Push to install right-wing Spanish government splits Socialist Party

Alejandro Lopez & Alex Lantier

On Wednesday afternoon, half of the Federal Executive of the Spanish Socialist Party (PSOE) resigned, in an inner-party putsch aimed at forcing the installation of a new right-wing government. The violent infighting now tearing apart the PSOE—a key instrument of capitalist rule in Spain, which has governed the country for 25 of the 38 years since the end of the fascist Franco regime—testifies to the historic character of the country’s current political crisis.

It has been nine months since Spain last had a government; the December 20 and June 26 elections both produced hung parliaments. On Wednesday, former Prime Minister Felipe González denounced current PSOE General Secretary Pedro Sánchez for refusing to back the installation of a minority, right-wing Popular Party (PP) government and pledged to abstain from voting against it when such a government was proposed in parliament.

While visiting Chile, González denounced Sánchez’s line, warning that it threatens to provoke a crisis of rule in Spain. “I feel cheated by Sánchez, he told me [previously] he would abstain in the second vote” on a PP government, González said, adding that Sánchez had “frustrated” him.

“If he has changed positions, since then he has not explained them to anyone, and he will have his reasons. I do not understand them,” declared González. “A third set of elections would be madness, it could bring about a crisis of the system.”

As reports of González’s statements emerged in Spain, 17 members of the PSOE Federal Executive resigned. These included former Defence Minister Carme Chacón, PSOE President Micaela Navarro, PSOE spokesman Carlos Pérez, and a variety of regional officials from the PSOE stronghold of Andalucía, as well as Madrid, Catalonia, Valencia and Castilla-La Mancha.

Sánchez, for his part, said that he “respects the opinions expressed about the current political situation” by González, but added, “It is the PSOE Federal Committee that sets the PSOE’s line on the matter of the investiture of [PP Prime Minister Mariano] Rajoy.”

The anti-Sánchez faction, which is apparently drawn primarily from the top PSOE bureaucracy, have launched a bid to take over the party. They claim that the 17 resignations, plus 3 previous vacancies in the 35-seat Federal Executive, mean that Sánchez is no longer general secretary and that the PSOE should be handed over to a caretaker leadership.

In fact, Article 36 of the PSOE’s Federal Statutes specify that “when the vacancies in the Federal Executive affect the General Secretariat, or half plus one of its members, the Federal Committee must call for an Extraordinary Congress to elect the new Federal Executive.”

Yesterday, Sánchez therefore went on to call an extraordinary congress.

Conflicts inside the PSOE continued to escalate, however, as pro- and anti-Sánchez factions both claimed to control the party, and protests erupted outside PSOE headquarters in several cities. Andalucía PSOE chief Susana Díaz sent PSOE Federal Executive Committee President Verónica Pérez to PSOE headquarters in Madrid, where Pérez claimed she was now the “sole authority” in the PSOE. Pro-Sánchez officials barred her from entering the building, however, while PSOE members outside the building shouted “traitor” at her.

Most of the regional PSOE federations came out against Sánchez, while Catalonia, the Basque Country and Navarra came out in favour, with Catalan PSOE leader Miquel Iceta announcing plans to bus PSOE members to Madrid to defend Sánchez.

Pro-PSOE daily El País, which has issued increasingly vitriolic denunciations of Sánchez in recent days, called him an “unscrupulous fool.” It explained that Sánchez was “breaking with the commitments to his party colleagues, who subordinate any internal move to the formation of a government”—that is, a regime of the PP and Rajoy.

González, El País, and the various PSOE factions fighting to install a PP government are trampling on the views of PSOE supporters and voters. A recent poll conducted by Metroscopia showed that 50 percent supported Sánchez’s “no” to Rajoy, while 43 percent preferred that the PSOE abstain and return the PP to power. This underlies both the hysterical tone and the contempt for legal procedures with which the anti-Sánchez faction is conducting their power grab.

It is highly significant that the power grab was launched by González, the PSOE’s main founder in the post-Franco era. González not only led the reconstruction of the party, with aid from German and French social democratic parties, but spearheaded the 1979 campaign during which the PSOE officially renounced Marxism and pledged its loyalty to capitalism.

The PSOE, like social democratic parties across Europe, is a party of bourgeois order. It has been discredited by years of austerity policies conducted by PSOE Prime Minister José Luís Rodríguez Zapatero, who participated in the war in Afghanistan and launched deep attacks on the working class at home, especially in the years after the 2008 Wall Street crash.

González’s remark that he fears a crisis of rule in Spain reflects the growing anxiety gripping the Spanish and other ruling elites over the political situation in Europe. The European Union (EU) has not dared impose further austerity measures while Spain has no government, due to the EU’s growing unpopularity. Britain’s recent vote to exit the EU not only highlighted this unpopularity, but also made EU officials more reluctant to proceed quickly, given fears that politically explosive opposition could soon emerge.

They are determined, however, to obtain detailed pledges for more social cuts from Spain and Portugal at a conference slated for October. The PSOE would be more than happy to issue such pledges.

From the standpoint of workers, however, the war and social policies of Sánchez are indistinguishable from those of González and the rest of the PSOE machine. He is simply pursuing a different tack to try to prevent a total collapse of the PSOE. He orients more to the pseudo-left Podemos party—the Spanish ally of the Syriza government in Greece, which is now infamous for its massive social cuts.

This manoeuvre is an attempt to give the PSOE a false image as a “left” opponent of the PP. It is, in fact, nothing of the sort, as its history shows. Moreover, it rapidly became clear yesterday that the political offensive launched by González had been coordinated with the PP. Yesterday, reports surfaced indicating that the PP caretaker government had known of plans to remove Sánchez as PSOE general secretary since last week, and that they were closely following the conflict inside the PSOE.

Details allegedly were passed on between caretaker Prime Minister Rajoy’s chief of staff Jorge Moragas and González’s former chief of staff, José Enrique Serrano. Caretaker Foreign Minister José Manuel García-Margallo has also boasted of his close ties with González and Zapatero.

Crisis at Germany’s Deutsche Bank intensifies

Ulrich Rippert

Following a 7.5 percent plunge in its shares at the beginning of the week, the fragility of Deutsche Bank was again demonstrated yesterday when its shares fell a further 7 percent in afternoon trading on Wall Street, following a Bloomberg report that about 10 hedge funds were cutting their exposure to Germany’s largest bank.

While the funds involved constitute only a small fraction of the more than 200 clients engaged in derivatives trading with the bank, it was enough to send its shares plummeting. Deutsche was forced to reissue a statement asserting that the “vast majority” of its clients have a full understanding of “our stable financial position” and the litigation process involving a $14 billion fine imposed on it by the US Department of Justice (DoJ) over its sub-prime mortgage dealings.

As Bloomberg noted, while the vast majority of clients had taken no action, the “hedge funds’ move highlights concerns among some counterparties about doing business with Europe’s largest investment bank.”

Such has been the fall in the value of the bank’s shares that the DoJ fine is almost equivalent to its current market capitalisation.

As Deutsche’s financial woes deepened, Germany’s second largest bank announced a drastic restructuring program on Thursday. Commerzbank will cut one in five jobs, a total of 9,600 positions.

Commerzbank chief Martin Zielke sought to portray the cuts as part of a technical restructuring plan. The bank would become a “digital technology company,” a press release stated. The firm would “concentrate strictly on its core businesses, digitalise 80 percent of their related processes and achieve significant improvements in efficiency,” the Commerzbank declared.

As at Deutsche Bank, however, the problems at Commerzbank are deeper. Commerzbank shares reached an all-time low in early August. Operating profit declined by 40 percent in the first six months of the year. An interim report by the bank’s board pointed out that “the operating result and the company result will be below last year.”

At the time, Der Spiegel commented: “What sounds so sober in the interim report is actually explosive, because it shows how bad things really are at Germany’s second-largest bank.”

Commerzbank was hit hard by the 2008 economic crisis. Immediately prior to that, it intensified its cooperation with the now largely dismantled Eurohypo, which provided financing for property and governments, and subsequently organised the risky takeover of the Dresdner Bank. The impact of the financial crash on Commerzbank was so severe that it had to be rescued with €18.2 billion in taxpayers’ money. Since then, the federal state has been the largest shareholder in Commerzbank  with around 15 percent of its stock.

It remains unknown whether a joint strategy is being worked on within the finance ministry to deal with the crises at Deutsche Bank and Commerzbank  However, it is clear that an emergency plan is being discussed for Deutsche Bank. Die Zeit reported on Wednesday that regardless of denials from government spokesman Seibert and Deutsche Bank head John Cryan, “the federal government and the responsible financial supervisory authorities” are working on a rescue plan. In the worst-case scenario, the state will directly participate in financing the bank. An investment of 25 percent was being discussed, Die Zeit reported.

The fact that a rescue plan is even being discussed shows how explosive the situation is. The collapse of Deutsche Bank would have consequences going far beyond the bankruptcy of Lehman Brothers and the crash of 2008.

The immediate cause of the current crisis is the fine imposed by the US Justice Department of $14 billion (roughly €12.5 billion) due to illegal business dealings in property loans, which played a central role in the financial meltdown eight years ago. But this has come on top of an ongoing share market decline.

Compared to 2006, Deutsche Bank’s share price had lost almost 90 percent of its value by September 2016. The bank is only worth €16 billion today. This is less than the building materials manufacturer HeidelbergCement, according to Focus-Online. Among Europe’s “system relevant” banks, Deutsche Bank has one of the weakest capital positions, and the most derivatives.

According to the International Monetary Fund (IMF), Deutsche Bank is the most dangerous financial institution in the world with regard to “systemic risks in the financial sector.”

DB does not only stand for Deutsche Bank, but also “derivative bomb,” wrote Focus-Online. It described the situation in the following terms: “Deutsche Bank’s derivative exposure of almost €46 trillion is an explosive risk—almost 17 times greater than Germany’s annual economic output—and this with capital of €61 billion! These loans run off the books and completely lack transparency. If just 5 percent of the derivatives blow up in their face, it will soon be lights out in Frankfurt.”

Derivatives are financial instruments that serve to transfer risk. They are highly speculative and operate on the verge of legality.

Since 2012, Deutsche Bank has had to cough up €12.7 billion for legal disputes. The issues included money laundering, tax fraud and interest rate manipulation. $2.5 billion and €725 million had to be paid for the illegal fixing of the Libor and Euribor inter-bank interest rates, and €1.9 billion for disputes over mortgage loans.

Deutsche Bank’s situation sheds light on the deepening crisis of Europe’s financial system. This is clearly on display in Italy. Despite the privatisation measures of three successive governments (Mario Monti, Enrico Letta, Matteo Renzi), Italian state debt has risen from €1.8 trillion in 2011 to €2.2 trillion today, or 133 percent of gross domestic product (GDP). Since the beginning of 2008, GDP has contracted by 8 percent. The total sum of toxic loans held by the banks has doubled and currently amounts to €360 billion, or one fifth of all loans. Of these, loans worth €200 billion are considered irretrievably lost.

Although the German economy has to date been described as the eurozone’s engine, it is now clear how unstable and precarious the situation is. In parallel with the crisis at Deutsche Bank, financial daily Handelsblatt published an article on Thursday on declining projections for economic growth. Under the title “Year of uncertainties,” the newspaper reported that for the coming year, economic researchers expect “nothing close to robust growth.” The reason given was political uncertainties “which could impact an export-dependent economy like Germany—beginning with the US elections, the Brexit and the developments in China.”

The British Daily Telegraph is already speculating about the end of Chancellor Angela Merkel’s government and the euro, warning: “If the German government does not stand behind the bank, then inevitably all its counter-parties—the other banks and institutions it deals with—are going to start feeling very nervous about trading with it … If Deutsche does go down, it is looking increasingly likely that it will take Merkel with it—and quite possibly the euro as well.”

Under conditions of deepening turmoil, trans-Atlantic relations are growing increasingly tense. Significantly, the fine for Deutsche Bank was imposed not, as usually would be the case, by the US financial regulator, but the US Department of Justice. The earlier decision by the EU to impose a €13 billion tax bill on Apple provoked outrage among US firms and at the US Treasury.

Declarations from Berlin and Paris that negotiations over the Transatlantic Trade and Investment Partnership (TTIP), which the US was striving to conclude, were being abandoned were also greeted with frustration in Washington.

Last summer, the first accusations were raised that Deutsche Bank had laundered rubles worth a total of $6 billion. Several employees in the bank’s Moscow office were fired as a result. Now the US Department of Justice and New York’s financial supervisory authority are going a step further and reviewing whether the bank was in breach of sanctions.

In contrast to the financial breakdown of 2008, when a limited degree of international cooperation and joint crisis management was practiced, all the major powers are responding today to the prospect of a renewed economic crisis with national recriminations and harsh measures against each other. The global economic and financial system is increasingly becoming a battlefield torn by national antagonisms. This is not only intensifying the economic predicament, but also encouraging the arms race and the global preparations for war.

JIT investigation blames Russia for MH17 crash in Ukraine

Alex Lantier

On Wednesday, the Joint Investigation Team (JIT) into the shooting down of Malaysian Airlines Flight MH17 over Ukraine issued its much-awaited report on the horrific crash.

The loss of MH17 and the unsolved murder of all 298 people aboard over separatist-held eastern Ukraine, on 17 July 2014, set off an explosive confrontation between NATO and Russia, as US and European officials and media charged that Moscow had shot down the jetliner. In August 2014, the NATO investigation was handed over to the JIT. The JIT included officials of several countries who lost citizens in the crash—Holland, Australia, and Belgium—and from the far-right CIA-backed regime in Ukraine.

From the outset, the JIT was beset by scandal and evidence of bias. It first excluded Malaysia, then relegated it to a secondary role as a provider of information. Then, Dutch news magazine Elsevier revealed that JIT proceedings are controlled by a secret pact giving each member, Ukraine included, veto power over what is revealed. The Dutch state invoked the state secrets privilege to block inquiries into this matter.

The report, which produced little new evidence and drew heavily on Ukrainian sources likely to be biased, was greeted with reservation by sections of the European press. But in the United States, the media, led by the New York Times, charged that the report presented damning and irrefutable evidence of Russian complicity in the downing of MH17.

“With meticulous detail, working with cellphone records, social media, witness accounts, and other evidence, the prosecutors traced Russia’s role in deploying the missile system into Ukraine and its attempts to cover its tracks afterward,” the New York Times wrote.

The day after the report’s publication, the Times seized upon its findings to declare Russia an “Outlaw State” in its lead editorial. Denouncing the “unconscionable behavior” of Russian President Vladimir Putin, the Times hinted that the Obama Administration is preparing to take a more directly confrontational stance toward Russia, particularly in Syria.

The JIT report, issued on the website of the Dutch public prosecutor, shows that MH17 was shot down by a mobile Buk surface-to-air missile battery. This is now the consensus view of NATO and Russian officials, but in and of itself it proves little, since both Ukrainian and Russian forces are armed with Buk missiles.

Specifically, the JIT alleges that the Buk launcher involved in the attack came from Russia but crossed into Ukraine for a day, firing a missile at MH17 from the village of Pervomaiskyi, near the town of Snizhne. This contradicts Russian claims that the Buk was fired by Ukrainian forces from a Ukrainian-held town, Zaroshchenskoye.

“Based on the results of the criminal investigation, it may be concluded that flight MH17 was shot down on July 17, 2014, by a 9M38-series missile from a Buk missile launcher [that] was brought from the territory of the Russian Federation and, after launch, subsequently returned to the Russian Federation territory,” said Dutch National Police official Wilbert Paulissen, introducing the report.

The materials published by the JIT—a brief, two-page report and six short YouTube videos—do not, however, provide sufficient evidence to substantiate its accusations. Indeed, in the course of two years of work, the JIT did not obtain any independent information that it saw fit to publish yesterday.

The JIT neither released data from MH17’s black box—which was taken from Malaysian authorities two years ago and sent to Britain, where it has not been heard from since—nor radar data on eastern Ukraine provided by Moscow. Nor did it publish US radar and satellite data on the area. Instead, it relied on wiretaps, photos and a few brief videos posted by unidentified users to Ukrainian social media and apparently collected by Ukrainian intelligence.

The JIT’s six YouTube videos are all made up of computer-generated images produced by the JIT to illustrate what it alleges took place. Every so often, the CGI video is interspersed with unidentified social media pictures or a few brief videos. In short, the JIT videos are not credible or independent evidence on who fired the Buk that brought down MH17.

The JIT claims to have tracked the launcher that shot down MH17 and identified “approximately 100 people” involved in guarding, transporting, and controlling it. To this effect, the JIT cites cellphone data and several wiretapped phone calls, apparently between unidentified separatist officials, who discuss moving vehicles and express confusion and concern over the MH17 shoot-down.

The JIT report does not, however, identify them, establish what motive or order they would have had to destroy MH17, or indeed assign any broader political responsibility for the MH17 attack.

Paulissen himself tacitly acknowledged the weakness of the JIT report, saying that the JIT was not blaming the Russian state or Russian individuals for the attack. “We have determined that the weapons came from the Russian Federation. Having established this, we do not make statements about the participation of the Russian Federation as a nation or people from the Russian Federation,” he said.

Significantly, reports emerged that the Dutch government itself lacks confidence in the conclusions it is itself drawing in the JIT report. “If Dutch authorities are prudent and refuse to draw any conclusions, it’s also because the most conclusive evidence found til now—the recordings of conversations—come from the SBU, the Ukrainian intelligence service,” wrote Le Monde.The daily cited a diplomat in The Hague: “This organization [the SBU] served the old regime and changed its loyalties to the new regime without changing its methods.”

Russian officials criticized the JIT report. “Instead of [working together], international investigators suspended Moscow from comprehensive participation in the investigative process, allowing our efforts only a minor role. It sounds like a bad joke, but at the same time they made Ukraine a full member of the JIT, giving it the opportunity to forge evidence and turn the case to its advantage,” said Russian Foreign Ministry spokeswoman Maria Zakharova.

Russian officers had previously maintained their allegations that Ukrainian forces were responsible for shooting down the plane. “The Ukrainian side has air situation data in the area of the Malaysian Airlines Boeing 777 crash from both civilian and military sources. The fact that Ukraine has not published radar data leads us to the conjecture that the missile, if it was a Buk, was launched from territory under the control of the Ukrainian military,” said Andrey Koban, the head of Russian Air Force radar operations.

At present, all that can be said is that the question of who shot down MH17 remains unresolved, primarily due to blatant interference in the investigation by the NATO powers.

From a political standpoint, however, there is no doubt as to where responsibility for the MH17 shoot-down lies: it is squarely with Washington and its European allies. In 2014, these countries backed a violent, pro-European putsch in the Ukrainian capital of Kiev that brought to power far-right and pro-fascist parties hostile to the Russophone population of eastern Ukraine. This broke Ukraine apart, as far-right militias began attacking civilians and provoking armed resistance in eastern Ukraine, which was then supported by Moscow.

Without this flagrant intervention in Ukrainian affairs, the separatist movement in eastern Ukraine would not have emerged, and the fighting in eastern Ukraine which led to the destruction of MH17 would not have begun.

New York Times brands Russia an “outlaw state”

Bill Van Auken

Amid mounting public threats that the US is preparing an escalation of its military intervention in Syria, the New York Times Thursday published a lead editorial branding Russia as an “outlaw state.”

This ratcheting up of rhetoric that has grown increasingly hysterical in regard to Russia is a response to the debacle suffered by US imperialism in its over five-year-long proxy war for regime change in Syria. Syrian government forces, backed by Russian air power, appear to be on the brink of retaking all of the eastern portion of Aleppo, the last major bastion of the US-backed “rebels,” composed principally of Al Qaeda-affiliated Islamist militias.

Secretary of State John Kerry issued an ultimatum to his Russian counterpart Sergei Lavrov Wednesday: either Russia grounds both its own and the Syrian government’s warplanes, or Washington will break off all negotiations with Moscow on Syria.

The significance of this threat was further spelled out in a press briefing by State Department spokesman John Kirby, who told reporters that as a consequence of Russia failing to bow to US demands, “extremists and extremist groups will continue to…expand their operations, which will include, no question, attacks against Russian interests, perhaps even Russian cities, and Russia will continue to send troops home in body bags, and they will continue to lose resources—even, perhaps, more aircraft.”

The provocative and utterly reckless character of Kirby’s remarks was no accident. That Washington intended to communicate a threat to unleash CIA-sponsored terrorism against Russia was underscored by a Washington Post column by Philip Gordon, who until last year was the White House coordinator for the Middle East, North Africa and the Gulf. The piece, which warned in its headline that “Russia will pay the price,” used almost identical language, stating that continued Russian action in Syria “could very well result in terrorist attacks against Russia.”

Gordon went on to warn that the Obama administration could take actions to “increase costs on Russia,” adding, “Arming the opposition with shoulder-fired missiles capable of hitting Russian and Syrian planes over Aleppo is among the options.”

The ex-White House aide finally cautioned Moscow that if “Hillary Clinton becomes the next U.S. president, Putin could be facing a U.S. leader who has long supported a no-fly zone in Syria and robust support for the opposition, has expressed skepticism about Russia’s intentions in Syria, and will be looking to more clearly reassert American leadership in the Middle East.”

It is evident, however, that the question of whether an escalation of the US intervention in Syria can wait until after the US election of November 8 has become the subject of heated debate within the US ruling establishment.

The Reuters news agency cited unnamed senior officials as saying that the Obama administration is considering “tougher responses to the Russian-backed Syrian government assault, including military options,” including the provision of heavier weaponry to the Al Qaeda-linked “rebels” and air strikes on Syrian government positions. (This second option was already put into practice with the September 17 US bombing that killed and wounded close to 200 Syrian troops near Deir Ezzor, which Washington claimed was an accident.)

With its editorial denunciation of Russia as an “outlaw state,” the New York Times is effectively weighing in on the debate within America ruling circles over the US intervention in Syria. It wants a military escalation and it wants it now—against Russia.

The Times writes: “President Obama has long refused to approve direct military intervention in Syria. And Mr. Putin may be assuming that Mr. Obama is unlikely to confront Russia in his final months and with an American election season in full swing. But with the rebel stronghold in Aleppo under threat of falling to the government, administration officials said that such a response is again under consideration.”

To bolster its case, the Times throws in unsubstantiated charges made in an investigation driven entirely by “evidence” supplied by the Ukrainian secret police that Russia was responsible for the July 2014 shootdown of a Malaysia Airline jet over the war-torn Donbass region.

Putin, the newspaper declares, is guilty of “butchering civilians in Syria and Ukraine, annexing Crimea, computer-hacking American government agencies,” and “crushing dissent at home.”

Putin’s government represents Russia’s ruling oligarchy, which enriched itself through the theft of state property during the dissolution of the Soviet Union and the restoration of capitalism. Its intervention in Syria, though of a defensive character, in response to US attempts to encircle and isolate Russia, represents the interests of this oligarchy and provides no progressive solution to the catastrophe unleashed by imperialism on Syria and the broader Middle East.

That being said, the crimes of Putin pale in the face of those carried out by successive US administrations, all of them with the complicity and propaganda support of the New York Times.

The US government is responsible for over a million deaths in Iraq and hundreds of thousands more from Afghanistan to Libya and Yemen. It instigated the regime-change operations in both Ukraine and Syria that gave rise to the “butchery” in those countries, much of it inflicted with weapons supplied by the CIA.

Moreover, even as the Times attacked the Russians’ “butchery” in Syria, the Pentagon announced that it is sending another 600 US troops to Iraq to prepare for a siege of Mosul, which, like the previous assaults on Fallujah and Ramadi, will entail massive crimes against the civilian population.

As for Russian computer hacking, the Times speaks on behalf of the US government, which, through the NSA, engages in the most massive spying operation the world has ever seen. And as for “crushing dissent at home,” the US, it should be recalled, is a country where the police murder over 1,000 people every year and the so-called "justice system" keeps some 2 million people behind bars. In brief, the Times editorial is a piece of war propaganda.

The term “outlaw state” was first put into official use by Ronald Reagan. It was later rendered as “rogue state” under Bill Clinton and, then, under George W. Bush, became the “axis of evil.” Invariably, these terms were used to describe oppressed, semi-colonial countries targeted by US imperialism for war and conquest: Nicaragua, Grenada, Iraq, Libya, Somalia, Sudan, North Korea, Iran, etc.

Now, in the pages of the New York Times, the term is used to describe Russia, a country of 146 million people armed with nuclear weapons. The implications could not be more ominous.

While the motivations of the Times editors may include short-term political considerations—the possibility of an “October surprise” in Syria boosting the prospects of Democratic presidential candidate Hillary Clinton—the anti-Russia propaganda campaign that the newspaper is leading has far deeper roots in the crisis of American capitalism and the protracted drive by US imperialism to overcome its historic decline through the instrument of militarism.

If words have any meaning, the Times editorial is a warning: behind the backs of the people of the United States and the entire planet, the preparations for a third world war are advancing rapidly.

India launches military attacks against Pakistan

Keith Jones

India carried out multiple “surgical” military strikes inside Pakistan over a five-hour period Wednesday night, bringing South Asia perilously close to an all-out war with potentially catastrophic consequences.

Not only would a war between India and Pakistan be the first-ever war between nuclear-armed states; it could rapidly draw in the United States and China on opposed sides.

In anticipation of a Pakistani counterstrike (or so as to provide cover for Indian war preparations), Indian authorities on Thursday ordered the evacuation of all those living within 10 kilometers of the Pakistani border in the Indian states of Punjab and Jammu and Kashmir.

Pakistan Prime Minister Nawaz Sharif denounced Wednesday’s night attack as “unprovoked and naked” Indian “aggression” and called an emergency meeting of his cabinet for today to discuss Islamabad’s response.

India says it attacked seven “terrorist launching pads” on the Pakistani side of the Line of Control that separates Indian- and Pakistani-held Kashmir; that its forces penetrated up to 3 kilometers inside Pakistani territory; and that they inflicted “significant casualties” on “terrorists and those trying to shield them.”

The military has been tight-lipped about the operation. But Indian media reports, based on official sources, said Indian commandos had crossed into Azad or Pakistan-Occupied Kashmir both on the ground and in helicopter gunships and that their “kills” were in the “double-digits.”

India and Pakistan have passed through repeated war crises over the past quarter-century and in 1999 fought an undeclared war in the remote Kargil region of Indian-held Kashmir. However, New Delhi has not publicly admitted to carrying out military action inside Pakistan for decades for fear that this could trigger a rapid escalation to war and even nuclear-war.

Yesterday’s attack came ten days after anti-Indian Islamist militants attacked the Indian military base at Uri, in the Himalayan state of Jammu and Kashmir, killing eighteen Indian soldiers. Without so much as a cursory investigation, India’s Hindu supremacist Bharatiya Janata Party (BJP) government held Islamabad responsible for the attack and vowed it would punish Pakistan.

India’s media, opposition parties, and a long list of retired military officers all joined in the clamour for India to bloody Pakistan.

At a celebratory press conference yesterday, the Indian Army’s Director General of Military Operations, Lt. General Ranbir Singh, said the “surgical strikes” had been aimed at “terrorist teams” positioned across the Line of Control for “launch” into India.

India, Singh claimed, has no further plans for cross-border actions. “However,” he continued ominously, “the Indian Armed Forces are fully prepared to deal with any contingency which may arise.”

Pakistan’s military, meanwhile, is vehemently denying that India mounted any “surgical” cross-border attacks, calling the claim “an illusion” and “fabrication of truth” promoted by India “to create false effects.”

The Pakistani military does concede two of its soldiers were killed and nine others wounded Wednesday night, but is attributing the casualties to cross-border artillery and gunfire—a regular occurrence across the Line of Control (LoC). In its statement challenging India’s claims, the military said that “Pakistan has made it clear that if there is a surgical strike on Pakistani soil,” it “will be strongly responded” to.

Both sides are clearly spreading disinformation—a further sign of how dangerous the situation is.

Take New Delhi’s claim that yesterday’s attack was aimed at preventing the imminent dispersal of terrorist squads into India. It is a transparent, trumped-up pretext for a reckless act of aggression.

The World Socialist Web Site has no brief for Pakistan’s reactionary, communalist ruling elite and its military, which have time and time again trampled on the democratic rights of the Pakistani people and served as a satrap for US imperialism. Having been schooled in the stratagem by the CIA, which enlisted Islamabad as its junior partner in its covert war against the Soviet Union in Afghanistan, Pakistan has used Islamist terrorists in pursuing its military-strategic rivalry against India, particularly so as to politically suppress and divert the popular opposition to Indian rule in Kashmir along communal lines

But why would Pakistan—which has repeatedly voiced alarm over the military-strategic gap between it and India, a country with a six times greater population and seven times bigger economy—mass terrorists to strike India when New Delhi is already on a war footing?

Rattled by the falling off of Indian’s growth rate after 2010, the India bourgeoisie brought Narendra Modi and his virulently right-wing BJP to power to intensify the exploitation of the working class and assert its great-power ambitions on the world stage. In pursuit of the latter aim, India has integrated itself ever more completely into Washington’s war drive against China and, bolstered by US support, sought to impose itself as the regional hegemon.

While the Indian elite paints the country as an innocent victim of Pakistani “terrorism”, the BJP government has pursued confrontation with Pakistan. Soon after taking office it instructed the military to adopt a more aggressive posture on the LoC, resulting in 2015 in the most prolonged cross-border shelling in a decade. More than a month before the Uri attack, Modi announced that India would leverage the ethno-nationalist insurgency in Pakistan’s southwestern province of Balochistan against Islamabad, effectively threatening Pakistan with dismemberment.

Yesterday’s attack was meant to show that New Delhi is ready to take greater risks in advancing its strategic interests and that vis à vis Pakistan it will no longer be bound by the so-called policy of “strategic restraint.”

As for Pakistan’s claims that there were no cross-border strikes, they are simply not credible. Various Pakistani government officials and political leaders have made statements that implicitly or explicitly contradict the military’s version of events. Among these is Defense Minster Khawaja Muhammad Asif, who declared, “If India tries to do this again, we will respond forcefully.”

By denying that India has carried out a military raid inside Pakistan, Islamabad is seeking to avoid further escalation, without having to make a public and, from the reactionary standpoint of capitalist geopolitics, humiliating admission that it won’t make good on its repeated threats to answer any Indian cross-border thrust with a military strike of its own.

This stance however is likely only to encourage the Modi government and the most bellicose sections of the Indian elite who will hold it up as proof of how weakened Pakistan is. Yesterday, the entire political establishment, including the Congress Party and the Stalinist Communist Party of India (Marxist) joined forces, including at an all-party meeting convened by the BJP, to celebrate the aggression against Pakistan. The media, meanwhile, went into overdrive to hail the military strikes, amplifying the government’s claims that they were proof of a bolder, more powerful India, and trumpeting the military as veritable heroes.

The strategic rivalry between India and Pakistan, which today threatens the people of South Asia with a nuclear holocaust, is testament to the failure of bourgeois rule. It is rooted in the 1947 communal partition of South Asia into an expressly Muslim Pakistan and a predominantly Hindu India, which was implemented by the Congress Party and the Muslim League, the rival parties of the South Asian bourgeoisie, in conjunction with the subcontinent’s departing British colonial overlords.

That said, a huge factor stoking the war danger is Washington’s more than decade-long drive to transform India into a frontline state in its strategic offensive to isolate, encircle and prepare for war with China. Under Modi, India has lined up with the US in the South China Sea dispute and developed closer strategic bilateral and trilateral ties with the US’s key Asian-Pacific allies, Japan and Australia. Last month, Modi agreed to allow US warplanes and battleships to make routine use of Indian military bases.

Under George W. Bush and Obama, the US has lavished “strategic gifts” on India, giving it access to its most advanced weaponry and creating a special status for it in the world nuclear regulatory regime that has the effect of allowing New Delhi to concentrate the resources of its indigenous nuclear program on nuclear weapons development.

Invariably the strengthening of the Indo-US alliance has been associated with the downgrading of Washington’s ties with Pakistan, which throughout the Cold War was the principal US ally in South Asia.

Islamabad has warned that Washington has overturned the balance of power in South Asia, and that its ever-closer strategic partnership with New Delhi is emboldening India, and fuelling an arms and nuclear arms race, but all to no effect.

Fearing strategic isolation, Pakistan has drawn closer to its long-time ally China. But that has only increased its estrangement from Washington and fuelled its rivalry with India.

Eager to placate New Delhi, Washington likely gave it the green light to “punish” Pakistan, although the Obama administration, which still relies on Pakistan to provide crucial logistical support to the US occupation forces in Afghanistan, has denied it.

Obama’s National Security Adviser Susan Rice called her Indian counterpart, Ajit Doval, Wednesday evening just hours before the Indian “surgical strike,” purportedly to give condolences for the Uri attack and express support for India’s fight against terrorism. Press reports suggest Rice’s call was precipitated by concerns over growing complaints in India that Washington has been insufficiently supportive, including for failing to label Pakistan as responsible for the Uri attack.

What is incontrovertible is that US government officials have refused to condemn yesterday’s “surgical strikes” on Pakistan, although they were patently illegal and highly provocative. Instead they have issued ritualistic calls for both sides to show restraint and move toward dialogue.

The US is playing a most dangerous and incendiary game. In pursuit of its anti-China alliance with New Delhi, it is encouraging India’s government, now led by the communally toxic BJP, to pursue an aggressive, but supposedly “calibrated,” policy of diplomatic, economic and military action against Pakistan—a country with which it has fought four wars and that has threatened to meet any large scale Indian attack with the speedy use of its recently deployed “battlefield” or tactical nuclear weapons.

India-Pakistan: Whither Surgical Strike?

Muhammad Faisal

On 29 September, the Indian Army claimed that it had conducted a “surgical strike” along the Line of Control (LoC), in the Pakistani-administered region of Kashmir. Pakistani authorities, both civil and military, quickly rebutted it while confirming that it had responded to “unprovoked” ceasefire violations in four sectors along the LoC earlier that night. These developments came in the wake of deteriorating Islamabad-New Delhi relations with widespread unrest in the Kashmir valley. The present rise in tensions is a direct result of a militant attack on an Indian Army base at Uri, in the Indian-administered region of Kashmir. India blamed the attack on anti-India militants based in Pakistan, while Pakistan vehemently denied the accusation.

 

At present, details of what actually took place along the LoC are scant. Indian claims, however, still need to be taken with a pinch of salt. Yet, the Indian announcement is an admission of violating the ceasefire agreement. Pakistani sources confirm that Indian troops did attack a forward post in the Hot Springs subsector, of the Kotli sector. Indian soldiers taking advantage of physical features of the area had moved close to the Pakistani post and opened fire on the forward post. Pakistani soldiers swiftly retaliated. In the ensuing exchange of small arms and light weapons, the Indian attack was repelled by the Pakistani troops.

 

Earlier in the morning the Pakistan Army’s public relations department announced that Pakistani troops had responded to “unprovoked firing” on four sectors along the LoC during the early hours of the day. It was taken as return of “cross-LoC firing” by most Pakistani analysts and media, in the current volatile environment. In the currently prevailing hostile climate, cross-LoC firing and artillery exchanges were being anticipated by observers. The announcement made by the Indian DGMO and the spokesperson of India’s Ministry of External Affairs (MEA) that India had conducted a “surgical strike,” has obviously increased the tensions.

 

This Indian armed incursion is by no means a “surgical strike.” A surgical strike would mean Indian Army conducting an operation with “boots on ground” across the LoC, deep into Pakistani-administered territory, instead of a forward post. For such an operation, the Indian Army would either have to rely on heli-borne special forces or conduct airstrikes on selected targets using precision-guided munitions (PGMs). Based on the available information, at this time, the Indian military did not go for any of these options.

 

The DGMO of the Indian Army choose to describe a usual ceasefire violation and an attack on a forward Pakistan army post as a “surgical strike.” Most significantly, the Indian DGMO and the MEA spokesman deliberately used ambiguous language to announce violation of ceasefire and called it a “surgical strike.”

 

The Indian DGMO claimed that a “surgical strike was conducted along the LoC,” which means that Indian authorities are essentially claiming that Indian troops did not cross into the Pakistani-administered territory. Meanwhile, the stress on a “surgical strike” was enough to create ambiguity for political purposes. Some were quick to misinterpret this as “Indian boots on Pakistani held territory” scenario, which it certainly was not.

 

Moreover, it is also for the first time that India has admitted to violating the ceasefire agreement in place between the two armies. In the past, the Indian military had blamed the Pakistan Army for violating the ceasefire to assist infiltration across the LoC into the Indian-administered Kashmir. As India reverts to the situation reminiscent of the 1990s, questions would surely be raised by Pakistani military and Foreign Office on the future of the ceasefire agreement and its feasibility. So far, Pakistan has acted responsibly and has not undertaken a counter-attack on a forward Indian post along the LoC.

 

Pakistani Prime Minister Nawaz Sharif has called an emergency meeting of the cabinet to deliberate further steps, while Pakistani officials are vehemently denying that a surgical strike took place.

 

In rebranding a cross-LoC duel as a surgical strike, Indian military quickly claimed political victory that the Pakistanis have been punished for Uri attack. In a limited war, a side can attack first, but it cannot decide the course of action in the battlefield. Without waiting for the other side to respond first, acknowledge and respond to the “so-called” surgical strike. In Islamabad, this appears to be an attempt to assuage the domestic constituency by Indian Prime Minister Narendra Modi’s government. This, however, sets a dangerous precedent for the future where any side could claim to have undertaken a successful raid/attack and launch a media blitz, thus, worsening the already complex bilateral relations.

 

This attack has raised the prospect of a military escalation as the bilateral relationship takes a plunge and acrimony deepens. Even the future of the 2003 Kashmir ceasefire agreement that has largely kept the peace between two armies for nearly 13 years, is in jeopardy. The nature of this attempt is repeat of cross-LoC duels between the Indian and Pakistani Armies’ pre-ceasefire agreements. Both sides used to attack and capture posts on the opposite sides to gain tactical and operational advantage over the other. Former Indian and Pakistani military officers who have served in operational areas along the LoC during the 1990s have penned accounts of posts exchanging hands for tactical advantages. The latest Indian attack along the LoC can lead to return of violent 1990s when artillery duels were a regular feature of the conflict between Pakistan and India.

The Long, Long Journey to Female Equality

James Haught

With the possibility of America’s first woman president looming, it’s appropriate to consider the monumental struggle for gender equality.

For millennia, female inferiority was presumed, and mandated, in virtually every human culture. Through most of history, the brawn of heavier males gave them dominance, leaving women in lesser status — often mere possessions of men, confined to the home, rarely educated, with few rights.

Many were forced to wear veils or shrouds when outdoors, and they couldn’t go outside without a male relative escort. Fathers kept their daughters restricted, then chose husbands who became their new masters.

Sometimes the husbands also had several other wives. In a few cultures, unwanted baby girls were left on trash dumps to die.

In Ancient Greece, women were kept indoors, rarely seen, while men performed all public functions. Women couldn’t attend schools or own property. A wife couldn’t attend male social events, even when her husband staged one at home. Aristotle believed in “natural slaves” and wrote that females are lesser creatures who must be cared for, as a farmer tends his livestock.

Up through medieval times, daughters were secondary, and inheritances went to firstborn sons. Male rule prevailed. Anthropologists have searched for exceptions, with little success — except possibly some Iroquois tribes in Canada, where women reportedly had some rights.

In the 1930s, the famed Margaret Mead thought she found a female-led group in New Guinea, but she later reversed her conclusion and wrote: “All the claims so glibly made about societies ruled by women are nonsense. We have no reason to believe that they ever existed…. Men everywhere have been in charge of running the show.”

As The Enlightenment blossomed in the 1700s, calls for women’s rights emerged. France’s Talleyrand wrote that only men required serious education — “Men are destined to live on the stage of the world” — and women should learn just to manage “the paternal home.” This infuriated England’s rebellious Mary Wollstonecraft (1759-1797), who wrote A Vindication of the Rights of Woman, contending that females have potential for full public life. (Her daughter married poet Percy Shelley and wrote Frankenstein.)

Reformer John Stuart Mill (1806-1873) wrote The Subjugation of Women in 1869 after his wife had written The Enfranchisement of Women, calling for a female right to vote. The husband protested: “There remain no legal slaves, save the mistress of every house.” As a member of England’s Parliament, Mill sought voting by women and became president of the National Society for Women’s Suffrage.

“The legal subordination of one sex to another is wrong in itself, and now one of the chief hindrances to human improvement,” Mill wrote.

The western world wrestled nearly a century before women finally won the right to vote.

Elizabeth Cady Stanton (1815-1902) was the bright daughter of a New York state judge. Few schools admitted girls, so her father arranged for her to attend male-only Johnstown Academy.

The daughter grew outraged by laws forbidding women to own property or control their lives. She married an abolitionist lawyer and accompanied him to London for a world conference against slavery. Women weren’t allowed to talk; they sat silent behind a curtain while men spoke.

Back in America, she joined Quakers to organize an 1848 assembly at Seneca Falls, New York, that launched the modern women’s equality movement. Frederick Douglass urged delegates to demand female suffrage. Stanton later joined Unitarians Susan B. Anthony, Lucy Stone, and Ralph Waldo Emerson in a lifelong struggle for female rights.

The Civil War temporarily suppressed those efforts, but they flared anew when the 15th Amendment, ratified in 1870, allowed black males to vote, but not females of any color. Demands snowballed for decades. Mark Twain gave a speech calling for female voting. Various suffrage groups took to the streets, some more militant than others. The National Woman’s Party led by Alice Paul was toughest, picketing outside the White House, enduring male jeers, and physical assaults.

President Woodrow Wilson tried to ignore the clamor. When a Russian delegation visited the White House, pickets held banners saying “America is not a democracy. Twenty million women are denied the right to vote.”

The protesters staged Washington parades that were attacked by mobs, sending some beaten victims to hospitals. Women pickets on sidewalks were hauled to jail on absurd charges of “obstructing traffic.” When they refused to pay fines, they were locked up with criminals. Paul was sentenced to seven months. She went on a hunger strike and was force-fed.

Finally, Wilson reversed position in 1918 and supported female enfranchisement. Congress approved the 19th Amendment, and it was ratified in 1920, letting women vote.

Around the world, various other nations followed, some more slowly than others. In Switzerland, women didn’t gain full ballot rights in all districts until 1991. Saudi Arabian women finally gained only partial voting in December 2015.

Social struggles never really end. Western women still haven’t gained full equality. Their pay remains below the average for male workers. In some places, American women couldn’t serve on juries until the 1950s. Some Muslim and African cultures remain medieval, with women subjugated, with girls less-educated, with “honor killings” of flirtatious daughters who besmirch a family’s Puritanical standards, and with genital mutilation of girls to subdue their sex drive and keep them “pure” for husbands.

An Amnesty International report said:

“In the United States, a woman is raped every six minutes; a woman is battered every 15 seconds. In North Africa, 6,000 women are genitally mutilated each day. This year, more than 15,000 women will be sold into sexual slavery in China. Two hundred women in Bangladesh will be horribly disfigured when their spurned husbands or suitors burn them with acid. More than 7,000 women in India will be murdered by their families and in-laws in disputes over dowries. Violence against women is rooted in a global culture of discrimination which denies women equal rights with men and which legitimizes the appropriation of women’s bodies for individual gratification or political ends. Every year, violence in the home and the community devastates the lives of millions of women.”

Workers’ strikes spreading throughout South Korea

Ben McGrath

Large numbers of South Korean workers in different industries have gone on strike in recent days, protesting the government of President Park Geun-hye’s onslaught on working conditions. These actions are a clear sign of the willingness to fight within broad layers of the working class despite the efforts of the unions to contain and stymie the movement.

The largest strike took place Monday when the 50,000 unionized workers at Hyundai Motors halted work at each of the company’s three domestic plants, the first full strike in 12 years. Additional six-hour, partial strikes have been scheduled for the rest of the week while workers at KIA, a Hyundai affiliate, will hold partial walkouts on three days.

Four-fifths of union members voted to strike in July with 19 partial strikes taking place before Monday’s walkout. The demands included a 7.2 percent monthly wage increase (152,050 won or $US139), bonus equivalent to 30 percent of Hyundai’s 2015 net profits, and the withdrawal of a plan to reduce wages of employees aged 58 and 59 by 10 percent and to freeze wages for those who are 60, the retirement age. Known as the peak wage system, it is a government initiative to cut labor costs at companies throughout South Korea.

An agreement between the union and company reached on August 24 was rejected by 78 percent of workers. Failing to match workers’ demands or even last year’s contract, the failed agreement raised wages by only 58,000 won and included a one-time bonus of 3.3 million won and other bonuses worth 3.5 times the basic monthly wage. It was the first wage deal union members had rejected since 2008.

According to Hyundai, which has posted 10 consecutive declines in quarterly profits, strikes this year have resulted in production losses of 101,400 vehicles worth approximately 2.23 trillion won. However, Hyundai’s union regularly forces workers to make up lost work after agreements are signed.

The political establishment has plied its usual tricks, denouncing the Hyundai workers as labor aristocrats. “The average annual wage of Hyundai Motor workers stands at 96 million won ($83,900),” said Jeong Jin-seok, the floor leader of the Saenuri Party. “Due to [the strike] of such high-income earners, those working at subcontractors that supply parts to Hyundai [and do not get paid as much] are being hurt.”

In actuality, the average base monthly pay of union members at Hyundai is only 2 million won or $US21,871 annually. The minimum cost of living determined by the government is 1.63 million won monthly for a family of four, which does not come close to meeting expenses as consumer prices rise. Kim Jeong-sik, a professor of economics at Yonsei University in Seoul, told the Yonhap News Agency bluntly last November, “The high cost of living in Korea is not reflected correctly in the consumer price index.”

The decision to launch a complete one-day strike at Hyundai is a sign that the union’s usual tactics designed to lessen the impact on the company are no longer working. The union, the Korean Metal Workers Union (KMWU), has consistently blocked a united struggle of all workers in the auto industry and in other industries throughout the country, to say nothing of workers internationally.

The partial strikes are often not organized on the same days even with workers under the same parent company, as in the case of Hyundai and KIA. When strikes are called, the full membership is rarely called out. The KMWU narrowly passed an agreement early this month with GM Korea, isolating auto workers at different companies.

Other workers in the public and financial sectors have gone on strike against the government’s attempts to push through a “merit”-based pay scheme that will be used to suppress wages by as much as 40 percent, the Korea Times reported, as well as create pretexts to fire “underperforming” employees.

The Federation of Korean Public Industry Trade Unions held a rally on September 22, attended by approximately 5,000 people. “The lives of public sector workers have been pushed to the edge of a cliff by the violence committed under the name of reform in the last three and a half years,” union leader Kim Ju-yeong said.

The following day, the Korean Financial Industry Union (KFIU) held a strike with a union-estimated 65,000 bank workers attending a protest at the World Cup Stadium in Seoul. The Financial Supervisory Service put the number of participants at only 18,000. The KFIU has stated additional walkouts could be coming.

On Tuesday, Seoul’s two subway unions covering lines 1 through 8, along with the Korean Railway Workers Union (KRWU), struck jointly for the first time in 22 years. Some 2,380 subway workers, or about 30 percent of the total, took part. A similar number of railway workers walked off the job, though the KRWU claims a membership of nearly 22,000. It employed a similar strategy during a strike in December 2013 in order to limit the impact on the company and government. None of the issues from that strike, called off under government and police pressure, has been resolved.

Around 400 union members at Seoul National University Hospital also walked out on Tuesday after 88.5 percent of the members voted to strike. “Performance-based pay will make institutions, which exist for the public, operate according to capitalism. This will result in squeezing money out of patients or only treating patients who need expensive treatments―hospitals will forget their duty and become commercialized,” the union stated. Additional job actions are planned with hospital employees from around the country intending to take part.

Workers in the shipbuilding and shipping sectors are also facing massive job losses, with sackings likely to total in the tens of thousands. All though not limited to these companies, they include industry leaders like Hyundai Heavy Industries, Samsung Heavy Industries, and Daewoo Shipbuilding and Marine Engineering, all of which are undergoing restructuring, and Hanjin Shipping, which was placed under court receivership earlier this month. Their unions have put up little resistance, either accepting the job cuts or staging the impotent partial strikes.

The Korean Confederation of Trade Unions, an umbrella organization to which unions like the KMWU and KRWU belong, also organized a “general strike” for Wednesday, following a day of protests held in front of Seoul Station. These protests are a common tool the KCTU uses to allow workers to let off steam in a controlled setting. In this case, with the growth of working class militancy, the KCTU is positioning itself to sellout workers while pretending to stand at the forefront of the movement.

Walmart to cut 7,000 back-office jobs in the US

Jessica Goldstein

Walmart announced on September 1 that it will be cutting about 7,000 back-office jobs in its stores across the US. The jobs to be eliminated are positions in accounting and invoicing, which will be automated or centralized going forward, according to the company. According to the Wall Street Journal, the types of jobs being cut are usually held by long-term employees at a higher pay rate than the average Walmart store employee. Most workers in these positions are earning on average $13.38 per hour and are employed full-time, compared to the average part-time Walmart sales associate who earns just $10.58 per hour in the US.

Although they earn a relatively high wage compared to the average Walmart worker, these workers in back-office positions still earn on average far less than the average hourly wage in the US of $20.43 per hour. The fact that Walmart is cutting its already low-wage jobs in order to stay on the very top of a market that is rapidly turning digital is a damning indictment of the destructive measures being taken by giant corporations to satisfy their insatiable drive for short-term profits at the expense of society as a whole. Walmart recorded gross annual profits of $131.69 billion in April, enough to pay each of its 2.2 million workers in the US a wage of $28.78 per hour.

Employees who are losing their jobs will be given the “opportunity” to transition into other jobs with the company, the majority of which are lower-paying, part-time customer service positions. Though employees technically have the ability to apply for higher-paying, full-time positions in store management, those jobs are few compared to low-paying customer service jobs, and often require experience that those in accounting and invoicing positions may not have.

The so-called transitioning program paints employees into a corner: either they take a more than likely lower-paying position, without status, or they must quit and seek employment elsewhere. This strategy serves two purposes, both for the benefit of Walmart and its shareholders. First, it allows the company to manipulate its job creation statistics with the aim of increasing its share price, since it says that it will have more positions available for those losing their jobs. Second, Walmart will most likely avoid paying unemployment benefits for the workers being cut, since the company is not laying off or firing workers, but “transitioning” them to other roles.

The cuts—or transitions, as they are being called—are expected to last through 2017. A pilot program in June of this year tested the transition program with back-office workers in 500 locations, in stores located mainly in the western US. According to a report by CNN, Walmart failed to provide exact data on how many of the affected employees chose to remain with the company after the pilot cuts.

The situation faced by Walmart workers paints a nightmarish picture of the lack of control that workers in the US have over their jobs. Accounting and invoicing is an essential part of the daily functions of all retail establishments, yet through automation even these essential jobs are rendered obsolete in the name of increasing share prices for short-term gains.

Less than two weeks before the cuts were announced, Walmart stock shares were traded at a yearly high of $74.30. The spike came after the August 8 announcement of Walmart’s acquisition of online retailer Jet.com for $3.3 billion.

According to the announcement published by the Wall Street Journal on September 1, the cuts are a part of a new program aimed at putting more employees in customer-facing positions in order to provide better service to consumers. However, in light of Walmart’s recent financial activity, these claims will all too soon be revealed to be false. The layoffs of higher-paid, full-time workers will also offset the costs of Walmart’s decision to raise its starting pay rate, which was announced in February.

Walmart stock continued to slide in the days before the layoffs were announced, but saw a brief spike to $72.84 on September 1, the day of the announcement. Despite the spike, share prices were still well below their previous high. Since then, share prices of the retailer have been more or less on a decline. The announcement of the cuts has done little, if anything, to restore profitability after the acquisition announcement.

In addition to the Walmart announcement, Sears Holding Corp. announced on September 16 that it would shutter another 64 of its Kmart discount retail stores, on top of the 68 closings it announced in April. Macy’s announced in August that 100 of its stores are set to close their doors in early 2017, in addition to the 38 that it closed this spring. According to a report by Credit Suisse, a total of 37,000 US retail jobs are set to be slashed by the end of this year, more than double the amount lost last year.

The reason for mass layoffs and closings, according to many of the retailers, is the competition posed by online retailers such as Jet and Amazon.com. However, the stores are not closing because of lack of need for the products they stock, but for a lack of profitability. Online retailers do not require salespeople or merchandisers in the way that brick-and-mortar establishments do. Some online retailers, such as Amazon, have replaced workers with drones used to catalog and manage inventory in their warehouses as well as to deliver orders. Walmart announced in June that it will be testing a drone program to catalog and manage inventory in its 190 US distribution centers, and will also begin to test drones for online deliveries as well.

Walmart is the largest retailer and the largest employer in the US. It is the number-one employer in 20 states in the US and employs about 1% of the US workforce. The mass layoffs planned for the largest employer in the world’s most powerful capitalist economy are an expression of the utter state of decay of American capitalism. They point to an intensely bitter period of struggle ahead for the working class.