Devolution for Greater Manchester spells the end of the National Health Service

Margot Miller

Manchester, which has 95 Labour councillors out of 96, is trailblazing a measure that will lead to the further fragmentation and privatisation of the National Health Service.

Chancellor George Osborne will devolve control of the region’s £6 billion NHS budget to the Greater Manchester Combined Authorities (GMCA).

Beginning next year, local government in Greater Manchester, a conurbation of 2.7 million people with 10 Local Authorities, will have control of every penny spent on public health, social care, general practitioner services, mental health and acute services and community care.

The Conservative/Liberal Democrat government has set out to destroy all the gains in health, education and social welfare conceded to the working class after the last World War, and has found willing accomplices in numerous Labour councils.

Last fall, Osborne visited Manchester to co-sign a deal with local Labour Party leaders, devolving £1 billion from central government. The £300 million housing budget, £30 million annual business rates for building a new tramline local transport, local apprenticeship funding, and part of the Government’s Welfare to Work Programme have been devolved to the GMCA.

According to Osborne, devolution will turn Manchester into a “northern powerhouse” of economic growth. After the model of Manchester, other city-regions in the north of England, Leeds and Sheffield will follow.

Negotiations over “Devo Manc” took place in secret last summer between Osborne, Treasury Permanent Second Secretary John Klingman, the leader of Manchester City Council Sir Richard Leese and Manchester’s Chief Executive Sir Howard Bernstein.

There has been no debate on the biggest overhaul in the provision of healthcare and welfare since the foundation of the welfare state either in Manchester or nationally. Yet it is being sold as an exercise to improve local democracy and accountability.

Two years ago, Manchester voted “no” by 53 to 47 percent in a low turnout of 25 percent in a referendum on whether or not to have an elected mayor. Now an elected and extremely well-paid mayor, with power over the devolved budget, has been made part of the new package regardless.

There is every indication that London will follow Manchester’s lead.

To support devolution, London’s Mayor Boris Johnson commissioned a report on city finance by the London School of Economics that described central control of taxation as “hollowed out democracy.” This is a red herring to hide the scale of the cutbacks in services still to be implemented, and the further rollout of privatisation through “competitive tendering.” Devolution essentially enables central government to offload its responsibilities for health and welfare.

Guardian writer John Harris wrote that Leese and his fellow Labour council leaders have “radical and creative answers not just to England’s creakingly centralized system of government but to the huge questions about how to run places when money is so tight.”

Local Authority leaders played a vital role in imposing cuts in services to finance the bailout of the banks in 2008, with the full cooperation of the public sector trades unions. Last November, Manchester City Council announced £60 million of cuts, including 600 voluntary redundancies which will fall heavily on social care.

The Financial Times reported that Prime Minister David Cameron underestimated the level of cuts to be imposed by a full half. According to the Office for Budget Responsibility’s figures from March, year on year cuts of £48 billion need to be made until 2018-2019 to meet the government’s targets for getting rid of the deficit.

Leese, a likely contender for the post of mayor, has promised to deliver a “reduction in public spending not by clumsy centrally imposed cuts but by helping as many as possible of those on benefits or in poor health into sustainable independence.”

With a devolved budget of £100 million for the Welfare to Work programme and a target of getting 50,000 people, including the sick, off benefits, the mayor will be tasked with advertising Manchester as a cheap labor platform for global corporations.

Greater Manchester is one of the most popular places in the UK, outside of London, for direct foreign investment. Beijing Construction Engineering has a 20 percent stake in Manchester Airport, for example. Globalised production and finance has provided opportunities for the regional bourgeoisie to make direct links with transnational corporations, which leads to a race to the bottom in relation to wages and services, as regions compete with each other for investment.

Devolved services will facilitate the end to national pay agreements and conditions, as the trade unions offer up their workforces at competitive rates of pay.

In announcing the devolution of health care and its integration with the budget for social care, Manchester City Council says it will focus on preventative medicine. Long-term conditions like asthma and heart conditions will be treated, as much as possible, in the community—a policy that sounds good but which will, of course, be accompanied by cutbacks in hospital services. Leese said the “first big change is to make sure that a lot of people aren’t entering into needing health care that don’t need it.”

People “are spending too long in hospital,” he added.

While the coalition government is implementing the £20 billion efficiency savings initiated by the previous Labour government, the reality is that the NHS and social care have been cut to the bone, and people are sent home from hospital almost as soon as they have been operated on.

The NHS has also been bled dry by the Private Finance Initiative. A shortage of hospital beds and a lack of doctors and nurses are compounded by the fact that, when elderly people have had hospital treatment, there is nowhere to send them to recuperate due to the closure of nursing homes. Added to that, the shortage of general practitioners has led to more people presenting at hospital emergency departments. Empty pledges to ring-fence spending on health by all political parties are rendered null and void by private companies eating away at money that should be spent on essential services.

Labour’s Shadow Health Secretary Andy Burnham said the Manchester agreement will lead to a “two-tier service and challenge the notion of a National Health Service.” Yet this is being carried out by a Labour Council.

The pro-Labour New Statesmen called the changes “a great leap forward.”

In the Guardian, Simon Jenkins made a bizarre comparison between the size of the NHS and “Russia’s Red Army,” intending that the demonization of Russia over the Ukraine will somehow rub off onto the NHS. “Big has not worked,” he declared.

The threats to health and social care posed by “Devo-Manc” underlines the warning made by the Socialist Equality Party during the Scottish independence referendum campaign of the dangers posed by regionalism, devolution and separatism as a means of dividing the working class—a policy backed by the pseudo-left Socialist Workers Party and Socialist Party.

“The aim is to transform Scotland into a low tax, cheap labour platform for the benefit of the banks and transnational corporations,” we wrote. “The victims of this will be workers on both sides of the border, who will see a deepening of the ongoing offensive against jobs, wages and conditions that has been waged by all the major parties in both Westminster and Holyrood.”

Australian Intergenerational Report: A fraudulent justification for sweeping budget cuts

Nick Beams

The Intergenerational Report released on Thursday by Australian Treasurer Joe Hockey is a contrived and concocted document aimed at trying to provide support for a program of major government spending cuts aimed against the working class.

Purportedly showing the relationship between budget projections and population changes 40 years into the future, the report is very much about the present and the impact of the deepening global economic breakdown on the fortunes of Australian capitalism.

It claims that if measures introduced in the May 2014 budget are not implemented, or cuts of an equivalent nature made, there will be a major government debt and deficit crisis. But if they are carried out, budget repair will take place within a decade, after which surpluses will be continually generated.

The report’s core argument, namely the expectation that people will live longer as a result of medical advancements—itself a progressive development—and cause a budget crisis, is a graphic expression of the perverted logic of the profit system. So is the claim that unless major cuts are undertaken the present generation will be robbing future populations.

Robbery there certainly is. But the theft involved is the contemporary cutting of social services, pensions and education in order to boost corporate and financial capital as global economic conditions worsen.

Not surprisingly, therefore, big business groups welcomed the report. The chief executive of the Australian Industry Group, Innes Willox, said it was a “sobering document” reinforcing the need for Australians to face up to slowing growth and ageing population and flat-lining productivity.

“The document paints a picture of a nation that needs to make significant and quite urgent structural changes to meet the needs of current and future generations, to ensure our standard of living continues to improve,” he said.

Structural changes are not aimed at improving living standards. Rather, as the Business Council of Australia indicated in its 2015–16 budget submission, sweeping cuts must be implemented to ensure the maintenance of Australia’s triple AAA credit rating, sustain corporate and financial viability and meet problems in any future global financial crisis—that is, the provision of funds to bolster finance houses and the banks. In addition, they are necessary to enable corporate tax cuts so that Australia can remain internationally competitive as an investment site.

However, this corporate agenda is deeply opposed by broad sections of the population, expressed in the hostility to the May budget because it targeted lower income earners, resulting in the failure of the government to secure passage of some key measures through the Senate.

Significantly, the Intergenerational Report did draw out the impact of the most important budgetary item passed with the support of the Labor party.

John Daley, the head of the Grattan Institute, which has been one of the most strident advocates of cuts, noted in a comment published on the Business Spectator that long-term projections in the report highlighted the effect of the federal government’s abandonment of its previous commitment to contribute to the long-term growth in hospital costs paid by the states. It saved an amount equivalent to 1.4 percent of gross domestic product by 2055.

“It is by far and away the largest long-term reduction in Commonwealth spending,” he wrote, adding that it transferred the deficit problem to the states to solve.

The aim of the Intergenerational Report is to try to create the political conditions whereby this already significant display of bi-partisanship can be extended.

This was the main thrust of Prime Minister Tony Abbott’s comments on the report. Abbott said he understood there might be a temptation on the part of the Labor Party to go scouring through the document looking for political ammunition. “But I think we’ve seen the better angels of the nature of the leader of the opposition [Bill Shorten] on a lot of subjects lately and I’m confident that this parliament is better than that,” he said.

Abbott did not spell it out but he was referring to the complete support by the Labor Party for the government’s bogus “war on terror” and the deployment of more Australian troops to Iraq. He is seeking to extend the bipartisanship on “national security” to the economic arena, with the support already given by the Labor Party to hospital and health cuts inspiring confidence this may be possible.

However, the achievement of this goal requires the creation of the necessary political atmospherics. It involves the promotion of a sense of “national emergency” by sections of what passes for the small “l” liberal political and media establishment—along the lines of that which followed Labor treasurer Paul Keating’s warnings in 1986 that Australia faced becoming a “banana republic” unless major economic restructuring was carried out.

Working hand-in-glove with the mass media and the trade union bureaucracy, Keating was successful in creating the conditions for sweeping changes that boosted profitability, lowered wages and attacked working conditions.

So far Hockey has not succeeded in emulating his predecessor, prompting the criticism in editorial columns that he has failed to “sell” the government’s measures.

He obviously hoped that the Intergenerational Report, which he claimed would have people “falling off their chairs” when they read it, would turn the situation around. But, at least to this point, it has not produced the desired result.

Sydney Morning Herald economics commentator Ross Gittins said the Intergenerational Report ought to be highly informative, leading to a serious debate about economic choice but “in the hands of Joe Hockey it has become a crude propaganda exercise.”

Gittins was referring to the partisan framing of the report and its projections of budget outcomes based on three scenarios: firstly a continuation of the previous Labor government’s policies, secondly the budget measures passed so far, and thirdly, measures the government would like to implement but are still blocked in the Senate. The first two portray an ever worsening position, while the third, on the basis of highly dubious and selective assumptions, sees a return to ongoing surpluses by 2030.

The political editor of the Guardian, Lenore Taylor began her comment by saying “Sorry, Joe but I’m still on my chair.” The overall scenario was an “obvious public policy challenge” and Hockey was right when he said “doing nothing” was not an option.

The “sensible response,” she continued, would be for everyone to remain in their chairs and find “sensible ways to cut spending or raise revenue for which they can win the support of the Australian people.”

In short, Taylor’s message to Hockey, delivered on behalf of a section of the liberal media, is: we are ready to come on board but give us something better to sell than this!

The importance of bipartisanship was also raised in an editorial in theAustralian, which has waged a continuous campaign in support of sweeping cuts. Describing the report as “sobering,” it said Hockey had to use it wisely “to sell a story of resolute fiscal consolidation in the whole community” before criticising the treasurer for erring on the side of political partisanship in the report’s presentation.

In many ways the report, with its fanciful attempt to track economic events 40 years out through a linear projection of present trends, is a diversion.

The working class should focus its attention on the present situation and its driving forces. The ongoing attacks on living standards, health facilities, social services and education—and the even bigger attacks to come—are not the result of an ageing population but are produced by the deepening breakdown of the global capitalist system that has the Australian economy firmly in its grip.

The working class must meet this situation through a political struggle for an independent socialist program, aimed at the overthrow of the profit system, so that the vast wealth it has created can be utilised for social and economic advancement, rather than for enhancing the profits of the corporate and financial elites.

“Ukraine Tomorrow”: Domestic oligarchs and western politicians plunder Ukraine

Johannes Stern

At the invitation of notorious Ukrainian oligarch Dmytro Fertash, several representatives of the European elites met on Tuesday at the luxurious Ferstel palace in Vienna. Under the heading “Ukraine Tomorrow” they planned the economic exploitation of the country, which has been embroiled in civil war since the Western-backed coup last February and stands on the edge of a political and economic abyss. To put it bluntly, the main issue was how Western companies can collaborate with domestic oligarchs to plunder the country.

As always when the imperialists and their local proxies are haggling over the division of the spoils, an attempt was made to package their sinister intentions for public consumption. In the official press release it was stated, “In 200 days, Ukraine will have a master plan for the complex modernisation of the country. The reforms will comprise the following areas: the economy, trade, judiciary, the integration of Ukraine into the EU, the healthcare system, the struggle against corruption, the financial sector and suggestions for a reform of the constitution.”

Among the participants were well-known figures like the French philosopher Bernard-Henri Levy (BHL) and former French foreign minister Bernard Kouchner. They are now permanent fixtures of proceedings where imperialist plunder is on the agenda under the cover of democracy and “European values.” Both men played an important role in 2011 in the preparation and imposition of NATO’s war on Libya, and, since the beginning of the Ukraine crisis, they have been among Russia’s sharpest critics.

Several former leading European politicians are serving as advisers to the “Ukraine Tomorrow” project, all of whom are in search of lucrative sources of income. Former Austrian conservative foreign and finance minister Michael Spindelegger (Austrian People’s Party) is to lead the “Agency for the modernisation of Ukraine.”

Former Polish Prime Minister Włodzimierz Cimoszewicz will be responsible for combatting corruption. He earned his spurs at the roundtable which reintroduced capitalism in Poland and led the country through a drastic austerity and privatisation course in the 1990s to bring it into line with the European Union (EU).

Cimoszewicz sought to convince journalists who were present that despite the project being financed by Fertash and other oligarchs—the main source of corruption in Ukraine—it would not be problematic for his work. “Ultimately they have to do something for their country, otherwise they could lose everything,” he said.

German Social Democratic politician Gunter Verheugen, a former EU commissioner, will oversee the EU association agreement, the centrepiece of which consists of brutal social cuts in a country where GDP per person is currently only half the level of the EU’s poorest state.

British Labour politician, former minister and EU commissioner Baron Mandelson will be responsible for trade issues. Together with the former minister in the German Chancellor’s office, Bodo Hombach, he was jointly responsible for authoring the notorious Schröder-Blair paper, which committed European Social Democracy to a strict neoliberal course at the end of the 1990s.

It is entirely appropriate that former German finance minister and most recent SPD Chancellor candidate Pier Steinbrück will be responsible for finance. Steinbrück’s main concerns during the 2013 election were defending exorbitant salaries for managers, justifying his millions in income from speeches to banks and companies, while calling for higher government salaries.

Steinbrück’s main task will be to raise funds for the Ukraine project. “Without the oligarchs, this will not happen,” he explained to the press, but of course the consultative group was “entirely independent and not reliant on income from anyone.”

“We are not under the influence of those who have played a role thus far in Ukraine as big industrialists or oligarchs,” Steinbrück asserted.

The money is to flow into a fund for the reconstruction of Ukraine, including projects to be financed by foreign investors, as Spindelegger explained. To put it another way, he will provide back-up to Western firms that wish to exploit the country’s cheap labour.

Dmytro Fertash was unwilling to comment on how much he had invested in the fund. But he noted, “I will invest in my branch of the modernisation programme.” Thus for him, it is also about making a fortune. The oligarch obtained his riches through gas trading with Russia and owns an empire of chemical companies. There are contradictory reports about his wealth, ranging from €700 million to €10 billion. After the change in power in Kiev, he is no longer able to access cheap Russian gas for his firms. Thus for him, a more efficient energy supply is a question of survival.

Another German representative was the jurist and former defence minister Rupert Scholz. In 2006, Scholz demanded that the German army be armed with nuclear weapons in order to “be able to respond appropriately to a nuclear threat from a terror state, meaning in an emergency even with its own nuclear weapons.” It is not known if he repeated this demand in Vienna in connection with the Ukrainian army, whose propaganda claims they are fighting terrorists in eastern Ukraine, backed by nuclear-armed Russia.

Fertash spared no effort or cost to keep his guests entertained. He accommodated them in the luxury Park Hyatt and Ritz-Carlton Vienna hotels. With his initiative, he intends not only to save his own business interests, but his own skin and avoid spending the rest of his life in prison.

It was no accident that Vienna was the location of the meeting. Fertash not only has his headquarters there, he is also unable to leave Austria. A year ago, he was arrested at the request of the American FBI. The reason was a 2013 warrant issued by a US federal district court on charges of bribery and membership in a criminal organisation. He is accused of paying Indian politicians bribes in connection with a titanium project. In the event of extradition, he is threatened with 15 years in prison. Fertash has disputed the charges and described the US proceedings as “politically motivated.”

The Austrian judiciary is not investigating Fertash. A few weeks after his detention, they released him on the highest bail in the history of the country, €125 million. He is not allowed to leave the country until the extradition request is settled.

Along with Fertash, other Ukrainian oligarchs, who were formerly pro-Russian, are financially supporting “Ukraine Tomorrow”, including Rinat Achmetov, who, according to the latest Forbes list, is the richest Ukrainian, with wealth of $6.7 billion, and Victor Pintchuk, the son-in-law of former Ukrainian President Leonid Kutchma.

The Western politicians now working under the wing of Fertash have made no secret of who their new employer is. “Mr. Fertash is of course a Ukrainian oligarch. I have absolutely no problem saying that word,” Steinbrück toldHandelsblatt. “When the suggestion comes from the employer—along with the trade union organisations—to provide an injection of finance for this worthwhile agency, this is positive. The billionaires are thus using a portion of their wealth to modernise their country. I can’t criticise them for that and exclude them as undesirables.”

Steinbrück’s statement is a devastating indictment not only of his own activities, but also of the West’s policy as a whole. Politicians and the media are spreading official propaganda that a democratic transition, or even revolution, has taken place in Ukraine against the oligarchs. Now, a leading German politician is proudly proclaiming the oligarchs to be the motor for the “modernisation” of the country who should not be “criticised.”

The coup in Kiev, planned and financed by the US and EU, never pursued the goals of establishing so-called Western values and overcoming the dominance of the oligarchs. The Western powers were much more concerned with installing a puppet regime and bringing the oligarchs, who had close ties with Russia, on to their side so as to organise the exploitation of the country’s raw materials and cheap labour by Western companies. These are the goals of the “Ukraine Tomorrow” project.

Behind the US jobs report: Low wages and persistent mass unemployment

Gabriel Black

The US economy created 295,000 new jobs in February, according to a Bureau of Labor Statistics (BLS) report released Friday. The percentage of the population officially unemployed shrank by 0.2 percentage points to 5.5 percent.

The report sent tremors throughout Wall Street, with the Dow Jones Industrial Average falling 1.5 percent. Investors fear that any slacking of the jobs crisis could lead the Federal Reserve to scale back on its policy of ultra-low interest rates that has formed the basis of financial speculation in recent years.

Media outlets have celebrated the jobs report as a sign of the US economy’s growing strength. However, some have been confused with the question, voiced by the New York Times, “So Why Aren’t Wages Rising More?”

Behind the headline figures of February’s report lie two underreported facts. First, the fall in the official unemployment rate is largely fictional. Second, new jobs are concentrated in lower-paying sectors, while the overall wages of workers throughout the economy are under sustained attack.

While February was the 60th straight month of job growth in the private sector, it was also the 11th straight month in a row that the labor participation rate—a more accurate measure of unemployment—remained below 63 percent. The figure fell 0.1 percentage points to 62.8 in February, the lowest level since 1978. The contrast between the extremely low labor participation rate and the ostensibly recovering official unemployment rate arises from the fact that millions of unaccounted laborers in the official statistics cannot find suitable work.

Indeed, more than two-thirds of the drop in the jobless rate was due to workers leaving the workforce, not workers finding jobs. In February the number of people reported as being unemployed shrank by 274,000. Of those, 178,000 left the work force and 96,000 gained jobs.

According to the Economic Policy Institute (EPI), there were 5,970,000 unemployed workers missing from the official statistics in this month’s job report. Were they to be added to the unemployment rate, it would stand at 9 percent. These missing workers “are people who would be either working or looking for work if job opportunities were significantly stronger.” The EPI notes that more than half of these missing workers are in their prime age of working, between the ages of 25 and 54.

There are several signs that the jobs market is entering a renewed downturn. The number of Americans who filed new claims for unemployment benefits rose sharply last week, by 7,000, to a seasonally adjusted 320,000.

Meanwhile, Challenger, Gray & Christmas, the consultancy firm that tracks mass layoffs, reported yesterday that US employers announced 103,620 planned layoffs in the first two months of 2015, up nearly 20 percent from the same period last year.

As for wages, they remained stagnant for non-supervisory and production workers, the bulk of the workforce. Wages for all workers rose slightly, by $0.03.

One commentator on National Public Radio noted, “We’re adding most of our jobs at or slightly above minimum wage, and as long as that’s the case, you’re not going to get a whole lot of upward pressure on wages.”

A report released last April by the National Employment Law Project, “The Low-Wage Recovery,” found that unlike previous recessions and post-recession recoveries, the current “recovery” has been dominated by low-wage growth. The authors wrote, “We find that low-wage job creation was not simply a characteristic of the first phase of the recovery, but rather a pattern that has persisted for more than four years now. Deep into the recovery, job growth is still heavily concentrated in lower-wage industries.”

The largest industry to gain workers in February was in “food services and drinking places,” which saw 59,000 new jobs, or about a fifth of all gains. Professional and business services increased by 51,000 jobs, retail by 31,000, construction by 29,000 and health care by 24,000. Part-time workers stood unchanged at 6.6 million people.

The Obama administration’s “recovery,” characterized by high stock prices for the rich, stagnating or declining wages for the majority, and long-term unemployment, is not a policy accident. Starting with the bailout of the auto companies, which cut in half the wages for new hires, the administration has led the charge in “wage restructuring” and “downsizing” in order to make American workers more easily exploitable. Meanwhile, the bailout of the banks and Federal Reserve’s quantitative easing program have ensured record profits and stock prices for the super-rich.

Refining sector in US producing windfall profits for oil companies

E.P Bannon

In rejecting the demands by striking oil workers in the US for improved safety and living standards, the energy conglomerates have pointed to the fall in crude oil prices to justify their hard line. Referring to the insulting offer of a 6.5 percent wage increase over the next three years, lead industry bargainer Shell said last week that the proposal was “slightly lower than the increase we settled in 2012, when the energy market was stable and much stronger.”

Chevron CEO John Watson warned at the beginning of the year that “belt-tightening” would intensify if price drops continued. Tens of thousands workers in the industry have already been laid off and wage cutting is spreading internationally. While the companies are slashing jobs and refusing to make the slightest concession to striking workers, they have not cut back on dividend payments to their richest investors.

The top five Big Oil companies—ExxonMobil, Chevron, BP, Shell and ConocoPhillips—made $90 billion in 2014, roughly the same as in 2013. Though the crude price decline led to a falloff in profits from 2012, when the five made $118 billion, the companies remain highly profitable chiefly because of their refining operations.

This sector of the industry—largely controlled by the same oil giants—has greatly benefited from the 60 percent drop in the cost of crude. The lower cost of this key raw material has enabled the companies to realize even higher profits by refining petroleum into gasoline, jet fuel, diesel, heating oil and other products.

A Bloomberg News article last November, titled, “Cheap Oil Proves a Boon to Exxon, Chevron Refineries,” analyzed the third-quarter profits in 2014. The article noted that profits from ExxonMobil’s refineries skyrocketed 78 percent to $1.4 billion in the quarter—with the world’s largest oil company making $1 million in profit every two hours during the quarter. Chevron more than tripled its profit from refining crude into fuels.

Shell saw profits in the refining sector rise by 31 percent, beating analyst estimates, while Phillips 66, more than doubled its profit by the end of the third quarter of last year.

The results, “showed the benefit of the so-called integrated model pioneered by John D. Rockefeller in the late 19th century that combined oil fields with refineries to squeeze more value from each barrel,” Bloomberg wrote, showering praise on the ruthless oil baron whose Standard Oil monopoly is the progenitor of Exxon and Chevron.

In addition to fuel, the refining companies benefit from petrochemical production as well. Petroleum is used to manufacture a wide array of products—anything from asphalt to plastic—that are largely shielded from oil price fluctuations. Likewise, US refiners are able to export their fuel to higher paying foreign markets.

The super-profits from the refining sector are the product of the relentless exploitation of oil workers. Refinery workers have been forced into increasingly long shifts—in some cases, as high as 18 hours a day and weeks on end with little rest in between. Striking workers on the picket lines across the country complain of extreme fatigue, posing a serious danger to their own safety as well as that of the surrounding communities. The oil companies also scrimp on infrastructure repair at refineries across the country, many of which are still using equipment that is decades old. The explosion that took place last month at ExxonMobil’s Torrance, California refinery highlights the dangers of the oil giants’ reckless policies.

These companies have also insisted they have the “sole right” over personnel decisions, meaning they are determined to continue replacing full-time unionized workers with contract workers who have no job security, health or pension benefits. Whatever meager wage increases oil workers have received over the last decade have been eaten up by increased out-of-pocket health care costs.

The United Steelworkers has aided and abetted the attacks upon the working class by Big Oil. Despite mass anger over stagnating wages, declining living standards and an abysmal safety record, the USW bureaucracy has done everything in its power to keep the strike as limited as possible. It has called out only 6,500 of the 30,000 workers it organizes in the industry.

At a rally at Shell’s Houston headquarters Friday, union officials said nothing about the company’s threat to replace strikers at its nearby Deer Park, Texas refinery and three plants in Louisiana. Although there are 5,000 USW oil workers in the Houston area—with only half on strike—and tens of thousands of other union members, the unions did nothing to mobilize workers, bringing out only a few hundred workers for the rally. The event was nothing more than a platform for US Congressman Gene Green and a promotion of the Democratic Party, which is no less a tool of Big Oil and Wall Street than the Republicans.

Oil workers and their supporters march on Shell headquarters in downtown Houston.

The USW has deliberately not targeted ExxonMobil and Chevron in the selective strike, allowing these companies to continue to rake in vast profits and make their own preparations to smash the strike and impose its demands.

A striking worker at the Tesoro Martinez refinery told the WSWS, “We don’t think the USW is fighting to win this. We had no choice, the union came and said you’re one of the refineries on strike and that was that. We’ve lost two paychecks so far and there’s no sign negotiations are going anywhere. If they’d asked us ‘do you want to go on strike by yourself?’ we’d have said ‘No.’”

The struggle to defend the jobs and living standards of oil workers cannot be taken forward through the USW and the other trade unions that are allied with the corporations and the big business parties. The business executives who run these organizations support and directly benefit from the capitalist system, which enriches the few through the impoverishment and oppression of the overwhelming majority of the population.

If the livelihoods and the very lives of workers are to take precedence over the further enrichment of corporate executives, Wall Street investors and their trade union servants, then the working class must base its struggles on an entirely different, socialist, perspective. This requires building a mass political movement of the working class, independent of the two big business parties, to reorganize economic life on the basis of human need, not private profit. This includes the transformation of the energy conglomerates into public utilities run under the democratic control of working people.

European Union press Syriza to deepen its austerity program for Greece

Robert Stevens

After the Syriza-led government’s decision to sign the February 20 Eurogroup statement and capitulate to European Union (EU) demands for more austerity in Greece, EU officials are stepping up their threats against the country.

Since then, the “troika”—the European Commission, European Central Bank (ECB) and International Monetary Fund (IMF)—have insisted that until Syriza begins actively imposing austerity, it will not receive another cent in loans.

This week Greece paid back €300 million to the IMF, but by the end of the month it must pay a further €1.5 billion. An additional €4.5 billion in maturing Treasury bills (T-bills) is due to be paid this month. More than €6 billion in debt repayments to the IMF falls due in August, immediately after the four month austerity extension expires. All told, Greece must pay back a total of €22.5 billion to its creditors in 2015.

Greece cannot meet these repayments, and without external funding, a default on its debt of around €320 billion is again a possibility.

Bloomberg reported the analysis of Nicholas Economides, a professor at New York’s Stern School of Business, who said, “Greece has already run out of money and lives with emergency compulsory borrowing from pension funds and from European agricultural support money in transit to farmers. Unless there are new loans from Europe or alternatively the ECB allows Greek banks to buy more Greek debt, Greece will default at the end of March.”

The Economist noted, “Syriza’s climbdown in late February has bought time but it has not brought any money from Greece’s creditors. None will be available until the government shows that it is sincere in its promise to complete the reforms that creditors still insist upon.”

This week Spain’s finance minister, Luis de Guindos, said he believed Greece would be unlikely to access capital markets by June and will require further loans of between €30 billion and €50 billion from its European creditors.

Since Syriza’s election in January, the European Central Bank has tightened the screws. The ECB no longer accepts Greek sovereign bonds as collateral for loans and banks are forced to rely on the emergency liquidity assistance (ELA) scheme, which has a high interest rate and will only be available temporarily. The ECB has also limited the amount of short-term T-bills that Athens can issue.

As a result, Greece’s banks are more or less insolvent with even more deposits withdrawn from them in December and January (€17 billion) than at the height of the euro zone financial crisis in May and June 2012. According to official figures, outflows from the banks continue, with a weekly rate of between €2 billion and €3 billion withdrawn in the first three weeks of February.

Tax revenues are down €2 billion in January and February, compared with 2014. Under these conditions it is impossible for Greece to pay for any extended period the €4.5 billion monthly bill for the wages of public sector workers and state pensions.

On Thursday, the ECB refused to countenance a relaxation of the rules that have cut off funds to Greek banks. ECB head Mario Draghi said the bank would only lend further funds to Greece if it was able to satisfy the Eurogroup, IMF and ECB of its strict adherence to the February 20 agreement.

In a desperate response Friday, Prime Minister and Syriza leader Alexis Tsipras contacted European Commission President Jean-Claude Juncker to request an emergency meeting. Juncker gave Tsipras short shrift. He advised Tsipras that any further discussion would have to wait until after Monday’s meeting of the euro zone’s finance ministers.

Juncker gave an interview Wednesday to Spain’s El Pais. Tsipras “still has to tell the Greeks that he is going to have to break certain promises,” he said.

With Syriza having already signed off on everything demanded by the troika, including a clause that the government make no “unilateral” moves to implement any of the programme it was elected on, it is functioning as a tool of the EU’s austerity agenda. According to a S ü ddeutsche Zeitung report, Juncker and Tsipras were in “permanent telephone contact.”

The February 20 agreement was conditional on Syriza supplying the Troika with a list of “reforms” that must first be approved by them and then implemented.

For discussion at Monday’s meeting, Greek Finance Minister Yanis Varoufakis presented a list of seven measures that his government proposes to immediately carry out, to tackle the “humanitarian crisis” and “alleviate extreme poverty.” They are highly targeted measures, introducing food allowances for 300,000 households, the re-connection of domestic electricity supplies and some free electricity for 150,000 households, and a rent allowance for fewer than 30,000 households.

Syriza’s initial budget to deal with the social crisis, outlined in its Thessaloniki election programme was €1.8 billion—a figure barely enough to scratch the surface of the staggering social devastation caused by five years of brutal cuts in living standards.

Now, following a month of negotiations with the troika, the total cost allotted is just €200 million, or 11 percent of the Thessaloniki programme. Even this must be approved next week by the troika. Varoufakis’s letter assures them that it will be “fiscally neutral,” with €200 million of savings to be made elsewhere.

According to excerpts of an interview with Tsipras to be published in Saturday’s Spiegel, he said on Friday, “The ECB has still got a rope round our neck.”

Tsipras added that if the ECB refuses Athens permission to issue additional short-term treasury bills, “the thriller we saw before February 20 will return.”

None of this pathetic posturing will wash with the representatives of the ruling elite. Speaking on Friday to the influential German business daily Handelsblatt, Klaus Regling, head of the European Stability Mechanism, which facilitates the EU’s loan agreements, said, “The new Greek government’s communication has, at times, been irritating in recent days.”

He warned, “Greece must pay back these loans in full. That’s what we expect and nothing has changed in that regard.”

Even as the representatives of the global financial aristocracy demand that Greece be bled white, the conditions facing millions worsen. Unemployment is entrenched, and rose again in December to 26 percent, more than double the euro zone’s average of 11.3 percent. The number of jobless has barely shifted since reaching a record level of 27.9 in September 2013.

Hundreds of thousands of people rely on food banks and soup kitchens to get a regular meal, with many people requiring handouts three times a day. Others resort to scavenging.

Speaking to the Daily Telegraph, a priest at a church involved in food distribution in west Athens said, “The local councils can’t cope, so people come to us for food. We’re feeding 270 people and it is getting worse every day. Today we discovered three young children going through rubbish bins for food. They are living in a derelict building and we have no idea who they are.”

Last month, two teachers alerted Athens City Council that they were being asked to teach starving children. One of the teachers reported that one of the pupils involved had not eaten for two days.

US orders 7,700 children deported without court hearings

Patrick Martin

More than 7,700 immigrant children have been ordered deported over the past 18 months without ever appearing in court, according to statistics released by the federal government recently and reported by the Los Angeles Times Friday.

The Times account was based on data supplied by the Transactional Records Access Clearinghouse at Syracuse University, which processes data from Immigration and Customs Enforcement and other federal agencies.

Legal proceedings had been brought against 62,363 children over the past 18 months. In at least 7,706 cases, the children were ordered deported after they failed to make a court appearance. No figures were available on how many of these children were even aware of their hearings—they range in ages from toddlers to adolescents. But 94 percent of those ordered deported had no attorney to represent them.

Attorneys and advocates for the undocumented children said that many of these hearings are held without any notice given to those facing deportation. This problem has been exacerbated by an Obama order that immigration judges fast track such hearings, holding them within 21 days of ICE seeking a deportation order. With children scattered across the country, in detention facilities, foster care or staying with relatives, the fast-track hearing process makes timely notice extremely difficult.

ICE has not reported the total number of children deported in its efforts to combat the “surge” of refugees from Central America that began in late 2013. The agency reported that 1,901 unaccompanied children were deported during fiscal year 2014 (October 1, 2013 through September 30, 2014), but some of these may have been detained earlier. ICE has not released figures on child deportations over the past five months.

The fact that deportations of unaccompanied children take place at all is outrageous. That the numbers are in the thousands, if not higher, demonstrates the brutality of the crackdown on Central American migrants conducted by the US government, in direct contradiction to the public pretense of sympathy adopted by President Obama.

The Obama administration has carried on a two-faced policy on immigration ever since taking office in January 2009. Obama claimed to advocate a more tolerant approach to undocumented immigrants and to support measures for their legalization and citizenship. But his government has deported more immigrants than any previous administration, more than two million men, women and children. Deportations are being carried out at nine times the rate of 20 years ago.

Immigration and Customs Enforcement began the latest crackdown at the end of 2013, when Central American women and children began arriving at the US southern border in much larger numbers than previously. The numbers swelled during the summer of 2014, leading to the detention of tens of thousands of unaccompanied children, mainly from Guatemala, El Salvador and Honduras.

The vast majority of the women and children were fleeing gang violence and military death squads in their home countries, as well as desperate poverty, conditions that are byproducts of a long history of oppression by American imperialism and its local henchmen in the wealthy oligarchies that rule Central America.

At the high point of the crisis, Jeh Johnson, secretary of the Department of Homeland Security, declared that the mass jailing of mothers and children was intended as a deterrent against the continued flight of refugees. In other words, he effectively conceded that the administration policy was deliberately punitive, and in violation of due process norms.

Last month a federal judge in Washington DC ordered the administration to stop the jailing of children, whether accompanying their parents or alone. The Department of Homeland Security is considering whether to appeal.

In another federal courtroom, in Seattle, Washington, the American Civil Liberties Union has brought suit seeking the appointment of defense counsel for all children facing immigration or deportation hearings.

The plaintiffs in this lawsuit, J.E.F.M. v. Holder, are all unnamed, in view of their ages, but their descriptions in the court filing suggest the dimensions of the social crisis in Central America from which they have fled. As detailed in the court documents, the plaintiffs include:

* A three-year-old boy conceived when his mother was raped when she was only 15 years old. After she faced continuing threats from her rapist, his mother fled El Salvador and left her son in the care of his aunt. However, because his family continued to fear for his safety in El Salvador, he was brought to the border in Texas, taken into custody by the government, and put into deportation proceedings.

* A 10-year-old boy, his 13-year-old brother, and 15-year-old sister from El Salvador, whose father was murdered in front of their eyes. The father was targeted because he and the mother ran a rehabilitation center for people trying to leave gangs.

* A 14-year-old girl who had been living with her grandparents, but was forced to flee El Salvador after being threatened and then attacked by gang members.

* A 15-year-old boy who was abandoned and abused in Guatemala, and came to the United States without any family or friends.

* A 16-year-old boy born in Mexico who has lived here since he was a year old, and has had lawful status since June 2010.

* A 16-year-old boy with limited communication skills and special education issues who escaped brutal violence exacted on his family in Honduras, and who has lived in Southern California since he was eight years old.

* A 17-year-old boy who fled gang violence and recruitment in Guatemala and now lives with his lawful permanent resident father in Los Angeles.

The lawsuit charges numerous agencies of the federal government with violating the Due Process Clause of the Fifth Amendment to the US Constitution, as well as provisions of the Immigration and Nationality Act requiring a “full and fair hearing” before an immigration judge. Such a fair hearing is impossible for a child deprived of both parental support and legal counsel.

This is the brutal reality of US immigration policy, behind the play-acting and stage-managed conflicts in Washington. President Obama and congressional Republicans engaged in such a mock battle over the past two weeks over funding of the Department of Homeland Security, which the Republicans had delayed in an effort to force the White House to abandon the executive order issued by Obama last November, providing limited work authorization for about four million undocumented immigrants.

The fight ended, as the WSWS predicted, with full funding for the DHS, one of key agencies of the emerging American police state, and with Obama’s immigration order unchanged. With only a few exceptions, corporate America supports the Obama policy, which makes available a supply of cheap labor for agribusiness, construction and other industries, while maintaining the overall framework of brutal police repression of undocumented workers.

The Justice Department report on Ferguson police: An indictment of American capitalism

Andre Damon

The US Justice Department released a report on Wednesday documenting systematic and wanton brutality, violence and outright criminality on the part of police in Ferguson, Missouri, carried out in violation of the legally protected constitutional rights of the city’s population.

The report found that the Ferguson police—the department responsible for the killing of unarmed teenager Michael Brown in August—engaged in “stops without reasonable suspicion and arrests without probable cause in violation of the Fourth Amendment; infringement on free expression, as well as retaliation for protected expression, in violation of the First Amendment; and excessive force in violation of the Fourth Amendment.”

The report documented numerous examples of egregious abuse at the hands of the police. It noted that in one incident, police sicced a dog on a fourteen-year-old boy, then “struck him while he was on the ground, one of them putting a boot on the side of his head.” The officers were “laughing about the incident afterward.”

The report also found that the city operates what one judge likened to a “debtors’ prison,” issuing vast numbers of arrest warrants and throwing the poor in jail in order to force them to pay traffic tickets. It notes that, for the city’s poor and low-income residents, “Minor offenses can generate crippling debts, result in jail time because of an inability to pay, and result in the loss of a driver’s license, employment, or housing.”

The conditions described are a devastating indictment of the American economic and political system. The actions of the police in America are much more in line with what would be expected in an economically backward dictatorship than a major industrial power, one that declares itself to be a role model of democratic rule for the whole world.

Obama responded to the Ferguson report on Friday with his typical admixture of cynicism and deceit. Calling the police practice in Ferguson “oppressive and abusive,” Obama declared that “it turns out” that protesters against police violence in the city “weren't just making it up.” He added, however, that the abuse revealed was “not typical.”

“The overwhelming number of law enforcement officers have a really hard, dangerous job and they do it well,” Obama said in South Carolina. “They do it fairly, and they do it heroically.”

Obama’s paeans to the “heroic” police in America notwithstanding, the actions detailed in the Ferguson report are not an aberration. Indeed, the Justice Department itself found similar misconduct in reports on police in Albuquerque and Cleveland over the past year.

In the past two years alone, there have been nearly two thousand police killings in the US. All over the country, people in poor and working-class communities live in fear of the police, who are given legal immunity to harass and brutalize the population in service of the ruling elite.

Obama’s comments followed earlier remarks by Attorney General Eric Holder in announcing the report. Holder declared that the findings showed that the concerns of demonstrators “were all too real.” As he put it, “Some of those protesters were right.”

A serious reporter, if such a thing existed in the White House press corps, would have asked Holder: “If the protesters were in fact right, why did you go to Ferguson during the height of the police crackdown against peaceful protesters against the killing of Brown and stage a photo op where you embraced Ron Johnson, who was coordinating the crackdown on peaceful demonstrators?”

This was, after all, the same White House that worked with Missouri Governor Jay Nixon to mobilize the National Guard against protesters, and sent over a hundred FBI agents to spy on those involved.

The White House combined its empty acknowledgment that protesters “were right” with its absolute defense of the decision not to bring charges against Darren Wilson for gunning down Brown in broad daylight. Obama made it a point Friday of explicitly defending the decision of the Justice Department not to charge Wilson—which followed a sham grand jury proceeding last year—as if the actions of the killer cop were not entirely of a piece with the outrageous conditions described in the Ferguson report released the very same day.

The criminality of the police in the US is of a piece with the operation of the state as a whole, and of the corporate and financial aristocracy that runs the country. As for the response of the Obama administration, it follows a definite playbook. Whenever the criminality of the American state comes bubbling to the surface and is revealed before the public, Obama admits the crimes while making sure that the people responsible for them go unpunished and acting as if the White House itself had no hand in the matter.

In May 2013, Obama gave a speech in which he declared, “I do not believe it would be constitutional for the government to target and kill any US citizen—with a drone or with a shotgun—without due process. Nor should any president deploy armed drones over US soil.”

This was after the president had already carried out the drone murders of multiple American citizens, and only two months after Holder had declared the right of the president to carry out drone assassinations “within the territory of the United States.”

Then there is the question of the government’s complicity in torture. In August of last year, Obama declared that over the past decade and a half, “We tortured some folks... We did some things that were contrary to our values.” And yet, none of the torturers, whose activities were exhaustively documented in the Senate Intelligence Committee report released last year, have been punished. Only a few months later, the corporate-controlled media now acts as if the report never existed.

The same pattern is evident in numerous revelations of outright criminality on the part of the banks and financial speculators. The US Senate Permanent Subcommittee on Investigations' 2011 report on the Wall Street crash proved beyond a shadow of a doubt that individual executives at major banks, including Goldman Sachs, Deutsche Bank and others, have committed crimes mandating prison sentences. The Senate turned over the report to the Justice Department, but no one was charged, much less prosecuted.

In all of these scandals, the entire political establishment works to ensure that no one will be held accountable. In relation to the Ferguson report, despite its damning revelations, it concludes with only a few empty and toothless proposals for “reform.”

No one can be held accountable because all of these great crimes are part of an even greater criminal conspiracy by the financial oligarchy to keep the great mass of the population in poverty and subjection.

Marking 20 Years Since Beijing Declaration and Platform for Action

Madeline McGill

From March 9 to 20, 2015, thousands of women will be meeting in New York City for the Commission on the Status of Women (CSW59) at the United Nations. Representatives of Member States, UN entities, and non-governmental organizations will be gathering to evaluate the progress in the implementation of the Beijing Declaration and Platform for Action, which was originally adopted 20 years ago in 1995.

The Declaration called for ambitious reforms, centered around 12 critical areas of concern such as violence, health, education, and media. It aimed to remove obstacles to women’s participation in all spheres of public and private life and give an equal share in economic, social, cultural, and political decision-making. Ultimately, the declaration sought after a global pledge to attain equality and develop a more peaceful world for women in the process.

These goals were easy to endorse, and are shared by Indigenous and non-Indigenous women around the globe. Unfortunately, as we have found 20 years following its adoption, they are not as simple to implement. Many of the problems that plague Indigenous women have not changed in the last 20 years. Tarcila Rivera Zea, president of the Continental Network for the Indigenous Women of the Americas and founder of Chirpaq (Center for Indigenous Peoples' Cultures of Peru), expressed this concern originally in a statement for Equal Times:

“We are not accepted and we cannot exercise our rights fully,” she said. “Discrimination, aggression, pollution, land grabs… We all suffer from the same forms of violence.”

Grim statistics still surround the well being of Indigenous women, especially in the areas of their sexual safety. To this day, 3 out of 5 American Indian and Alaska Native women (61%) will have been assaulted in their lifetimes. Even more harrowing, 34% will be raped in their lifetimes.  It remains difficult for Indigenous women to feel safe even within their own communities, as 59% of assaults against these women occur at or near a private residence.

The Declaration was successful in starting a dialogue on many of these concerns within the international community. The CSW has given Indigenous advocacy groups and NGO’s an additional point of focus in their work for community progress and increased self-determination. However, many would like to see increased success in the Declaration and Plan of Action’s implementation, and plan to express this desire at the upcoming commission.

Cultural Survival is one of these organizations, as we intend to attend and participate in the discussion surrounding the protection of Indigenous women’s human rights, empowerment, and social equality. We believe that one of the solutions for a more equal world for Indigenous women lies in empowerment and self-determination, particularly though the legalization and recognition of communication platforms such as community radio stations.

Other International organizations have also been in preparation. Indigenous women from 23 countries in the Americas (organized by the Continental Network of Indigenous Women of the Americas) met in Lima March 2-4 to prepare common demands to be presented to the UN. The meeting discussed concerns such as continued violence, displacement, exclusion from justice, health and education systems, and homicide. These topics were made even more relevant by a recent UN study published last May revealing the nature of the situation of Indigenous Women in Latin America. 

It is the hope of Cultural Survival that the presence of Indigenous NGO’s and advocacy groups as CSW59 will have a tangible impact on the further implementation of the Beijing Declaration. Indigenous women deserve and require greater visibility in public policy concerning their health, empowerment, and education. In regards to issues of cultural identity and human rights, many Indigenous women plan on their concerns being voiced at this week’s conference.  

The United Steelworkers’ intimate ties to Wall Street

Shannon Jones

Lessons of the Philadelphia refinery buyout

Anger is mounting among oil workers over the refusal of the United Steelworkers (USW) to expand the month-long strike into a national walkout against the multinational oil giants. The limits imposed by the USW are only increasing the arrogance of the employers, who are now threatening to permanently replace striking workers.

The refusal of the USW to mount a serious struggle is driven by definite material and social interests. The USW functions not as a workers’ organization, but as a business, whose executives prosper from the income and investment opportunities they receive in exchange for imposing concessions on the workers they allegedly “represent.”

Sunoco Oil's Girard Point refinery in Philadelphia

While the USW long benefited from its corporatist relations with the steel bosses, by the 1990s and 2000s the union’s headquarters in Pittsburgh began to resemble an investment banking boutique on Wall Street. With advice from former Lazard Freres partner Ron Bloom, the USW courted investors to finance its proposed merger of 80 steel companies. While billionaire asset strippers made fortunes and USW executives got corporate board seats and fatter stock portfolios, hundreds of thousands of workers lost their jobs and pensions in the corporate restructuring.

In remarks to a steel industry conference in 2004, Bloom—then a special advisor to USW President Leo Gerard—said the best route for creating and sustaining viable companies was a partnership between labor and “providers of capital.” We recognize, he said, “in a capitalist society, over time, if capital does not earn a return it will stop showing up.”

Having proven their worth to Wall Street, the USW pursued the same strategy after oil workers were brought into the USW in 2005. An examination of the 2012 deal between the USW, Sunoco and the hedge fund The Carlyle Group in Philadelphia is particularly instructive.

In late summer of 2011 Sunoco announced it would close its two remaining refineries in the Philadelphia area and wipe out hundreds of jobs if a new owner could not be found.

The USW did not respond by mobilizing workers to oppose the shuttering of the facility, which accounted for 25 percent of the East Coast’s refining capacity. On the contrary, it turned to the Obama administration and private equity firms to work out a deal to “save” the refinery on the backs of the workers.

USW Headquarters in Pittsburgh

One member of the USW negotiating team in the current oil strike, Jim Savage, president of USW Local 10-1 in Philadelphia, played a key role in forcing concessions on the Sunoco refinery workers and facilitating its acquisition by Carlyle.

The USW boasts of its close relations with the massive private equity firm notorious for hiring former heads of state, including former President George Bush, Sr., to provide lobbying and insider connections to back its deal making. It buys companies for a fraction of their value and resells them for enormous profits after slashing jobs, pay and benefits. In this operation, the target companies are typically loaded up with debt, which is then used to pay outsized fees to hedge fund investors.

Carlyle is heavily invested in the defense industry and made enormous profits off the two US wars against Iraq. Among those currently or formerly on its payroll include government officials hardly notable for their sympathy for workers, including former British Prime Minister John Major, former Secretary of State James Baker III, Fidel Ramos, former Philippine president, Karl Otto Pöhl—former President of the Bundesbank, and former Reagan-era Secretary of Defense Frank Carlucci.

Carlyle earned international notoriety in the early 2000s for its efforts to block the Pentagon from canceling the contract for the Army’s self-propelled artillery piece, the Crusader, which one of its units, United Defense Industries, was set to build. Pentagon officials wanted to scrap the huge howitzer as a relic of Cold War military strategies. In a blatant conflict of interest, Carlyle used George Bush Sr. to lobby the administration headed by his own son.

In the case of rental car company Hertz, Carlyle and a group of private equity firms took over the company in 2005. Then, just six months after the deal was consummated, they had the company take out loans to fund a special dividend payment to themselves of $1 billion. Later, they carried out the layoff of 2,000 of the company’s 31,500 workers in advance of an initial public stock offering (IPO).

In the deal to take over the Philadelphia refinery Carlyle created Philadelphia Energy Solutions (PES), two-thirds owned by Carlyle and a minority stake for Sunoco. The plan was for the facility to use cheaper domestically produced crude oil rather than more expensive imports. Refineries on the East Coast have had problems accessing oil from the US interior due to the limitations of existing pipelines. To take advantage of this supply Carlyle proposed to build a high-speed unloading terminal at the refinery that would enable it to process large quantities of oil from the North Dakota oil shale fields. It also planned to achieve savings by using available local sources of natural gas.

As part of the deal, the Obama administration agreed to loosen environmental restrictions on the refinery and the state of Pennsylvania advanced $25 million in subsidies and other incentives. For its part Carlyle did not have to put up a cent for the acquisition, only agreeing to invest in upgrades.

At a public ceremony held shortly following the deal, USW President Leo Gerard could hardly restrain his enthusiasm, declaring, “They haven't come in to strip and flip the plant. They've come in to make it work.”

Among the concessions reportedly surrendered by the USW were the elimination of the defined benefit pensions plan and the substitution of an inferior 401(k) plan. The union also agreed to reduce overtime from double-time to time-and-a-half for certain shifts and to permit the contracting out of some work. In a statement expressing the utter servility of the union apparatus Jim Savage told the Delaware County Times he would have taken any proposal back to his members, no matter how bad it was. He called the final settlement, “a pretty decent deal. They treated us with dignity and respect when they didn’t have to.”

Opening ceremony with CEO of Philadelphia Energy Solutions Philip Rinaldi, center, former Governor Tom Corbett, left, USW Local 10-1 President Jim Savage right in blue shirt.

Following the ratification of the sellout deal, USW Local 10-1 held a award dinner honoring Phillip Rinaldi, CEO of Philadelphia Energy Solutions, and David Marchick, Managing Director of the Carlyle Group and a former Clinton administration official. After noting that there had been “considerable debate” about the union honoring corporate execs and financiers, USW local president Jim Savage said, “We have the courage to recognize people that do the right thing no matter who they are.”

By all accounts the Philadelphia operation is now highly profitable. Last year Carlyle reported that it was selling shares in the oil unloading facility it installed at the Philadelphia refinery. The deal is structured so that the newly formed company can use loopholes to avoid paying most corporate taxes. In February Carlyle announced an initial public stock offering for PES with a nominal goal of raising $100 million.

The relationship between the USW and Carlyle is another demonstration of the transformed role of the unions, which have been integrated into the structure of corporate management and the capitalist government.

Through such figures as Ron Bloom—who moved on from USW advisor to Obama’s Auto Task Force in 2009, which ordered the halving of new GM and Chrysler workers’ wages—the nexus of the union businessmen, finance capital and the Democratic Party—was displayed.

The fight to defend jobs and oppose concessions requires a struggle against this anti-working class gang-up. The conduct of the oil strike must be taken out of the hands of the USW through the formation of rank-and-file action committees to shut down the entire industry and appeal to the broadest sections of the working class to defend the oil workers.

Above all, an entirely different strategy is needed, based on the international unity of workers, political independence from both big parties and the fight for socialism, including putting the global energy industry under the democratic control of working people.