Australian flu epidemic inundates public health services

John Mackay

The 2017 Australian winter flu season looks to be the most severe for at least eight years. It has caused more than 400 deaths nationally and placed significant demands on under-funded public hospital and primary care health services. The peak numbers of flu cases also occurred earlier in winter than in previous years.

The epidemic has demonstrated the incapacity of the public health system to manage a sudden increase in acutely sick patients. Emergency room visits reached record levels at the peak of the season in many major hospitals, with limited or no beds available for many more affected by the virus.

The past three years have seen higher numbers of reported cases compared to the previous three years, suggesting an emerging trend that means future flu seasons may see repeats of this year’s epidemic or worse. The severity of the Australian flu season also is creating fears that the northern hemisphere winter will produce a similar crisis.

No full report on the Australian flu season is expected until the end of November, but the Australian government’s Health Department recorded 212,365 laboratory-confirmed notifications of influenza by October 16. The numbers have more than doubled since last year.

By the end of September, according to the Health Department, 417 influenza-associated deaths had been notified to the National Notifiable Diseases Surveillance System during 2017. The median age of deaths notified was 85 years. There had been a large increase in deaths since the previous Australian Influenza Surveillance Report, mostly attributed to improved reporting in New South Wales.

However, the Health Department cautioned that the true number of deaths could be higher, because the statistics depend on the follow up of cases to determine the outcome of their infection. Such follow up is not a requirement of notification, making year-on-year comparisons unreliable.

Australian Medical Association vice president Dr Tony Bartone told the New York Times: “Clearly, we don’t have the reliable sources of information to assist us with predictions regarding future years. The more information we collect, the more prepared we will be.”

Media reports have highlighted numbers of deaths in aged care facilities, prompting calls for booster vaccinations for the elderly, because the effectiveness of immunisation can decrease with age, due to weakened immune systems. But the problems are far broader.

The pressure on public hospitals has been overwhelming. Attendances to emergency centres have broken prior attendance records for many hospitals. In the state of Victoria, more than 3,900 people visited emergency departments each day during August, the most ever recorded for that month.

Resources have been limited by continuous cost cutting by both state and federal governments. Many hospital staff have contracted the flu themselves, compounding staffing shortages. The epidemic was not declared a pandemic, which would have triggered increases in staffing levels.

Vaccination is vital in the fight against influenza as it permits people to build up immunities to viruses. Severe influenza can lead to secondary bacterial infections, such as pneumonia, which can complicate the illness, making it life-threatening.

This year’s vaccine targeted four flu strains—two influenza A and two influenza B. It is highly effective against influenza B and one of the A strains, H1N1. However the vaccine is known to be less effective against the H3N2 strain.

Australia-wide data suggest so far that 74 percent of the 2017 cases could be attributed to the H3N2 strain, which is different to the other well-known A strain, H1N1 or “swine flu,” that caused a pandemic in 2009.

The H3N2 variant has been a dominant virus over the past five Australian flu seasons and is known to have the most impact on elderly people. There are fears this year that the vaccine will have been less than 40 percent effective against H3N2.

Vaccines are designed from the flu strains of the previous season. However, health experts are concerned that this year’s vaccinations may have been undercut by new variants or mutations of the H3N2 strain.

The World Health Organisation Global Influenza Surveillance and Response System, a worldwide network of influenza centres and collaborating laboratories, found that vaccine effectiveness was reduced where the H3N2 was prevalent. This has led to recommendations to vaccine manufacturers to modify the vaccine’s H3N2 component for the next season.

Flu vaccines success rates vary from year to year. The United States Centre for Disease Control and Prevention estimates that from 2004 to 2016, influenza vaccine effectiveness ranged from the 10 percent to 60 percent. It can take vaccine manufactures up to six months to produce large quantities once a strain is identified. Thus, the viruses for the next flu season have to be anticipated in advance and cannot account for subsequent virus mutations.

Health experts hope a “universal” vaccine can be developed to account for all influenza viruses and mutations. No such vaccine has been produced, however.

Vaccines are not the most lucrative sector of the pharmaceutical industry, causing companies to shut down vaccine productions. It is more profitable to sell treatments that are taken daily, compared to one-off or annual treatments such as flu vaccinations. In the United States, the Food and Drug Administration licensed vaccines made by 26 different manufacturers in 1967. By 1980 the number fell to 17 and by 2002 it dropped to 12.

Today the major pharmaceutical conglomerates dominate vaccines. The profit motive limits the companies from funding vaccine research and development, leaving much of the work to publicly-funded researchers, who find opportunities increasingly limited by major cuts in government budgets.

Despite varying protection with vaccines, extensive research has demonstrated that immunisation decreases the risk of contracting influenza. In Australia, the vaccination rate is low, covering just 20 percent of the population. Under the federal government’s National Immunisation Program, only certain vulnerable individuals can obtain the influenza vaccine for free. Even then, they often must pay a health provider to administer the vaccination.

The program covers pregnant women, those 65 years and older, and people at risk of infection, such as those with respiratory or heart conditions, diabetes or compromised immune systems. This includes Aboriginal and Torres Strait Islander people 15 years and over.

For those not covered—the vast majority of the population—if an employer does not provide the vaccine, the cost can be $6 to $20 for children and adults, on top of the consultation fee to visit a doctor.

The cost of vaccination has been proven to be a barrier. The Australian Child Health Poll demonstrated that for Queensland parents, the cost was an issue limiting the vaccination of their children. The study’s author, paediatrician Anthea Rhodes, told the Australian Broadcasting Corporation: “Universally free funded flu vaccines could have the potential to increase the rate among families and kids.”

The severity of this flu season forced the Victorian state Labor government—after the epidemic had already peaked—to announce a one-off funding package of $115 million. The funding related to moving flu patients faster through emergency rooms so ambulances could get back on the road faster. However, the state government refused to offer free, universal vaccinations, unless the federal government funded them.

Australian governments, like their counterparts internationally, are increasingly lowering corporate taxes in order to increase profits. This is driving ongoing cost cutting in healthcare and all essential social services. This year’s flu epidemic, and the possibility of worse outbreaks to come, again highlight the human cost as essential services like public health care become unable to cope with epidemics.

After electoral victory, Argentine president promises “most austere policies”

Andrea Lobo 

In Sunday’s midterm elections in Argentina, the conservative ruling coalition Cambiemos of President Mauricio Macri received 40 percent of votes nationally and came in first in the five most populous voting districts.

Having a long list of reactionary measures waiting only for the election to be over, Macri immediately promised “the most austere politics possible” and imposed a 10 percent gasoline price-hike on Monday as part of an over-all policy of creating more profitable conditions for foreign investors.

In response to the electoral results, the Argentine financial markets rose to record levels, along with a 1.8 percent jump in Argentine dollar bonds.

This year’s round of elections involved races for two-thirds of the seats in the senate along with half of those in the chamber of deputies, with all 24 voting districts electing members in one or both congressional chambers. Macri’s Cambiemos (Let’s Change) party obtained the first place in 14 districts—three more than in the August primaries.

Far from being a “vote of confidence” in Macri, the results express a deep resentment against the twelve-year Peronist rule that began the austerity drive, price hikes and job cuts now being accelerated under Macri.

On Sunday morning, police raided an office of the Socialist Workers’ Party (PTS) in Mar del Plata, the second largest city in the province of Buenos Aires. The PTS, the leading party in the Left and Workers’ Front (FIT), had six of it members, including two candidates, arrested and detained until later in the day on trumped-up charges of violating a mandatory suspension of campaigning in advance of the vote. This cowardly police-state act represents a serious warning that the Macri administration stands ready to use the full weight of its repressive apparatus to intimidate and suppress all social opposition to its agenda.

As a result of the election, Cambiemos has replaced the Peronists as the largest party in the Chamber of Deputies, with 108 seats against the 67 of the Front for Victory (FPV) led by the Peronist ex-president Cristina Fernández de Kirchner (2007-2015). However, Macri’s coalition will still be short of a majority in either chamber, and will remain behind the Kirchnerists in the Senate.

Several historical Peronist strongholds saw Cambiemos come in first place. Most significantly, in the province of Santa Cruz—considered the stronghold of Kirchnerism and currently governed by the sister of ex-president Néstor Kirchner (2003-2007)—Cambiemos took a 12 percent lead over FPV.

In the populous City of Buenos Aires, Macri’s former minister of education, Esteban Bullrich, who imposed widespread cuts in staff and real wages against teachers, beat Cristina Fernández. Such unfavorable results for Kirchnerism confirm polls showing disapproval ratings between 60 and 70 percent for the ex-president.

In spite of this, she secured one of the three seats in the Senate for the City of Buenos Aires. In a brief speech on Sunday, she called for “the unity of the different political forces of the opposition.” Fernández placed well ahead of the tendencies led by the other top Peronists, Florencio Randazzo and Sergio Massa. The latter even lost to Cambiemos in his main stronghold of Tigre.

Fernández had formed the coalition Citizens’ Unity this year, hoping to give the FPV a new face, and benefit from the escalation of social opposition against Macri’s policies, which saw mass protests by teachers earlier this year, a general strike in April and large demonstrations against the state’s efforts to cover up the disappearance and murder of the youth Santiago Maldonado, whose body was found last week, raising more questions than answers.

However, popular hostility to her political legacy has only risen. During her term in office, a loss of industrial activity, growing dependence on fossil fuel exploitation, debt accumulation, and widespread corruption allegations paved the way for economic stagnation by 2012, a debt default in 2014, spiraling poverty, deep austerity, mass demonstrations and the election of Macri in 2015. Many Peronist legislators have since sought to distance themselves from Kirchner, while even the Kirchnerists have simply pledged to “moderate” Macri’s pro-business measures.

“Everything indicates that Cambiemos made a great election in many provinces,” said Randazzo, congratulating Macri and responding to the results with a sigh of relief.

While the historically-Peronist trade union bureaucracies have already collaborated with Macri in demobilizing a spike in anti-Macri strikes this year, the Peronist establishment parties will act with ever greater complicity in supporting Macri’s delusional promises of stability for Argentine capitalism and making Argentina “normal” again.

Acknowledging that his partial victory will undercut even the façade of opposition in Congress, Macri announced a “stage of permanent reformism,” which truly means a permanent state of financial plundering of state assets and workers’ living standards. “Argentina will have to continue taking new debt,” he said Monday, sanctioning a continuation of high interest rates and the lifting of currency controls that have made Argentina’s bonds and finance sector a paradise for parasitism.

Nonetheless, the Financial Times warns that $54 billion that Macri has already borrowed is more than almost any other emerging economy in the world and will demand severe measures to pay back. “Some of the biggest risks stem from the gradualist agenda that Mr. Macri has pursued to sweeten the bitter pills of his reforms,” the London-based daily warns.

Due to such concerns by the international financial aristocracy, the Macri government has promised to “double down” on its agenda and present bills and decrees imposing further social austerity, tax cuts for the rich and corporations, and labor “flexibilization” measures modeled on Brazil’s recent “labor reform,” which was aimed at overhauling entire sectors of the economy. “This is just the beginning, we still have many battles to fight,” Macri told business executives last week.

Such language of class war makes clear that he is leading a frontal offensive against the working class. Seventy percent of the hundreds of thousands of layoffs since he came into office in December 2015 have taken place in the industrial sector, with one in every three due to the closing of a factory, according to the Center of Political Economy of Argentina (CEPA). This had a multiplying effect, dropping consumption and in turn generating layoffs in the service sector.

Overall, the Labor and Economy Institute (ITE) calculated in September that the supposed “recovery” under Macri has left a balance of 73,251 jobs lost with salaries above the median, in comparison with a slight increase in jobs “in sectors with salaries 25 percent to 10 percent below the median.” However, this imposition of a cheap labor regime has not attracted an increase in productive investments, amid low profit rates and global economic stagnation; consequently, most of the money entering the country is going into finance.

This major electoral defeat and unequivocal rejection of the corporatist, bourgeois-nationalist and populist politics of Peronism exposes the political bankruptcy of its allies within the trade unions and the pseudo-left. This process also reflects the dead-end of the nationalist “pink tide” politicians and governments, which are facing similar degrees of repudiation in Venezuela, Brazil, Bolivia, Uruguay, Paraguay and Ecuador.

The Left and Workers’ Front (FIT), comprised of parties claiming to represent Trotskyism and a coalition of Guevarist organizations, received about 1.2 million votes nationally. With its former presidential candidate Nicolás del Caño at the head of the deputy ballot for the Province of Buenos Aires, the FIT received half a million votes there and two seats. It also gained several seats in the provincial and municipal legislatures.

While it received a vote total similar to what it won in 2013, the FIT lost one place in the national Congress. In spite of its proclamations that this would be a “historic” election, and the promotion by the bourgeois media of its attempts to exploit protests over the layoffs of workers in a PepsiCo factory earlier this year and the disappearance of Santiago Maldonado for electoral gain, the support for FIT has remained virtually stagnant.

In a coalition strictly formed for electoral purposes, organized openly under “the main challenge” of electing new deputies, the FIT’s negative results could again set in motion the irresolvable contradictions behind their alliance and re-open the internal crisis and threats of splits that occurred earlier this year, during the period of opportunistic ballot-trading ahead of the primaries.

Its stymied popularity is largely a reflection of the crisis of Peronism, with which it is associated. Whether it was with the PepsiCo protests, with FIT legislators presenting a bill in partnership with Peronists for a re-hiring of the workers, or the promotion of illusions that repressive disappearances like Maldonado’s will cease with a change in ministers or a new capitalist government, the coalition failed to fundamentally distinguish itself from the essential politics of Peronism, while its constituent organizations have continued their attempts to orient workers to the Peronist trade unions.

The FIT has not only given the appearance of, but demonstrated in practice, its status as a reformist extension of the bankrupt Peronist establishment and its efforts to shore up the Macri government. With the deepening of Peronism’s crisis, its own drive towards the creation of an Argentine version of Greece’s Syriza or Spain’s Podemos will inevitably accelerate.

Trade war in the aerospace industry: Airbus takes over shares in Bombardier

Gustav Kemper

At the beginning of last week, the heads of the aircraft manufacturers Airbus and Bombardier, Tom Enders and Alain Bellemare, announced a long-term cooperation between the two companies. The European Airbus Group will take control of a joint venture to produce the C-Series medium-haul aircraft of the Canadian Bombardier Group.

Airbus will take over 50.01 percent of Bombardier shares. At the same time, the previous owners of the C Series Aircraft Limited Partnership (CSALP), Bombardier and the Quebec government, will reduce their shares to 31 and 19 percent, respectively. Airbus has also been given an option to purchase the shares of the Quebec government two years after the end of the acquisition, and Bombardier’s shares some time later. The result would be a 100 percent takeover of the company by Airbus.

On the same day as the announcement of the joint venture, shares in Airbus rose by 4.2 percent and Bombardier by 15 percent. The price of Boeing shares, however, fell by 2.4 percent and shares in the Brazilian Embraer company, a direct competitor, dropped by 5.4 percent. Financial experts estimate that the value of the joint venture will double in a short time from $2 billion to $4 billion, leading to large profits for shareholders.

The German business newspaper Handelsblatt greeted the takeover as “a masterstroke” by Airbus. According to the paper, when the deal goes through the European company will be the main beneficiary of the trade war measures imposed on Bombardier by the US Department of Commerce following pressure from its US competitor Boeing.

Boeing filed a complaint with the US Department of Commerce after Delta Airlines ordered 75 CS100 model aircraft (108-125 seats) from Bombardier. Global market leader Boeing did not participate in the tender because it does not produce aircraft of this size. Nevertheless, Boeing accused its Canadian competitor of selling its aircraft below cost price. As justification for its lawsuit, Boeing stated that the province of Québec had invested $1 billion in Bombardier in 2015 following delays and cost problems arising from the development of the new aircraft. Boeing declared the investment to be an unauthorised subsidy of development costs.

The Trump administration then issued a lawsuit and in mid-September announced penalties of 300 percent on the import of C-series aircraft. The measure hit Bombardier hard and Canadian Prime Minister Justin Trudeau tried (in vain) to negotiate with Trump. The penalties threatened the sale and production of the C series and thus thousands of jobs in a company already under financial pressure from high development costs of $6 billion and fines for the late delivery of its first aircraft. Trudeau warned that Canada would not buy any further military aircraft from Boeing if forced to pay the penalties.

British Prime Minister Theresa May also threatened to curtail the further purchase of Boeing aircraft. Bombardier has a workforce of 1,000 in Belfast, Northern Ireland, and May also negotiated intensively with Trump on behalf of the company. Following the British parliamentary election in June, May has had to rely on the Democratic Unionist Party (DUP) from Northern Ireland to secure a parliamentary majority for her government, but Trump refused to back down.

For the past two years Bombardier has been pursuing cost-cutting programs that have already cost thousands of jobs in its air and rail sectors. Most recently, a joint venture planned with Siemens over rail vehicles collapsed in September after Siemens struck a deal with the French company Alstom. Now Bombardier has abandoned its plan of competing on an equal footing with Airbus and Boeing, based on its C-Series. The company will retain only its private and luxury jet and train sectors.

From 2012 onwards Airbus public ownership by the French and German governments stood at around 11 percent respectively. Spanish ownership is about 4 percent. The company’s latest intervention will have dramatic repercussions. The world’s second biggest aerospace company has a production facility in Mobile, Alabama, which, according to plan, will assemble the C series after completion of the takeover process.

According to Patrick de Castelbajac, the Airbus board member responsible for corporate strategy, strong legal arguments confirm that this move makes the US penalties obsolete. Although Boeing claims that the import of components of the aircraft should be taxed, half of the parts are already manufactured by American companies.

The US government has not yet responded to the new development and a decision is not expected until the beginning of 2018. The conflict is, however, characteristic of the growing international trade war in which major corporations lobby their respective governments to gain market access and benefits.

Brigitte Zypries, the German economics minister, declared: “Airbus’s participation in Bombardier’s C-series program can provide important opportunities for Airbus and is a positive signal for the deepening of European-Canadian economic relations.”

For years, Boeing and Airbus have been accusing each other of unfair competitive practices due to state funding. A number of complaints are currently being negotiated by the World Trade Organisation (WTO). The EU, as well as Germany, France, Spain and the United Kingdom, have all filed complaints with the WTO against US tax cuts to protect their own aviation industry, in particular Boeing. The Brazilian manufacturer Embraer SA has also lodged a complaint against Bombardier with the WTO.

In an interview with Bloomberg, Airbus manager de Castelbajac denied that the merger with Bombardier was taking place in order to head off a collaboration between Bombardier and the Chinese manufacturer Commercial Aircraft Corporation of China (COMAC). Instead, he argued, the merger was about expanding product lines to include a smaller medium-range aircraft, since the world market for this size of aircraft was growing. The Airbus A320 is too big for this market segment. Modern design and the composite materials used make the CS100 and CS300 cost-effective with lower fuel consumption.

The long-term volume of the world market for this category of aircraft is estimated at almost 30,000 and Airbus expects a share of 6,000 aircraft over the next two decades. High investment and development costs, the stringent licensing procedures for air transport and fierce competition are leading to a growing concentration of manufacturers working closely with their respective governments to defend their position on the world market—a race that is also intensifying political tensions.

This process entails rationalisation and cost reductions, which threaten massive job cuts. Airbus has yet to explain how jobs at Bombardier in Canada can be retained when the final assembly of the aircraft is transferred to the US.

Documents show US participation in 1965-66 massacres in Indonesia

Mike Head

Declassified documents published last week confirm that the US government was intimately involved in the campaign of mass murders conducted by the Indonesian military and Islamic organisations during the 1965-66 coup led by General Suharto.

Not only did Washington have detailed knowledge of the massacres that killed up to one million workers, peasants and suspected supporters of the Indonesian Communist Party (PKI). The US escalated covert operations to instigate the military takeover, encouraged the bloodbath, and urged the military to go further in order to overthrow President Sukarno.

Diplomats in the Jakarta Embassy kept a record of which PKI leaders were being executed, and regularly informed the US Secretary of State that tens of thousands of alleged PKI sympathisers were being murdered. It was a “fantastic switch,” one US official enthused.

This material is another warning of the utter ruthlessness of American imperialism. US governments and their diplomatic, military and intelligence agencies have a proven record of overthrowing governments and participating in immense violence and repression in order to pursue its strategic and economic interests.

In the words of one secret diplomatic cable, the United States had a “heavy stake in the outcome” of the bloody political purge. As Washington escalated the Vietnam War, it regarded Indonesia, the most populous and strategically located country in South East Asia, as a linchpin of its continued post-World War II domination of the region.

The US, led by Democrat President Lyndon Johnson, was determined to oust Sukarno, a bourgeois nationalist who collaborated with the PKI as a means of keeping control over the rising social, economic and political unrest among the many-millioned Indonesian working class and peasantry.

Suharto, who formally ousted Sukarno in March 1966, ruled Indonesia with US backing for the next 32 years before being toppled in May 1998. To this day, the country’s military retains far-reaching political and economic  power, and basic  democratic rights remain suppressed.

The 39 documents were posted on October 17 by the National Security Archive at George Washington University, after being processed by the National Declassification Center (NDC). They provide only a partial picture of Washington’s hand in one of the greatest imperialist crimes of the twentieth century.

Of the 30,000 pages processed by the NDC, several hundred documents remain confidential and are undergoing “further review.” The files do not include US Central Intelligence Agency (CIA) documents, which remain secret.

Even without the CIA material, the record is undeniable. Documents published in 1999 already proved that the US and its allies, particularly Australia, helped orchestrate the coup. They drew up lists of PKI and other figures to be assassinated, and urged on the massacres to ensure that Suharto fully seized power and established a military dictatorship.

The latest material points to covert US operations to oust Sukarno, which had been underway since at least 1956, being intensified in the lead-up to the coup. The first document, dated June 7, 1965, records US diplomats welcoming a move by army commanders in Medan, the capital of North Sumatra province, to overrule the local governor, using powers granted to the military by Sukarno himself. “Army officials clear winner in first skirmish,” the US consul in Medan, Robert Blackburn, reported to the Jakarta Embassy.

Significantly, this “first skirmish” was more than three months before the so-called September 30 Movement, an alleged PKI-orchestrated plot to kidnap and kill leading generals. Suharto seized upon this supposed plot, the circumstances of which remain highly questionable, to instigate the bloodshed.

Many examples can be cited of US culpability for the Indonesian killing fields. On October 12, 1965 recently-arrived US ambassador to Indonesia, Marshall Green, who played a key role in the coup, sent a telegram to Secretary of State David Dean Rusk reporting on a conversation with the German ambassador to Indonesia. According to the latter, “Indo Army is now considering possibility of overthrowing Sukarno himself and is approaching several Western Embassies to let them know that such a move is possible.”

The American Embassy made clear that any US aid was contingent on Sukarno being removed. In an October 23 letter, Norman Hannah, the political advisor to the commander-in-chief for the Pacific (CINCPAC) asked Ambassador Green how to respond to the “reasonable possibility that the Indonesian Army might request our help.” A week later, Green asked the Johnson administration to “explore [the] possibility of short-term one shot aid on a covert, non-attributable basis,” precipitating an expansion of US covert support that would include money, communications equipment and arms.

A November 20 Jakarta Embassy telegram to Rusk pointed to the fraudulent character of the September 30 Movement allegations. Reporting on conversations between Western observers and leading PKI members in Jakarta and central Java, including Jogjakarta, it indicated that the PKI figures had no knowledge of the supposed plot and “there was great confusion in Party ranks on what they were supposed to do.”

On November 30, a weekly embassy summary sent to the State Department said the repression had “reached the stage of mass executions in several Indonesian provinces, apparently at the behest of General Suharto in Central Java at least.”

In a December 21 weekly report, Embassy First Secretary Mary Louise Trent noted that at least 100,000 people had been killed, and lauded the “striking Army success” of its efforts to accumulate power.

US authorities knew the September 30 Movement plot was concocted as a pretext for the coup. Ambassador Green, in a March 4, 1966 telegram to the State Department said the allegations were manufactured to serve “the propaganda needs of the moment.” The military wanted to foster the notion that “the whole pro-Communist movement … should be considered guilty ‘in principle’.”

Two documents from 1967 underscored the corporate interests at stake, as Suharto’s regime sought to meet the needs of US firms by drafting a new foreign investment law and signing concession agreements with oil, mining, and timber companies.

One report noted the “red carpet treatment” afforded a Greater San Francisco Chamber of Commerce Pacific Trade Mission that arrived in Jakarta on April 18, 1967, for a week-long stay. Indonesian regime and business leaders were “cooperative and forthcoming.”

After meeting Ambassador Green, Business International Corporation chairman Elliot Haynes wrote in a diary that multinational corporations, including Uniroyal and Goodyear, were interested in setting up operations in Indonesia, while companies like Alcoa wanted lower income taxes.

US and global media outlets have barely reported the release of the documents, and provided few details of their contents. One reason is that the corporate media was complicit in the coup, assisting the US and Suharto’s regime to justify it and whitewashing the massacres.

A November 1966 report to the State Department recorded a trip embassy officials took with a New York Times reporter to central Java, accompanied by military representatives. In an early example of “embedded journalism,” officials showed off several “model” villages under military control. The author noted that the army had an “ironclad grip” on the province, complete with roadblocks, ID cards, house-to-house searches and a ban on gatherings of five people or more.

Today, the New York Times and the media establishment continue to collaborate closely with Washington as the US and its allies bomb civilians, devastate cities, assassinate people, provoke conflict after conflict, from the Middle East to Korea, and prepare for wars against their rivals, including China.

Xi Jinping consolidates grip over Chinese Communist Party apparatus

Peter Symonds

In an extraordinary step yesterday, the Chinese Communist Party (CCP) Congress not only concluded with a ringing endorsement of President Xi Jinping’s opening report. It also included his “thought” into the Chinese constitution. Barely known five years ago when he became president, Xi has consolidated his position as the “core” or indispensable strongman in the CCP apparatus.

Far from being a sign of strength, the elevation of Xi to supreme leader is a sign of crisis in the CCP regime. It is beset with mounting economic and financial turmoil, and the danger of growing social unrest at home, as well as an aggressive US administration that threatens war with North Korea and China itself.

All the key resolutions were passed overwhelmingly, if not unanimously, without significant debate. The 2,300 hand-picked delegates are not accountable to the CCP’s 89 million members, let alone the broader population. However, significant differences over economic and foreign policy exist between the rival party factions. In these circumstances, Xi has emerged as political supremo to ensure and impose party unity.

By entrenching himself in the constitution, Xi undoubtedly hopes to make his position unchallengeable. The new constitution does not simply contain a symbolic reference to “Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era.” It enshrines specific policies: the modernisation of and, absolute party control over, the army; Xi’s “One Belt, One Road” geo-strategic initiative; and target dates for enhancing China’s position in the world.

In reality, this is a sign of political weakness. It is aimed at giving constitutional legitimacy to the ongoing purge of critics and potential rivals through Xi’s so-called anti-corruption drive and suppression of dissidents who express “politically incorrect” views. The tightening up of Xi’s control of the CCP and its police-state apparatus is the preparation for looming political and social explosions.

Xi is well aware that the CCP regime is sitting atop a social time bomb. He maintains the absurd fiction that China is progressing toward socialism in a desperate attempt to obscure the gross inequities of Chinese society that the CCP’s policies of capitalist restoration have created. He told the congress social inequality is the number one challenge, but his policies of ensuring “the decisive role of market forces” and advancing “supply-side structural reform”—now enshrined in the constitution—will only widen the gulf between rich and poor.

The CCP does not represent the hundreds of millions of Chinese workers and urban and rural poor, but a tiny stratum of ultra-rich billionaires, some of whom were congress delegates, as well as layers of the wealthy middle classes, inside and outside the party.

The ideological cement to bind the party together and to subordinate the masses to the interests of the capitalist class is Chinese nationalism and xenophobia—now under the banner of Xi’s “Chinese dream of national rejuvenation,” which also has been included in the constitution.

By “national rejuvenation,” Xi means an end to China’s colonial subjugation in the 19th and early 20th centuries, and its emergence as a “strong nation” that is “moving to centre stage” in the world. “The Chinese people and nation have a great and bright future ahead,” Xi told the congress as it concluded.

Xi came to power in 2012 as US President Barack Obama was implementing his “pivot to Asia”—a comprehensive diplomatic, economic and military strategy aimed at undermining and preparing for war against China. Trump is pursuing the same US objective more openly and aggressively, reflecting the view in American ruling circles that Beijing is the key obstacle to Washington’s world dominance.

Under Xi, China has reacted by accelerating its own military build-up and its efforts to expand its diplomatic and economic influence in Asia and around the world. Xi’s signature One Belt, One Road policy involves massive infrastructure projects, including rail, roads and ports, linking the Eurasian landmass, to the exclusion of the United States. It is aimed, in particular, at encouraging the major European powers to loosen their ties to Washington.

Xi has also sought to manoeuvre with Washington. The CCP has bowed to some US demands for greater access for trade and investment in China and for punitive sanctions on North Korea, while refusing to budge on key issues such as Chinese land reclamation in the South China Sea. In his opening report to the congress, Xi declared: “No one should expect China to swallow anything that undermines its interests.”

Xi has emerged from the congress as the party’s undisputed strongman, publicly at least, but sharp differences undoubtedly remain. In 2012, a key potential rival, Bo Xilai, party boss in the major city of Chongqing, was removed on trumped-up corruption charges, expelled from the party, tried and jailed. Bo was an advocate of stronger measures to protect state-owned enterprises and a tougher response to the US “pivot.” While Bo’s closest supporters have been purged also, sections of the Chinese military no doubt continue to push for stronger measures against US provocations, particularly in the South China Sea.

At the same time, elements within the CCP apparatus are pushing for an acceleration of pro-market measures and the opening up of the Chinese economy to foreign investors. Premier Li Keqiang, who was installed in 2012 along with Xi, championed these policies and worked closely with the World Bank to draw up the China 2030 economic blueprint. Li, however, largely has been sidelined over the past five years. Xi has established key “small groups” under his control to manage many policy areas, including finance and the economy.

The congress concluded yesterday with the installation of a new central committee of 204 members and 172 alternate members. Today a central committee plenum will elect the politburo and the top decision-making body, the politburo standing committee—currently with 25 and seven members, respectively.

The committees will be stacked with Xi’s close supporters. However, the new era proclaimed by Xi will not be one of peace and stability. The attempt to hold together the sclerotic CCP apparatus through bureaucratic means only sets the stage for future political turmoil as the regime attempts to grapple with acute internal and external crises.

The American oligarchy prepares a new tax windfall for the rich

Barry Grey

The drive to enact the most massive tax cut for the rich in US history accelerated Tuesday as Donald Trump met behind closed doors with Senate Republicans to finalize the plan.

The House of Representatives is set to approve Thursday the Senate budget resolution passed last week, a parliamentary maneuver that will allow the Republicans, under expedited rules, to pass the tax plan by a simple majority in the Senate rather than a filibuster-proof three-fifths vote. The actual proposal will be released on November 1, setting the stage for the final push to secure passage by the end of the year.

Wall Street celebrated the stepped-up push for the plan with a 167-point surge in the Dow, bringing the index closer to 24,000. Since Trump was elected last November, the Dow has risen by more than 25 percent. It has quadrupled since 2009, thanks to the multitrillion-dollar bank bailout and other handouts to the corporations and banks under Obama.

The Trump tax measure, however, will raise to a new level the plundering of society’s resources by the ruling class.

Its provisions read like a Christmas wish list for the rich: slashing the corporate tax rate from 35 percent to 20 percent, generating additional corporate revenues of $6.7 trillion by 2037; reducing the top personal income tax rate from 39.6 percent to 35 percent; abolishing the alternative minimum tax, which applies only to the wealthy; and slashing to 25 percent the rate at which business owners are taxed on money recorded as “pass through” income.

It also abolishes the estate tax, which affects those worth over $5 million, just 0.02 percent of the population. This measure has long been desired by the corporate oligarchy, allowing its members to pass on to their children all the wealth accumulated through fraud and speculation, effectively establishing a form of dynastic rule.

The top 1 percent will see their after-tax income rise by 8.5 percent if all these measures are adopted. The Center for Budget and Policy Priorities estimates that half of the tax cuts will go to the top 1 percent of households, those making more than $700,000 per year. Within this group, the top 0.1 percent will receive 30 percent of the tax cuts, for an average cut of $800,000 a year.

The bottom 90 percent of the population, the working class and lower-middle class, will get little or nothing. A married couple with one child that earns less than $24,850 a year will receive no tax cut, while a similar family earning $48,700 will see a cut of just $180. At the same time, the budget deficits produced by the tax cuts will be used by both parties to demand massive cuts in social programs, including Social Security and Medicare.

As is to be expected, Trump and the Republicans are promoting the plan with shameless lying, denying that their plan is designed to benefit the rich and insisting it is aimed at cutting taxes for “hard-working Americans” and creating jobs.

The Democrats, for their part, support a huge cut in corporate taxes and are offering only token opposition to the other handouts to the rich. Following the Republican meeting on Tuesday, Senate Minority Leader Charles Schumer and other Democratic senators held a press conference. Schumer, the senator from Wall Street, accused Trump of lying about the plan but said nothing about corporate taxes. Other Democrats attacked the plan for being fiscally irresponsible.

As always, the Republicans set the reactionary framework for policy and the Democrats ensure that it is enacted virtually intact. The Democrats’ main function is to disarm the working class by creating an illusory smokescreen of democratic debate and opposition.

The Trump tax plan is the outcome of a decades-long social counterrevolution that has produced a colossal transfer of wealth from the working class to the rich and the super-rich, creating levels of social inequality unseen since the 1920s and transforming the United States into an oligarchy.

The Sixteenth Amendment to the US Constitution, granting Congress the power to tax people’s income, was passed in 1913, as part of the progressive movement’s efforts to rein in the robber barons. The estate tax was enacted at the same time.

During the Great Depression, the Roosevelt administration raised the top rate from 25 percent to 63 percent as part of the New Deal reforms aimed at heading off a socialist revolution. During World War II, the top rate peaked at 94 percent. Over the next three decades, the top rate never fell below 70 percent.

The first postwar reduction was carried out by John F. Kennedy, but this was only a foretaste of what was to come, as the ruling class adopted a policy of social counterrevolution under Ronald Reagan. The Democrats, who controlled Congress, capitulated to Reagan in 1981 and slashed the top rate from 70 percent first to 50 percent and then to 28 percent. This gradually rose back to the current rate of 39.6 percent.

At the same time, taxes on capital gains from stock and bond speculation were slashed to 25 percent as part of the inflation of the stock market that has proceeded since the 1980s. Tax cuts for the wealthy have been an essential part of the mechanism by which the stock market and other forms of financial speculation have been used as the primary mechanism for wealth accumulation by the financial aristocracy.

Wealth shares by wealth percentile, 1989-2016 surveys

The consequences are clear. Since the 1980s, the share of national income going to the top 1 percent has risen from 12 percent to 20 percent, while that of the bottom 50 percent has fallen from 20 percent to 12 percent.

The most recent Survey of Consumer Finances from the US Federal Reserve shows that the top 10 percent of Americans now own 77 percent of all wealth. The top 1 percent owns 38.5 percent, an increase even since 2013. The share of the bottom 90 percent has declined by more than two percentage points to 22.9 percent.

The impact of these shifts in wealth and income on the conditions of life of millions of people can be seen in myriad forms: declining life expectancy, rising infant and maternal mortality, rampant drug addiction and a rising suicide rate.

This growth of parasitism has coincided with the destruction of large swathes of industry, the devastation of former industrial centers all over the country, and the impoverishment of broad sections of the working class. Now, with the Trump tax cut—authored by the Goldman Sachs alumni Treasury Secretary Steven Mnuchin (net worth $500 million) and economic adviser Gary Cohn (net worth $610 million)—a new level of enrichment of the oligarchy is being launched that will make current levels of inequality seem quaint by comparison.

The conditions are being created for a social upheaval. The emerging working-class opposition must take up the demand for a massive revision of tax policy to break the stranglehold of the financial oligarchy and radically redistribute the wealth in favor of the working people. The top rate for both personal income and corporate wealth must be raised once again to what it was in the 1940s and 1950s, to end the theft of social resources and provide for the social needs of the broad masses of people.

These are in themselves democratic demands. They cannot be achieved, however, without a frontal assault on the source of the power of the corporate and financial elite: its control of economic life, and with that, the entire political system. The redistribution of wealth to the working class must be connected to the fight for workers’ power, the transformation of the giant corporations and banks into publicly owned utilities, and the socialist reorganization of economic life.

Sri Lanka: Phony moves toward democratic constitutional change

K. Ratnayake

Sri Lankan Prime Minister Ranil Wickremesinghe presented a “constitutional assembly” steering committee report last month. Although he declared the aim of a new constitution was “reconciliation and development,” the accompanying debate shows that every faction of the ruling elite is thoroughly steeped in divisive Sinhala communalism.

The report presented on September 21 will be debated for three days from October 30 to November 1, during which time the Sri Lankan parliament will meet as a constitutional assembly.

In March last year, the parliament decided to act as a constitutional assembly (CA) to prepare a new constitution. This is an anti-democratic body and not a genuine constitutional assembly directly elected by workers and poor.

The decision was backed by the ruling coalition led by the Sri Lanka Freedom Party (SLFP) and United National Party (UNP), as well as the Tamil National Alliance (TNA), Janatha Vimukthi Peramuna (JVP) and a faction of SLFP MPs supporting former president Mahinda Rajapakse.

Wickremesinghe boasted the CA would present a “consensus constitution” of all political parties for the first time since independence in 1948. However, the discussion has dragged on for more than a year and, after 60 sittings of the “steering committee,” only an interim report has been produced.

During the 2015 presidential election, President Maithripala Sirisena promised “democratic changes” to the constitution, including the abolition of the executive presidency and the strengthening of parliament to ensure “good governance.” This phony campaign, backed by the JVP, TNA and various pseudo-left organisations, was a means of exploiting popular anger toward Sirisena’s rival, the incumbent President Rajapakse, and his attacks on democratic rights.

The ousting of Rajapakse was in reality a regime-change operation backed by the US and India. Washington was hostile to Rajapakse’s close relations with Beijing and wanted Sri Lanka to line up behind its military build-up in Asia against China.

Presenting the report to parliament, Wickremesinghe said the new constitution would ensure no divisions on the basis of race, religion, ethnicity or social background. It would provide “equal distribution of the benefits of economic development … widen democracy and establish peace and stability.”

At the same time, the prime minister declared: “Sri Lanka should be a unitary state.” He stated: “We are a proud Buddhist nation. And the constitution is to be drafted on ‘Buddhist policies and principles.’”

Wickremesinghe noted the report replaced the words “unitary state” with more suitable words and formulas such as “Sri Lanka should be an undivided and indivisible country.” He said Buddhism would be given “the foremost place while assuring to all religions their rights.”

These comments demonstrated the utter hypocrisy of Wickremesinghe’s claims that the constitution will ensure no racial or religious divisions and will establish equality and democracy. His remarks are nothing but a vow to maintain the supremacy of the island’s ethnic majority Sinhalese Buddhists.

Under the banner of defending the unitary state and the “foremost place to Buddhism,” the Sinhalese ruling elite has systematically discriminated against the Tamil minority and exploited communalism to divide the working class. That resulted in the 30-year communal war against the separatist Liberation Tigers of Tamil Eelam (LTTE), which was defeated in May 2009.

Sirisena and Wickremesinghe have promised some minor concessions to the Tamil elite and its main party, the TNA, in order to strengthen bourgeois rule. The US and India, which are concerned about the risk of communal unrest, have advised the government to accommodate the TNA in a power-sharing arrangement.

The TNA earlier presented a proposal for a federal system, but later dropped it. TNA leader R. Sambandan praised the interim report, adding, “we must not be hanging on to words like federalism.” However, the TNA is hoping that the 13th Amendment to the existing constitution will be implemented, devolving greater powers to the majority Tamil provinces of the north and east.

The interim report demonstrates that the ruling coalition is not agreed on how far to go in making concessions to the Tamil elite. The UNP is proposing to merge the northern and eastern provinces—a longstanding TNA demand. But the SLFP is opposed. It demands the removal of a clause in the present constitution to hold a referendum to merge the provinces.

Just one week after the interim report was announced, Sirisena spoke at a Buddhist ceremony. He declared that the report “does not project a concept of federal state,” then added: “I will never allow a constitution that will break up this unitary status.” He affirmed there would be no “downgrading in the new constitution of any clause or paragraphs pertaining to Buddhism that are in the current constitution.”

Sirisena and Wickremesinghe campaigned to abolish the executive presidency but there is also no agreement between the ruling parties on this matter.

For all its claims to be establishing a new democratic constitution, the government is in fact preparing dictatorial rule and taking repressive measures against workers and the poor.

After nearly three years in office, the government has been discredited because of its implementation of savage, IMF-dictated austerity measures. Struggles have erupted in the plantations, power sector, petroleum industry, railways and universities, to mention a few. About 8,000 medical students have boycotted lectures for nine months, while other students are continuing to campaign against the privatisation of education.

The government depends on the betrayals of the trade unions, on one hand, and, on the other, the unleashing of the police and military to crush strikes and student protests. Fearing defeat, the ruling coalition has postponed local government and provincial council elections.

Along with these repressive measures, the government has integrated the country more closely into US war plans against China. Last week, the Sri Lankan armed forces held joint exercises sponsored by the US military in Trincomalee. Next month, US Deputy Secretary for Political Affairs Thomas Shannon will visit Colombo for a “Partnership Dialogue” between the two countries.

The Rajapakse-led faction of the SLFP, with the backing of various chauvinist groups and Buddhist monks, has launched a virulent communal campaign. While participating in the CA, this faction is accusing the government of seeking to divide the country and create a federal system to satisfy the TNA.

In a statement on October 16, Rajapakse warned the government to stop its “destructive measures.” He is seeking to exploit the growing opposition to the government and divert it into reactionary communal channels. He is openly campaigning to topple the government.

The struggle for genuine democratic rights is bound up with the fight against war and attacks on living conditions. In the struggle for a secular democratic state, every form of discrimination, including on a racial or religious basis, must be opposed. These tasks can be achieved only by the working class, supported by the oppressed masses, in the fight for socialism.

Australian spy agency promotes anti-China witch-hunt

Oscar Grenfell 

The Australian Security Intelligence Organisation (ASIO), the country’s main domestic spy agency, used its annual report, released last Wednesday, to further fuel a hysterical media campaign alleging widespread Chinese “interference” in Australian politics.

ASIO’s public reports are always highly political documents. Their purpose is not to disclose the agency’s activities, but to promote the anti-democratic agenda of successive governments, including ramping up the powers of ASIO and the entire military-intelligence apparatus.

For the past 16 years, ASIO’s reports have centred on declarations that Australia is threatened by “Islamist terrorism.” Such claims have been used to justify Australia’s role in predatory US-led wars in the Middle East, and sweeping inroads into civil and political rights.

This year’s report, while maintaining the “war on terror” rhetoric, includes vague and unsubstantiated assertions that “foreign powers” are conducting a wide-ranging campaign of “espionage” and “covert influence operations.” It declares that the “the scale of the threat to Australia and its interests is unprecedented.”

ASIO did not name any “foreign powers.” But the media outlets that function as little more than adjuncts of the intelligence agencies and the political establishment, filled in the gap.

An article in the Murdoch-owned Australian newspaper was headlined “ASIO battling spy threat from China and Russia.” The state-owned Australian Broadcasting Corporation (ABC) declared that unnamed “government officials … believe China is becoming more aggressive with its activities against Australia.”

As in previous “exposures” of supposed Chinese “espionage” and “political interference,” the articles provided no evidence or detail for their sweeping assertions. That is because they are part of what can be described only as a long-running exercise in state-propaganda.

The purpose of the repeated anti-China campaigns by the ABC, Fairfax and Murdoch-owned publications has been to legitimise Australia’s central role in US plans for war in the Asia-Pacific, including against North Korea, and, above all, China.

This is in line with Australia’s integration into Washington’s “pivot to Asia,” a vast military build-up in the region, announced by US President Barack Obama in 2011 from the floor of the Australian parliament. Since then, Labor and Liberal-National governments have expanded US basing arrangements and deepened the collaboration between the Australian and American militaries.

ASIO’s report coincided with Australian involvement in US provocations against North Korea, including the deployment of two Australian frigates to waters near the Korean peninsula, ready to participate in any US-launched attack.

Because these policies are deeply unpopular, they cannot be discussed openly. To fill the breach, and attempt to create a nationalist and pro-war atmosphere, lies and fabrications are invented out of whole cloth, presenting China as an aggressive power and an imminent danger to Australia.

In its report, ASIO asserts, without evidence: “Foreign intelligence services sought access to privileged and/or classified information on Australia’s alliances and partnerships.” It warns of “foreign powers clandestinely seeking to shape the opinions of members of the Australian public, media organisations and government officials.”

ASIO claims that by “seeking to unduly influence public perceptions of issues,” these activities “represent a threat to our sovereignty, the integrity of our national institutions and the exercise of our citizens’ rights.”

This is in line with several joint “investigations,” earlier this year, by the ABC and Fairfax, conducted in close collaboration with ASIO. The investigations “exposed” that a handful of Chinese-born businessmen made donations to the Labor, Liberal and National parties.

These were supposedly part of a coordinated campaign by the Chinese Communist Party to “interfere” in Australian politics, even though the businessmen named included long-time Australian citizens and avowed opponents of the Chinese government.

University research funded by Chinese companies has been targeted also in the witch-hunt. Fairfax publications and the Guardian recently warned that research into areas such as marine technologies and solar power may, in the future, have military implications.

The ASIO report obliquely concedes that the activities are benign and mundane. It cynically states, “activities that may appear relatively harmless today can have significant future consequences.”

ASIO’s rhetoric mirrors the McCarthyite campaign being waged by the US intelligence agencies, in league with the Democratic Party and the corporate press, against supposed “Russian interference” in American politics.

In addition to pressing for the Trump administration to escalate the confrontation initiated by the Obama administration against Russia, it seeks to present growing opposition to militarism, social inequality and poverty among ordinary people as the result of a Kremlin plot.

ASIO’s report foreshadows a similar crackdown on democratic rights, in the name of combatting an external “enemy.” It declares that the agency is “no longer meeting key performance indicators” and demands more resources for “personnel security assessments” and other measures to counter “foreign influence.”

In June, the spy agency demanded the extension of sweeping powers, associated with draconian anti-terror laws, to “foreign interference” investigations. These powers include secret detention and questioning for seven days without charge.

The Liberal-National government this month also issued draft legislation that would give relevant ministers sweeping “last resort” powers to impose binding directives on owners of “critical infrastructure,” including barring them from selling assets to foreign companies. The new laws are being advanced on the pretext of combatting “foreign espionage,” “sabotage” and “coercion.”

Last month, the Fairfax-owned Sydney Morning Herald reported that the government plans new legislation to target Chinese “sub-espionage,” including the creation of a foreign agent registry.

Among those identified by Fairfax as potential targets was a lobby group of Chinese-Australians contesting local elections. Chinese associations previously have been denounced for opposing aggressive US military activities against China in the South China Sea.

Chinese international students, who number an estimated 140,000, have been branded in media reports as a potential “fifth column” of the Chinese government.

ASIO’s report followed by an unprecedented address earlier this month by Frances Adams, the head of the Department of Foreign Affairs, whose remarks were later reinforced by Foreign Minister Julie Bishop.

Speaking at the University of Adelaide’s Confucius Centre, a body funded by the Chinese government, Adams warned “international students” that the “silencing of anyone in our society—from students to lecturers to politicians—is an affront to our values.”

Adamson was apparently referencing sketchy reports that inflated minor disagreements between Chinese students and lecturers, allegedly over how Chinese foreign policy was presented in classes.

Adamson told the students that when they disagreed with something, they should not “blindly condemn,” but “respectfully engage.” The thinly veiled message was that Chinese students are welcome to study and pay their exorbitant fees, but should think twice before disagreeing with the Australian government or its plans for war against China.

A week later, on October 15, reports appeared in the ABC and Fairfax, declaring that Australia was at the centre of a push by the “Five Eyes” spying network, headed by the US, to counter “China’s pervasive and subversive influence,” especially at universities.

The reports were based on statements by an unnamed “senior foreign diplomatic figure,” who menacingly told the ABC: “It’s time for the federal government to insist the Chinese comply with Australia’s values and interests.”

The campaign is a warning to students, young people and the entire working class. It presages more direct forms of political repression, as opposition mounts to the criminal and reckless US and Australian preparations for war against North Korea and China.

Airbnb and eBay paying virtually no tax in the UK

Margot Miller 

Two of the world’s largest corporations, Airbnb and eBay, have paid virtually no tax in the UK.

Last year Airbnb Payments UK paid a derisory £188,000 in taxes to the UK Treasury—£8,000 less than in 2015. This was despite collecting £657 million in rents and making a pre-tax profit of £960,000.

Airbnb Payments is one of two UK subsidiaries of the web-based multinational Airbnb. The other subsidiary, Airbnb UK, which markets the web site for British consumers, did not pay a penny in tax, even though its pre-tax profits amounted to £463,000.

It evaded paying tax quite legally, by issuing each of its employees with shares that are tax deductible, thus shifting profits away from taxable income.

Airbnb links travellers and holidaymakers in 65,000 cities with landlords/homeowners, undercutting hotels and bed and breakfasts. Taking a commission from landlords—3 percent for each booking and a 6-12 percent service charge from guests—it is a highly lucrative business. The company has mushroomed since it was founded in San Francisco in 2008, so that today it is valued at $24 billion and is planning to diversify into commissioning tours.

The company has been accused of driving up rents and contributing to housing shortages, as private landlords can generate bigger rental income from short-term lets. This led to protests earlier in the year in Barcelona, Spain, where 3,000 people are homeless.

Internet auction giant eBay managed to massively avoid paying tax, causing its US account managers to boast of £233 million in tax savings. While eBay’s main UK arm raked in profits of £7.7 million from advertising and marketing, its tax bill came to £1.6 million.

Fees charged for web site listings, however, were booked through Luxembourg and Switzerland, so that out of £1 billion of sales last year in the UK, only £200 million were shown on the books for UK tax purposes.

This is the latest in a growing list of high-tech giants revealed to be carrying out similar operations. Their kid gloves treatment by the authorities is in stark contrast to ordinary taxpayers, who face severe penalties if they fail on their tax bills.

While profits soar to exponential heights, these corporations engage in myriad complex scams to evade paying even the minimal and ever decreasing corporation tax rates taxes levied by governments.

Last week a report by the Organisation for Economic Co-operation and Development and the G20 revealed that laws permitting companies to shift profits to tax havens meant that between $100 billion and $240 billion tax revenue was lost annually—accounting for up to 10 percent of global tax revenues.

This vast amount could resolve much of the world’s social ills. According to US-based global finance company, Goldman Sachs, it would cost about $175 billion per year to end extreme poverty worldwide in 20 years.

The European Commission is currently investigating Amazon, Google, a division of the Fiat motor company, Starbucks and Uber over their tax arrangements with EU states.

The commission recently ordered Luxembourg to reclaim £224 million from online retailer Amazon over a concessionary tax deal it made with the company, following a three-year investigation. At the time the deal was struck in 2003, the prime minister of Luxembourg was Jean-Claude Juncker—now president of the European Commission.

Last year Google paid the Italian authorities €306 million to end a criminal investigation into its decades-long tax avoidance practises. This amounts to small change for parent company Alphabet, worth $26 billion and growing.

The usual corporation tax rate in Ireland is 12.5 percent—less than half the European average and nearly a third the US rate of 35 percent—though the Trump administration is in the process of substantially lowering this. Corporation tax is levied in the UK at 19 percent, falling to 18 percent by 2020.

In 2014, the social network giant Facebook paid £4,327 to the UK treasury. This was less tax than an average Facebook employee earning an annual salary of £26,000, who would pay £5,392 in tax and insurance.

Last January, Facebook reported a 34 percent increase in profits from the previous quarter, up to £462 million. Total profits for the year amounted to $2.9 billion, double the profits amassed in 2013.

Facebook paid share bonuses worth £96,000 to each of its 362 UK employees, enabling it to register a pre-tax loss of £28.5 million loss with the Treasury.

Another way Facebook UK avoids tax is by billing advertising customers via Facebook Ireland Ltd. Facebook Ireland Ltd makes little profit on paper because it makes payments to Facebook’s parent company in the US and royalty payments to Facebook Ireland Holdings, which owns the rights to use of the platform.

Prior to this, an EU investigation into Starbucks uncovered that in the 14 years the Seattle-based chain has been operating in the UK, it has only paid £8.6 million in corporation tax. Since being exposed, fearful of customers boycotting its products, the company has promised to pay the Treasury additional amounts of corporation tax, but this will be just £20 million in each of the next two years.

The car service company Uber is using UK and EU tax loopholes to avoid paying VAT (value added tax). It does this by treating its 40,000 UK drivers as self-employed workers, i.e., separate businesses that are too small to qualify for VAT payments. As a result, the approximate tax avoided for 2015 was £20 million.

Uber drivers, who have no employment rights, have reported earning as little as £5 an hour after expenses.

This month, Transport for London made the announcement that the company’s minicab driver’s licence would end in September, unless it appealed. However, if Uber drivers lose their jobs they face destitution, as many have accrued debts to pay for the new cars demanded by Uber as a condition of employment.

The EU Commission has estimated that Fiat has avoided tax bills of €20 million and €30 million in the last three years in deals with Luxembourg authorities.

The super-rich continue to avoid taxes. In 2009, Her Majesty’s Revenue and Customs (HMRC) set up a specialist unit to chase up £2 billion in missing tax revenues, following the public outcry after the release of the “Panama Papers” in 2016.

The Papers consisted of 11.5 million files, leaked from the database of the world’s fourth biggest offshore law firm, Mossack Fonseca. They revealed the many nefarious operations of the rich, who use offshore tax havens to protect their personal fortunes.

Since 2009, while total UK tax receipts have increased, the share paid by the super-rich actually fell, in 2015, by £900 million. As wealth inequality widens even further, the bottom 90 percent of society are proportionally being asked to pay far more.

At the beginning of the year UK Prime Minister Theresa May said that local authorities, which provide essential services, could increase council tax by up to 6 percent to offset cuts in central government funding.

Governments today exist only to offer transnational corporations the best conditions to reap vast profits. Last year the EU’s competition authorities ordered US technology giant Apple to pay the Irish government more than €13 billion euros in back taxes. The California-based company had reported its Europe-wide profits in shell companies in Ireland, after sealing a sweetheart deal with the Irish government to pay virtually no tax—just 0.005 percent in 2014 and an average rate of 1 percent over 25 years.

Earlier this month it emerged that Brussels is considering court action against Ireland over its failure to collect the billions it is owed by Apple.