “Collapse of the Euro will help Britain”, the conclusions of the research are presented as:

Britain will be better off in five years’ time if the eurozone breaks up than if the single currency survives the debt crisis, research suggests today.  The disorderly break-up of the euro would mean a short, sharp economic shock and probably a recession, but would be followed by a quicker return to strong economic growth, according to the Centre for Economics and Business Research.  The economists also predict that break-up would free many eurozone members from the deficit-cutting austerity policies that threaten to subdue their growth for years.

The article quotes the research thus:

If it [the eurozone] breaks up the immediate pain is much more intense, but then there is a more stable basis and we would expect that within about 30 months growth will actually be faster than if the eurozone survives in its current form.

I am no economist, but this analysis makes a lot of sense to me and probably to most people in Europe.  In the absence of cogent explanations to the contrary from politicians who have invested a lot of capital in the Euro, and are influenced by self serving institutions and lobbyists, I believe the CEBR conclusions.

The clash between democratic ideals and the straight jacket of the Euro is succinctly put in this scenario by Jackie Ashley in the Guardian:

David Cameron and George Osborne have resigned. They did their best, but were unable to carry support, even in the Tory party, for the devastating attacks on pensions and living standards the markets demand. To prevent a British default, Reginald Pinstripe-Grey, formerly chief economist of Megabank in New York, is to be installed in the Lords as acting prime minister, leading a Government of Unity and Patriotism.  In London, representatives from the EU and German “advisers” will sit alongside the truncated cabinet. British MPs have been warned that any attempt to resist the extreme austerity measures by parliamentary vote will result in the final collapse of the British economy, and anarchy. No elections will be held in the meantime.  Orwellian fantasy? The plot of an unlikely TV drama? For many voters in Greece, and Italy too – despite joy at the disappearance of the idiotic Berlusconi – this effective suspension of democracy feels all too here-and-now.

What is happening in Italy and Greece could well be repeated in Portugal, Spain…etc. The position of the British government is curious and contradictory.  Having congratulated itself for staying out of the eurozone, British politicians, nevertheless, urge other countries to save the Euro.  If it is right for Britain to be out of the euro, surely it is right for other countries to ditch it.

It is one thing for people to enact measures through democratically elected politicians, it is quite another to be told to swallow a medicine that is causing a lot of pain by leaders of other countries and unelected bodies such as the ECB, financiers, and the IMF.

The remarks by Angela Merkel would be more accurate if turned on their head.  The austerity and hardships imposed on people to save the Euro are leading to disharmony, division and hostility between the peoples of Europe.  This is the opposite to the European ideals of unity under the banner of freedom, democracy and human rights.   Now Mrs. Merkel, these are ideals worth fighting for, not the Euro.

For Germany (and her American ally) the Euro-zone is ‘too big to fail.’ And since the European Union lacks a mechanism like the U.S. Federal Reserve Bank, only Germany is in a position to underwrite the necessary major bailout. This is a financial gamble of historic proportions, and it comes at a political price: German hegemony in Europe.

Bismarck Makes Germany a Great Power

Paul Kennedy’s classic The Rise and Fall of the Great Powers (1987) classifies Germany as the hegemonic (or would-be hegemonic) military-industrial power in Europe from the year 1870. That was when Bismarck, the ‘Blood and Iron’ Chancellor of Prussia, tricked the French Emperor Napoleon III into hastily starting a war that Prussia had long been preparing for. After a stunning defeat (Napoleon was take prisoner when the Prussians surrounded the main French army), Bismarck crowned his somewhat reluctant feudal sovereign as Kaiser Wilhelm I, ruling a vastly expanded, united German Reich (including two captured French provinces and most of the Southern German-speaking states) from his own capital, Berlin.

By the end of the 19th Century, efficient, scientifically-organized German industry was challenging Britain’s outdated industrial plant for economic supremacy. Meanwhile, Prussian militarism, supported by this industrial and financial expansion, prepared for future political hegemony and territorial expansion. During the 20th Century, two drawn-out mechanized World Wars were required to prevent the German Reich from transforming her industrial and financial power into imperial domination of the Continent. The main factors that prevented capitalist Germany’s ‘natural’ ascendancy to European hegemony were military: 1) Geography. Situated in the center of Europe between the vast Russian Empire and her ally the French Republic (still a major military power), Germany was obliged to fight on at least two fronts in both 1914 and 1940, as well as at sea against the formidable British Navy; 2) the rise of a new, and vastly richer military-industrial power, the United States, allied with France and Britain.

Defeated, Divided and Demilitarized, Germany Rebounds

In 1945, the demilitarization and division into East and West of post-WWII Germany was designed to prevent yet another attempt at hegemony, but by 1960 (the year I bought my first VW !) West Germany’s industrial plant had risen from the ruins, modernized and become competitive with U.S. industry. Moreover, demilitarization freed up huge amounts of German capital, whereas Germany’s conquerors, the U.S. and the USSR, were draining their economies in a costly arms race. Moreover, West Germany found unlikely support from an ex-enemy — Charles de Gaulle of France –who forged a close alliance with Chancellor Adenauer, while carrying out a foreign policy independent of the U.S., during the Cold War. By the 1970’s, West German leader Willi Brandt dared to break the ice of the Cold War with his independent Ostpolitik, opening up lucrative German trade with her Warsaw Pact neighbors. Today, Germany and Russia are staunch allies and trading partners to the point where Immanuel Wallerstein talks of a Paris-Berlin-Moscow Axis.

United Germany’s Great Gamble

When the Soviet Empire collapsed and the two Germany’s were reunited in 1990, far-seeing West German capital took the risk of investing huge amounts in integrating and modernizing the impoverished East. The West German investors’ bet paid off — so successfully that a former East German, Angela Merkel, is now ruling a populous, rich, and powerful united Germany, where she presides over the Berlin Chancellery established at by Bismarck back in 1871.

Chancellor Merkel, like Bismarck a Conservative, has dragged her centrist coalition, uniting all factions of German capitalism, into another daring bet. The terms? Bail out the Euro zone and end up owning it: achieve hegemonic power, without militarism. Using diplomacy and ‘soft’ power, the Chancellor will now collect the debts that the Greeks and Italians owe the Frankfort bankers as effectively as the U.S. Marines collected the Central American debts for the N.Y. bankers a century ago. Only, instead of sending gunboats, Merkel has used canny diplomacy and financial clout to engineer the fall of Papandreou and Berlesconi, Europe’s two longest-serving and popular Prime Ministers. (Papandreou was brave enough to call her bluff and announce a popular referendum on the Euro at the Nice summit, but then he shamefacedly backed down). That crafty manipulator Bismarck (who after 1870 actually preferred diplomacy to war) would have been proud of his disciple.

Two Bloodless Beheadings

The deposed Greek and Italian heads of government have now been replaced by ‘technocrats’ subservient to the German-dominated European Union Central Bank. The Chancellor has just dispatched teams of German bankers to ‘advise’ them, much as U.S. Embassy staff ‘advised’ the Mexicans and Nicaraguans: pay up or else! The advisors are there to make sure that the technocratic puppet regimes carry out the most stringent austerity measures and force the Greek and Italian working people to pay the debts previously contracted by their own bankers and rulers. This may not prove to be easy.

Meanwhile, the future implications of Merkel’s historic ‘beheading’ of two European heads of state may be as far reaching in their own way as the double beheading in Tunisia and Egypt. To begin with, Germany’s de facto imposition of these super-national ‘receivership’ regimes means an end to democracy and national sovereignty for Greece and Italy. Ancient Europe’s two historical Great Powers, the fountains of European civilization, the cradles of democracy and of the rule of law, are henceforth vassals states under the regency of German and North European banking capital.

From an international perspective, Merkel’s diplomacy and soft power have succeeded in dominating two countries where Hitler’s hoards came a cropper. As for Germany’s once-vulnerable Eastern front, Wallerstein’s Paris-Berlin-Moscow Axis has literally been sealed in concrete with the recent innauguration of the Nordstream pipeline, which will provide Germany with an endless supply of cheap Russian gas and a bottomless market for Mercedes and VWs. And this time around, the U.S., whose precarious finances also depend on the stability of the Euro, will have to support Germany, even if this means reinforcing a rival German-dominated European economy more powerful and productive than the declining American economy. Merkel’s Bismarckian diplomacy has thus succeeded in removing the three principal historical obstacles to German economic-military hegemony: 1) the geographical necessity for a Central European Power to fight a two-front war; 2) the unmatched military and economic power of the United States; 3) inadequate access to modern petroleum-based fuels.

New Possibilities for Struggle?

From the perspective of the European class struggle, this new situation creates new possibilties. For over a year now, the Greek youth and working classes have been striking and rioting against being forced to ‘pay for their crisis’, and now the Italians, with a long history of self-organization, will be called upon to defend their interests as well. These inevitable struggles will take place in the revolutionary atmosphere initiated in the Arab Spring and now gone global with the Occupy Wall Street movement of the 99%-ers. No more illusions about capitalism’s ‘trickle-down’ effect. Moreover, the new technocratic rulers of Greece and Italy and their bean-counting German advisors will be hard put to cope politically with rebellious populations who will see themselves as debt-slaves to the creditor German banks. It would take a showman like Berlesconi or a populist ‘Socialist’ like Papandreou to continue to bambozzle the masses into acquiesance, and now they are gone.

In this new situation in Greece and Italy, one can expect both a rise of national resentments and splits in the national bourgeoisie between ‘Europeans’ and local business interests (tourism, export industries) who may support the working classes, perhaps demanding exit from the Euro so as to devaluate their currencies and become competitive again. If national resentment doesn’t turn into Chavinism and if the bourgeois allies fail to dominate the popular front with the 99%, these developments may open up new prospects for struggle. The key factor will be internationalism. Only if the Greek and Italian working classes are able to unite (and draw in the Spanish, Irish and other European workers) will they escape from debt-slavery to the German-dominated European banks.

Up to now, the European labor unions and the Left parties (Communists and Socialists) have succeeded in confining class conflicts within their national borders, while limiting resistance to ritual one-day ‘general strikes,’ and channeling discontent into local and national elections. (Of course elections are now superfluous under appointed receivership governments responsible to a European super-government). Nonetheless, the entrenched, class-collaborationist national labor unions and ‘Left’ parties — although rejected wholesale by Greek youth and the Spanish indigñados — still have a powerful influence in Italy and France. If more spontaneous, self-organized, horizontal movements like the Arab Spring, the indigñados, and the international Occupy Everything movement spread into Old Europe (including Germany), the straightjacket hold of the official Left on European social movements may be broken, releasing new energies and the creation of international solidarity among the 99%.

This solidarity will be needed when the next financial bubble bursts — as it inevitably will — and turns the Great Recession (from which only the 1% have ‘recovered’) into a globalized Second Great Depression.

Workers first detected an ammonia leak in a water purification system about 3 p.m. Ammonia, when mixed into air, is toxic. The 30 gallons of ammonia were caught in a holding tank and posed no health risk, according to the Nuclear Regulatory Agency (NRC).

During the 1970s and 1980s, at the peak of the nuclear reactor construction, organized groups of protestors mounted dozens of anti-nuke campaigns. They were called Chicken Littles, the establishment media generally ignored their concerns, and the nuclear industry trotted out numerous scientists and engineers from their payrolls to declare nuclear energy to be safe, clean, and inexpensive energy that could reduce America’s dependence upon foreign oil.

Workers at nuclear plants are highly trained, probably far more than workers in any other industry; operating systems are closely regulated and monitored. However, problems caused by human negligence, manufacturing defects, and natural disasters have plagued the nuclear power industry for its six decades.

It isn’t alerts like what happened at San Onofre that are the problem; it’s the level 3 (site area emergencies) and level 4 (general site emergencies) disasters. There have been 99 major disasters, 56 of them in the U.S., since 1952, according to a study conducted by Benjamin K. Sovacool Director of the Energy Justice Program at Institute for Energy and Environment  One-third of all Americans live within 50 miles of a nuclear plant.

At Windscale in northwest England, fire destroyed the core, releasing significant amounts of Iodine-131. At Rocky Flats near Denver, radioactive plutonium and tritium leaked into the environment several times over a two decade period. At Church Rock, New Mexico, more than 90 million gallons of radioactive waste poured into the Rio Puerco, directly affecting the Navajo nation.

In the grounds of central and northeastern Pennsylvania, in addition to the release of radioactive Cesium-137 and Iodine-121, an excessive level of Strontium-90 was released during the Three Mile Island (TMI) meltdown in 1979, the same year as the Church Rock disaster. To keep waste tanks from overflowing with radioactive waste, the plant’s operator dumped several thousand gallons of radioactive waste into the Susquehanna River. An independent study by Dr. Steven Wing of the University of North Carolina revealed the incidence of lung cancer and leukemia downwind of the TMI meltdown within six years of the meltdown was two to ten times that of the rest of the region.

At the Chernobyl meltdown in April 1986, about 50 workers and firefighters died lingering and horrible deaths from radiation poisoning. Because of wind patterns, about 27,000 persons in the northern hemisphere are expected to die of cancer, according to the Union of Concerned Scientists. An area of about 18 miles is uninhabitable. The nuclear reactor core is now protected by a crumbling sarcophagus; a replacement is not complete. Even then, the new shield is expected to crumble within a century. The current director at Chernobyl says it could be 20,000 years until the area again becomes habitable.

In March, an earthquake measuring 9.0 on the Richter scale and the ensuing 50-foot high tsunami wave led to a meltdown of three of Japan’s Fukushima Daiichi nuclear reactors. Japan’s nuclear regulatory agency reported that 31 radioactive isotopes were released. In contrast, 16 radioactive isotopes were released from the A-bomb that hit Hiroshima August 6, 1945.  The agency also reported that radioactive cesium released was almost 170 times the amount of the A-bomb, and that the release of radioactive Iodine-131 and Strontium-90 was about two to three times the level of the A-bomb. The release into the air, water, and ground included about 60,000 tons of contaminated water. The half lives of Sr-90 and Cs-137 are about 30 years each. Full effects may not be known for at least two generations. Twenty-three nuclear reactors in the U.S. have the same design—and same design flaws—as the Daiichi reactor.

About five months after the Daiichi disaster, the North Anna plant in northeastern Virginia declared an alert, following a 5.8 magnitude earthquake that was felt throughout the mid-Atlantic and lower New England states. The earthquake caused building cracks and spent fuel cells in canisters to shift. The North Anna plant was designed to withstand an earthquake of only 5.9–6.2 on the Richter scale. More than 1.9 million persons live within a 50-mile radius of North Anna, according to 2010 census data.

Although nuclear plant security is designed to protect against significant and extended forms of terrorism, the NRC believes as many as one-fourth of the 104 U.S. nuclear plants may need upgrades to withstand earthquakes and other natural disasters, according to an Associated Press investigation. About 20 percent of the world’s 442 nuclear plants are built in earthquake zones, according to data compiled by the International Atomic Energy Agency.

The NRC has determined that the leading U.S. plants in the Eastern Coast in danger of being compromised by an earthquake are in the extended metropolitan areas of Boston, New York City, Philadelphia, Pittsburgh, and Chattanooga. Tenn. The highest risk, however, may be California’s San Onofre and Diablo Canyon plants, both built near major fault lines. Diablo Canyon, near San Luis Obispo, was even built by workers who misinterpreted the blueprints.

Every nuclear spill affects not just those in the immediate evacuation zone but people throughout the world, as prevailing winds can carry air-borne radiation thousands of miles from the source, and the world’s water systems can put radioactive materials into the drinking supply and agriculture systems of most nations. At every nuclear disaster, the governments eventually declare the immediate area safe. But animals take far longer than humans to return to the area. If they could figure out that radioactivity released into the water, air, and ground are health hazards, certainly humans could also figure it out.

Following the disaster at Daiichi, Germany announced it was closing its 17 nuclear power plants and would expand development of solar, wind, and geothermal energy sources. About the same time, Siemens abandoned financing and building nuclear power plants, leaving only American-based Westinghouse and General Electric, which own, or have constructed, about four-fifths of the world’s nuclear plants, and the French-based Areva.

The life of the first nuclear plants was about 30–40 years; the newer plants have a 40–60 year life. After that time, they become so radioactive that the risk of radiation poison outweighs the benefits of continuing the operation. So the operators seal the plant and abandon it, carefully explaining to the public the myriad safety procedures in place and the federal regulations. The cooling and decommissioning takes 50–100 years until the plant is safe enough for individuals to walk through it without protection. More critical, there still is no safe technology of how to handle spent control rods.

The United States has no plans to abandon nuclear energy. The Obama administration has proposed financial assistance to build the first nuclear plant in three decades, and a $36 billion loan guarantee for the nuclear industry. However, the Congressional Budget Office believes there can be as much as 50 percent default.  Each plant already receives $1–1.3 billion in tax rebates and subsidies. However, in the past three years, plans to build nuclear generators have been abandoned in nine states, mostly because of what the major financiers believe to be a less than desired return on investment and higher than expected construction and maintenance costs.

A Department of Energy analysis revealed the budget for 75 of the first plants was about $45 billion, but cost overruns ran that to $145 billion. The last nuclear power plant completed was the Watts Bar plant in eastern Tennessee. Construction began in 1973 and was completed in 1996. Part of the federal Tennessee Valley Authority, the Watts Bar plant cost about $8 billion to produce 1,170 mw of energy from its only reactor. Work on a second reactor was suspended in 1988 because of a lack of need for additional electricity. However, construction was resumed in 2007, with completion expected in 2013. Cost to complete the reactor, which was about 80 percent complete when work was suspended, is estimated to cost an additional $2.5 billion.

The cost to build new power plants is well over $10 billion each, with a proposed cost of about $14 billion to expand the Vogtle plant near Augusta, Ga. The first two units had cost about $9 billion.

Added to the cost of every plant is decommissioning costs, averaging about $300 million to over $1 billion, depending upon the amount of energy the plant is designed to produce. The nuclear industry proudly points to studies that show the cost to produce energy from nuclear reactors is still less expensive than the costs from coal, gas, and oil. The industry also rightly points out that nukes produce about one-fifth all energy, with no emissions, such as those from the fossil fuels.

For more than six decades, this nation essentially sold its soul for what it thought was cheap energy that may not be so cheap, and clean energy that is not so clean.

It is necessary to ask the critical question. Even if there were no human, design, and manufacturing errors; even if there could be assurance there would be no accidental leaks and spills of radioactivity; even if there became a way to safely and efficiently dispose of long-term radioactive waste; even if all of this were possible, can the nation, struggling in a recession while giving subsidies to the nuclear industry, afford to build more nuclear generating plants at the expense of solar, wind, and geothermal energy?

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.

It has since emerged that despite legal requirements that police do so only with a warrant and only if surveillance intercepts are used to prevent threats to “life, limb or liberty,” authorities are not complying with strict limits laid down by Germany’s Supreme Court.

And while these disclosures may have ignited a political firestorm in Berlin, they will come as no surprise to readers of Antifascist Calling.

Three years ago, I reported that Germany’s foreign intelligence service, the Bundesnachrichtendienst or BND, was caught up in a major scandal after the whistleblowing web site WikiLeaks, published documents which revealed that the agency had extensively spied on, and even recruited, journalists for use in illicit intelligence operations.

Recalling the CIA’s long-running Operation Mockingbird program that enrolled journalists as spies in what are now euphemistically called “influence operations,” the covert manipulation of the domestic and foreign press according to WikiLeaks, showed “the extent to which the collaboration of journalists with intelligence agencies has become common and to what dimensions consent is manufactured in the interests of those involved.”

BBC News reported that “Bavaria has admitted using the spyware, but claimed it had acted within the law.” And Deutsche Welle disclosed that “several additional German states have admitted to deploying spyware,” including “Baden-Württemberg, Brandenburg, Schleswig-Holstein and Lower Saxony,” but like their counterparts in Bavaria, those officials also claimed they had operated “within the parameters of the law.”

As I have written many times, the secret state is bound by their own set of “laws.” Normal rules and procedures which are supposed to protect citizens from unwarranted government intrusions are deemed inoperative for reasons of “national security.”

In the United States, constitutional protections designed to guarantee the right of citizens to protest, enjoy a modicum of privacy in their daily lives or, at the most basic level, have their day in court before being executed, have been overthrown by two successive administrations who assert the right to conduct the affairs of state in secret, according to a set of legal guidelines which are unreviewable by any court.

It would appear that similar moves are underway in Germany.

‘Backdoor Functionality’

The Chaos Computer Club revealed in their analysis that when they reverse engineered the program, variously dubbed “0zapftis”, “Bundestrojaner” or “R2D2,” they discovered that the spyware “found in the wild” and “submitted to the CCC anonymously,” can “not only siphon away intimate data but also offers a remote control or backdoor functionality for uploading and executing arbitrary other programs. Significant design and implementation flaws make all of the functionality available to anyone on the internet.”

Club researchers learned that “the trojan’s developers never even tried to put in technical safeguards to make sure the malware can exclusively be used for wiretapping internet telephony, as set forth by the constitution court. On the contrary, the design included functionality to clandestinely add more components over the network right from the start, making it a bridge-head to further infiltrate the computer.”

“The government malware can,” analysts noted, “unchecked by a judge, load extensions by remote control, to use the trojan for other functions, including but not limited to eavesdropping.”

“This complete control over the infected PC, is open not just to the agency that put it there, but to everyone. It could even be used to upload falsified ‘evidence’ against the PC’s owner, or to delete files, which puts the whole rationale for this method of investigation into question.”

Their study also “revealed serious security holes that the trojan is tearing into infected systems. The screenshots and audio files it sends out are encrypted in an incompetent way, the commands from the control software to the trojan are even completely unencrypted. Neither the commands to the trojan nor its replies are authenticated or have their integrity protected.”

“We were surprised and shocked by the lack of even elementary security in the code. Any attacker could assume control of a computer infiltrated by the German law enforcement authorities,” a CCC spokesperson commented. “The security level this trojan leaves the infected systems in is comparable to it setting all passwords to ’1234′.”

Nothing ‘Magical’ about this ‘Lantern’

There are glaring similarities between the “R2D2″ package deployed by German police and “Magic Lantern” software used by the FBI. As with Bureau spyware, the German program is a keystroke logging virus installed via a malicious email attachment or by exploiting operating system vulnerabilities.

When news of the FBI program first broke back in 2000, the Electronic Privacy Information Center (EPIC) obtained documents under a Freedom of Information Act request relating to the system, which were part of a suite of surveillance tools then called Carnivore.

At the time, EPIC revealed that the FBI “had developed an Internet monitoring system that would be installed at the facilities of an Internet Service Provider (ISP) and would monitor all traffic moving through that ISP.”

Once a user is spoofed into installing the malicious Trojan, it is activated when PGP encryption is used to enhance email security. When switched on, the Trojan will log the PGP password which will then allow the agents to read the encrypted communications unbeknownst to the sender. Since its first iteration in the 1990s, such programs are exponentially more sophisticated and are now capable of scooping-up virtually everything a user stores on a computer or handset.

A 2007 exposé by Wired Magazine revealed that Magic Lantern’s “computer and internet protocol address verifier” or CIPAV, “gathers a wide range of information, including the computer’s IP address; MAC address; open ports; a list of running programs; the operating system type, version and serial number; preferred internet browser and version; the computer’s registered owner and registered company name; the current logged-in user name and the last-visited URL.”

And once that data was obtained, it was siphoned-off to the Bureau’s technology laboratory in Quantico, Virginia via fiber optic splitter cables.

As whistleblower Babak Pasdar revealed in 2008, following earlier disclosures by AT&T whistleblower Mark Klein, Verizon, and other giant telecommunications firms, including AT&T, maintained a high-speed DS-3 digital line that handed the Bureau and other security agencies “unfettered” access to the carrier’s wireless network, including billing records and customer data “transmitted wirelessly.”

Just after the scandal broke, Wired Magazine disclosed that “two years before the Bavarian state in Germany began using a controversial spy tool to gather evidence from suspect computers, German authorities approached the Federal Bureau of Investigation to discuss a similar tool the U.S. law enforcement agency was using.”

“Bavarian authorities,” Wired reported, “began using their spyware in 2009. It’s not known if that spyware is based on the FBI’s, but in July 2007, German authorities contacted the FBI seeking information about its tool.”

The FBI’s assistant legal attache in Frankfurt “sent an email to Bureau colleagues on July 24, 2007, writing, ‘I am embarrassed to be approaching you again with a request from the Germans … but they now have asked us about CIPAV (Computer Internet Protocol Address Verifier) software, allegedly used by the Bu[reau]‘.”

The email uncovered by Wired was part of a huge cache of files obtained by the Electronic Frontier Foundation (EFF) in response to their 2007 Freedom of Information Act request for data on CIPAV.

In the years since those disclosures, secret state surveillance is more pervasive than ever and and now includes the “lawful interception” of GPS locational data streamed automatically to their manufacturers or hosting services by smart phones.

It appears that German secret state officials are playing a similar game. According to Der Spiegel, at least two agencies, the Bundeskriminalamt, or BKA, the federal crime investigation agency equivalent to the FBI, and some 16 Landeskriminalamt or LKAs, regional investigative bureaus, may have deployed the malware during wide-ranging investigations unrelated to terrorism.

Following Chaos Computer Club revelations, it is clear that German authorities have been caught red-handed violating a landmark decision by the Supreme Court. “The court,” Der Spiegel noted, “specified that online spying was only permissible if there was concrete evidence of danger to individuals or society.”

In a follow-up piece, Der Spiegel disclosed that the firm DigiTask was the spyware’s developer. Along with hundreds of similar firms, DigiTask is a niche security outfit that develops applications for the so-called “lawful interception” market.

In 2008, WikiLeaks released two documents concerning “interception technology for Skype and SSL in Bavaria, Germany. The first document is a communication by the Bavarian Ministry of Justice to the prosecutors office, relating to cost distribution for the interception licenses between police and prosecution. The second document allegedly presents the offer made by Digitask, the German company developing the technology, and holds information on pricing and license model, high-level technology descriptions and other detail.”

According to the WikiLeaks analysis, the DigiTask offer “introduces a basic description of the cryptographic workings of Skype, and concludes that new systems are needed to spy on Skype calls.”

We were informed in that letter that German police were interested in standing-up a “Skype Capture Unit.”

“In a nutshell: malware is installed onto a target machine, to intercept Skype Voice and Chat. Another feature introduced is a recording proxy, that is not part of the offer, yet would allow for anonymous proxying of recorded information to a target recording station. Access to the recording station is possible via a multimedia streaming client, supposedly offering real-time interception.”

“Another part of the offer,” WikiLeaks noted, was related to “an interception method for SSL based communication, working on the same principle of establishing a man-in-the-middle attack on the key material on the client machine. According to the offer, this method works for Internet Explorer and Firefox web browsers. Digitask also recommends using overseas proxy servers, to cover the tracks of all activities.”

As it turns out those proxy servers were conveniently located in the United States. This raises the distinct possibility that information captured by German secret state officials is also being shared with “partner agencies” of their close NATO ally, the CIA, FBI and NSA.

This was confirmed by CCC’s analysis of R2D2′s code. “To avoid the location of the command and control server, all data is redirected through a rented dedicated server in a data center in the USA. The control of this malware is only partially within the borders of its jurisdiction.”

“Considering the incompetent encryption and the missing digital signatures on the command channel, this poses an unacceptable and incalculable risk. It also poses the question how a citizen is supposed to get their right of legal redress in the case the wiretapping data get lost outside Germany, or the command channel is misused.”

The short answer is, they can’t.

Aside from lining the pockets of DigiTask shareholders, there are more sinister uses for the malware. As the World Socialist Web Site noted “the remote-control function could be used to load and execute malicious software, and to plant bogus digital evidence on the computer, which can then be detected if the computer was seized. A suspect would have no way of proving that this had happened.”

This would certainly be a convenient way to “neutralize” a troublesome politician, journalist or over-eager anticorporate campaigner.

‘Less Democracy’

Following similar efforts in the United States, evidence that police are illegally spying on German citizens using sophisticated malware developed for the government are neither benign nor accidental events.

As a recent article in German Foreign Policy disclosed, leading voices in Europe’s largest state are “pleading for a transition toward ‘less democracy’.” A recent book, published under the title, Dare Less Democracy, claims that the “voice of the people” and the “‘emancipatory Zeitgeist, putting everything into question,’ has a too ‘paralyzing influence” on current governance’.”

“The author,” the critical online leftist magazine observes, “demands to ‘correct the system’ for ‘more efficient policy making.’ These ‘corrections’ must include the dismantlement of democratic participation.”

Author Laszlo Trankovits, the bureau chief of the Deutsche Presse Agentur in South Africa, who had previously worked for the agency in Washington “as its White House correspondent,” explained “it should never be suggested that a ‘democratic society can do away with inequality and establish social justice’.”

“Trankovits,” German Foreign Policy notes, is “a member of the elitist Rotary-Club.” He demands that “the elite clearly ‘commits itself to capitalism and profit,’ and that ‘intelligent forms of public relations’ be used to communicate policy measures to the population. However, the demand for more ‘transparency’ is ‘counterproductive and paralyzing’ for any ‘governance efficiency’ and must be rejected.”

That drivel such as this was penned by a journalist for Germany’s leading news agency, to whit, that the media should serve as a propaganda mouthpiece for casino capitalist interests, is one more sign that democratic norms, already seriously eroded in the West, are now being rapidly jettisoned by our political masters.

With the global capitalist system on the verge of a repeat performance of the 2008 meltdown, and with a worldwide resurgence of opposition to the one-sided costs of saving a system of financial plunder borne by the working class, elite calls for “less democracy” are warning signs that stern measures, including blanket surveillance and naked police violence, are in the offing.

One of the demands voiced by protesters in the Occupy Wall Street movement is for a “public option” in banking.  What that means was explained by Dr. Michael Hudson, Professor of Economics at the University of Missouri in Kansas City, in an interview by Paul Jay of the Real News Network on October 6:

[T]he demand isn’t simply to make a public bank but is to treat the banks generally as a public utility, just as you treat electric companies as a public utility. . . . Just as there was pressure for a public option in health care, there should be a public option in banking.  There should be a government bank that offers credit card rates without punitive 30% interest rates, without penalties, without raising the rate if you don’t pay your electric bill. This is how America got strong in the 19thand early 20thcentury, by essentially having public infrastructure, just like you’d have roads and bridges. . . . The idea of public infrastructure was to lower the cost of living and to lower the cost of doing business.

We don’t hear much about a public banking option in the United States, but a number of countries already have a resilient public banking sector.  A May 2010 article in The Economist noted that the strong and stable publicly-owned banks of India, China and Brazil helped those countries weather the banking crisis afflicting most of the world in the last few years.

In the U.S., North Dakota is the only state to own its own bank.  It is also the only state that has sported a budget surplus every year since the 2008 credit crisis.  It has the lowest unemployment rate in the country and the lowest default rate on loans.  It also has oil, but so do other states that are not doing so well.  Still, the media tend to attribute North Dakota’s success to its oil fields.

However, there are other Western public banking models that are successful without oil booms.  Europe has a strong public banking sector; and leading it is Germany, with eleven regional public banks and thousands of municipally-owned savings banks.   Germany emerged from World War II with a collapsed economy that had degenerated into barter.  Today it is the largest and most robust economy in the Eurozone.  Manufacturing in Germany contributes 25% of GDP, more than twice that in the UK.  Despite the recession, Germany’s unemployment rate, at 6.8%, is the lowest in 20 years.  Underlying the economy’s strength is its Mittelstand—small to medium sized enterprises—supported by a strong regional banking system that is willing to lend to fund research and development.

In 1999, public banks dominated German domestic lending, with private banks accounting for less than 20% of the market, compared to more than 40% in France, Spain, the Nordic countries, and Benelux.  Since then, Germany’s public banks have come under fire; but local observers say it is due to rivalry from private competitors rather than a sign of real weakness in the sector.

As precedent for a public option in banking, then, the German model deserves a closer look.

From the Ashes of Defeat to World Leader in Manufacturing

Germany emerged Phoenix-like from its disastrous defeat in two world wars to become Europe’s economic powerhouse in the second half of the 20th century.  In 1947, German industrial output was only one-third its 1938 level, and a large percentage of its working-age men were dead.  Less than ten years after the war, people were already talking about the German economic miracle, and twenty years later, its economy was the envy of most of the world.  By 2003, a country half the size of Texas had become the world’s leading exporter, producing high quality automobiles, machinery, electrical equipment, and chemicals.  Only in 2009 was Germany surpassed in exports by China, which has a population of over 1.3 billion to Germany’s 82 million.  In 2010, while much of the world was still reeling from the 2008 financial collapse, Germany reported 3.6% economic growth.

The country’s economic miracle has been attributed to a variety of factors, including debt forgiveness by the Allies, currency reform, the elimination of price controls, and the reduction of tax rates.  But while those factors freed the economy from its shackles, they don’t explain its phenomenal rise from a war-torn battlefield to world leader in manufacturing and trade.

One overlooked key to the country’s economic dynamism is its strong public banking system, which focuses on serving the public interest rather than on maximizing private profits.  After the Second World War, it was the publicly-owned Landesbanks that helped family-run provincial companies get a foothold in world markets. As Peter Dorman describes the Landesbanks in a July 2011 blog:

They are publicly owned entities that rest on top of a pyramid of thousands of municipally owned savings banks. If you add in the specialized publicly owned real estate lenders, about half the total assets of the German banking system are in the public sector. (Another substantial chunk is in cooperative savings banks.) They are key tools of German industrial policy, specializing in loans to the Mittelstand, the small-to-medium size businesses that are at the core of that country’s export engine. Because of the landesbanken, small firms in Germany have as much access to capital as large firms; there are no economies of scale in finance. This also means that workers in the small business sector earn the same wages as those in big corporations, have the same skills and training, and are just as productive. [Emphasis added.] 

The Landesbanks function as “universal banks” operating in all sectors of the financial services market.  All are controlled by state governments and operate as central administrators for the municipally-owned savings banks, or Sparkassen, in their area.

The Sparkassen were instituted in Germany in the late 18th century as nonprofit organizations to aid the poor. The intent was to help people with low incomes save small sums of money, and to support business start-ups. The first savings bank was set up by academics and philanthropically-minded merchants in Hamburg in 1778, and the first savings bank with a local government guarantor was founded in Goettingen in 1801.  The municipal savings banks were so effective and popular that they spread rapidly, increasing from 630 in 1850 to 2,834 in 1903.  Today the savings banks operate a network of over 15,600 branches and offices and employ over 250,000 people, and they have a strong record of investing wisely in local businesses.

Targeted for Privatization

The reputation and standing of the German public banks were challenged, however, when they emerged as competitors in international markets.  Peter Dorman writes:

[T]he EU doesn’t like the landesbanken. They denounce the explicit and implicit public subsidies that state ownership entails, saying they violate the rules of competition policy. For over a decade they have fought to have the system privatized. In the end, the dispute is simply ideological: if you think that public ownership should only be an exception, narrowly crafted to address specific market failures, you want to see the landesbanken put on the auction block. If you think an economy should be organized to meet socially defined needs, you would want a large part of capital allocation to be responsive to public input, and you’d fight to keep the landesbanken the way they are. (There is a movement afoot in the US to promote public banking.)

The vicissitudes of German banking in the last decade were traced in a July 2011 article by Ralph Niemeyer, editor-in-chief of EUchronicle, titled “Commission’s Dirty Task: WESTLB Devoured by Private Banks.”  He notes that after 1999, the major private banks left the path of sustainable traditional banking to gamble in collateralized debt obligations, credit default swaps, and derivatives.  Private German banks accumulated an estimated €600 billion in toxic assets through their investment banking branches, for which German taxpayers wound up providing guarantees.  Deutsche Bank AG was feeding its record profits almost exclusively through its investment banking division, which made a fortune trading credit default swaps on Greek state obligations.  When this investment turned sour, the German government had to bail out the financial institution into which Deutsche Bank AG dumped these toxic assets.

While the large private banks were betting on the casinos of the financial markets, lending to businesses and the “real” economy was left to the public Sparkassen, which were more efficient in serving average citizens and local business because they were not stock companies that had to satisfy shareholders’ hunger for ever-larger dividends.  Today the market share of private banks in Germany is only 28.4%, and Deutsche Bank AG dominates the segment.  But with its 7% market share, it is still well behind the public banks owned by municipalities and communities.

Neimeyer says the private banks wanted to break up the market dominance of the public banks to get a bigger piece of the pie themselves, and they used the European Commission to do it.  The Commission had been lobbied since the early 1990s by German private banks and by Deutsche Bank AG in particular to attack the German government over the country’s “inflexible” public banking sector.

The IMF, too, had long demanded that any competing public monopolies in the German banking market be broken up, citing their “inefficiencies.”  When the German public Sparkassen and Landesbanken were reluctant to turn to investment banking with its skyrocketing profits, they were branded as bureaucratic and “unsexy.”  When they were pressured to increase their returns for their government owners, the German Landesbanken did get sucked to some extent into derivatives and CDOs (fraudulently rated triple A).  But while they “lost billions in the Goldman Sachs, Deutsche Bank and Lehman Brothers Ponzi scheme,” Niemeyer says the extent to which they became involved in highly speculative transactions was “laughable in comparison with the damage done by private banks, for whom taxpayers are now providing guarantees.”

It was the public banks and Sparkassen that supplied the real economy with liquidity, and that stepped in for the private banks when they withdrew to bet in the financial casino; but it was on the failings of the Landesbanken and Sparkassen that the media focused their attention.  The real motive, says Niemeyer, was that the large private banks wanted the public banks’ market share themselves:

In order to win back this important market share, it has become a prerogative to destroy public banking in Germany completely. This unpopular move could never come from the German government itself, so that’s why the [European] Commission is being employed for this dirty job.

The Price of Success

The German public banks were brought down by knocking their public legs out from under them.  Previously, they had enjoyed state guarantees that allowed them to acquire and lend funds at substantially better rates than private banks were able to do.  But in 2001, the European Commission ruled to strip the Landesbanks of their explicit state credit guarantees, forcing them to compete on the same terms as private banks.  And today the European Banking Authority is refusing to count the banks’ implicit state guarantees in their “stress tests” for banking solvency.

The upshot is that the German public banks are being stripped of what has made them stable, secure, and able to lend at low interest rates: they have had the full faith and credit of the government and the public behind them.  By eliminating the profit motive, focusing on the public interest, and relying on government guarantees, the German public banks were able to turn bank credit into the sort of public utility described by Prof. Hudson.

The example of Germany shows that even success is no guarantee in the face of a relentless onslaught of propaganda by large privately-owned banks interested only in making money for their CEOs, wealthiest clients and shareholders. But peering behind the propaganda, the public banking model that helped underwrite Germany’s economic success might be the fast track to a U.S. banking system that serves Main Street rather than Wall Street.

There is now open speculation about the euro’s survival and even that of the European Union itself. The whole situation hangs in the balance. And all for what? Because Greece cannot pay its bills. But this was surely no surprise. Every serious person knew full well that the crisis of the Greek economy was so deep that all the rescue packages could do was to buy a little time.

The time is now up. Greece cannot pay its bills and that is that. So why all the fuss? How does it come about that the problems of a small country on the periphery of Europe can bring about a tragedy of such dimensions? One might call it a Greek tragedy, were it not for the fact that it is not at all confined to Greece. Its origins must be sought beyond the confines of Greece and its repercussions will also be felt far afield.

Why are the European leaders falling over themselves in a desperate attempt to restore confidence? Why is Jean-Claude Trichet, the president of the European Central Bank, demanding stricter budgetary rules? Why has Mario Draghi, head of the Bank of Italy and Trichet’’s successor at the ECB, called for binding limits not on just budgets but also on a host of other national economic policies?

At the roots of the nervousness in the markets are doubts about the stability of Europe’s banks. It is no accident that bank stocks were hit hardest in the recent crash. After the last crisis there was a black hole in the banks that governments have been attempting to fill by shovelling in billions of taxpayers’ money. The result has been close to zero. The banks are not lending, the capitalists are not investing, the economies are stagnant, unemployment is growing, and now they are on the brink of a new slump.

The problem is that to this very day nobody knows what the real debts of the banks are. Decades of deregulation and uncontrolled speculation in things like hedge funds, whose workings are very obscure, mean that the danger to the global financial system is systematically underestimated, like the bulk of an iceberg that cannot be seen because it is submerged.

What is known is that French and German banks are heavily exposed to Greece. This alone explains the tender concern with which the governments in Paris and Berlin view the Greek crisis. If (or rather, when) Greece defaults, it would be followed immediately by a crisis of the banking system in the two pivotal countries of the EU. That is why they cobbled together a “rescue fund”, the European Financial Stability Facility. But it is a case of too little and too late.

The crisis that began with the bankruptcy of banks has now moved on to express itself as the bankruptcy of whole nations. If Greece is allowed to collapse, other more important economies will follow. That is why the leaders of the Euro zone have called an emergency summit in Poland. Their previous plans are in ruins. The debt exchange that was agreed to in July is now dead in the water. They will have to throw it out and grant Greece some kind of debt relief to prevent a collapse that would have devastating effects throughout Europe.

Europe and America

Sooner or later the EU authorities must decide either to relieve Greece and Ireland of their austerity programmes, or else pull the plug, pushing them over the abyss of default. Despite all the brave talk about keeping Greece inside the Euro zone, in the end they will have to take the latter course. This will have the most serious consequences’ for Europe and the world economy.

If the EU and IMF decide that they cannot continue to throw good money after bad, and withhold their support, this would push Greece into the abyss. This would signify what the markets most fear: a disorderly debt default. The social, political, and economic consequences of such a step would be incalculable – and not only for Greece. This scenario would spell chaos on an epic scale.

But this prospect is provoking alarm in ruling circles in Europe. Economists are already talking about the breakup of the euro zone, leaving Portugal, Italy, Ireland, Greece, and Spain outside it. But if you say “A”, you must also say “B”, “C”, and “D”. Globalization means that every economy in Europe is linked to every other economy. So what happens in even a smaller economy such as Greece will inevitably affect all the others.

What would the consequences be for the rest of Europe – for Britain, France, yes, and Germany too? It would trigger a chain reaction of collapsed banks in those countries. French banks are heavily exposed to Greece, but so are German banks. British banks are rather less exposed to Greece, but heavily exposed to Ireland. Austrian banks are exposed to Italy, and so on.

The results would be catastrophic for Europe, and not only for Europe. An economic collapse in Europe would send a Tsunami racing across the Atlantic, putting pressure on the dollar and threatening to undermine the unstable financial set-up in the USA. When Greece goes, the question is immediately posed of the contagion spreading to other countries. Ireland, Portugal, Spain and Italy will fall like dominoes. Banks will collapse, starting with the Greek and Cypriot banks, and then proceeding to the UK and US financial system, both of which are unsound.

In order to prevent his from happening, some bourgeois economists are now discussing other possibilities: for example, a German “Marshall Plan” for Greece and southern Europe. The idea seems childishly simple: Germany received millions of dollars in Marshall Aid, which enabled it to rebuild its shattered economy after 1945. Why should Germany not do the same for southern Europe? This is what the Americans are demanding ever more insistently.

Sadly the historical parallel is misguided. In 1945 the USA enjoyed a total hegemony over its competitors. Its industry was intact, while Europe and Japan were devastated by the War. Two thirds of the world’’s gold was in Fort Knox. The dollar then was “as good as gold”. Above all, the world capitalist economy was entering into a phase of upswing that lasted almost three decades. None of these factors exist now.

Germany is the leading power in Europe but it does not possess the virtually unlimited economic reserves that the USA enjoyed in 1945. Its shoulders are broad, but not strong enough to bear the weight of the accumulated deficits of Greece, Ireland, Portugal, Spain, Italy and the rest. Most importantly, Europe and the world are not on the verge of a long period of upswing but, on the contrary, on the eve of a new recession and a prolonged period of economic difficulties and austerity.

Barack Obama accuses the eurozone that it is dragging the rest of the world into crisis again, conveniently overlooking the small matter of the huge US fiscal crisis and the inability of the Republicans and Democrats to agree on a serious plan for reducing the huge budget deficit.

The Americans are desperately calling on Germany to “do more” to pull Europe out of crisis. The Germans must cut taxes; they must boost the economy; they must send more money to Greece; they must lead a coordinated fiscal stimulus across northern Europe. Germany must do this and Germany must do that. But who are the Americans to tell the Germans what to do?

Yes, say the Europeans, but who pays for all this? To this question there can only be one answer: France and Germany, or more correctly, Germany, which is Europe’s banker of last resort. Those who have talked bib about a Marshall Plan for Greece are now politely requested to put their money where their mouths are. But this is easier said than done. It immediately raises political problems that cannot easily be overcome.

Eurobonds?

Twenty years ago, after the collapse of the USSR, the German ruling class had big ambitions. Their idea was that a unified Germany could dominate Europe, achieving by its economic muscle what Hitler failed to do by military means. Over the past two decades, France has been increasingly pushed into second place and Germany now rules the roost in Europe.

The idea of a closer European Union will appeal to those sections of the German ruling class that still entertain some illusions of grandeur. But the past 20 years have also convinced Germany that such ambitions can come with a very hefty price tag. This contradiction has been exposed by the recent debate on the possible creation of “Eurobonds”.

Guy Verhofstadt, leader of the Alliance of Liberals and Democrats for Europe in the European Parliament, is only one in a growing chorus of voices calling for the creation of Eurobonds. Germany’s finance minister, Wolfgang Schäuble, has suggested that Europe needs to move to full fiscal union.

The Greens and SPD in Germany already back Eurobonds. But they are facing an electoral backlash, not only against fiscal union but against bailouts in general. The French have expressed guarded support for the proposal. Even the British Conservative leaders have adopted a surprisingly positive attitude (itself an indication of the seriousness of the crisis), which is causing them problems with their rank and file.

On the one hand, this idea contains a certain logic. All history shows that it is impossible to achieve a firm and lasting monetary union without some kind of political union. But here we immediately run up against new contradictions. The creation of Eurobonds would require a degree of political consensus that is simply not there. Any movement in the direction of fiscal union will meet fierce resistance. It would also require a fundamental revision of the EU’’s founding treaties.

The experience of the farce over the proposed European Constitution shows that it is not easy to get people to vote more powers for Brussels either in national parliaments or in referenda. And the mood of euro-scepticism has become even stronger since then.

But the governments of Germany and other northern European are coming under pressure from increasingly restive public opinion, unwilling to pay the debts of foreign states. The Merkel government is unpopular and has just suffered a humiliating drubbing in recent elections.

For the time being, Merkel is making the right noises: Greece must stay in the Euro Zone; the Euro must stay; Germany will do this and Germany will do that. But the fact is that Germany, the most powerful economy in Europe, is showing signs of strain. Its economy is slowing down, as a result of the general stagnation of the world economy. Its politicians are showing signs of impatience at being continually asked to put their hands in their pockets.

So far the EU has bailed out the Greek economy, or at least provided some funds with which the beleaguered Papandreou government could pay the wages of its civil servants and the pensions of its old folk. But more money than this is required. It is like pouring money down a bottomless well. And in the end, one way or the other, Greece will still default.

All that they have done is to yet again create a breathing space for Greece. But this comes at a huge cost to the Greek people, who are presented with the bill. As always, it is not the bankers and speculators who are asked to pay but the poorest sections of society: the workers, the unemployed, the old and the sick.

The price of “stabilizing the finances” and “restructuring” their economy is a brutal slashing of living standards and an increase in unemployment. This will lead to a further fall in tax revenue and thus a further increase in the deficit in the public finances. In what way this madness is supposed to help Greece to pay its debts is a mystery compared to which the Eleusinian Mysteries of old were child’’s play.

Without economic growth, tax revenues will remain stagnant, and the capacity to service debts will continue to decline. But the world economic slowdown and the merciless pressure to reduce the deficit through austerity, has plunged Greece into a deep slump. Despite all the painful sacrifices of its people, the government of Athens continues to miss its fiscal targets.

Alarm at this prospect is compelling the politicians in Brussels to take emergency measures to prevent the immediate collapse of the Greek economy. They still possess a number of instruments they can use: a relaxation of the demands of the creditors, an agreement not to press too hard on Athens to meet unrealisable fiscal targets. This would be quite a logical thing to do, on the grounds that it is not possible to squeeze blood from a stone.

There can be no solution for the problems of Europe without economic growth. Economic, social and political stability, throughout Europe, depends on it, and not only in Greece. But there is no prospect of a recovery of growth in the near future.

Protectionist tendencies

The deafening chorus shows that Europe is not short of proposals. They have proposals by the bucket load. The problem is that none of these proposals can do anything to solve the euro zone’s immediate problems. They cannot pay Greece’s debts. They cannot stop the problem from spreading to other countries. They cannot restore the shattered confidence of investors.

In the most optimistic scenario, they may possibly (just possibly) do a little to ease some problems in the long run (but, as Keynes pointed out, in the long run we are all dead). But they will do nothing to resolve the present crisis, which is clearly getting out of hand.

The hopeless confusion of the economists is illustrated by the strange spectacle of Jeff Sachs, the man who unleashed neo-liberalism onto Eastern Europe, calling for a global version of the New Deal. The problem is that any such suggestion is anathema to the Republican dominated Congress, which is hell-bent on pursuing the opposite policies.

Neither free market economics nor Keynesian stimulus policies have worked, or can work. Governments and their economist advisers are in a state of despair. There is no more money for fiscal stimulus, but austerity policies only serve to depress demand still further, aggravating the slump.

The greatest fear is that a new recession will provoke a resurgence of protectionist tendencies and competitive devaluations, as happened in the 1930s. This would have catastrophic effects on world trade and pose a threat to globalization itself. All that has been achieved in the past 30 years can unravel and turn into its opposite.

The measures recently announced by the Swiss National Bank to push down the value of the Swiss franc is a warning of the way things are drifting in the direction of protectionist policies and competitive devaluations. It was this that turned the 1929-33 slump into the Great Depression of the 1930s. The same thing can happen again.

Danger of reaction?

We have pointed out repeatedly that all the attempts of the bourgeois to restore the economic equilibrium will destroy the social and political equilibrium. Greece is proof of this assertion. Already social and political stability have been destroyed. And the realization that all the sacrifices have been in vain will make the austerity utterly intolerable.

It is possible that the Greek ruling class will seek a solution to their problems by moving towards reaction as they did in 1967. But the Greek workers remember 1967 and the crimes of the Junta. Any move in that direction now would provoke civil war.

This is recognized by an American political analyst, Barry Eichengreen (Professor of Economics and Political Science at the University of California, Berkeley.) in a recent article, significantly entitled: “Europe on the Verge of a Political Breakdown”:“ In Greece itself, political and social stability are already tenuous. One poorly aimed rubber bullet might be all that is needed to turn the next street protest into an outright civil war.”

Barry Eichengreen is not alone. Paul Mason, the economics editor of BBC2’ s Newsnight writes:

“In the chancelleries of Europe, above all in Berlin, these are questions that are impossible to mention. There is a total mismatch between political expectation and what is imminent.

“It reminds me – as so much of 2011 reminds me – of 1848. Metternich sneering out of the window at the irrelevant mob, a few hours before his unceremonious overthrow, Guizot unable to breathe with shock as he resigns his ministry, Thiers, prime minister for one day, suffering a bout of 19th Century Tourette’s in his carriage, hounded by the masses…”

These lines show that the most intelligent bourgeois strategists are seriously alarmed by the developments in Greece. The problem is not so much that this could lead to civil war. The problem is that the Greek bourgeoisie would not be sure of winning such a war. The working class is undefeated. Behind them they feel the support of the mass of the Greek population – not just the workers and peasants, not just the students and intellectuals, but also the small shopkeepers and taxi drivers who are driven to revolutionary conclusions by the sudden collapse of their living standards.

The politicians in Brussels fear that Greece is becoming ungovernable. If it has not yet become so, it is thanks to the reformist leaders. The Pasok leadership is anxious to prove its “statesmanlike qualities” and its patriotism, that is, its devotion to the interests of the bankers and capitalists. It is willing to take upon its shoulders all the odium of the austerity programme, and even to sacrifice itself on the altar of Greek and European Capital, if necessary.

In November 2001 there was an uncontrolled default in Argentina, accompanied by a run on bank deposits. The banks closed their doors, there were mass protests in the streets and the president had to flee from the roof of his palace in a helicopter. Something similar might occur in Greece, where protesters have hung a banner on the railings of parliament showing a helicopter carrying off Prime Minister George Papandreou.

The government is deeply unpopular. But who could replace it? The right-wing opposition party does not want to take over the reins of government in conditions of acute crisis with an aroused working class. It is not the right wing that the bourgeoisie is obliged to lean on to save it but the leaders of Pasok. Politicians like Evangelos Venizelos and Elena Panaritis (the non-elected, Western-educated MP advising Papandreou) and Papandreou himself are the Saviours of the bourgeoisie: their only defence against the masses.

It is the same story all over Europe. Without the reformist leaders, capitalism could not last even for a week. For that very reason, talk about the danger of fascism and Bonapartism makes no sense at the present time. The ruling class all over Europe must base itself on these organizations. The bourgeoisie does not need the fascists at this moment in time. Any attempt to move in the direction of fascism or Bonapartism at this point would simply provoke the labour movement to action.

Of course, this can change. The present crisis can last for years or even decades. However, at a certain point, the ruling class will say: there are too many strikes, too many demonstrations, too much disorder; we need to restore Order! Then there could be a movement towards reaction. But even in such a case, the ruling class would have to proceed carefully, first testing the ground by moving towards parliamentary Bonapartism.

That is not the perspective now, either in Greece or any other country in Europe. On the contrary, the pendulum will swing to the left. The working class will have many opportunities to take power into its hands before the ruling class can turn to reaction. Of course, the movement of the working class is never in a straight line.

The civil servants’ union, ADEDY, warned that it was gearing up for action over the government’s plans to extend a “labour reserve” scheme that would put civil servants on a sharply reduced salary for 12 months before reviewing their status. This shows that there are still important reserves in the working class in Greece. New layers will move into struggle to replace those that are exhausted by many months of constant activity.

We must not adopt a superficial and impressionistic attitude to events like the events in Greece. The masses cannot stay on the streets indefinitely. There will inevitably be periods of lull, in which the workers will think deeply about what has happened, criticize, differentiate and draw conclusions. It is precisely in such periods that the ideas of Marxism can gain a powerful echo, on condition that we are patient, that we listen to what the masses are saying and put forward the correct slogans.

In the revolutionary events that are coming, the advanced workers and youth will learn. If we work correctly we can help them to draw revolutionary conclusions, and come to understand the need for Marxism and a revolutionary organization.

All over Europe the working class and the youth are taking the road of struggle. In Italy there have been a general strike and mass demonstrations against the austerity plan. Berlusconi’s programme is too little for the bosses but too much for the workers. Outside parliament one evening, riot police came under a barrage of fire, paint bombs and even a pig’’s heart, hurled by angry protesters.

Moody’’s have already warned of a possible downgrade of Italy’’s credit rating on June 17 and its decision is expected by Saturday. Incessantly, implacably, the crisis is spreading and new burdens are being placed on the shoulders of the working class in every country.

What is the duty of the Marxists in this situation? We do not aim to reach the masses with our propaganda. That is beyond our ability. We aim at the most advanced elements of the workers and youth. We do not put forward “easy” agitation slogans that merely tell the workers what they already know. The workers need to be told the truth. And the truth is that under capitalism the only future that awaits them is a future of permanent austerity, falling living standards, unemployment and poverty.

We must explain that only the expropriation of the bankers and capitalists and the replacement of capitalist anarchy by a democratic planned economy can provide a way out of the crisis. In particular, we must counter the nationalist poison of the Stalinists by advancing the slogan of the United Socialist States of Europe, the only real alternative to the bankrupt bosses’ EU. Our duty, to use Lenin’’s expression, is to patiently explain.

• Originally appeared at In Defence of Marxism.

In contrast, in Northern and Central Europe the hard right and neo-fascist movements have made significant inroads among workers and the lower middle class at the expense of the traditional center-left and center-right parties. ¹ The relative stability, affluence and stable employment of the Nordic working class has been accompanied by increasing support for racist, anti-immigrant, Islamophobic parties. ²

In the case of the United States, with a few notable exceptions, the working class has remained a passive spectator in the face of the right turn of the Democratic Party and the hard right’s capture of the Republican Party.  There are no left wing street politics in the US, unlike Southern Europe, and only a passive rejection and repudiation of the hard right policies of Congress and the White House.

Rather than solidarity, the economic crisis highlights working class fragmentation, disunity and internal polarization.

The Right/Left Polarizations

One of the key reasons for the growth of right wing appeals to Northern European workers is the demise of working class-based ideology, parties and leaders.  The Labor and Social Democratic Parties have initiated and administered neoliberal programs while promoting multi-national corporation-led export strategies.  They have embraced regressive tax ‘breaks’ for big business; they have participated in imperialist wars of aggression (Afghanistan, Iraq and Libya); they have embraced the so-called “war on terror” mostly against Muslim countries while tolerating the growth of the neo-fascist, far-right Islamophobes who practice “direct action” to expel immigrants in Europe.

The European governing parties of the center-left (social democratic and labor) and the center-right (Sarkozy, Cameron and Merkle) have been outspoken in their assault on “multiculturalism” code-word for Muslim immigrant rights. Their tolerance and exploitation of Islamophobia serves as a cheap vote getter among their xenophobic electorate and as a justification for their involvement in US-Israeli wars of aggression in the Middle East and South Asia. As a result the “mainstream” regimes have weakened working class solidarity with immigrant workers and undermined any concerted effort by the state and civil society to actively counteract the neo-fascist racists who ply a more virulent version of Islamophobia embracing the Zionist ideologues’ vision of ethnic cleansing.

The trade unions have lost membership due especially to the growth of ‘contingent or temporary workers’ who are especially susceptible to far-right appeals. Equally important, trade unions no longer engage in political education aimed at strengthening class solidarity among all workers.  While in Northern Europe wages may increase, the trade unions collaboration with the corporate elite has left workers vulnerable to anti-immigrant and Islamophobic propaganda.  In this context a perverse “class struggle” pits the unorganized workers against those “below”, the immigrants.  The neo-fascists gain by promoting and exploiting cultural and chauvinist beliefs which trade unions and social democratic parties no longer actively combat through worker education and class struggle.  In other words, the neoliberal practice and ideology of the “center-left” parties and unions undermine class political identities and open the door for right wing penetration and influence.  This is especially evident when center-left and trade union leaders no longer bother to consult or debate policies with their members:  They impose policies from above, providing the ‘far right’ with a formidable weapon to attack the ‘elitist nature’ of the center-left political system.

In contrast, in Southern Europe the profound economic crisis,  due in large part to the harsh conditions imposed by Northern and Western European bankers and their local center-left and right-wing politicians, has strengthened and sharpened class consciousness and politics.  Right-wing appeals to anti-immigrant and anti-Muslim politics has little resonance among Southern European workers in the face of skyrocketing unemployment and brutal wage and pension cuts.

Northern European workers have allied with the right, and their own politicians and bankers, in demanding the imposition of greater austerity measures against Southern European countries, buying into the racist ideology that Mediterranean workers are lazy, irresponsible and on permanent vacation.  In fact, Greek, Portuguese and Spanish workers work more days per year, enjoy less vacation time and much less secure pensions.  The same racist sentiments pitting Northern workers against immigrants also promote chauvinist stereotypes against militant Southern European workers and fuel right-wing sympathies.

Creditor Northern European bankers and political leaders squeeze their own working and middle class taxpayers in order to bail-out their counterparts among the Southern European debtor elites, who, in turn, agree to squeeze their workers and public employees to meet the debt payment demands of the North.  The Northern workers in the imperial countries have been convinced that their living standards are threatened by the irresponsible and indebted South, and not by the speculative activity and irresponsible lending of their own bankers.  In the South, the workers have to shoulder the double exploitation of the Northern European creditors as well as their own local elites; hence, they have greater class awareness of the injustice of the imperial and local capitalist system.

To the degree that Northern workers make common cause with their own creditor ruling class and shift their resentments toward workers abroad and immigrants below, they become vulnerable to right wing appeals.  They openly express resentment against striking Greek, Spanish or Portuguese workers’, whose militant struggles might disrupt their planned vacations to the Mediterranean islands and seashore resorts.  The ideological battle which should pit the workers of Northern Europe against their own state creditors and speculator financial elite is transformed into hostility towards Southern European workers and immigrants.  Overseas bailouts, imperial wars and cuts in social programs lead to greater competition over shrinking social expenditures and conflict between employed and unemployed, ‘native’ and ‘immigrant’ workers’.

International workers solidarity has been severely weakened and replaced, in some cases, by the proliferation of international far-right networks propagating virulent anti- immigrant (and anti-socialist)  propaganda and, as in the case of the massacre of almost 70 left-wing youth, mostly teenage, activists of the Norwegian Labor Party,  poses a direct murderous threat to progressive supporters of immigrant rights.  The extreme-right began its assault on immigrants and Muslims and has now moved against the local left and progressive movements which support them.  This has taken on an even more complex dimension with the marriage of rabid pro-Israel, Zionist ideologues (mostly based in the US) and the neo-fascist Islamophobes attacking supporters of Palestinian rights, an issue repeatedly stressed by the Norwegian fascist mass murderer, Anders Behring Breivik. The problem is that the ‘respectable’ liberal, social democratic and conservative parties, in their electioneering, have pandered to the anti-immigrant, anti-Muslim appeals of the far-right in order to attract workers rather than embarking on far-reaching class reforms which would lessen inequalities, financing them via increases in progressive taxes and greater public investments to unify all workers (local and immigrant) against capital.

Lacking working class solidarity, the sons and daughters of immigrants, especially the disproportionately unemployed young workers, engage in forms of direct action such as the pillage of local business, confrontations with the police and general mayhem, as was evident in the nationwide riots in England in the “hot August” of 2011.  The demise of working class politics thus has produced violent right-wing extremism, racial-immigrant riots and pillage.  The labor elite are spectators, confined to condemning extremism and violence, calling for investigations, but without any semblance of self-criticism or any programs for changing the socio-economic structures that produce the right turn and violence among workers and the unemployed.

The United States:  The Rise of the Right

Unlike Europe, the extreme right is at home within the US established order.  Brutal anti-immigration policies have led to the expulsion of nearly 1 million undocumented workers or family members in the first three years of the Obama regime (a three-fold increase over the George W. Bush years).  The Tea Party has elected Congress members in the Republican Party who promote massive cuts in the social safety net with the collaboration of the White House.  The mass media, Congress, the White House, mass-based Christian fundamentalist politicians and leading Zionist personalities and organizations actively promote Islamophobia and lead virulent campaigns against Muslims by fanning public insecurity. The US ‘establishment’ has pre-empted the racist agenda of the far-right in Europe.  The far-right has turned its guns directly on the social programs of the poor, the working class and public employees (especially school teachers).

Moreover, their assault on debt financing and public expenditures has led to conflicts with sectors of the capitalist class, who are dependent on the State.  In the course of the recent Congressional ‘debate’ over raising the debt ceiling, Wall Street joined in a selective struggle against the far-right:  calling for “compromise” involving social cuts and tax reforms while supporting their anti-public union offensive.

Unlike in Europe, the mass of the US working class and poor are passive. They have been neutered: neither engaging in the street riots of England, nor taking the sharp right turn of their Northern European counterparts, nor participating in militant workers’ strikes of Southern Europe.  The US trade unions, with the exception of the public employees union in Wisconsin, have been totally absent from any of the big confrontations. The American trade union bosses concentrate on lobbying the corporate Democratic Party and are incapable of mobilizing their shrinking membership.

The Tea Party, unlike its Northern European counterparts, does not attract many workers because of their virulent attacks on popular public programs, like Medicare, Medicaid, unemployment insurance and especially Social Security – all of the programs most likely to benefit American workers and their families.  On the other hand, the economic crisis in the US has not led to Mediterranean-style mass action because American trade unions either don’t exist (93% of the private sector is not unionized) or are compromised to the point of paralysis.

So far the US working class is a spectator to the rise of the extreme right, because its organized leaders have tied their fortunes to the Democratic Party, which, in turn, has adopted significant parts of the far right’s agenda.

Conclusion

The US, in contrast to Europe, is experiencing a peaceful transition from neoliberalism to far-right politics, where the working and middle class are passive victims rather than active combatants for either the left or the right.  In Europe, the current crisis reveals a deep polarization between the radical left turn of workers in the South and the growing shift to the far right among workers in Northern Europe.  The ideal of international worker solidarity is being replaced, at best, by regional solidarity among the workers of Southern Europe and, at worst, by a network of rightist parties in the Northern European countries.  With the decline of international solidarity, chauvinist and racist tendencies are rampant in the North, while in the South workers’ movements are joining with a broad range of social movements, including the unemployed, students, small business people and pensioners.

While the electoral right is capitalizing on the disenchantment with the center-left in Southern Europe, they still face formidable resistance from the extra-parliamentary workers and social movements.  In contrast, in Northern Europe and the US, the far-right faces no such conscious opposition – in the streets or in the workplace.  In these regions only the breakdown of the economic system or a prolonged severe economic recession, combined with devastating cuts of basic social programs and protections, may set in motion a revival of working class movements. and hopefully it will be from the class-conscious left and not from the far right.

1. According to a study of workers support for far right wing parties in Western Europe, “workers have become their core clientele”. See Daniel Oesch, “Explaining Workers’ Support for Right-wing Populist Parties in Western Europe: Evidence from Austria, Belgium, France, Norway, and Switzerland”, International Political Science Review 2008: 29; pp. 350 -373
2. While some of the motivations of the workers vary, the far-right wing parties are the beneficiaries

Still, for all of Walmart’s conspicuous success (which some might call wretched excess), the world’s mega-retailing giant, after having set up shop in Germany in 1997, was forced to withdraw from the country in 2006, abandoning their lucrative $370 billion retail market.  Interestingly, the withdrawal was due largely to cultural differences.

While the German debacle qualifies as old news, it’s worth reviving.  At first blush, given the vaguely similar cultural/political antecedents, one might assume that an American business would have a greater chance of succeeding in Europe than in an Asian setting, particularly one that had been isolated from the West.  But, as the German experience has shown, that’s not necessarily the case.  Indeed, while the nominal Communist regime of China embraced Walmart’s corporate philosophy, the Germans rejected it.

Since Walmart’s abrupt 2006 exit there’s been much discussion as to why the venture failed.  One of the explanations (favored by environmentalists) is that Germany was simply too “green” for a slash-and-burn outfit like Walmart, that Germany’s enlightened consumers resented Walmart’s love affair with plastic bags and plastic junk   While there may be some truth to the noble “green” theory, three other explanations seem to make more sense.

First was the chanting.  Arguably, what initially stuck in the craw of German workers was the mandatory chanting.  Walmart employees are required to start their shifts by engaging in group chants and group exercises, a practice intended to build morale and drive home the importance of company loyalty.  While performing synchronized calisthenics Walmart employees are required to chant, WALMART!  WALMART! WALMART!

Apparently, this kind of happy horseshit didn’t go over well with the Germans.  Maybe they found it too embarrassing, maybe they found it too regimented, maybe they found this aggressive, mindless and exuberant group-psychology too painfully reminiscent of certain rallies, like one that occurred in Nuremberg some years ago.

The second problem was the smiling.  Walmart requires its checkout people to smile at customers after bagging their purchases.  Plastic bags, plastic junk, plastic smiles.  Walmart employees who refuse to flash a bright but insincere smile at exiting shoppers can be fired.  But alas, in German society, merchants and customers don’t exchange reflexive smiles.  In Germany, smiles are genuine; smiles actually mean something.  Thus, Walmarters grinning like jackasses at total strangers not only didn’t impress the Germans, it unnerved them.

And third was the ethics problem.  Walmart’s corporate policy prohibited sexual intercourse among employees.  This applied to all in-store romances: boyfriends and girlfriends, and husbands and wives (even if they met at work and fell in love).  Apparently, the Arkansas-based company had no problem with screwing the environment, but objected to employees doing it with each other.

Although a German court struck down this sexual prohibition in 2005, Walmart’s bizarre ethics policy left a bitter residue; and that ethics policy, coupled with the ritual chanting and mandatory smiling, more or less poisoned the whole deal.  So Germany is now verboten to Walmart.  Presumably, they’ll open stores in Libya to take up the slack.

This time there were about 100 taking part in the protest. I don’t know if any were Libyans, but there was a new element — almost half of the protesters were black, marching with signs saying: “Stop Bombing Africa”.

There was another new element — people supporting the bombing of Libya, facing us from their side of Pennsylvania Avenue about 40 feet away. They were made up largely of Libyans, probably living in the area, who had only praise and love for the United States and NATO. Their theme was that Gaddafi was so bad that they would support anything to get rid of him, even daily bombing of their homeland, which now exceeds Serbia’s 78 days. I of course crossed the road and got into arguments with some of them. I kept asking: “I hate that man there [pointing to the White House] just as much as you hate Gaddafi. Do you think I should therefore support the bombing of Washington? Destroying the beautiful monuments and buildings of this city, as well as killing people?”

None of the Libyans even tried to answer my question. They only repeated their anti-Gaddafi vitriol. “You don’t understand. We have to get rid of Gaddafi. He’s very brutal.” (See the CNN video of the July 1 mammoth rally in Tripoli for an indication that these Libyans’ views are far from universal at home.)

“But you at least get free education and medical care,” I pointed out. “That’s a lot more than we get here. And Libya has the highest standard of living in the entire region, at least it did before the NATO and US bombing. If Gaddafi is brutal, what do you call all the other leaders of the region, whom Washington has long supported?”

One retorted that there had been free education under the king, whom Gaddafi had overthrown. I was skeptical of this but I didn’t know for sure that it was incorrect, so I replied: “So what? Gaddafi at least didn’t get rid of the free education like the leaders in England did in recent years.”

A police officer suddenly appeared and forced me to return to my side of the road. I’m sure if pressed for an explanation, the officer would justify this as a means of preventing violence from breaking out. But there was never any danger of that at all; another example of the American police-state mentality — order and control come before civil liberties, before anything.

Most Americans overhearing my argument with the Libyans would probably have interjected something like: “Well, no matter how much you hate the president you can still get rid of him with an election. The Libyans can’t do that.”

And I would have come back with: “Right. I have the freedom to replace George W. Bush with Barack H. Obama. Oh joy. As long as our elections are overwhelmingly determined by money, nothing of any significance will change.”

Postscript: Amidst all the sadness and horror surrounding the massacre in Norway, we should not lose sight of the fact that “peaceful little Norway” participated in the bombing of Yugoslavia in 1999; has deployed troops in Iraq; has troops in Afghanistan; and has supplied warplanes for NATO’s bombing of Libya. The teenagers of those countries who lost their lives to the US/NATO killing machine wanted to live to adulthood and old age as much as the teenagers in Norway. With all the condemnation of “extremism” we now hear in Norway and around the world we must ask if this behavior of the Norwegian government, as well as that of the United States and NATO, is not “extremist”.

The Berlin Wall: Another Cold War Myth

The Western media will soon be revving up their propaganda motors to solemnize the 50th anniversary of the erecting of the Berlin Wall, August 13, 1961. All the Cold War clichés about The Free World vs. Communist Tyranny will be trotted out and the simple tale of how the wall came to be will be repeated: In 1961, the East Berlin communists built a wall to keep their oppressed citizens from escaping to West Berlin and freedom. Why? Because commies don’t like people to be free, to learn the “truth”. What other reason could there have been?

First of all, before the wall went up thousands of East Germans had been commuting to the West for jobs each day and then returning to the East in the evening; many others went back and forth for shopping or other reasons. So they were clearly not being held in the East against their will. Why then was the wall built? There were two major reasons:

1) The West was bedeviling the East with a vigorous campaign of recruiting East German professionals and skilled workers, who had been educated at the expense of the Communist government. This eventually led to a serious labor and production crisis in the East. As one indication of this, the New York Times reported in 1963: “West Berlin suffered economically from the wall by the loss of about 60,000 skilled workmen who had commuted daily from their homes in East Berlin to their places of work in West Berlin.”¹

In 1999, USA Today reported: “When the Berlin Wall crumbled [1989], East Germans imagined a life of freedom where consumer goods were abundant and hardships would fade. Ten years later, a remarkable 51% say they were happier with communism.”² Earlier polls would likely have shown even more than 51% expressing such a sentiment, for in the ten years many of those who remembered life in East Germany with some fondness had passed away; although even 10 years later, in 2009, the Washington Post could report: “Westerners say they are fed up with the tendency of their eastern counterparts to wax nostalgic about communist times.”³

It was in the post-unification period that a new Russian and eastern Europe proverb was born: “Everything the Communists said about Communism was a lie, but everything they said about capitalism turned out to be the truth.” It should also be noted that the division of Germany into two states in 1949 — setting the stage for 40 years of Cold War hostility — was an American decision, not a Soviet one.⁴

2) During the 1950s, American coldwarriors in West Germany instituted a crude campaign of sabotage and subversion against East Germany designed to throw that country’s economic and administrative machinery out of gear. The CIA and other US intelligence and military services recruited, equipped, trained and financed German activist groups and individuals, of West and East, to carry out actions which ran the spectrum from juvenile delinquency to terrorism; anything to make life difficult for the East German people and weaken their support of the government; anything to make the commies look bad.

It was a remarkable undertaking. The United States and its agents used explosives, arson, short circuiting, and other methods to damage power stations, shipyards, canals, docks, public buildings, gas stations, public transportation, bridges, etc; they derailed freight trains, seriously injuring workers; burned 12 cars of a freight train and destroyed air pressure hoses of others; used acids to damage vital factory machinery; put sand in the turbine of a factory, bringing it to a standstill; set fire to a tile-producing factory; promoted work slow-downs in factories; killed 7,000 cows of a co-operative dairy through poisoning; added soap to powdered milk destined for East German schools; were in possession, when arrested, of a large quantity of the poison cantharidin with which it was planned to produce poisoned cigarettes to kill leading East Germans; set off stink bombs to disrupt political meetings; attempted to disrupt the World Youth Festival in East Berlin by sending out forged invitations, false promises of free bed and board, false notices of cancellations, etc.; carried out attacks on participants with explosives, firebombs, and tire-puncturing equipment; forged and distributed large quantities of food ration cards to cause confusion, shortages and resentment; sent out forged tax notices and other government directives and documents to foster disorganization and inefficiency within industry and unions … all this and much more.⁵

The Woodrow Wilson International Center for Scholars, of Washington, DC, conservative coldwarriors, in one of their Cold War International History Project Working Papers (#58, p.9) states: “The open border in Berlin exposed the GDR [East Germany] to massive espionage and subversion and, as the two documents in the appendices show, its closure gave the Communist state greater security.”

Throughout the 1950s, the East Germans and the Soviet Union repeatedly lodged complaints with the Soviets’ erstwhile allies in the West and with the United Nations about specific sabotage and espionage activities and called for the closure of the offices in West Germany they claimed were responsible, and for which they provided names and addresses. Their complaints fell on deaf ears. Inevitably, the East Germans began to tighten up entry into the country from the West, leading eventually to the infamous Wall. However, even after the wall was built there was regular, albeit limited, legal emigration from east to west. In 1984, for example, East Germany allowed 40,000 people to leave. In 1985, East German newspapers claimed that more than 20,000 former citizens who had settled in the West wanted to return home after becoming disillusioned with the capitalist system. The West German government said that 14,300 East Germans had gone back over the previous 10 years.⁶

Let’s also not forget that Eastern Europe became communist because Hitler, with the approval of the West, used it as a highway to reach the Soviet Union to wipe out Bolshevism forever, and that the Russians in World War I and II, lost about 40 million people because the West had used this highway to invade Russia. It should not be surprising that after World War II the Soviet Union was determined to close down the highway.

We came, we saw, we destroyed, we forgot

An updated summary of the charming record of US foreign policy. Since the end of the Second World War, the United States of America has …

    1. Attempted to overthrow more than 50 governments, most of which were democratically-elected.
    2. Attempted to suppress a populist or nationalist movement in 20 countries.
    3. Grossly interfered in democratic elections in at least 30 countries.⁷
    4. Dropped bombs on the people of more than 30 countries.
    5. Attempted to assassinate more than 50 foreign leaders.

In total: Since 1945, the United States has carried out one or more of the above actions, on one or more occasions, in the following 69 countries (more than one-third of the countries of the world):

(See a world map of US interventions.)

The occult world of economics

When you read about economic issues in the news, like the crisis in Greece or the Wall Street/banking mortgage shambles are you sometimes left befuddled by the seeming complexity, which no one appears able to untangle or explain to your satisfaction in simple English? Well, I certainly can’t explain it all myself, but I do know that the problem is not necessarily that you and I are economic illiterates. The problem is often that the “experts” discuss these issues as if we’re dealing with hard and fast rules or laws, not to be violated, scientifically based, mathematically sound and rational; when, in fact, a great deal of what takes place in the real world of economics and in the arena of “expert” analysis of that world, is based significantly on partisan party politics, ideology, news headlines, speculation, manipulation, psychology (see the utter meaninglessness and absurdity of the daily rise or fall of stock prices), backroom deals of the powerful, and the excessive power given to and reliance upon thoroughly corrupt credit-rating agencies and insurers of various kinds. The agencies like Moody’s and Standard and Poor’s are protection rackets — pay our exorbitant fees or we give you a bad rating, which investors and governments then bow down to as if it’s the result of completely objective and impressive analytical study.

Then there’s the exceptions made for powerful countries to get away with things that lesser countries, like Greece, are not allowed to get away with, but all still explained in terms of the unforgiving laws of economics.

And when all other explanations fail to sound plausible, the experts fall back on “the law of supply and demand”. But that law was repealed years ago; just try and explain the cost of gasoline based on it, as but one example.

So there’s a lot to cover up, many reasons why the financial-world players can’t be as open as they should be, as forthright as the public and investors may assume they are.

Consider the US budget deficit, about which we hear a great deal of scare talk. What we don’t hear is that the most prosperous period in American history occurred in the decades following the Second World War — from 1946 to 1973. And guess what? We had a budget deficit in the large majority of those years. Clearly such a deficit was not an impediment to growth and increasing prosperity in the United States — a prosperity much more widely shared than it is now. Yet we’re often fed the idea of the sanctity of a balanced budget. This and other “crises” are typically overblown for political reasons; the current “crisis” about the debt ceiling for example. Paul Craig Roberts, former Assistant Secretary of the Treasury under Reagan, now an independent columnist, points out that “regardless of whether the debt ceiling is raised the US government is not going to go out of business. … If Goldman Sachs is too big to fail, certainly, the US government is.”

In economic issues that occupy the media greatly, such as the debt ceiling, one of the hidden keys to understanding what’s going on is often the conservatives’ perennial hunger to privatize Social Security and Medicare. If you understand that, certain things become much clearer. Naomi Klein points out that “the pseudo debate about the debt ceiling … is naked class war, waged by the ultra rich against everyone else, and it’s well past time for Americans to draw the line.”

Consider, too, the relative value of international currencies. Logically, reasonably, if the British pound is exchangeable for two dollars, one should be able to purchase in Washington goods and services for two dollars which would cost one pound in London. In real life, this of course is the very infrequent exception to the rule. Instead, at places called “exchanges” in New York and Chicago and London and Zurich and Frankfurt a bunch of guys who don’t do anything socially useful get together each day in a large room, and amidst lots of raised voices, busy computers, and numerous pieces of paper, they arrive at a value for the pound, as well as for a barrel of oil, for a pound of porkbellies, and for various other commodities that affect our daily lives. Why should these speculators and parasites have so much influence over the real world, the real economy, and our real lives?

As a general rule of thumb, comrades, as an all-purpose solution to our economic ills, remember this: We’ll keep going around in crisis circles forever until the large financial institutions are nationalized or otherwise placed under democratic control. We hear a lot about “austerity”. Well, austerity has to, finally, visit the super-rich. There are millions (sic) of millionaires and billionaires in the United States and Europe. As governments go bust, the trillions of dollars of these people must be heavily taxed or confiscated to end the unending suffering of the other 95% of humanity. My god, do I sound like a (choke, gasp) socialist?

1. New York Times, June 27, 1963, p.12.
2. USA Today, October 11, 1999, p.1.
3. Washington Post, May 12, 2009; see a similar story November 5, 2009.
4. Carolyn Eisenberg, Drawing the Line: The American Decision to Divide Germany, 1944-1949 (1996); or see a concise review of this book by Kai Bird in The Nation, December 16, 1996.
5. See William Blum, Killing Hope: US Military and CIA Interventions Since World War II, p.400, note 8, for a list of sources for the details of the sabotage and subversion.
6. The Guardian (London), March 7, 1985.
7. See chapter 18 of Rogue State: A Guide to the World’s Only Superpower – add Palestine, 2006 to the list.

The British corporate media is obsessed with the “special relationship” and the “personal chemistry” between British prime ministers and American presidents. When the two meet, the body language and every gesture are nauseatingly analysed, seeking reassurance that Britain is still America’s best friend.  This clinginess is unhealthy; it leads to unquestioning acquiescence and deference to the senior partner, the US. Special relationships should mean being honest and frank, and saying things your special friend may not want to hear.  At least that is what I think it should be.

According to Wikipedia, the phrase “special relationship” was first used in 1946 by Winston Churchill to describe the close political, diplomatic, cultural and historical relationship between the US and Britain.  Tony Blair’s interpretation of it is that of grovelling sycophancy towards George Bush culminating in the disaster that was the Iraq war. Whatever Blair’s thinking was about the war, he felt that because of the “special relationship” Britain must act as its cheerleader.  This was also the view of most of the British cabinet.

Contrast that with the attitude of France and Germany, who opposed the Iraq war on logical, thoughtful calculations – that the war was unnecessary, illegal and not in the West’s interest.

That illegal war has caused death, injury and suffering to thousands of British and American people, and inflicted enormous suffering on the entire Iraqi people with death and injury to hundreds of thousands if not millions. It has also caused enormous damage to the reputation of the US and Britain, weakened the rule of international law, and the authority of international institutions. It has also invigorated international terrorism.  You would think after such a disaster future British governments would be more circumspect in foolishly and slavishly following America in its future wars.  Not a bit of it.

Britain’s Guardian Newspaper (3 December 2010) reports on a meeting between Liam Fox, the current British Defence Minister, and the US ambassador, Louis Susman, a year ago.  On 10 December 2009, in a WikiLeaks cable marked “confidential”, Susman recorded:

Liam Fox affirmed his desire to work closely with the US if the Conservative Party wins power…….adding that we (Conservatives) intend to follow a much more pro-American profile in procurement.” He reportedly went on: “Increasing US-UK ‘interoperability is the key’ since the US and UK will continue to fight together in the future

At the time, Liam Fox was the shadow Defence Minister, and the cable quoted him saying “US and UK will continue to fight together in the future”.  This statement shows contempt for democracy, its institutions and us, the people of Britain. These are the remarks dictators make knowing that their word is law, and should not be made by a democratically elected politician, and to make them after the disastrous illegal war against Iraq beggars belief.

Moreover, such general commitment was apparently given, regardless of who might be in the White House in the future. This is alarming to the people of the US, Britain and millions across the world who could well be at the receiving end of such wars.  Have Britain’s politicians finally become totally compliant puppets of the US?  It seems its leaders are falling over each other to prostrate themselves before whoever occupies the White House.  The Labour party, for obvious reasons, is completely relaxed about such revelations; they could not possibly object given the role Tony Blair played in the illegal war against Iraq as cheerleader-in-chief.  Many liberal minded people hoped that with their new leader, Ed Miliband, they would protest at such a dangerously irresponsible commitment.  The liberal democrats who had behaved honourably in opposing the Iraq war are now part of the government, and have remained silent.  We now have a situation where there is no opposition, no one to question and challenge the British role in future wars.

Without the so called “special relationship” as interpreted by Tony Blair, Britain may have stood with France and Germany in opposition to the Iraq war, which could well have delayed its start. This would have given Hans Blix and his team of inspectors enough time to prove conclusively and publically that Iraq did not possess weapons of mass destruction, thus removing the “supposed” excuse for the war, making it difficult for the Americans to proceed.

The special relationship is also damaging the interests of the American and British people by stopping Britain from becoming an effective member of the European Union, and cooperating with the rest of Europe to develop a common foreign policy.

On April 26, 2011, Venezuelan immigration officials, relying exclusively on information from the Colombian secret police (DAS), arrested a naturalized Swedish citizen and journalist (Joaquin Perez Becerra) of Colombian descent, who had just arrived in the country. Based on Colombian secret police allegations that the Swedish citizen was a ‘FARC leader’, Perez was extradited to Colombia within 48 hours. Despite the fact that it was in violation of international diplomatic protocols and the Venezuelan constitution, this action had the personal backing of President Chavez. A month later, the Venezuelan armed forces joined their Colombian counterparts and captured a leader of the Revolutionary Armed Forces of Colombia (FARC), Guillermo Torres (with the nom de Guerra Julian Conrado) who is awaiting extradition to Colombia in a Venezuelan prison without access to an attorney. On March 17, Venezuelan Military Intelligence (DIM) detained two alleged guerrillas from the National Liberation Army (ELN), Carlos Tirado and Carlos Perez, and turned them over to the Colombian secret police.

The new public face of Chavez as a partner of the repressive Colombian regime is not so new after all. On December 13, 2004, Rodrigo Granda, an international spokesperson for the FARC, and a naturalized Venezuelan citizen, whose family resided in Caracas, was snatched by plain-clothes Venezuelan intelligence agents in downtown Caracas where he had been participating in an international conference and secretly taken to Colombia with the ‘approval’ of the Venezuelan Ambassador in Bogota. Following several weeks of international protest, including from many conference participants, President Chavez issued a statement describing the ‘kidnapping’ as a violation of Venezuelan sovereignty and threatened to break relations with Colombia. In more recent times, Venezuela has stepped up the extradition of revolutionary political opponents of Colombia’s narco-regime: In the first five months of 2009, Venezuela extradited 15 alleged members of the ELN and in November 2010, a FARC militant and two suspected members of the ELN were handed over to the Colombian police. In January 2011 Nilson Teran Ferreira, a suspected ELN leader, was delivered to the Colombian military. The collaboration between Latin America’s most notorious authoritarian right wing regime and the supposedly most radical ‘socialist’ government raises important issues about the meaning of political identities and how they relate to domestic and international politics and more specifically what principles and interests guide state policies.

Revolutionary Solidarity and State Interests

The recent ‘turn’ in Venezuela politics, from expressing sympathy and even support for revolutionary struggles and movements in Latin America to its present collaboration with pro-imperial right wing regimes, has numerous historical precedents. It may help to examine the contexts and circumstances of these collaborations:

The Bolshevik revolutionary government in Russia initially gave whole-hearted support to revolutionary uprisings in Germany, Hungary, Finland and elsewhere. With the defeats of these revolts and the consolidation of the capitalist regimes, Russian state and economic interests took prime of place among the Bolshevik leaders. Trade and investment agreements, peace treaties and diplomatic recognition between Communist Russia and the Western capitalist states defined the new politics of “co-existence”. With the rise of fascism, the Soviet Union under Stalin further subordinated communist policy in order to secure state-to-state alliances, first with the Western Allies and, failing that, with Nazi Germany. The Hitler-Stalin pact was conceived by the Soviets as a way to prevent a German invasion and to secure its borders from a sworn right wing enemy. As part of Stalin’s expression of good faith, he handed over to Hitler a number of leading exiled German communist leaders, who had sought asylum in Russia. Not surprisingly they were tortured and executed. This practice stopped only after Hitler invaded Russia and Stalin encouraged the now decimated ranks of German communists to re-join the ‘anti-Nazi’ underground resistance.

In the early 1970s, as Mao’s China reconciled with Nixon’s United States and broke with the Soviet Union, Chinese foreign policy shifted toward supporting US-backed counter-revolutionaries, including Holden Roberts in Angola and Pinochet in Chile. China denounced any leftist government and movement, which, however faintly, had ties with the USSR, and embraced their enemies, no matter how subservient they were to Euro-American imperial interests.

In Stalin’s USSR and Mao’s China, short-term ‘state interests’ trumped revolutionary solidarity. What were these ‘state interests’?

In the case of the USSR, Stalin gambled that a ‘peace pact’ with Hitler’s Germany would protect them from an imperialist Nazi invasion and partially end the encirclement of Russia. Stalin no longer trusted in the strength of international working class solidarity to prevent war, especially in light of a series of revolutionary defeats and the generalized retreat of the Left over the previous decades (Germany, Span, Hungary and Finland) .The advance of fascism and the extreme right, unremitting Western hostility toward the USSR and the Western European policy of appeasing Hitler, convinced Stalin to seek his own peace pact with Germany. In order to demonstrate their ‘sincerity’ toward its new ‘peace partner’, the USSR downplayed their criticism of the Nazis, urging Communist parties around the world to focus on attacking the West rather than Hitler’s Germany, and gave in to Hitler’s demand to extradite German Communist “terrorists” who had found asylum in the Soviet Union.

Stalin’s pursuit of short term ‘state interests’ via pacts with the “far right” ended in a strategic catastrophe: Nazi Germany was free to first conquer Western Europe and then turned its guns on Russia, invading an unprepared USSR and occupying half the country. In the meantime the international anti-fascist solidarity movements had been weakened and temporarily disoriented by the zigzags of Stalin’s policies.

In the mid-1970s, the Peoples Republic of China’s ‘reconciliation’ with the US, led to a turn in international policy: ‘US imperialism’ became an ally against the greater evil ‘Soviet social imperialism’. As a result China, under Chairman Mao Tse Tung, urged its international supporters to denounce progressive regimes receiving Soviet aid (Cuba, Vietnam, Angola, etc.) and it withdrew its support for revolutionary armed resistance against pro-US client states in Southeast Asia. China’s ‘pact’ with Washington was to secure immediate ‘state interests’: Diplomatic recognition and the end of the trade embargo. Mao’s short-term commercial and diplomatic gains were secured by sacrificing the more fundamental strategic goals of furthering socialist values at home and revolution abroad.

As a result, China lost its credibility among Third World revolutionaries and anti-imperialists, in exchange for gaining the good graces of the White House and greater access to the capitalist world market. Short-term “pragmatism’ led to long-term transformation: The Peoples Republic of China became a dynamic emerging capitalist power, with some of the greatest social inequalities in Asia and perhaps the world.

Venezuela: State Interests versus International Solidarity

The rise of radical politics in Venezuela, which is the cause and consequence of the election of President Chavez(1999), coincided with the rise of revolutionary social movements throughout Latin America from the late 1990s to the middle of the first decade of the 21st century (1995-2005). Neo-liberal regimes were toppled in Ecuador, Bolivia and Argentina; mass social movements challenging neo-liberal orthodoxy took hold everywhere; the Colombian guerrilla movements were advancing toward the major cities; and center-left politicians were elected to power in Brazil, Argentina, Bolivia, Paraguay, Ecuador and Uruguay. The US economic crises undermined the credibility of Washington’s ‘free trade’ agenda. The increasing Asian demand for raw materials stimulated an economy boom in Latin America, which funded social programs and nationalizations.

In the case of Venezuela, a failed US-backed military coup and ‘bosses’ boycott’ in 2002-2003, forced the Chavez government to rely on the masses and turn to the Left. Chavez proceeded to “re-nationalize” petroleum and related industries and articulate a “Bolivarian Socialist” ideology.

Chavez’s radicalization found a favorable climate in Latin America and the bountiful revenues from the rising price of oil financed his social programs. Chavez maintained a plural position of embracing governing center-left governments, backing radical social movements and supporting the Colombian guerrillas’ proposals for a negotiated settlement. Chavez called for the recognition of Colombia’s guerrillas as legitimate ‘belligerents” not “terrorists’.

Venezuela’s foreign policy was geared toward isolating its main threat emanating from Washington by promoting exclusively Latin American/Caribbean organizations, strengthening regional trade and investment links and securing regional allies in opposition to US intervention, military pacts, bases and US-backed military coups.

In response to US financing of Venezuelan opposition groups (electoral and extra parliamentary), Chavez has provided moral and political support to anti-imperialist groups throughout Latin America. After Israel and American Zionists began attacking Venezuela, Chavez extended his support to the Palestinians and broadened ties with Iran and other Arab anti-imperialist movements and regimes. Above all, Chavez strengthened his political and economic ties with Cuba, consulting with the Cuban leadership, to form a radical axis of opposition to imperialism. Washington’s effort to strangle the Cuban revolution by an economic embargo was effectively undermined by Chavez’ large-scale, long-term economic agreements with Havana.

Up until the later part of this decade, Venezuela’s foreign policy – its ‘state interests’ – coincided with the interests of the left regimes and social movements throughout Latin America. Chavez clashed diplomatically with Washington’s client states in the hemisphere, especially Colombia, headed by narco-death squad President Alvaro Uribe (2002-2010). However, recent years have witnessed several external and internal changes and a gradual shift toward the center.

The revolutionary upsurge in Latin America began to ebb. The mass upheavals led to the rise of center-left regimes, which, in turn, demobilized the radical movements and adopted strategies relying on agro-mineral export strategies, all the while pursuing autonomous foreign policies independent of US control. The Colombian guerrilla movements were in retreat and on the defensive – their capacity to buffer Venezuela from a hostile Colombian client regime waned. Chavez adapted to these ‘new realities’, becoming an uncritical supporter of the ‘social liberal’ regimes of Lula in Brazil, Morales in Bolivia, Correa in Ecuador, Vazquez in Uruguay and Bachelet in Chile. Chavez increasingly chose immediate diplomatic support from the existing regimes over any long-term support, which might have resulted from a revival of the mass movements. Trade ties with Brazil and Argentina and diplomatic support from its fellow Latin American states against an increasingly aggressive US became central to Venezuela’s foreign policy. The basis of Venezuelan policy was no longer the internal politics of the center-left and centrist regimes but their degree of support for an independent foreign policy.

Repeated US interventions failed to generate a successful coup or to secure any electoral victories against Chavez. As a result, Washington increasingly turned to using external threats against Chavez via its Colombian client state, the recipient of $5 billion in military aid. Colombia’s military build-up, its border crossings and infiltration of death squads into Venezuela, forced Chavez into a large-scale purchase of Russian arms and toward the formation of a regional alliance (ALBA).

The US-backed military coup in Honduras precipitated a major rethink in Venezuela’s policy. The coup had ousted a democratically elected centrist liberal, President Zelaya in Honduras, a member of ALBA, and set up a repressive regime subservient to the White House. However, the coup had the effect of isolating the US throughout Latin America – not a single government supported the new regime in Tegucigalpa. Even the neo-liberal regimes of Colombia, Mexico, Peru and Panama voted to expel Honduras from the Organization of American States. On the one hand, Venezuela viewed this ‘unity’ of the right and center-left as an opportunity toward mending fences with the conservative regimes; and on the other, it understood that the Obama Administration was ready to use the ‘military option’ to regain its dominance.

The fear of a US military intervention was greatly heightened by the Obama-Uribe agreement establishing seven US strategic military bases near its border with Venezuela. Chavez wavered in his response to this immediate threat. At one point he almost broke trade and diplomatic relations with Colombia, only to immediately reconcile with Uribe, although the latter had demonstrated no desire to sign on to a pact of co-existence.

Meanwhile, the 2010 Congressional elections In Venezuela led to a major increase in electoral support for the US-backed right (approximately 50%) and their greater representation in Congress (40%). While the Right increased their support inside Venezuela, the Left in Colombia, both the guerrillas and the electoral opposition lost ground. Chavez could not count on any immediate counter-weight to a military provocation.

Chavez faced several options. The first was to return to the earlier policy of international solidarity with radical movements; the second was to continue working with the center-left regimes while maintaining strong criticism and firm opposition to the US backed neo-liberal regimes; and the third option was to turn toward the Right, more specifically to seek rapprochement with the newly elected President of Colombia, Santos, and sign a broad political, military and economic agreement where Venezuela agreed to collaborate in eliminating Colombia’s leftist adversaries in exchange for promises of ‘non-aggression’ (Colombia limiting its cross-border narco and military incursions).

Venezuela and Chavez decided that the FARC was a liability and that support from the radical Colombian mass social movements was not as important as closer diplomatic relations with President Santos. Chavez has calculated that complying with Santos political demands would provide greater security to the Venezuelan state than relying on the support of the international solidarity movements and his own radical domestic allies among the trade unions and intellectuals.

In line with this Right turn, the Chavez regime fulfilled Santos’ requests – arresting FARC/ELN guerrillas, as well as a prominent leftist journalist, and extraditing them to a state which has had the worst human rights record in the Americas for over two decades in terms of torture and extra-judicial assassinations. This Right turn acquires an even more ominous character when one considers that Colombia holds over 7600 political prisoners, over 7000 of whom are trade unionists, peasants, Indians, students;  in other words, non-combatants. In acquiescing to Santos requests, Venezuela did not even follow the established protocols of most democratic governments: It did not demand any guaranties against torture and respect for due process. Moreover, when critics have pointed out that these summary extraditions violated Venezuela’s own constitutional procedures, Chavez launched a vicious campaign slandering his critics as agents of imperialism engaged in a plot to destabilize his regime.

Chavez’s new found ally on the Right, President Santos, has not reciprocated: Colombia still maintains close military ties with Venezuela’s prime enemy in Washington. Indeed, Santos vigorously sticks to the White House agenda: He successfully pressured Chavez to recognize the illegitimate regime of Lobos in Honduras- the product of a US-backed coup in exchange for the return of ousted ex-President Zelaya. Chavez did what no other center-left Latin American President has dared to do: He promised to support the reinstatement of the illegitimate Honduran regime into the OAS. On the basis of the Chavez-Santos agreement, Latin American opposition to Lobos collapsed and Washington’s strategic goal was realized. A puppet regime was legitimized.

Chavez’s agreement with Santos to recognize the murderous Lobos regime betrayed the heroic struggle of the Honduran mass movement. Not one of the Honduran officials responsible for over a hundred murders and disappearances of peasant leaders, journalists, human rights and pro-democracy activists are subject to any judicial investigation. Chavez has given his blessings to impunity and the continuation of an entire repressive apparatus, backed by the Honduran oligarchy and the US Pentagon.

In other words, to demonstrate his willingness to uphold his ‘friendship and peace pact’ with Santos, Chavez was willing to sacrifice the struggle of one of the most promising and courageous pro-democracy movements in the Americas.

And what does Chavez seek in his accommodation with the Right?

Security? Chavez has received only verbal ‘promises’, and some expressions of gratitude from Santos. But the enormous pro-US military command and US mission remain in place. In other words, there will be no dismantling of the Colombian para-military-military forces massed along the Venezuelan border and the US military base agreements, which threaten Venezuelan national security, will not change.

According to Venezuelan diplomats, Chavez’s tactic is to ‘win over’ Santos from US tutelage. By befriending Santos, Chavez hopes that Bogota will not join in any joint military operation with the US or cooperate in future propaganda-destabilization campaigns. In the brief time since the Santos-Chavez pact was made, an emboldened Washington announced an embargo on the Venezuelan state oil company with the support of the Venezuelan congressional opposition. Santos, for his part, has not complied with the embargo, but then not a single country in the world has followed Washington’s lead. Clearly, President Santos is not likely to endanger the annual $10 billion dollar trade between Colombia and Venezuela in order to humor the US Secretary of State Hilary Clinton’s diplomatic caprices.

Conclusion

In contrast to Chavez’s policy of handing over leftist and guerrilla exiles to a rightist authoritarian regime, President Allende of Chile (1970-73) joined a delegation that welcomed armed fighters fleeing persecution in Bolivia and Argentina and offered them asylum. For many years, especially in the 1980s, Mexico, under center-right regimes, openly recognized the rights of asylum for guerrilla and leftist refugees from Central America – El Salvador and Guatemala. Revolutionary Cuba, for decades, offered asylum and medical treatment to leftist and guerrilla refugees from Latin American dictatorships and rejected demands for their extradition. Even as late as 2006, when the Cuban government was pursuing friendly relations with Colombia and when its then Foreign Minister Felipe Perez Roque expressed his deep reservations regarding the FARC in conversations with the author, Cuba refused to extradite guerrillas to their home countries where they would be tortured and abused. One day before he left office in 2011, Brazilian President Luiz Inacio Lula da Silva denied Italy’s request to extradite Cesare Battisti, a former Italian guerrilla. As one Brazilian judge said – and Chavez should have listened: ”At stake here is national sovereignty. It is as simple as that”.

No one would criticize Chavez’s efforts to lessen border tensions by developing better diplomatic relations with Colombia and to expand trade and investment flows between the two countries. What is unacceptable is to describe the murderous Colombian regime as a “friend” of the Venezuela people and a partner in peace and democracy, while thousands of pro-democracy political prisoners rot in TB-infested Colombian prisons for years on trumped-up charges. Under Santos, civilian activists continue to be murdered almost every day. The most recent killing was yesterday (June 9,2011), Ana Fabricia Cordoba, a leader of community-based displaced peasants, was murdered by the Colombian armed forces. Chavez’s embrace of the Santos narco-presidency goes beyond the requirements for maintaining proper diplomatic and trade relations. His collaboration with the Colombian intelligence, military and secret police agencies in hunting down and deporting Leftists (without due process!) smacks of complicity in dictatorial repression and serves to alienate the most consequential supporters of the Bolivarian transformation in Venezuela.

Chavez’s role in legitimizing of the Honduran coup-regime, without any consideration for the popular movements’ demands for justice, is a clear capitulation to the Santos – Obama agenda. This line of action places Venezuela’s ‘state’ interests over the rights of the popular mass movements in Honduras. Chavez’s collaboration with Santos on policing leftists and undermining popular struggles in Honduras raises serious questions about Venezuela’s claims of revolutionary solidarity. It certainly sows deep distrust about Chavez’s future relations with popular movements who might be engaged in struggle with one of Chavez’s center-right diplomatic and economic partners.

What is particularly troubling is that most democratic and even center-left regimes do not sacrifice the mass social movements on the altar of “security” when they normalize relations with an adversary. Certainly the Right, especially the US, protects its former clients, allies, exiled right-wing oligarch and even admitted terrorists from extradition requests issued by Venezuela, Cuba and Argentina. Mass murders and bombers of civilian airplanes manage to live comfortably in Florida. Why Venezuela submits to the Right-wing demands of the Colombians, while complaining about the US protecting terrorists guilty of crimes in Venezuela, can only be explained by Chavez’s321 ideological shift to the Right, making Venezuela more vulnerable to pressure for greater concessions in the future.

Chavez is no longer interested in the support from the radical left: His definition of state policy revolves around securing the ‘stability’ of Bolivarian socialism in one country, even if it means sacrificing Colombian militants to a police state and pro-democracy movements in Honduras to an illegitimate US-imposed regime.

History provides mixed lessons. Stalin’s deals with Hitler were a strategic disaster for the Soviet people. Once the Fascists got what they wanted they turned around and invaded Russia. Chavez has so far not received any ‘reciprocal’ confidence-building concession from Santos’ military machine. Even in terms of narrowly defined ‘state interests’, he has sacrificed loyal allies for empty promises. The US imperial state is Santos primary ally and military provider. China sacrificed international solidarity for a pact with the US, a policy that led to unregulated capitalist exploitation and deep social injustices.

When, and if, the next confrontation between the US and Venezuela occurs, will Chavez, at least, be able to count on the “neutrality” of Colombia? If past and present relations are any indication, Colombia will side with its client-master, mega-benefactor and ideological mentor. When a new rupture occurs, can Chavez count on the support of the militants, who have been jailed, the mass popular movements he pushed aside and the international movements and intellectuals he has slandered? As the US moves toward new confrontations with Venezuela and intensifies its economic sanctions, domestic and international solidarity will be vital for Venezuela’s defense. Who will stand up for the Bolivarian revolution:  the Santos and Lobos of this “realist world” or the solidarity movements in the streets of Caracas and the Americas?

Take, for example, the French-owned multinational Roquette Freres.  Twenty years ago, Roquette opened a milling plant in the tiny town of Keokuk, Iowa, lured there by the generous promise of tens of millions of dollars in tax breaks and other financial benefits.  The community leaders desperately needed the industry, and Roquette was more than happy to put down roots.

But last September, things turned unexpectedly ugly when Roquette put a gun to the head of the 240 members of BCTGM (Bakery, Confectionery, Tobacco Workers and Grain Millers) Local 48 G and told them that unless they accepted what amounted to the evisceration of their current contract, they would be locked-out.

Roquette’s “last, best and final” offer to the union was an insult.  It included a $4 per hour pay cut, total freedom to use temp workers in place of full-time employees, elimination of sick, maternity and personal leaves, elimination of the pension plan, and drastic increases in health care premiums.  All jammed down the union’s throat.

Needless to say, if Roquette had dared used a similar power-play in France, they would have a public relations nightmare on their hands—not to mention a possible riot.  But noting that the U.S. has neither the strict labor laws nor the grudging but deep-seated pro-union sentiment France has, Roquette believes it can get away with any anti-union muscle tactics it likes.  And, apparently, it can.

Unfortunately, because Local 48 G couldn’t possibly sign so inferior an agreement, the union membership has been locked out since September, 2010.  The union’s good faith offer to continue working while negotiating was summarily turned down by the company.  Clearly, Roquette already had made up its mind; they were either going to humiliate the union by forcing it to capitulate, or destroy the Local outright, through attrition.

Some months ago I interviewed by telephone Local 48 G’s president, Steve Underwood, and learned that, although he and his fellow members were understandably disappointed and frustrated, they were hanging in there as best they could—despite being out of work during the holidays, which made for a bleak Christmas.  As of this writing, Local 48 G is still locked out.  It’s been almost 10 months.

Another example of this mutated European opportunism occurred in Washington, D.C., practically in the shadow of the Capitol Dome.  A German-based company (Jamestown Properties, with headquarters in Cologne) purchased the landmark Madison Hotel in the nation’s capital, and, after taking over, on January 19, 2011, proceeded to mount a frontal assault on its workforce.

The company boldly announced, on January 31, that it had decided not only to refuse to recognize the existing contract between the previous owners and UNITE-HERE, the union representing 150 workers, but to more or less “fire” everybody and require them to re-apply for their jobs. Simple as that. No talking, no compromising, no second thoughts. The decision was unilateral and final.  They pull a stunt like that in Germany—with their labor laws—and the company executives go to jail.

And then there’s Ikea’s Danville, Virginia, manufacturing plant.  It was only three years ago that state and local officials offered the high-profile Swedish company $12 million dollars in tax breaks and subsidies to lure it to Virginia.  For Danville, it seemed like the economic coup of the century:  a tiny, backwater, industry-starved community manages to attract a renowned corporation like Ikea.  It was a dream come true.

Then, alas, catastrophe struck.  Ikea’s Danville plant turned into a Scandinavian version of a modern day sweatshop.  When the IAM (International Association of Machinists) made a run at unionizing the facility, Ikea went into a hysterical defensive posture, actually hiring the law firm of Jackson Lewis, an aggressive, anti-labor outfit that specializes in keeping unions out.  And that NEVER would have happened back home in Sweden.

Of course, without a union to protect the employees, Ikea-Danville quickly began doing what many non-union shops are fond of doing.  They established draconian, top-down work rules—unilaterally altering seniority, forcing people to work overtime without advance notice, and arbitrarily lowering the starting hourly wage from $9.75 per hour to $8.00 per hour (the federal minimum is $7.25).

Again, none of the aforementioned hardball tactics would be employed in Europe….which is why these corporations are relocating here.  As conservative as the European Right can be, you don’t hear right-wing politicians publicly advocating the wholesale elimination of labor unions and the abolition of the federal minimum wage.  Even the European Right would view such extreme positions as nutty.

But you do hear those suggestions being made in the U.S.  And you don’t just hear them from some fringe commentator ranting on a low-frequency Mojave Desert radio station.  You hear them from the U.S. Chamber of Commerce, the National Association of Manufacturers, and the Koch brothers.

The film has been awarded the Lola, the German equivalent of an Oscar, for best picture, and Kekelli has been awarded the Lola for best actress. Kekilli performs with a grace and beauty that is truly timeless. Capable of drawing the viewer into a secret inner-world of breathtaking emotional depths, brutally crushing heartache, and deeply disturbing cultural contradictions – Kekilli is unforgettable.

In the beginning of the film, Umay, who has been wedded to a Turkish man and has moved to Turkey to live with him, suffers emotional and physical abuse under his tyrannical roof, and when he turns on her son, Cem (Nizam Schiller), in a similarly despotic manner, she flees and returns to Berlin.

Umay’s father, played with impressive emotional depth and nuanced acting by Settar Tanriogen, initially believes his daughter is simply homesick and warmly greets her. When he and the rest of the family learn that she has left her husband and returned for good, they grow increasingly upset with her, feeling that she is bringing an unspeakable act of shame and humiliation upon the family, threatening their standing both with the in-laws and with the Turkish-German community.

Umay’s mother, Halima (Derya Alabora), and her deeply possessive older brother, Mehmet (Tamer Yigit), who is even more patriarchal and inclined towards medievalism than his brother-in-law, are both adamant that she return to Turkey immediately, or destroy the good name of the family forever.

Umay’s younger sister, Rana (Almila Bagriacik), and younger brother, Acar (Serhad Can), are initially sympathetic, however this changes when they begin to feel the hostility of the Turkish-German community bearing down on them. In the end, Umay is tragically and hopelessly alienated from those she loves.

One of the subtler mysteries of When We Leave is how Umay has managed to assimilate into German society far better than the rest of her deeply segregated family. She continues to believe until the bitter end that her family will forgive her, and that it will somehow be possible to strike a reconciliation and peaceful marriage between these two diametrically opposed cultures.

The film is filled with marvelous subtleties and nuances, such as when Umay speaks Turkish to her parents one moment, and German to her younger siblings the next.

When Umay initially pleads with her father for understanding, he refuses to take her side, even when she tells him that her husband has beaten her. “The hand that strikes is also the hand that soothes,” he tells her. However, as the drama unfolds, Umay’s father reveals himself to be a man of conflicting emotions and profound complexity.

When We Leave may also force the more intellectually astute in the audience to consider the implications of a government bringing foreign workers into a Western country so as to exploit them as cheap labor, while simultaneously doing everything in the power of the state to see to it that they stay as segregated and ghettoized as possible.

For innocent souls like Umay, who grow up in the West, yet are taught from the earliest possible age to not integrate, the clash of cultures that invariably ensues is often terribly tragic, and not the romantic utopia that liberals are always promising it will be.

The film’s German title translates as “strangers.” Indeed, Umay’s family have become strangers to Germany, alienated from the land of their birth, and in the end, most tragically, strangers to each other.

Devastating, somber, and gripping, When We Leave is a heart-wrenching tale of globalization in the throes of darkness, and a people lost in a world of terrifying and dehumanizing barbarism.

Written and directed by Feo Aladag; director of photography, Judith Kaufmann; edited by Andrea Mertens; music by Max Richter and Stéphane Moucha; production design by Silke Buhr; costumes by Gioia Raspé; produced by Feo Aladag and Züli Aladag; released by Olive Films. In German and Turkish, with English subtitles. Running time: 1 hour 59 minutes. This film is not rated. WITH: Sibel Kekilli (Umay), Settar Tanriögen (Kader), Darya Alabora (Halime), Florian Lukas (Stipe), Nizam Schiller (Cem), Ufuk Bayraktar (Kemal) and Tamer Yigit (Mehmet).