Spanish fascists vote to save Podemos party’s bank and corporate bailouts

Alejandro López

Spain’s minority Socialist Party (PSOE)-Podemos government has passed a bailout handing billions of euros to the banks and corporations thanks to support from the fascist Vox party. The vote sharply exposes the class policy that is pursued. While Vox and Podemos are routinely presented as different anti-system populists—one right and another, supposedly, “left”—both are in the service of the financial aristocracy.

On Thursday, the PSOE-Podemos submitted the “Royal Decree for the Modernization of the Public Administration and for the Execution of the Recovery, Transformation and Resilience Plan” in parliament. The law had already been approved in November, with barely any press comment, let alone public debate. However, it required ratification by parliament.

As the WSWS noted in November, the law specified how €140 billion in EU bailout funds will be funneled to banks and corporations. Large companies from Spain’s main stock exchange, Ibex-35, such as Endesa, Iberdrola, Ferrovial and Inditex, are already drafting plans to receive billions.

Podemos party leader Pablo Iglesias (Wikimedia Commons)

The reactionary character of the law is clear. Tens of millions of workers and small business owners have only received meagre COVID-19 furlough schemes, if any at all, but billions of euros are to be handed over to the financial aristocracy. It also exposes the lie that there is “no money” for a scientifically guided shelter-at-home policy to prevent the spread of COVID-19 and thus save the lives of hundreds of thousands of people in Europe.

On Thursday, however, the PSOE-Podemos government’s law faced defeat. There were 177 votes against and 173 in favour, after the separatist Catalan Republican Left (ERC) changed its vote. Bucking its consistent support over the past two years for the PSOE-Podemos government, even when it sent ERC leaders to jail on trumped-up charges of sedition and rebellion, the ERC decided to vote against the law. The ERC feared that if it supported the government, its own vote would collapse in the upcoming February 14 Catalan regional elections.

El País wrote: “The government, which has spent the last hour anguishing over the prospect Congress will overturn the most important decree, that of the management of European funds, the same one that has brought down the Executive in neighbouring Italy, believes it has one last unexpected trump card.” The “trump card” was the fascist Vox party.

After Vox abstained in the vote to allow the EU bailout to pass, Deputy Prime Minister Carmen Calvo thanked the party: “The government’s gratitude to all those who protected Spaniards and have understood the message. Today parties had to show if they were up to the problems that Spain faces. There will be few times when politics must be so sincere. I thank you in advance.”

This cynical language notwithstanding, the law represents a historic assault on the working class. It is the main mechanism through which the financial aristocracy will enrich itself in the coming years. It will be paid with pension and labour reforms, wage slashes and cuts in health care and education spending, and above all, by continued “herd immunity” policies condemning hundreds of thousands of people across Europe to die—all with the support of Podemos and the trade unions.

The PSOE-Podemos government’s “herd immunity” policy has already cost the lives of over 80,000 people and infected over 2.6 million. The government will continue to claim that in order to “save the economy,” shelter-at-home policies must be rejected. This comes just weeks after Vox’s demand for no shelter-at-home was immediately responded to by the PSOE-Podemos government with insistence that these were not on the agenda.

The vote exposes that the EU bailout policy, as well as the health and financial policies of the PSOE-Podemos government, enjoys the full support of the fascists. It tears to shreds the “anti-fascist” pretensions of Podemos.

In May, Podemos leader Pablo Iglesias called Vox “anti-democratic.” He said Vox defended “the interests of those who have no country other than money” and who “will never defend the general interest.” Iglesias said, “You are not on the side of the Spanish families, you are not patriots, you are on the side of vultures and speculators. You are not a Spanish party but a party of false architects and shameless people who sign irregular projects to enrich themselves with real estate speculation while working to criminalize poor families.”

Podemos stands, however, in the same trench with the “vultures and speculators.” Vox works to drive the political agenda to the right, rehabilitate the bloodstained 1939–1978 Spanish fascist regime led by Francisco Franco, and promote anti-immigrant hatreds in order to divide workers and attack democratic rights. Its program is to install a neo-fascist dictatorship. In this they are aided by Podemos, which provides cover for the implementation of a policy agenda that enjoys the support of the fascists.

The vote also exposed the character of the advanced fascistic coup plans Vox and sections of the army have been plotting over the past year. As the WSWS has noted, while ostensibly targeting the PSOE-Podemos government, which has tried to lull workers to sleep by denying the mounting evidence that officers are plotting a coup, the coup is in fact aimed at working class opposition.

The bailout mechanism is a fundamental part of the political economy of ruling elite’s murderous “herd immunity” policy. The enrichment of the ruling class can only be continue if workers are sent to work and children to school amid a pandemic. Vox abstained precisely so that it can pin blame for this reactionary policy on Podemos and continue to posture as an “anti-system populist” party, even as it supports handing hundreds of billions to the super-rich at the expense of tens of thousands of workers’ lives.

Some of Vox’s supporters—like the far-right web site OkDiario ’s director, Eduardo Inda—claim this was a “historical and tactical error that will take a tremendous toll [on Vox], and a betrayal of Spaniards.” For these sections, Vox has missed a golden opportunity to bring down the government and further its coup plans.

The faction of Vox that prevailed in the vote, however, decided to bid its time. Since Podemos, on the most fundamental issues, is implementing policies it supports, it could afford to wait. It manifestly calculates that will be able to profit further from growing working class anger at the bailout, austerity and herd immunity policies implemented by Podemos, inciting nationalism and strengthening its position before a coup to impose a military regime is attempted.

This vote has thus exposed Podemos as a tool of the fascistic policies of the ruling class—as are the various bankrupt nationalist and separatist parties. The Basque separatist party Bildu, with its six lawmakers, were essential for the approval of the law. Bildu, formerly the Batasuna party, was the political wing of the armed group ETA which waged a six-decade armed struggle to carve out a capitalist mini-state in the economically rich Basque Country.

Until their dissolution in 2018, Bildu (Batasuna) and ETA were promoted by many pseudo-left groups like the Pabloite Anticapitalistas as part of a “radical left” struggle against the Spanish state. Since ETA ended its armed struggle, however, the Basque nationalists have rapidly integrated themselves into the state apparatus, both in the Basque Country and, increasingly, in Madrid.

The WSWS noted on Bildu in 2018: “For these aspiring upper-middle-class layers, ETA has been an obstacle to their further progress. Its dissolution opens the door to participating more fully in the exploitation of the region’s working class.” Its leader, Arnaldi Otegi, relished “a new situation” which “opens many windows of opportunity.” Nearly three years later, amid the deepest economic and political crisis since the end of the Franco regime in 1978, Bildu is helping implement “herd immunity” against the Basque and Spanish people.

15,000 students involved in rent strikes in 55 UK universities

Ioan Petrescu

UK students are engaged in the largest rent strike in decades, in protest against their mistreatment and exploitation throughout the pandemic. There are currently strikes ongoing in at least 55 universities, with over 15,000 students nationwide now signed up to withhold their next rent payment and new rent strikes starting almost daily.

The strike wave began last term, after the Conservative government encouraged students to travel from all over the country, and the world, to gather in universities, as part of its criminal programme of reopening all education settings and the economy. Inevitably, huge outbreaks of COVID-19 ripped through campuses, forcing thousands of students to self-isolate.

More and more universities had to switch to fully online learning. However, this was done on an ad-hoc basis, resulting in a significant deterioration in the quality of education, which was plagued by issues such as Wi-Fi problems, lack of equipment to attend online classes and lack of contact with lecturers.

Students organise rent strike at University of Manchester. The banner on the Owens Park Tower reads "Put Students and Staff before Profit" (Credit: Twitter/@rentstrikeUofM and tke.media)

University administrations also failed to provide adequate mental health or quarantine support, with reports of some students going hungry as they were not allowed to leave their accommodation and were only provided one meagre meal a day. Several universities took the confinement of their students as an opportunity for profiteering, charging those self-isolating extortionate amounts for low-quality food packages.

The contempt with which students were treated was summed up at the University of Manchester, where metal fencing was erected around student residences in the middle of the night and a student occupation was met with a mob-handed police response.

Rent strikes at dozens of universities began to swell, as students refused to pay full accommodation fees for such reduced services and abusive treatment. Actions at Bristol University and the University of Manchester won rent rebates of 30 percent, in Manchester’s case for the whole first term, inspiring strike plans at dozens of other universities.

Most groups have a similar set of demands, including a reduction in rent of between 30 and 50 percent, no repercussions for rent strikers, and better wellbeing and mental health support plans for students. Many rent strike movements have established links of solidarity between staff and students, demanding a no-redundancies policy for all staff and PhD students.

A huge spur was given to the strikes by the government’s guidance, issued in the New Year as part of the national lockdown, telling students not to travel to their universities. This meant that students were paying rent for rooms that they are now instructed not to use, as their contracts usually last for 12 months. No provisions were made to suspend or refund students’ costs. The government provided just £20 million in additional “hardship funds” to universities.

Many students have been thrown into a grave financial crisis as a result. The lockdown has necessarily closed the hospitality and retail sectors in which young people generally find employment to pay their way through university.

This has had a particularly sharp effect on international students from poorer backgrounds, who need to work to pay their exorbitant international fees—of around £14,000 to £20,000 a year—as well as their rent. A joint survey of international students by the Migrants Right Network and Unis Resist Border Controls found that more than half said they were destitute or at risk of becoming so. The Newham Community Project in East London is providing food packages to 1,300 students every week.

Facing mass opposition, universities and private student accommodation providers have offered a patchwork of rebates and single payments of varying sizes. Some, like Cambridge, University College London and Bristol, have offered a full rebate for the weeks students are forced to stay at home. However, these offers frequently come with big caveats attached. Bristol’s offer, for example, does not apply to students who came back to halls this month, even if only for one night, to collect their belongings.

Other institutions have provided partial refunds or a fixed payment. Queen Mary University of London is offering a 30 percent reduction for the term, while Salford University and Lancaster University are providing “good will” payments of £1,200 and £400 to each student.

Private accommodation provider Unite Student has offered a 50 percent reduction for the four weeks up to February 14 and Student Roost has offered a refund for six weeks’ worth of rent, both of which must be applied for to be received. Two other private providers of student accommodation, Campus Living Villages and Sanctuary Students, told the Financial Times that they would continue to charge full fees.

This amounts to a fraction of the rents due to be paid this term. The fact that students are still being forced to hand over millions of pounds for rooms they cannot use is the most glaring expression to date of their exploitation by a thoroughly marketised system of higher education.

Since the higher education “reforms” started by the 1997 Labour government, and accelerated since 2010, universities have become businesses—more interested in squeezing profits from students, and especially international students—than providing high quality education. Since most university funding now comes from student fees and rent, universities have been thrown into fierce competition with each other for student numbers and become increasingly entangled with big finance, private investors and property developers.

The student accommodation market alone is valued at more than £50 billion in the UK. Last February, the multi-trillion-dollar investment management firm Blackstone bought IQ Student Accommodation from giant US investment bank Goldman Sachs for £4.7 billion, in the largest private real estate transaction in the UK to that point.

Before Christmas, universities kept their incomes flowing by working with the government to sell the myth that students could gather together at “COVID-secure” campuses across the country, in the middle of a pandemic, with no risk of mass infection. The resulting concentration of students on campus was a danger not just to students themselves, but to their families and the wider community. The promises of a normal university experience quickly fell to pieces.

As the pandemic reached new and devastating heights with the start of the second term in the New Year, the lie of a safe return to the campuses became completely untenable and the exploitation naked. There is not even the pretence of a normal university experience to cover for the continued charging of fees and rent.

The International Youth and Students for Social Equality (IYSSE) supports the rent strikes. We fully back their expansion and demand the full refund of all tuition fees and rent paid for this academic year, to be funded from the pandemic profits of the major corporations and the billions handed to big business and banks by the government which must be reclaimed.

This would be the first step in the necessary struggle to dismantle the marketised system of higher education and establish a fully funded system of free, high-quality university education for all. Only then will students stop being treated as cash cows.

Such a struggle must be waged entirely independently of the National Union of Students (NUS) which did nothing to organise the rent strikes, only supporting them after the fact—with a few union officials appearing at some of the strikers’ online rallies. They have confined their action to statements and petitions calling on the government to act. After the mass protests against the tripling of tuition fees in 2010, the NUS entirely adapted itself to the marketised regime.

Triple shock of US sanctions, oil price collapse and the pandemic decimates Iranian living standards

Jean Shaoul

Iranian workers and their families are reeling under the combined impact of US sanctions, the oil market collapse and the COVID-19 pandemic.

Iran’s GDP had already fallen by 6.8 percent in the financial year before the pandemic-induced recession took its toll, as oil revenues halved following the expiry of the Trump administration’s short-term waivers of sanctions on those countries importing Iranian oil.

The Trump administration’s punitive sanctions were imposed in 2018, after the US scuttled the 2015 Iran nuclear accord, with the aim of crashing its economy and provoking “regime change.” The sanctions effectively bar Iran from selling its oil—the lifeblood of the Iranian economy—causing crude oil production to fall to its lowest level in 40 years and oil storage facilities to be filled to capacity and depriving the government of a major source of its revenues.

Tehran, capital of Iran (Wikimedia Commons)

Just five days before leaving the White House, President Donald Trump expanded Washington’s punitive sanctions to other key industries, including Iran’s marine, aerospace, aviation and steel sectors.

Revenues fell even further in 2020 following the global oil market collapse, with oil production now less than 2 million barrels per day, about half that in 2018. This contraction, expected to lead to a further 3.7 percent decline in GDP for 2020-21, comes in the wake of a decade-long decline in per capita GDP income. Iran’s currency, the rial, has lost 43 percent of its value against the dollar.

This, together with years of austerity imposed by successive governments with the support of all factions of Iran’s political establishment, has led to inflation rising to 46 percent, mass unemployment, with a devastating impact on household budgets as the cost of food and housing soared, and ever-deepening social inequality, with the Gini coefficient of inequality reaching 35.6, according to the Iran Economic Monitor.

These rising living costs have eroded wages, driving many young people out of the city centres where rents are high into the outer suburbs, satellite towns or back to their families in the impoverished rural areas. They have decimated the value of the government’s cash transfers to those with little or no income, despite an increase announced last autumn.

At least 55 percent of Iranians are poor, with half of these living in extreme poverty, a five-fold increase since the reimposition of US sanctions in 2018, because wages are totally inadequate to meet their basic needs.

Last November, a video went viral on Iranian social media showing Bandar Abbas municipal officials demolishing a single mother's rickety shed, erected without a permit. The destruction of the shack that was home to herself and three children, one of whom is disabled, drove 35 year old Tayyebeh to attempt suicide by setting fire to herself, by no means an isolated phenomenon. The furore that followed forced the municipality to pay for her hospitalisation and local commanders of the Islamic Revolutionary Guard Corps (IRGC) to offer to build her a home if the city provided the land, although such promises are rarely fulfilled.

Illegal construction is widespread, but the authorities routinely turn a blind eye to the business tycoons and officials involved in such projects, while declining requests for homes and demolishing the illegally constructed shacks built by homeless families. It highlights the reactionary character of the clerical regime that has escalated its attacks on the working class as it has sought to reach some accommodation with the imperialist powers.

Iran has been hard hit by COVID-19, with more than 1.41 million cases recorded along with nearly 60,000 deaths, numbers—widely believed to be a gross underestimate--that make Iran the worst affected country in the Middle East.

This is in large part because of the devastating impact of decades of US sanctions on the country’s health care system, preventing Iran from obtaining medicines and supplies to treat coronavirus cases, cancer patients, and other deadly diseases. But fraud, mismanagement and profiteering by Iran’s pharmaceutical companies are widespread, with multiple reports of the hoarding and stockpiling of vital medical supplies, even as officials call on an enraged public to cut down on their doses.

Like its counterparts around the world, the government has put the interests of big business before the lives of ordinary people and is now in the midst of a third partial series of restrictions, including night traffic curfews imposed by a massive police operation, that have pushed more households into poverty.

COVID vaccine (Stock image credit: Envato)

Iran is unlikely to be able to begin a mass vaccination programme until the end of the year at the earliest. It has signed an agreement with the COVAX consortium, led by the Vaccine Alliance Gavi, the Coalition for Epidemic Preparedness Innovations (CEPI) and the World Health Organization (WHO). COVAX is one of the three arms of the Access to Covid-19 Tools (ACT) accelerator set up to ensure that all countries, including low-income ones, could acquire coronavirus diagnostics, treatment and vaccines.

This should provide nearly 17 million doses of the Pfizer-BioNTech vaccine at a cost of $244 million or $14.5 a shot for less than 10 percent of Iran’s 83 million population, far less than the two-thirds needed to curb the spread of the pandemic. A further 21 million doses are to be imported from foreign manufacturing firms directly and the rest to be produced locally through joint ventures with other countries.

At the end of last year, following repeated claims by Iranian officials that US sanctions were preventing them from making payments to COVAX, Abdolnaser Hemmati, the governor of Iran’s Central Bank, announced that the US Treasury’s Office of Foreign Assets Control had finally approved the transfer of money to a Swiss bank to pay for the vaccines. Hemmati told state TV, “They [the Americans] have put sanctions on all our banks. They accepted this one case under the pressure of world public opinion.”

Vaccination issue has become deeply politicised amid the growing popular anger over the Rouhani government’s mismanagement of the economy, the pandemic and the lack of vaccines.

There is a bitter factional fight within Iran’s ruling elite in the run up to the presidential elections on June 18 and after the inauguration of President Joe Biden in the US, who had pledged during his election campaign to rejoin the 2015 nuclear accord between Tehran and the major powers.

The “hardline” faction around the deeply conservative Islamic Revolutionary Guard Corps (IRGC) is using the opportunity to attack the faction around President Hassan Rouhani who negotiated the agreement with the Obama administration. This takes place amid every indication that Biden intends to continue enforcing the “maximum pressure” campaign of draconian sanctions and military provocations that have plunged working people into poverty and destitution, while threatening to provoke the region into a calamitous war.

Ayatollah Ali Khamenei, Iran’s Supreme Leader, has banned the import of vaccines from Britain and the US, leading the Iranian Red Crescent Society to refuse 150,000 vaccines donated by Pfizer. Speaking on television, Khameini said, “Imports of US and British vaccines into the country are forbidden… They're completely untrustworthy. It’s not unlikely they would want to contaminate other nations.”

He also lambasted French-made vaccines, saying, “Given our experience with France’s HIV-tainted blood supplies, French vaccines are not trustworthy either,” referring the contaminated blood scandal of the 1980s and 1990s.

Speaking at a press conference in Moscow last week, Iranian Foreign Minister Javad Zarif said that Iran had approved Russia’s Sputnik V vaccine and that it planned to import and produce it. Iran has signed an agreement with Cuba to collaborate on a locally made vaccine, while Shifa Pharmed, an Iranian pharmaceutical company has begun human trials of the country’s first domestic vaccine.

Strikes mount in Turkey against austerity and herd immunity policies

Ozan Özgür

The Turkish government’s murderous response to the pandemic and the collapse of social conditions for millions is increasingly driving workers into struggle to defend their basic rights.

On Friday, workers at Amana Foods went on a wildcat strike reportedly to protest the company firing a fellow worker after workers joined a trade union tied to the Türk-İş confederation.

Last Tuesday, construction workers at the Galataport site in Istanbul went on a wildcat strike to demand their unpaid wages. The company said it would pay their wages on February 5, but workers continue to reject working at the site.

Mass demonstration in Kadıköy, İstanbul, January 6, 2020 [Credit: @ boundayanisma on Twitter]

A week before, angry construction workers at the Istanbul Finance Center site stormed the canteen to protest insect-ridden food, breaking glasses and tables. While companies have made massive fortunes, workers live and work in deplorable conditions.

Growing job cuts and forced “unpaid leave” practices are driving a growing wave of strikes. A metalworkers’ strike of the Birleşik Metal-İş union (DİSK) at the Baldur factory in Kocaeli has continued since December 25. About 90 metalworkers at the Ekmekçioğulları company in Çorum are protesting job cuts in front of the workplace. And Migros supermarket workers have waged a struggle against a forced “unpaid leave” attack by the company after they joined a trade-union.

While these struggles are signs of growing opposition within the working class, they all remain isolated and under the control of the unions. Whatever their posturing, all of the union confederations are implicated in collaborating with the government and big business to force workers to generate profits under unsafe conditions. This directly raises the need to build independent rank-and-file safety committees in all workplaces to save lives and defend social rights amidst the pandemic.

The policies implemented by President Recep Tayyip Erdoğan in the pandemic have left millions of workers unemployed or on unpaid leave with only 1,170 TL (US$156) monthly in 2020, increased to only 1,420 TL after the New Year. The government, supported by the bourgeois opposition Republican People’s Party (CHP), extended this forced “unpaid leave” until July 2021. Millions have also been forced to take a short-time working allowance.

Moreover, the cost of living is endlessly increasing. The Turkish Statistical Institute (Turkstat) estimated that Turkey’s 2020 inflation rate stood at 14.6 percent—nearly three times more than the official 5 percent target of Central Bank (TCMB). Turkey is one of a few countries with a double-digit inflation rate. Nonetheless, the reliability of Turkstat’s calculations is being widely questioned.

The issue is raised whether the state is manipulating these figures to hide the pandemic’s true impact and suppress workers’ demands for higher wages. The state has an interest in keeping the official inflation rate low to avoid giving raises to public employees, retirees and other workers.

Many studies suggest the real inflation figure is much higher, at 30–38 percent. For example, the Inflation Research Group (ENAG) uses the standards of “Classification of Individual Consumption According to Purpose” (COICOP) of the UN Statistics Department, a common inflation calculation method adopted by many countries. It calculated the 2020 annual inflation rate as 36.72 percent.

The ENAG found that annual price increases for staple products was even higher: 55 percent for butter, 80 percent for sunflower oil, 66 percent for olive oil, 35 percent for cheese, 67 percent for olives, 53 percent for chicken and 130 percent for eggs.

The Erdoğan government set the 2021 minimum wage, received by nearly 10 million workers in Turkey, at the hunger level of 2,825 Turkish liras (US$380) monthly—an increase of only 500 Turkish liras (US$67). The government is seeking to calm workers’ anger by claiming that the minimum wage has been increased by more than 7 percentage points above inflation.

However, Turkey has the second-lowest minimum wage in Europe, only above Albania. The 2020 minimum wage was just 2,374 TL (around US$320), close to minimum wage levels in China. The Turkish bourgeoisie and state seek to keep wages competitive against low wages in East Asian and Eastern European countries, and to allow unfettered exploitation by local and international capital.

The minimum wage hovers around the “hunger limit”—the monthly food expenditure a family of four needs in order to have a healthy diet. In December 2020, for a family of four, this hunger level was 2,592 TL (US$345) and the poverty threshold was 8,436 TL (US$1,124), according to research conducted by Türk-İş, Turkey’s largest union confederation. The monthly cost of living for a single worker was 3,146 TL (US$419).

The 2020 state budget deficit, projected to be 139 billion TL as 2020 began, turned out to be 173 billion TL. Public debt has risen more than 40 percent, rising from 1.1 trillion TL in 2018, to nearly 2 trillion TL in November 2020.

While billions are pumped into the ruling elite’s bank accounts through low-interest loans and stimulus packages in Turkey and internationally, this debt must be paid by the working class through increased exploitation and attacks on basic social rights. The government is exploiting the pandemic for low wages, increased exploitation and violent attacks on social rights. The economic burden of the pandemic in Turkey has been unloaded onto workers and the poor; the impoverishment of the working class has seen an unprecedented acceleration.

To finance this massive debt, the Erdogan government has implemented successive increases in many basic product prices and taxes in January. While the working class and poor pick up the tab, a tiny elite has made vast fortunes profiteering from the pandemic. The BIST-100 stock index has risen nearly 80 percent since its lowest level (842 points) on March 23, 2020.

The “herd immunity” policy—which has led to 2.5 million confirmed cases and 26,000 deaths in Turkey, including those of 360 health care workers—is massively benefiting the financial aristocracy. Profits at Turkey’s top 10 banks have surged by 36 percent compared to 2019.

Turkey’s largest industrial enterprises increased their profits significantly. In the January-September 2020 period, Koç Holding increased its net profit to 8,481 billion TL, with a 94 percent increase compared to the same period of 2019. Sabancı Holding increased net profits by 69 percent in the third quarter of 2020 compared to the same period of the previous year, making a total profit of 3.8 billion TL in the nine-month period.

The only way forward for the working class to fight the pandemic and defend social rights is a struggle against the capitalist system. This means organizing and mobilizing internationally, independent of the unions, to stop nonessential production with full compensation for workers and small businesspeople, in a fight for socialism to save lives.

Commerzbank cuts 10,000 jobs in Germany, with union support

Gustav Kemper

Commerzbank’s share price jumped 6 percent when CEO Manfred Knof announced last week that 10,000 full-time jobs would be cut and 340 of the bank’s 790 branches would be closed. The jobs massacre is the price Commerzbank staff are expected to pay for the bank to achieve a return on equity of about 7 percent by the end of 2023 through cost savings of €1.4 billion.

Anyone who thought this would provoke an outcry from the trade union Verdi has been taught better. “We can largely support this strategy because it is correct in terms of the target picture,” Verdi representative Stefan Wittmann told the Deutsche Presse-Agentur. His only objection was that “the timeline for staff reductions until the end of 2023 provided for in the new strategy is far too short.”

The supervisory board is to vote on the new plans this week. It is already becoming apparent that the job cuts will be approved there—perhaps in a somewhat longer time frame. The trade union and its representatives on the supervisory board have already proven to be reliable co-managers of the financial institution in the past, to the delight of the shareholders.

Commerzbank branch (Image: Donald Trung / CC BY-SA 4.0)

Last year, Wittmann told the financial magazine Der Aktionär that the then head of Commerzbank, Martin Zielke, and the chairman of the supervisory board, Stefan Schmittmann, were “overworked conflict avoiders” who were running away from the crisis. Verdi had always worked closely with management and had proposed rationalisation and structural measures at an early stage. “The figure of 10,000 by the end of 2023 is too high. But to cut a high four-digit number of jobs—we can accept that under the right conditions,” he continued.

The chairman of the General and Group Works Council, Uwe Tschäge, who is also deputy chairman of the Supervisory Board, told finance daily Handelsblatt at the time that he was not opposed to the job cuts if they were “socially accommodated.”

“There must be no compulsory redundancies, we will fight for that,” Tschäge said. He added that Commerzbank must choose a “reasonable period of time” and provide enough money for partial retirement models and similar devices. He wanted to be able to understand why and where management was cutting jobs. He expected support from the federal government as a major shareholder to ensure that employees were “dealt with decently.” What was important to him, Tschäge said, was “that the bank is in a stable position even after restructuring and that it can continue to develop.” In other words, that it makes more profit again!

No wonder business magazine Capital then proposed Tschäge as interim head of the supervisory board. It reassured shareholders, “That a works council representative—in this case, by the way, a trained banker—heads the supervisory board may frighten arch-capitalists, but there are examples of this working smoothly.”

After the resignation of Commerzbank managers Zielke and Schmittmann, the search began for a new board with enough toughness to enforce the cost-cutting measures that shareholders—above all the financial shark Cerberus—were already demanding at the time. Commerzbank boss Knof, who was appointed at the beginning of January, had already proved in his past positions that he had this quality.

As head of Deutsche Bank’s private and corporate client division, Knof had cut 50 percent of administrative positions last year. Before that, he was head of financial services company Allianz AG Germany.

Hans-Jörg Vetter, who has been chairman of the supervisory board since August, also has experience in restructuring banks. After the banking scandal that led to the collapse of the Bankgesellschaft Berlin in 2001, he realised a “restructuring plan” under the newly elected Social Democrat-led Berlin Senate (state executive), to which up to 10,000 jobs fell victim, while the assets of investors and shareholders were saved using billions of taxpayers’ money.

These are the qualities required of bank managers today to secure such institutions in the fierce cut-throat competition on the international financial markets and to preserve the huge fortunes of the wealthy. This competition also determines the policy of the federal government, which does everything to defend its “national champions” in the financial sector, and which are important for financing foreign trade and investments abroad. The federal government—with a 15.6 percent stake and the largest shareholder—fully supports Commerzbank’s strategic plan.

The coalition of federal government, corporations and trade unions is directed against the working class, which they seek to prevent from rebelling against the continuing destruction of jobs and lowering of living standards.

The unions completely subordinate workers’ interests to the profit drive of the corporations, in the banks as well as in industry. Wittmann is not an isolated case but represents a clique of functionaries who call the shots in all trade unions. They deliberately try to hoodwink and betray workers using every trick in the book.

For example, in an interview with news weekly Der Spiegel, Verdi deputy chairperson Christine Behle supported the job cuts at Lufthansa. “The fact that capacity has to be cut is an economic decision that is not wrong from the outset,” she explained.

A Hamburg Airbus works council member remarked that one only had to “look at the sky empty of planes” to understand that there was “staff overcapacity” and that the IG Metall union had to “make it possible for people to leave [the company] voluntarily.” Countless similar statements could be quoted.

The Left Party is playing an equally rotten role. In a statement on the massive job cuts at Commerzbank, its leader Bernd Riexinger, a former Verdi official, said the federal government must finally conclude from experiences like this, “It’s not the owners of the companies who have to be saved, but the jobs and the benefits of the company for the general public.”

Riexinger is trying to make the workforce believe that the government can be pulled onto their side. This is absurd. The grand coalition of Christian Democrats and Social Democrats is unreservedly on the side of the banks and corporations. For years, it has cut social spending and driven whole countries (like Greece) into abject poverty through austerity dictates. In the coronavirus crisis, it supports big business with gigantic sums (according to Deutsche Bank calculations, a total of €1.9 trillion), while schools and hospitals lack the most basic necessities. Now it is already drawing up plans to claw back these funds at the expense of working people.

As the largest shareholder, the federal government is one of the driving forces behind the job cuts. It became involved in Commerzbank during the financial crisis in 2008. Last summer, Economics Minister Peter Altmaier announced he intended to sell off the government’s stake at a profit in 2021.

The jobs at Commerzbank—just as in the auto industry, the retail trade and in many other sectors where mass redundancies are imminent—can only be defended in a fight against the government, the corporations and their henchmen in the trade unions.

The right to breathe: COVID-19 and the scarcity of medicinal oxygen for the developing world

Benjamin Mateus

The singularly most important treatment for patients with severe COVID-19 is medicinal oxygen. However, this life-saving treatment is not ubiquitous as it has tragically been shown. Recent reports that oxygen supplies were exhausted in Manaus, Brazil, and Egypt, while patients suffocated in their pulmonary fluid, shocked the world that a lack of oxygen so plentiful in the world could be in short supply.

Patients with severe or critical COVID-19 cannot get enough oxygen into their bloodstream by simply breathing in room air. They need a higher concentration of oxygen and support to get it into their lungs to survive. But these particular types of equipment and supplies are lacking in much of the developed world. The oxygen demand is so high in COVID-19 patients that even the United States, the wealthiest nation on the planet, took stock of the oxygen crisis that put Los Angeles hospitals in extremis in the first week of January when hospitals were overwhelmed with COVID-19 cases.

The first month of the new year was horrifically brutal. There were 18.75 million new cases of COVID-19 and over 400,000 further deaths worldwide. The most recent global tally stands at 103.3 million cases of COVID-19 and 2.23 million deaths.

Ventilator tubes attached to a COVID-19 patient at Providence Holy Cross Medical Center in the Mission Hills section of Los Angeles, Nov. 19, 2020 [Credit: AP Photo/Jae C. Hong]

While the ruling classes are impatiently demanding a return to economic normalcy, the more level-headed and impartial scientists are raising concerns that the variants’ spread will reignite a spring surge with grim consequences. Many low-income countries experiencing the pandemic first-hand for the first time lack the resources to make oxygen, let alone access to the global supply chains.

On Friday, Dr. Michael Osterholm of the University of Minnesota, a member of Biden’s coronavirus task force, spoke at a press conference with Minnesota Governor Tim Walz. “Now we’re down to 150,000 cases, which surely feels better than 300,000 cases,” he said. “But this is our new baseline. And this is what we’ll jump off on with the next challenge. And these new variants, we’re seeing these mutated viruses are much more infectious and do actually produce much more serious illness. And I anticipate over the next six to 14 weeks, the darkest days of the pandemic are going to occur.”

During the initial onslaught, many patients with low blood oxygen levels were immediately placed on ventilators, leading to difficulties weaning them off the breathing device and extensive lung injury from the high pressures that had to be used. The move to delivering oxygen through helmets, masks and nasal tubes shifted the survival curves. Patients found to be stable are now being sent home from hospitals with portable oxygen canisters and asked to monitor their symptoms and oxygen levels with affordable pulse-oximeters.

The rate of hospitalized COVID-19 patients on ventilators has declined from a high of 18.6 percent in March to 1.5 percent in September. Additionally, the use of blood thinners and steroids have contributed significantly to survival. But, as witnessed over the winter surge, the health system’s lack of capacity, despite these measures, increased the fatality rate. In countries with direly limited health resources, a rapid rise in cases can be catastrophic.

Back in June 2020, the director-general of the World Health Organization, Dr. Tedros Adhanom Ghebreyesus, had raised the alarm: “Many countries are now experiencing difficulties obtaining oxygen concentrators. Demand is currently outstripping supply.” Medicinal oxygen is made using oxygen concentrators, which extract and purify oxygen from the air. When the number of cases rose by 1 million a week, the demand for medicinal oxygen had climbed to 88,000 large cylinders per day (620,000 cubic meters of oxygen). Just a few companies own close to 80 percent of the market. Little headway has been made in the intervening months.

A report published last week in the Wall Street Journal notes, “As COVID-19 cases increase sharply in much of the world, a scarcity of oxygen is forcing hospitals to ration it for patients and is driving up the coronavirus pandemic’s death toll. The problem is especially acute in the developing world.”

In Europe and North America’s wealthy countries, liquid oxygen is brought in tankers and piped into the hospital’s internal oxygen system directly to patient beds. In June, when Spain was facing a catastrophic death toll, engineers were able to lay seven kilometers of piping delivering oxygen to 1,500 beds in a make-shift hospital. For much of the rest of the world, however, the right to breathe is tied to economic status. Oxygen remains expensive and difficult to obtain.

It has been estimated that approximately 20 percent of people infected with COVID-19 suffer from some level of respiratory distress necessitating oxygen therapy. And without that therapy, the situation can turn fatal. A Lancet Global Health report published last summer found that across health care systems in sub-Saharan countries, only 43.4 percent had both continuous power and oxygen available. More than 70 percent would experience more than two hours of power outage per week. As the report notes, critical patients on oxygen concentrators rely on an uninterrupted oxygen supply.

The South African variant of the virus has begun to drive infections in neighboring countries. John Nkengasong, director of the Africa Centers for Disease Control and Prevention, told the Wall Street Journal, “[T]he second wave is here with a vengeance, and our systems are overwhelmed.” A concerning statistic recently reported was that the death rate across Africa due to COVID-19 had surpassed the global average. Many countries like Senegal and Zambia have seen recent daily cases double those experienced in their first wave. Yet, these nations have still not received the life-saving vaccines.

In Lagos, Nigeria, the number of people infected requiring oxygen surged fivefold by mid-January, increasing from 70 to 350 six-liter cylinders per day. Bloomberg reported that on January 17 there had been over 41,000 confirmed cases of COVID-19. A total of 227 patients had been admitted to treatment centers, and more than 9,000 were receiving care at home. President Muhammadu Buhari has approved $17 million in US dollars as emergency funding to construct 38 oxygen plants. According to Africa News, the oxygen demand has now doubled.

Though much has been said about Africa having dodged the bullet with the pandemic’s first wave, the evidence is mounting that the opposite is true. In countries like Zambia, testing of bodies at the main morgue in Lusaka found that 19 percent of the recently deceased over the summer had tested positive for the coronavirus, with a peak of 31 percent in July.

Tanzania’s John Magufuli declared god had eliminated COVID-19 from his country. With a country of 60 million, it had stopped updating its COVID-19 infection cases in April when the number had reached 509. Health care workers who have attempted to speak to the issue have been fired from their positions.

In mid-January, Zimbabwe, a country with just over 14 million people, saw a surge in cases reaching a daily peak of over 1,000 new cases. The country’s hospitals were quickly running short of space and medicinal oxygen. People turned to social media looking to purchase oxygen cylinders. Private suppliers were selling overpriced oxygen concentrators at between $2,000 and $3,700 per unit, a price beyond the vast majority in Zimbabwe.

Latin American countries have also faced a scarcity of medicinal oxygen.

With 1.86 million cases and 158,000 deaths (a crude case fatality rate of 8.5 percent), Mexico continues to suffer a massive number of deaths, which may in part be due to a health system that is too overwhelmed to care for its population during the pandemic. The number of deaths is likely an undercount.

The price of oxygen has climbed fourfold in Mexico City, with 22 million people, where the pandemic has pummeled inhabitants. According to Reuters, 20 medical oxygen distributors they had consulted said they had no tanks in stock. People are waiting hours in line at the few stores that still have supplies on hand. Prices can run up to $160 to refill a 24-hour tank. Many who need oxygen will require such treatment for up to a week, in a country where the minimum daily wage of a worker is about $7.

In the populous city of Villa El Salvador, Peru, it has become an everyday routine for friends and families of people infected with severe COVID-19 to carry empty canisters of oxygen, searching for places that might sell it at a reasonable price. Most hospitals in Peru don’t have oxygen concentrators, leading to price gouging and black-market exchange. A young woman speaking to the Associated Press said, “It’s so sad to see that all people go through this. It is sad to see that not only I, but all people are waiting for oxygen for their family.”

French government rejects a new lockdown to stop coronavirus spread

Alex Lantier

On Friday evening, after a week of press reports suggesting French President Emmanuel Macron was likely to announce a lockdown, Macron sent Prime Minister Jean Castex to announce on television that there would be no lockdown. But health officials are adamant that the spread of the more contagious British variant is accelerating, and only a lockdown can stop a massive wave of deaths.

Like his counterparts across Europe, Macron is making the politically criminal choice to sacrifice masses of lives to increase the wealth of the super-rich. This weekend, the number of COVID-19 deaths officially recorded in Europe exceeded 700,000. Of these, more than 76,000 occurred in France. More than 100,000 people are dying every three weeks in Europe.

With blatant indifference to the loss of human life, Castex gave a 15-minute speech in which he concluded: “Our duty is to do everything possible to avoid a new lockdown, and the next few days will be decisive.” Castex declared that the question of a lockdown “is legitimately raised,” but that he dismissed it in view of “its very heavy impact on the French in all areas.”

A nurse holds a phone while a COVID-19 patient speaks with his family from the intensive care unit at the Joseph Imbert Hospital Center in Arles, southern France, Wednesday, Oct. 28, 2020 [AP Photo/Daniel Cole]

He detailed additional measures that leave the government’s health strategy essentially unchanged, organized around a nationwide 6 p.m. curfew, the prohibition of entry from or leaving to outside the European Union, the obligation to conduct tests at national borders, the closure of large shopping centres of more than 20,000 square meters, and increased patrols by police to enforce the curfew.

With approximately 23,000 new cases and 500 new deaths of COVID-19 per day in France, even before the British variant had established itself as the dominant strain, these measures would not prevent a vast increase in contagion.

Even official government statements confirm that its policy will have no significant impact. “The curfew has an impact, but it is not enough in the face of the variants,” Health Minister Olivier Véran said at a press conference on January 28, two days before Castex’s speech. He admitted that transmission in schools and workplaces, which accounts for two-thirds of clusters, plays a huge role: “There is a contamination that is difficult to avoid, contamination in the family. There are contaminations linked to professional practice.”

Doctors have denounced the policy announced by Castex. “It is obvious that it will not help to restore the health situation,” said Djillali Annane, head of the intensive care unit of the Poincaré Hospital in Garches. “If we only count on this measure there and the partial closure of borders to re-control the epidemic with in 10 days, with the period of school vacations, it is a very risky and daring bet.”

Similarly, the professor of infectious disease, Anne-Claude Crémieux said: “The moment when the increase will be very rapid is approaching. Containment is therefore still very likely.” Noting the few countries “that have almost eliminated the virus” such as Vietnam, Taiwan and China, she added that this requires a decision “to eliminate the virus at the price of economic sacrifices.” However, she made it clear that in France and Europe, the political power had made the opposite choice, to let the virus spread.

To stop the virus, she added, the attacks on the health system, which have been carried out for decades, should be stopped: “First, a strict and long containment should be imposed, and then a very effective policy of isolation and tracing for sources of contamination should be put in place. But we would need an army of public health professionals in the field, which we no longer have, and it would take months and the means to rebuild it.”

It is obvious to growing numbers of workers and young people that the Macron government and the European Union, in their hostility to a serious fight against the virus, have no viable strategy to end the pandemic. While there are huge delays in the delivery of vaccines, whose effectiveness against the new strains is now unknown, containment is more essential than ever. But a policy of defending lives is incompatible with the capitalist system and the class interests of the financial aristocracy that Macron defends.

His arguments, that non-essential economic activity must continue at the cost of lives and continued contagion to assist small businesses, are nonsensical. The state has no real prospect of reopening most of the businesses—cafés, restaurants, sports halls, concert halls, etc.—that it has closed to avoid overwhelming intensive care units. It is maintaining non-essential work and face-to-face schooling, not to help the economy, but so that the profits continue to accumulate in the banks and for the largest companies.

Even if one took the morally and politically indefensible view that the only important variable is financial wealth, a strict health policy would collectively be more profitable than the collective immunity policy pursued by Macron and the EU. The Gross Domestic Product (GDP) of France (3.2 million cases, 76,000 deaths) has fallen by 8.3 percent and that of Germany (2.2 million cases, 58,000 deaths) by 5 percent in 2020. Taiwan’s (911 cases, 8 deaths) increased by 2.5 percent, China’s (89,522 cases, 4,636 deaths) by 2.3 percent.

Macron’s goal is not to save the economy, but to continue the transfer of wealth to the financial aristocracy, organized by the European Union/European Central Bank stimulus packages of more than €2 trillion. The only important issue, from the government’s point of view, is the impact this will have on corporate profit.

The Journal du dimanche, which devoted its issue yesterday to Macron’s announcement, noted: “One last argument weighed heavily” on the government decision: “the economic bill, estimated by the finance ministry at €25 billion for a month and a half of lockdown. ‘We have to find another option,’ pleaded Economy Minister Bruno Le Maire to Macron.”

The president of the French employers’ association (MEDEF), Geoffroy Roux de Bézieux, confirmed that the pleas of Le Maire were pushed by MEDEF itself. “We have constantly exchanged with Bruno Le Maire and his teams. We are all aware that a simple solution to the health crisis does not exist. But businessmen would be indignant at the return of a solution identical to that of March,” i.e., a lockdown that would stop in-person schooling and non-essential production in order to stop the transmission of the virus.

The MEDEF has received support in this matter from the trade union apparatuses and middle-class pseudo-left parties, such as the New Anti-Capitalist Party, which support the economic bailout plans and call for the reopening of universities and the economy as a whole.

However, the €25 billion that would be needed to finance a lockdown represents less than the profits that Bernard Arnault was able to add to his wealth in 2020 alone. His wealth has grown from $73 billion to more than €100 billion ($121 billion) thanks to the government bailouts, financed at the expense of the working population.

Nervous opening expected for Wall Street

Nick Beams

The key questions that will be uppermost when Wall Street opens today are whether the speculative frenzy in GameStop and other companies, whose shares have been shorted by hedge funds, will continue, and whether the downturn in the broader market, evidenced by significant falls at the end of last week, will deepen.

The two phenomena are interconnected. There are fears the surge in shorted stocks, which has resulted in a 1600 percent rise in GameStop shares since the start of the year, coupled with rises in others, such as AMC, up by 300 percent, is a sign that the Wall Street bubble may be about to collapse.

As the Financial Times noted: “The frenzied trading of the past week has fuelled concerns that a speculative bubble … could trigger a sharp market pullback.”

A GameStop storefront [Wikimedia Commons]

The reason is that the GameStop frenzy is only the most egregious expression of the speculative bubble that is Wall Street as a whole.

The surge in GameStop and other targeted companies represents the complete divorce of the market value of their shares from the underlying economic reality. GameStop, a retailer of video games, had seen its revenues halved in the last 10 years and then experienced a 31 percent fall in sales in the first nine months of last year. But its market value as a result of the speculation makes it a $25 billion company.

What could be called the “GameStop strategy” involves buying up the shares of companies that have been “shorted” by major hedge funds. Shorting is a process in which a hedge fund borrows the shares of a company, sells them in anticipation they will fall—a result which can result from the shorting action itself—and then buys the shares at the lower price, returns them to the original holder, making a profit on the deal.

But if the share price rises, as has happened with the targeting by retail investors of shorted stocks using a Reddit platform, the hedge fund has to buy the shares at a higher price, thereby making a loss.

The extent of the losses by the hedge fund Melvin Capital, a significant shorting player, as a result of last week’s GameStop surge, is now being revealed.

According to a report in the Wall Street Journal, Melvin, which had previously been regarded as successful, started the year with about $12.5 billion on hand, but lost 53 percent in January. It now has capital of around $8 billion, which includes $2.75 billion of emergency funds injected into it by two other funds, Citadel and Point72 Asset Management.

The extent of the losses at Melvin, together with the possibility that other hedge funds could also lose large amounts, has sparked the concern of the Securities and Exchange Commission, the Wall Street regulator.

In a statement issued on Friday, the SEC said it was closely monitoring and evaluating the extreme volatility of a number of the stocks.

The statement began with an assurance that the “core market infrastructure” had proven “resilient” under the impact of the “extraordinary” weight of last week’s trading volumes, but then added:

“Nevertheless, extreme stock price volatility has the potential to expose investors to rapid and severe losses and undermine market confidence.”

The concern of the SEC is not the fate of the hundreds of thousands of small retail investors and individual stock market players who have been caught up in the frenzy. It fears that if there are further major losses by hedge funds, defaults on debts and a major sell-off, this could set off a crisis.

No doubt the SEC has in mind the experience of 1998, when the bankruptcy of the hedge fund Long Term Capital Management, threatened the entire market, prompting a rescue operation by the New York Federal Reserve.

The speculation in GameStop and other shorted stocks is not only the result of the activity of retail investors.

Long-time hedge fund operator and noted short seller Jim Chanos told the Financial Times that the events of the past 10 days were “surreal,” unlike anything he had witnessed in his 40 years in finance.

He poured cold water on the claim, widely circulated on Reddit and on other platforms, that the speculation hitting hedge funds was “sticking it to the suits,” noting that besides some retail investors “a bunch of hedge funds have made a lot of money.”

On Thursday, an angry social media storm arose over the decision by the sharebroker Robinhood, the main firm through which the retail surge has taken place, to suspend purchases of GameStop shares and other shorted stocks with the claim that this was the result of intervention by major hedge funds to protect their positions.

While it cannot be ruled out that Robinhood was leant on, the real reason for the suspension in trading appears to be that the brokerage firm could not finance the increased volume of deals. Share trades pass through a clearing-house before they are finalised, in a process that can take as long as two days.

Clearing-houses require that brokerages post collateral for their trades in case there is a default. Because of the increased volume of its deals, Robinhood was forced to obtain a cash infusion of more than $1 billion. Lenders included JP Morgan Chase and Goldman Sachs.

In a series of interviews explaining the suspension, Robinhood CEO Vlad Tenev said it was “not negotiable” for the firm to “comply with our financial requirements and our clearing house deposits.”

The Depository Trust and Clearing House Corp has not provided details of how much money individual firms are required to supply to cover their trades, but on Friday it was revealed that the total capital it required to be placed under its jurisdiction had increased from $26 billion to $33.5 billion.

In a statement, the DTCC said that the frenzied trading in stocks, such as GameStop and the movie chain AMC, “generated substantial risk exposure at firms that clear these trades ... particularly if the clearing member or its clients are predominantly on one side of the market.”

Under normal circumstances the activities of the DTCC pass unnoticed, in the background. But in times of great turbulence, calls for increased money to be placed with it as collateral can have a major impact. In reporting on this development, the Financial Times noted that, during the market crisis in mid-March, one US bank was required to find $9.6 billion in the course of an hour to finance derivative trades.

Cutting through the hype on social media that the surge is some kind of rebellion or even a “revolution” against the titans of Wall Street and a movement to “democratize finance,” the essential reason can only be found in the most fundamental feature of the entire financial system.

This is the divorce between the market value of shares and other financial assets, and the underlying real economy. This process, which began 40 years ago, was accelerated first by government bailouts and the provision of ultra-cheap money by the Fed, after the 2008 crisis, and was given a further boost when the government and the Fed injected trillions of dollars into the financial system as a result of the market crisis in mid-March last year.

Since then, amid the worst economic contraction since the Great Depression and the loss of millions of jobs, Wall Street is up more than 66 percent, with stocks such as Tesla, which returns only a relatively small profit, escalating by 900 percent. The escalation of the stocks of companies that are either in bankruptcy or on the road to it, was first seen immediately after the Fed’s March intervention, when the stocks of the car hire firm Hertz spiked 900 percent after it had filed for bankruptcy.

In an editorial last week entitled, “The Reddit Wolves of Wall Street” the Wall Street Journal referred to the present situation as one of “high financial drama.” It then offered a reassurance to its readers and to itself that: “This may be a new example of the power of social media, but it isn’t a crisis of capitalism or the stock market.”

The editorial went on to point to the underlying driving force of this speculation.

“The government body that should come in for more introspection is the Federal Reserve. The central bank may be feeding the asset frenzy as it holds interest rates near zero and crushes the long bond yield curve so it doesn’t send accurate price signals. As investors search for yield they move into commodities, real estate, junk bonds, foreign currencies – and stocks.”

But that analysis only raises another question, which the WSJ does not care to probe. Why does the Fed not end this policy which, as the editorial implicitly acknowledges, can only lead to a disaster?

The short answer is that it is incapable of doing so. It is locked into the escalation of financial assets by the injection of ever-greater amounts of money, because to end it would bring about a collapse of the financial house of cards with devastating economic and financial consequences.

That, by any definition, signifies a crisis of capitalism. The fact that the WSJ raises this prospect, only to immediately rule it out, is a sure sign that it smells the odour of death wafting up from the open grave of the system it so strenuously defends.

But the ending of the capitalist profit system, no matter how deep its crisis, will not come about automatically. Rather, its death agony will result in social destruction and the eruption of the class struggle, for which the ruling class is making its preparation through the cultivation and development of fascist forms of rule, as revealed by the events in Washington of January 6.

The capitalist system is caught in the coils of an ever-tightening crisis. But it can only be overturned, and a higher form of socio-economic organisation developed, through the conscious political struggle by the working class to take power in its own hands—a struggle for which the crisis on Wall Street must provide further impetus.