Oil, Agriculture and Imperialism: Averting the Fast-Track to Armageddon?

Colin Todhunter

US National Security Advisor John Bolton has more or less admitted that the ongoing destabilisation of Venezuela is about grabbing its oil. He recently stated:

“We’re looking at the oil assets… We’re in conversation with major American companies now… It will make a big difference to the United States economically if we could have American oil companies really invest in and produce the oil capabilities in Venezuela.”

The US’s hand-picked supposed leader-in-waiting, Juan Guaido, aims to facilitate the process and usher in a programme of ‘mass privatisation’ and ‘hyper-capitalism’ at the behest of his coup-instigating masters in Washington, thereby destroying the socialist revolution spearheaded by the late Hugo Chavez and returning to a capitalist oligarch-controlled economic system.

One might wonder who is Bolton, or anyone in the US, to dictate and engineer what the future of another sovereign state should be. But this is what the US has been doing across the globe for decades. Its bloody imperialism, destabilisations, coups, assassinations, invasions and military interventions have been extensively documented by William Blum.

Of course, although oil is key to the current analysis of events in Venezuela, there is also the geopolitical subtext of debt, loans and Russian investment and leverage within the country. At the same time, it must be understood that US-led capitalism is experiencing a crisis of over-production: when this occurs capital needs to expand into or create new markets and this entails making countries like Venezuela bow to US hegemony and open up its economy.

For US capitalism, however, oil is certainly king. Its prosperity is maintained by oil with the dollar serving as the world reserve currency. Demand for the greenback is guaranteed as most international trade (especially and significantly oil) is carried out using the dollar. And those who move off it are usually targeted by the US (Venezuela being a case in point).

US global hegemony depends on Washington maintaining the dollar’s leading role. Engaging in petrodollar recycling and treasury-bond ‘super-imperialism’ are joined at the hip and have enabled the US to run up a huge balance of payments deficit (a free ride courtesy of the rest of the world) by using the (oil-backed) paper dollar as security in itself.

More generally, with its control and manipulation of the World Bank, IMF and WTO, the US has been able to lever international trade and financial systems to its advantage by various means (for example, see this analysis of Saudi Arabia’s oil money in relation to African debt). US capitalism will not allow its global dominance and the role of the dollar to be challenged.

Unfortunately for humanity and all life on the planet, the US deems it necessary to attempt to prolong its (declining) hegemony and the age of oil.

Oil, empire and agriculture

In the article ‘And you thought Greece had a problem’, Norman Pagett notes that the ascendance of modern industrialised humans, thanks to oil, has been a short flash of light that has briefly lifted us out of the mire of the middle ages. What we call modern civilisation in the age of oil is fragile and it is becoming increasingly difficult and expensive to extract remaining oil reserves. The age of oil is a driver of climate change, that much is clear. But what is equally disturbing is that the modern global food regime is oil-dependent, not least in terms of the unnecessary transportation of commodities and produce across the planet and the increasing reliance on proprietary seeds designed to be used with agrochemicals derived from petroleum or which rely on fossil fuel during their manufacture.

Virtually all of the processes in the modern food system are now dependent upon this finite resource:

“Vast amounts of oil and gas are used as raw materials and energy in the manufacture of fertilisers and pesticides, and as cheap and readily available energy at all stages of food production: from planting, irrigation, feeding and harvesting, through to processing, distribution and packaging. In addition, fossil fuels are essential in the construction and the repair of equipment and infrastructure needed to facilitate this industry, including farm machinery, processing facilities, storage, ships, trucks and roads. The industrial food supply system is one of the biggest consumers of fossil fuels and one of the greatest producers of greenhouse gases.” Norman J Church (2005)

Pagett notes that the trappings of civilisation have not altered the one rule of existence: if you don’t produce food from the earth on a personal basis, your life depends on someone converting sunlight into food on your behalf. Consider that Arabia’s gleaming cities in the desert are built on its oil. It sells oil for food. Then there is the UK, which has to import 40 per cent of its food, and much of the rest depends on oil to produce it, which also has to be imported. Pagett notes that while some talk about the end of the oil age, few link this to or describe it as being the end of the food age.

Without oil, we could survive – but not by continuing to pursue the ‘growth’ model China or India are pursuing, or which the West has pursued. Without sustainable, healthy agriculture, however, we will not survive. Destroy agriculture, or more precisely the resources to produce food sustainably (the climate, access to fresh water and indigenous seeds, traditional know-how, learning and practices passed on down the generations, soil fertility, etc.), which is what we are doing, and we will be in trouble.

The prevailing oil-based global food regime goes hand in hand with the wrong-headed oil-based model of ‘development’ we see in places like India. Such development is based on an outmoded ‘growth’ paradigm:

“Our politicians tell us that we need to keep the global economy growing at more than 3% each year – the minimum necessary for large firms to make aggregate profits. That means every 20 years we need to double the size of the global economy – double the cars, double the fishing, double the mining, double the McFlurries and double the iPads. And then double them again over the next 20 years from their already doubled state.” – Jason Hickel (2016)

How can we try to avoid potential catastrophic consequences of such an approach, including what appears to be an increasingly likely nuclear conflict between competing imperial powers?

We must move away from militarism and resource-gabbing conflicts by reorganising economies so that nations live within their environmental means. We must maximise human well-being while actively shrinking out consumption levels and our ecological footprint.

Some might at this point be perplexed by the emphasis on agriculture. But what many overlook is that central to this argument is recognising not only the key role that agriculture has played in facilitating US geopolitical aims but also its potential for transforming our values and how we live. We need a major shift away from the current model of industrialised agriculture and food production. Aside from it being a major emitter of greenhouse gases, it has led to bad food, poor health and environmental degradation and has been underpinned by a resource-grabbing, food-deficit producing US foreign policy agenda for many decades, assisted by the WTO, World Bank, IMF and ‘aid’ strategies. For instance, see ‘Sowing the Seeds of Famine in Ethiopia’ by Michel Chossudovsky and ‘Destroying African Agriculture’ by Walden Bello.

The control of global agriculture has been a tentacle of US capitalism’s geopolitical strategy. The Green Revolution was exported courtesy of oil-rich interests and poorer nations adopted agricapital’s chemical-dependent model of agriculture that required loans for inputs and related infrastructure development. It entailed trapping nations into a globalised system of debt bondage, rigged trade relations and the hollowing out and capture of national and local economies. In effect, we have seen the transnational corporate commercialisation and displacement of localised productive systems.

Western agricapital’s markets are opened or propped up by militarism (Ukraine and Iraq), ‘structural adjustment’ and strings-attached loans (Africa) and slanted trade deals (India). Agricapital drives a globalised agenda to suit its interests and eradicate impediments to profit. And it doesn’t matter how much devastation ensues or how unsustainable its food regime is, ‘crisis management’ and ‘innovation’ fuel the corporate-controlled treadmill it seeks to impose.

But as Norman J Church argues, the globalisation and corporate control that seriously threaten society and the stability of our environment are only possible because cheap energy is used to replace labour and allows the distance between producer and consumer to be extended.

We need to place greater emphasis on producing food rooted in the principles of localisation, self-reliance, (carbon sequestrating) regenerative agriculture and (political) agroecology and to acknowledge the need to regard the commons (soil, water, seeds, land, forests, other natural resources, etc) as genuine democratically controlled common wealth. This approach would offer concrete, practical solutions (mitigating climate change, job creation in the West and elsewhere, regenerating agriculture and economies in the Global South, etc) to many of the world’s problems that move beyond (but which are linked to) agriculture.

This would present a major challenge to the existing global food regime and the prevailing moribund doctrinaire economics that serves the interests of Western oil companies and financial institutions, global agribusiness and the major arms companies. These interlocking, self-serving interests have managed to institute a globalised system of war, poverty and food insecurity.

The deregulation of international capital flows (financial liberalisation) effectively turned the world into a free-for-all for global capital. The further ramping up of US militarism comes at the back end of a deregulating/pro-privatising neoliberal agenda that has sacked public budgets, depressed wages, expanded credit to consumers and to governments (to sustain spending and consumption) and unbridled financial speculation. This relentless militarism has now become a major driver of the US economy.

Millions are dead in Iraq, Syria, Libya and Afghanistan as the US and its allies play out a continuation of what they regard as a modern-day ‘Great Game’. And now, in what it arrogantly considers its own back yard, the US is instigating yet another coup and possible military attack.

We have Western politicians and the media parroting unfounded claims about President Maduro, like they did with Assad, Saddam Hussein, Qaddafi and like they do about ‘Russian aggression’. All for what? Resources, pipelines, oil and gas. And these wars and conflicts and the lies to justify them will only get worse as demand across the world for resources grows against a backdrop of depletion.

We require a different low-energy, low-carbon economic system based on a different set of values. As the US ratchets up tensions in Venezuela, we again witness a continuation of the same imperialist mindset that led to two devastating world wars.

How the Age of Billionaires Ends

Josh Hoxie

Every month or so there’s a stunning new headline statistic about just how stark our economic divide has become.

Understanding that this divide exists is a good start. Appreciating that a deeply unfair and unequal economy is problematic is even better. Actually doing something about it — that’s the best.

As 2020 presidential hopefuls start trying to prove their progressive bona fides, serious policies to take on economic inequality are at the forefront. These ideas don’t stand much of a shot of becoming law in the Trump era, of course. But if the balance of power shifts, so too does the potential for these paradigm-shifting new programs.

Let’s take a closer look at the problems they’ll have to address.

A new billionaire is minted every two days, according to a recent Oxfam study. As a result, the top 0.1 percent owns a greater share of the nation’s wealth than the bottom 90 percent combined.

The richest dynastic families in the United States have seen their wealth expand at a dizzying pace. The three wealthiest families — the Waltons, the Kochs, and the Mars — increased their wealth by nearly 6,000 percent since 1983.

In other words, the rich in the United States have accumulated a metric crap ton of money. And what are they doing with this immense wealth and power?

Dan Gilbert (#71 on the Forbes 400) just bought the world’s first mega-yacht, with an IMAX theater on it, for $100 million. Hedge fund billionaire Kenneth Griffin (#45) just broke the record for the highest price ever paid for a house — $238 million — for an apartment in Manhattan’s “Billionaires’ Row.”

Add in a few private jets, a couple of absurd presidential runs, and those Trump tax cuts, and you get a pretty accurate depiction of the priorities of billionaire spending.

Meanwhile, the rest of the country isn’t shopping for yachts and jets. Most families are forced to work longer hours for lower wages.

Despite massive increases in growth and productivity, the median family saw their wealth go down over the past three decades, not up. The proportion of families with zero or negative wealth (meaning they owe more than they own) jumped from 1 in 6 to 1 in 5.

Relatedly, our roads and bridges our crumbling and our public schools are desperately underfunded.

It doesn’t take an economist to tell you this isn’t sustainable. So what about those policies to do something about it?

Senator Bernie Sanders has proposed a robust addition to the federal estate tax. Billionaires under his plan would pay a top rate of 77 percent on whatever they bequeath to their heirs over $1 billion. (Far from a new idea, Sanders is merely proposing reinstating the top rate in place from 1941 to 1976.)

Senator Elizabeth Warren, not to be outdone, has proposed a direct tax on concentrated wealth targeting modern day wealth hoarders. Her plan would impose a progressive annual tax starting at 2 percent on assets over $50 million and rising to 3 percent on assets over $1 billion.

And at least one member of Congress who isn’t running for president, Rep. Alexandria Ocasio-Cortez, has gotten in on the action. She’s proposed raising the top marginal tax rate to 70 percent (only on income over $10 million, contrary to what you might hear on Fox News).

Three bold ideas to stem our skyrocketing economic inequality, three ways to tax the ultra-rich, three policies unlikely to become law given the current administration.

Yet these ideas are more than mere platitudes. Poll after poll shows big majorities of Americans ready to see the rich pay their fair share — and worried about the economic power consolidating in the upper echelons.

When the political moment arrives, we won’t have to wonder what’s coming.

Civil Society Matters to the Sustainable Development Goals

Peter J Jacques

Life and death for whole communities hang in the balance of achieving the 17 Sustainable Development Goals (SDGs) that include eliminating poverty, conserving forests, and addressing climate change, passed by the United Nations unanimously in 2015. Take for example, the Indigenous Amazigh people who live in the mountains around Marrakech. They are representative of people who need to be served first by sustainable development.

The High Atlas Amazigh people experience hard lives in small villages. Most work as day laborers and agriculturalists with barely enough income to support their families and heat their homes. Education is a major concern, but is hard to attain for a number of reasons. Sometimes families cannot afford the subsequent costs of backpacks and books, even when the school is open and free. The challenge is especially difficult for girls, because, as one person explained, “How can fathers let their girls study if it is dark when they must travel?” The effect of incomplete education is profound, and when we asked one 62-year-old man what he thought the greatest threats to the future were for his community, he did not have confidence in his own experiences, noting, “What can I say? I am not read [educated].”

Through a partnership of the University of Central Florida (Orlando), The Hollings Center for International Dialogue (Washington D.C. and Istanbul), and the High Atlas Foundation (Marrakech), we recently conducted field work in the High Atlas Mountains, speaking with the people there who poured their hearts out to us.

The most consistent message we heard from the people of the High Atlas was that the future hinges on water. One group told us that when things are good, it is because the rain is abundant and on time; things are very hard otherwise. They are worried that climate change will affect if the rains come, or that the rain will not “come in its time.” They have good reason to worry because climate change is expected to decrease precipitation significantly, reducing streams, lakes, and groundwater.

Drought is a constant worry. The World Bank estimates that 37 percent of the population works in agriculture, meanwhile production of cereal crops varies wildly due to annual variation of precipitation– and 2018 was thankfully a bountiful year. Climate change will make the people of the High Atlas Mountains much more vulnerable while they are already living on the edge of survival. In one area, this change in precipitation timing and amount was already noticeable, resulting in a significant loss of fruit trees. In that same area, we were told that there is fear that there will be no water in twenty years, and that for these people who are deeply connected to the land, there will be “no alternatives.”

The High Atlas people are in an extremely vulnerable position. One group noted that they are so desperate for basic resources that they burn plastic trash to heat their water. Worse, they believe they have been left behind by society and that “the people of the mountains do not matter.” They feel that Moroccan society is deeply unfair—there is no help for the sick, little support for education, little defense against the cold, and that, for some, corruption is the greatest threat to a sustainable future.

Consequently, civil society has an important role in achieving the SDGs. The High Atlas Foundation has been working to help people in this region to organize themselves into collectives that decide both what the collective wants, and pathways to achieve those goals. Women have organized into co-ops that they own and they collect dividends from their products together. People in one coop lobbied the 2015 Conference of Parties climate meeting in Marrakech. Men’s associations have developed tree nurseries that not only produce income, but which protect whole watersheds – and therefore some water for the future. They are also participating in carbon sequestration markets. In this regard, the Marrakech Regional Department of Water and Forest provides them carob trees and the authorization to plant these trees on the mountains surrounding their villages.

However, perhaps the most important element of these collectives is that they give each person in them a voice. Leaders of these collectives have formal rights to approach the regional governments about their needs, and this voice would not be heard at all without the formal collective organization. These organizations cannot replace government services, but they do add capacity to the community.

Not only do these collectives lend people some influence over their current and their children’s lives, they love each other and they are not struggling alone. We witnessed profound solidarity. Repeatedly, the collectives told us “We love each other, we are one family,” “We are like one,” “We help each other,” and the conviction that “I will be with you.”The world is decidedly on an unsustainable path, so If we are going to meet SDGs, all the people like the people of the High Atlas Mountains must matter and their voice deserves to be heard.

Germany is preparing for economic war

Peter Schwarz 

The “National Industrial Strategy 2030,” presented to the press by Economics Minister Peter Altmaier (Christian Democratic Union, CDU) on Tuesday, is the economic policy counterpart to the 2016 “ White Paper on Security Policy .” In the White Paper, the grand coalition of Christian Democrats and Social Democrats had committed itself to a massive rearmament of the Bundeswehr(armed forces) to impose Germany’s worldwide interests by military means. Now Berlin is putting economic policy on a war footing.

Altmaier’s strategic guidelines break with the mantra of “free competition,” which had previously characterised the policy of the German bourgeoisie. While the paper still references the “market economy,” it makes significant exceptions.

“Industrial policy strategies are experiencing a renaissance in many parts of the world, and there is hardly a successful country that relies solely and invariably on market forces to accomplish its tasks,” it states. “There are strategies of rapid expansion with the clear aim of conquering new markets for one’s own economy and, wherever possible, monopolizing them.”

This is what the Germany government is also aiming for. A German and European policy that suppressed these economic policy challenges and left them unanswered, “would leave one’s own companies weakened and alone in a difficult phase,” the paper states, which pursues the megalomaniacal goal of contributing to “industrial leadership at the national, European and global level in all relevant sectors ... together with big business players.”

This is to be achieved mainly by two means:

On the one hand, the government wants to promote the emergence of financially powerful, market-leading monopolies that can counter their American and Chinese competitors “on an equal footing.” To this end, German and European competition law should be “reviewed and, if necessary, amended.”

“National and European Champions: Size Counts!” runs a subheading in the Altmaier paper. “The emergence of a comprehensive world market in more and more sectors raises the question of the critical size required for an industrial player to compete successfully internationally.” Examples include the construction of large commercial aircraft, the creation and modernization of railway systems, major Internet platforms, plant construction and international finance and banking. They all demand “large and strong players who stand as equals with competitors from the US or China.”

It was cause for concern that hardly any new companies of this size had been created in Germany for years. In the US and China, however, “in the last 20 years, many new large world market corporations have emerged, in particular in the field of telecommunications technologies, the Internet and digitization.”

On the other hand, the German government wants to promote and protect certain sectors of the economy, regarded as key technologies. These are, “Internet Companies of the Platform Economy,” “Artificial Intelligence (AI),” “New Biotechnologies,” “Autonomous Driving Innovation” and “The Creation of Novel Mobility Concepts” in the automotive industry.

“Almost all innovation-driven areas, notably those of digitization and AI, are creating new, large and globally successful companies possessing tremendous capital resources and market power beyond that of any single Dax company. This development has so far evaded Germany,” states the paper.

The fact that this also means trade-war measures against international competitors is only hinted at in the paper; after all, one does not want to alarm one’s opponents. But discussion about the exclusion of the Chinese company Huawei from the billion-dollar construction of the G5 mobile network makes more than clear that this is the case.

Up to now, criticism of Altmaier’s industrial strategy has mainly been drawn from business-related circles, who fear the state is interfering too heavily in their affairs. For example, the economics professor Lars Feld was critical that it was “at best, about French economic tradition, and at worst, planned economy.” He hoped “that this concept disappears as quickly as possible,” said the member of the Council of Experts on the Assessment of Macroeconomic Development.

Altmaier’s concept of “planned economy” has absolutely nothing to do with this in the socialist sense. The bourgeois state does not intervene in the economy to stifle the profits of the capitalists, to siphon off their gigantic assets, and to reorganize the economy in the interest of the whole society; it stands at the service of the most powerful corporations and banks to support them in the battle for markets, raw materials and spheres of influence—a development that inevitably leads to trade war and war.

Many passages in the Altmaier paper read like a modern illustration of the book Imperialism, the Highest Stage of Capitalism, written by Lenin in the midst of the First World War. He pointed out, “It is proved in the pamphlet that the war of 1914-18 was imperialist (that is, an annexationist, predatory, war of plunder) on the part of both sides; it was a war for the division of the world, for the partition and repartition of colonies and spheres of influence of finance capital, etc.”

Lenin demonstrated that imperialism is not merely a wrong policy to which there are alternatives, but that it arises directly out of the developmental tendencies of capitalism: the replacement of free competition through monopolies, the dominance of finance capital, and the merging of the state with the tops of the economy. Therefore, the First World War could only be ended by the socialist revolution, by the overthrow of capitalism by the working class.

We are experiencing a similar development today, but at a much higher level. The tremendous potential of modern technologies and the global integration of production do not make the burden of labour any lighter, nor do they raise the cultural and material levels of humanity, and solve urgent societal problems—exploitation, poverty, health, education, the environment. Rather, they lead to the formation of monopolies that fiercely combat each other, to the immeasurable enrichment of a small financial aristocracy, to increasing poverty for the masses, and to the growing danger of a war between the major powers.

Just two years after Donald Trump entered the White House to cries of “America first!” the German government now shouts out, “Germany (and Europe) first!”—and will only accept a Europe that is dominated by Berlin. This is the significance of the Altmaier paper.

This is enthusiastically supported by the Social Democratic Party (SPD) and the trade unions, which will not be outdone by anyone—not even the far-right Alternative for Germany (AfD)—when it comes to fueling nationalism.

In a press release, Bernd Westphal, political spokesman for the SPD parliamentary group, welcomed Altmaier’s initiative. “We support a readjustment of European competition law,” he wrote. “The emergence of European champions, which should exist on the world market, must not be prevented by a too narrow European market view.”

Wolfgang Lemb, an executive board member of the IG Metall union, also backed the Altmaier paper. The idea of an industrial strategy was “correct and important.” The federal government must be “more involved than before in the debate about a common European industrial strategy,” he said. It was important to “extend national industrial policy leeway in competition and procurement law, identify key European industries and promote them with industrial and structural policy instruments, such as structural funds or a European Investment Bank.”

The union functionary understands very well that this means further attacks on workers’ wages and working conditions. This is also evident from the Altmaier paper. The “great advantage of German industry in terms of technology and quality,” it says, which has offset the “advantage of much lower labour and manufacturing costs in important emerging markets,” was melting away “slowly but clearly.” As a result, “competitive pressure is increasing, even where German companies have so far been unrivaled.”

Workers can only defend their wages, jobs and living conditions by rejecting the government’s nationalist policies, breaking with the unions and joining forces internationally to fight for a socialist programme to overthrow capitalism.

Corporate tax cuts in UK save big business billions of pounds

Barry Mason

Tax cuts being implemented by Theresa May’s Conservative government will save big business billions of pounds, as austerity measures continue to pauperise millions of workers. Corporation tax will be slashed from its current figure of 19 percent to a 17 percent rate effective from April 2020.

HM Revenue and Customs (HMRC) estimates that the planned cut to 17 percent would mean a revenue shortfall of £5.8 billion in the year 2020-21 and £6.2 billion the following year. The estimated 1 percent rise in corporation tax would produce £2.8 billion to £3.1 billion a year for government revenues, so a 2 percent cut in the tax would mean a loss of around £6 billion a year to the public purse.

The proposed cut in corporation tax to 17 percent was first announced in 2016. According to Adam Corlett of the Resolution Foundation, it was initially estimated a 2 percent reduction in corporation tax would mean a reduction in revenue of around £2.5 billion, but the new HMRC analysis shows it will be double that.

Corporation tax brings in around £60 billion a year in revenue for the government. According to analysis by the Institute for Fiscal Studies, previous cuts in corporation tax led to a reduction of around £16.5 billion a year in revenue, between 2010 and 2016.

At 19 percent, the corporation tax rate is already the lowest among the G7 leading economies. Its reduction to 17 percent would bring it into line with corporation tax rates in countries such as Singapore (17 percent), Taiwan (17 percent) and Switzerland (17.77 percent).

The rate of corporation tax has been steadily reduced over four decades. Set at 52 percent when Thatcher came to power in 1979 it was down to 34 percent when she was forced out of office in 1991. Over the decade from 2008’s global financial crash, the rate fell by nearly a further 10 percent. By 2008, the rate had fallen to 28 percent and then to a record low of 24 percent in 2010 under Tory Chancellor George Osborne. The following year, Osborne boasted that his latest budget laid the basis to establish Britain as the “most competitive tax system in the G20.”

UK Prime Minister Theresa May confirmed her government’s intention to reduce corporation tax to 17 percent when speaking in New York in September last year.

Commenting on May’s speech Liz Nelson, director of the advocacy group Tax Justice Network, said, “Corporate tax cuts carry multiple and diverse costs that hurt national welfare, and cause immense leakage: a large portion of corporate tax cuts flow to foreign shareholders. Nor do corporate tax cuts generally attract much useful investment either. They tend to attract unproductive activity and profit shifting, avoidance nonsense: the least useful stuff.”

Many multinational companies arrange their affairs to severely minimize the amount they pay in corporate tax. A Daily Mirror article January 31 showed how Internet retailer Amazon paid just £62 million in corporation tax in the UK over a 20-year period. This was on revenues of £7 billion earned in the UK over that period. This means a less than 1 percent rate of tax. It noted this amount for the 20-year period was less than major UK retailers such as Marks and Spencer pay in a year.

The Mirror noted that “for most of Amazon’s 20 years here, the money it gets from its millions of UK customers has gone directly to low-tax Luxembourg. Under pressure, the company voluntarily altered its structure in 2015. Since then, its retail sales are still going first to Luxembourg, then return to an offshoot here, on which any profits are taxed. Amazon refused to reveal how much corporation tax this business has paid. However, it said Amazon EU Sarl, the company’s European arm, paid £48 million in corporation tax across five countries, of which only one was the UK.”

The coffee chain giant Starbucks similarly paid just £5.9 million tax in the UK on a turnover of £213 million for the year ending October 2017, an effective tax rate of only 2.8 percent.

This is the new normal among corporations. In 2016/17, HMRC (tax department) calculated, “The estimated total tax gap for Corporation Tax was £3.5 billion in 2016-17 (£3.4 billion in 2015-16). This equates to 10.6 percent of the overall tax gap in 2016-17.” The tax gap is the difference between total taxes owed to the government and the amount received.

In 2016, four of the top 10 companies listed on the Financial Times Stock Exchange paid no corporation tax at all. A quarter of FTSE companies avoided taxation by locating subsidiaries to tax havens recognised by the UK. This increases to 98 percent of such companies if a stricter US definition is applied.

A briefing paper, “Public Good or Private Wealth,” released in January this year by the international development body Oxfam, highlights the global impact of tax regimes favouring the rich.

Oxfam notes, “There is a growing consensus that the wealth of individuals and corporations is not being adequately taxed, and instead taxes are falling disproportionately on working people. For every dollar of tax revenue, on average just 4 cents are made up of revenue from wealth taxes.” This has occurred at time when the wealth of the super-rich has grown to a record level.

The briefing continues: “In rich countries, the average top rate of personal income tax fell from 62 percent in 1970 to 38 percent in 2013. In developing countries the average top rate of personal income tax is 28 percent. In some countries like Brazil and the UK, the poorest 10 percent are now paying a higher proportion of their incomes in tax than the richest 10 percent. … The super-rich are hiding $7.6 trillion from the tax authorities. Corporates also hide large amounts offshore. Together this deprives developing countries of $170 billion a year.”

HMRC recently released figures on the amount of tax relief awarded. While in theory tax relief is supposed to provide help to struggling households or encourage economic growth, an analysis of the figures shows the richest people benefiting most from such relief. The cost of tax relief to government revenues was a record £164 billion last year.

Analysis by the Resolution Foundation noted that “these reliefs, which amount to significantly more than the entire health budget [£125 billion in 2017/18], are the equivalent of almost £6,000 per household in the country. But these reliefs do not benefit all households equally. … While some reliefs benefit almost all families, others see very large gains going to very small numbers of people. The Foundation notes that the average individual gain from agricultural or business property reliefs on Inheritance Tax was around £270,000, while the average gain from Entrepreneurs’ Relief was £50,000.”

Commenting on the figures, Robert Palmer of the Tax Justice Network said, “Many of these reliefs are simply giveaways to companies and the wealthy. HMRC rarely looks at whether they are good value for money and are actually doing what they are meant to.”

What is described in these reports is a staggering transfer of wealth from those at the bottom to those at the top at an accelerating pace.

These giveaways to big business would continue were a Labour government under Jeremy Corbyn to come to power. In its 2017 general election manifesto Labour called on “large corporations to pay a little more while still keeping UK corporation tax among the lowest of the major economies.”

France conducts dry-run simulation of nuclear weapon strike

Will Morrow 

On Monday afternoon, three days after the Trump administration declared it would suspend compliance with the Intermediate-Range Nuclear Forces (INF) treaty with Russia, the French military conducted a dress rehearsal for a nuclear weapons strike.

The dry-run was reported the following day in a brief, three-paragraph statement from the defense ministry. The operation lasted 11 hours and included “all phases” of what was referred to as a “nuclear dissuasion mission,” except for the detonation of an actual nuclear warhead.

A Rafale warplane equipped with a nuclear-capable cruise missile took off from the Saint-Dizier Air Base 113, approximately 200 kilometers east of Paris. It conducted high-altitude flying, mid-air refueling, and a low-altitude high-speed portion, practicing evading anti-aircraft defense systems, before firing its missile at a target on a testing range in Biscarrosse in southwestern France.

Downplaying the connection of the exercise to the collapse of the US-Russian nuclear treaty, the French government statement claims that such operations are “planned well in advance and conducted regularly.” Whether or not this is true, the decision to announce the exercise was a deliberate signal to make clear that the French state is preparing for nuclear war.

These war preparations are a conspiracy involving the highest echelons of the military and state apparatus, worked out entirely behind the backs of the working class.

The population is informed of nothing. It awoke on Tuesday to reports that the military had rehearsed a nuclear attack. But none of the most obvious questions are addressed: Whom is the French military preparing to use nuclear weapons against? Which cities or countries is it planning to destroy? How many millions or tens of millions does it anticipate would die in such a conflict? None of these questions are raised, because the ruling class knows there is overwhelming opposition to war in the population.

France possesses approximately 300 nuclear warheads, making it the third-largest nuclear power in the world, behind the United States and Russia, which possess each approximately 6,500 and 6,800 warheads. The French government has not tested a nuclear weapon since 1996, when a nuclear test in the Pacific under Jacques Chirac prompted a mass outcry in the population.

Amid growing military and geopolitical tensions between the world’s major powers, the European ruling classes, led by France and Germany, are rapidly arming for war. To this point, the European powers have aligned themselves under NATO with the aggressive US confrontation against both Russia and China. But there are growing demands in the ruling class that Europe be prepared to act independently of and in opposition to the United States to protect its own imperialist interests.

The day after the nuclear exercise, French Army Minister Florence Parly spoke before the Portuguese government and military brass in Lisbon and declared that Europe must arm itself for wars on a scale unlike anything seen since WWII.

“Our continent has been at peace for seventy years,” she said. “But, today more than ever, this peace should not be taken for granted. We are facing growing threats.”

After blaming Russia and repeating the completely unsubstantiated claims by the Trump administration that Moscow had violated the INF treaty, Parly added: “Let us not forget the seemingly more distant challenges of Asia” and “the rise of China,” which was “challenging the rules-based order.”

The “rules-based order” refers to the system of alliances, dominated by the United States, by which the European and US imperialist powers have maintained their dominance since the second world war, which is being disrupted by the economic growth of China in particular.

Parly stated that while “NATO is and will remain the cornerstone of the collective defence of the European continent … nevertheless, we need to do more by ourselves.” Europe must be “able to ensure our own security, to be ready to act whenever our interests are at stake—because we have the capabilities, a shared assessment and a common willingness.”

Such a “willingness” meant overcoming the deep anti-war sentiments among workers and young people. Governments must “explain to our citizens what we are doing,” she said, and “convince our citizens of the benefits of a ‘Europe that protects.’”

While Parly was careful to couch her call for Europe to do “more by ourselves” within the framework of being “better allies” with the United States, they are clearly directed at developing a more independent stance. They followed the statements by President Emmanuel Macron last November, in which he called for the building of a “real European army,” so Europeans can “protect themselves from China, Russia and even the United States.”

Macron has also announced an increase in nuclear military spending from €3.9 billion in 2017 to €6 billion per year in 2025 as part of a major modernization of its nuclear weapons arsenal.

France’s preparations to wage nuclear war demonstrate the fraud of all claims that the European imperialist powers represent some kind of more benevolent, less brutal and aggressive counterweight to the United States. Their own drive to war is proceeding hand in hand with brutal austerity overseen by the European Union against the working class, the build-up of police powers and elevation of extreme right-wing forces across the continent, and attacks on immigrants and refugees.

Germany is also remilitarizing and boosting its military spending. Last July, the Welt am Sonntag, a major German national newspaper, published a front-page picture of a nuclear bomb, painted in the colours of the German flag, with the headline: “Do we need the bomb?” (and answering in the affirmative).

These war preparations are accompanied by a systematic ideological campaign to rehabilitate the past crimes of the European imperialist powers.

In Germany, the neo-fascist Alternative for Germany now sets the line of official politics. It has been promoted by the state and security forces, and its anti-immigrant policies have been adopted by the political establishment. Its growth has been facilitated by extreme-right academics such as Humboldt University’s Jorg Baberowski, who have worked to justify and relativize the crimes of the Nazis.

In France, Macron recently hailed Marshal Philippe Pétain, the head of the fascist Vichy regime that collaborated with the Nazi occupation, as a “great soldier.”

Over 7,000 Bangladesh garment workers sacked after wage protests

Wimal Perera

Bangladesh garment industry bosses have sacked thousands of workers following the end of recent protests and strikes involving up to 50,000 workers over low wages. The witch-hunts began last month, after garment workers reluctantly ended an eight-day strike under the threat of mass lockouts and police intimidation.

Although media reports vary, the trade union IndustriALL Bangladesh Council (IBC) and garment industry unions estimate that more than 7,000 workers have been dismissed.

The unions claim that police have filed cases against about 3,500 named and unnamed workers and arrested more than a 100. Workers have been falsely accused of violence and vandalism. Fearful of arrest, scores of workers are reported to have gone into hiding.

Last month’s protests were in response to the ongoing refusal of garment industry employers to even increase workers’ monthly minimum pay to 8,000 takas ($US96), up from the previous 5,300 takas ($63), as recommended last September by Prime Minister Sheik Hasina’s Awami League-led government. The recommended increases resulted from discussions in a government-appointed tripartite committee of employers, unions and state authorities.

Garment workers, who have long-demanded the doubling of their monthly pay to 16,000 takas, were hostile to the government’s meagre pay rise recommendations, as well as discrepancies in the increases for junior and senior workers.

While the unions publicly bewail the mass sackings and arrests, these organisations have long played a treacherous role in sabotaging garment workers’ struggles for higher wages and better working conditions.

The IBC and the National Garment Workers Federation (NGWF) last month urged striking workers to return to the factories, opening the way for the mass sackings. The IBC is the Bangladesh section of the IndustriALL, a Geneva-based international union federation notorious for collaborating with employers.

Shafiul Islam Mohiuddin, president of the Federation of Bangladesh Chambers of Commerce and Industry, called on the Awami League-led government to “actively protect the nation’s assets” and take action against all those who “vandalised factories.” NGWF president Amirul Haque Amin made similar unsubstantiated allegations of vandalism.

Recent media reports point to how the mass sackings were carried out. Victimised workers said they were simply told by employers that their services were no longer required, ordered to leave their plants and then sent a payout a few days later.

“I was in jail for 16 days and just got bail last week,” Mohammad Ali Hossain, 28, a sacked garment worker, told the Arab News. “After getting out of jail, I contacted the factory management but on Saturday, I received a compensation of $250 from my owner.” Of the 1,200 workers at his factory, 92 had been sacked and seven had police cases registered against them, he said.

Shariful Islam, another worker, said: “There are 2,000 workers at my factory and 255 of them lost their jobs on January 11. I received compensation of $200 on January 26. After my dismissal, I contacted other garment factories to try and get a new job but all of them refused to employ me because I’ve been terminated.”

China Akter, who works for Luman Fashions at Rampura in Dhaka, told one newspaper: “We have been in fear of losing jobs since the announcement of the new wage structure. The owners have tried to frighten us saying that any increase in wages would force to shut down… [and] when we demand our lawful wage, the factory owner threatened us.

Rina Akter, from Yolk Garments at Kakrail, said she was paid only 7,000 taka, including overtime, for the month of December. None of the workers were paid the official 8,000 taka minimum, even after the announcement of the new wage structure. They received only a 250–300 taka increase, she said.

A Guardian article on January 20 about the Interstoff Apparels factory in Gazipur revealed something of the harsh conditions in the Bangladesh garment industry, which employs 4.5 million workers and is the world’s second largest garment producer and exporter.

The Interstoff Apparels plant, which employs 4,500 workers, produces t-shirts with the brand name Spice Girls for export. Salma [not her real name], who is in her mid-20s, told the newspaper she was paid only 8,450 taka a month, including a 600-taka attendance bonus, for a 54-hour week. It would take her about a week to obtain the 2,130 taka ($25) required to buy a Spice Girls t-shirt.

Salma said management set workers “impossible” targets of sewing up to 2,000 garments a day. If you did not reach that target, she said, you “might even get called inside the production manager’s office and get verbally abused… and sometimes subjected to obscene language such as khankirbaccha (daughter of a prostitute).”

Amid the current wave of victimisations and mass sackings, the unions are sowing illusions that workers can get redress by appealing to the government. IBC secretary Salahuddin Shapon called for a meeting with Labor Minister Monnujan Sufian. The NGWF organised a “human chain” protest on February 1 to demand the release of arrested workers and withdrawal of police charges.

The Bangladeshi Stalinist parties, such as the Communist Party of Bangladesh (CPB), Socialist Party of Bangladesh and the Workers Party, who often back the Awami League, have not called for any mobilisation of workers to fight the mass sackings and arrests.

Apart from the CPB-controlled Garment Workers Trade Union Centre (GWTUC), which made a lame appeal to the government to stop the repression, these organisations have maintained a stony silence.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Siddiqur Rahman told the media that garment workers were not sacked over the protests but then said some plants “may have had problems” because of the pay increase.

Confident of ongoing collaboration with the unions, Rahman issued a direct appeal. “We are very much concerned about maintaining stability in the country’s ready-made garment sector and if the trade union leaders come up with any such [unfair dismissal] issue, we will sit together to find a way out of any situation,” he said.

Like the garment industry owners, Prime Minister Sheik Hasina’s government depends completely on the unions to strangle any attempts by garment workers to win decent wages and working conditions. It is determined to continue attracting foreign investment by maintaining the country’s cheap labour status and exploitative conditions.

France recalls its ambassador to Italy

Alex Lantier

Yesterday, for the first time since World War II, the French Foreign Ministry announced the recall of its ambassador in Rome. An immediate pretext was Italian Vice Premier Luigi di Maio’s February 5 meeting with a group of “yellow vest” protesters calling for French President Emmanuel Macron’s ouster. The communiqué made clear, however, that far broader international conflicts are involved.

“For several months,” it wrote, “France has been targeted with repeated accusations, unfounded attacks, and outrageous declarations that everyone knows and recalls. It is unprecedented since the end of the war. To have disagreements is one thing, exploiting them for electoral purposes is another. The latest interventions constitute a further and unacceptable provocation.”

While calling for “a relationship of friendship and mutual respect” between France and Italy, it added: “All these actions have created a grave situation that raises questions as to the intentions of the Italian government in its relations with France. In light of this unprecedented situation, the French government has decided to recall the French ambassador to Italy for consultations.”

Paris’s recall of its ambassador—a move typically signaling the danger of a collapse of diplomatic relations, or war—underscores the collapse of relations in the European Union (EU) flowing from the relentless incitement of nationalism and militarism by the European ruling class.

Clashes between Paris and Rome have become ever more bitter, as they vied for influence in the EU and backed rival factions in the civil war in Libya that followed the 2011 NATO war. Two years ago, Macron nationalized France’s naval shipyards to keep Italy’s Fincantieri corporation from buying them. When Italy’s far-right government took power, Macron postured as the spokesman of an enlightened Berlin-Paris axis hostile to neofascism, attacking it as “spreading leprosy.”

More recently, Italian officials have increasingly lashed out at France. After organizing with Brazil’s fascistic President Jair Bolsonaro the rendition from Latin America of former Italian leftist Cesare Battisti, who had initially fled from Italy to France, Italian Interior Minister Matteo Salvini attacked Paris over Libya last month. “In Libya, France has no interest in stabilizing the situation, probably because its oil interests are opposed to Italy’s,” he said.

While setting up its own concentration camps for refugees in Libya, a former Italian colony, Rome has kept attacking France’s neocolonial wars in Africa. “Europeans, and the French in particular, have never ceased colonizing Africa,” di Maio said last month. He denounced the CFA franc, aligned on the French currency, used in many of France’s former African colonies: “There are dozens of African countries where France prints a currency, the colonial franc, and with this currency it finances France’s public debt.”

Rome also criticized the US-led coup in Venezuela, which Paris has strongly supported—criticisms French papers attributed to Rome’s sympathies for Russia and China, who support the Venezuelan regime.

It is not for nothing that the French Foreign Ministry reached back to World War II to find a situation comparable to the current crisis between Paris and Rome. Today, over a quarter of a century after its founding in 1992, the EU has not resolved any of the fundamental inter-imperialist conflicts that prompted Italy to attack France on June 10, 1940.

Italian and French troops clashed in the Alps as the Nazi Wehrmacht crushed the bulk of the French army in the north. After the armistice, Hitler negotiated with Nazi-collaborationist dictator Marshal Philippe Pétain, French agriculture and industry were redirected towards German and Italian requirements for war with the Soviet Union. Berlin and Rome militarily occupied much of France’s colonial empire in North Africa, and Rome was authorized to occupy parts of southeastern France.

The similarity in foreign policy between 20th century fascist Europe and European imperialism today is unmistakable. After a quarter century of imperialist wars since the Stalinist bureaucracy’s dissolution of the Soviet Union in 1991, the threat of war against Russia and China, the struggle for domination in Europe and the plunder of ex-colonial regions is reaching extraordinary intensity.

In 2011, as French President Nicolas Sarkozy, London and Washington launched a war in Libya, despite objections in Germany and from significant forces in Italy, the WSWS warned of the implications the imperialist war drive would have in Europe:

The common front of what former Defense Secretary Rumsfeld derided as “Old Europe” has broken apart. However, it is not to be assumed that Obama has fully worked through the implications of his support for Sarkozy’s schemes. By participating in a war publicly opposed by Berlin, Washington has all but repudiated its decades-long policy of maintaining the political and military unity of Western Europe. It is exacerbating intra-European tensions on a continent already riven by conflicts over economic policies. As has happened in the past, Germany—fearing that it has been outmaneuvered and isolated by its historical adversaries—will look for other means to protect its interests. Once again, Washington has set into motion events which will have disastrous consequences.

This warning has been vindicated. In 2014, Berlin launched a campaign to remilitarize its foreign policy, and the Brexit vote and Trump’s election in 2016 brought to the surface the profound breakdown of the NATO alliance. Now the European powers are all pouring hundreds of billions of euros into their military machines. While Macron said last year that Europe must be ready to fight Russia, China or the United States, the European powers are also preparing to fight each other.

As Britain prepares to leave the EU next month, the EU is in chaos. Bitter divisions persist in Berlin, the dominant EU power, over foreign policy. While Chancellor Angela Merkel is associated to an alliance with Macron, last year saw calls in both the German and Austrian ruling classes for a Berlin-Vienna-Rome “Axis,” reprising the name of World War II-era alliance between Berlin and Rome. Under these conditions, Macron’s sudden decision yesterday not to attend next month’s Munich Security Conference is another sign of deep crisis.

None of the imperialist powers in Europe have anything to offer to the working class, which cannot let itself be drawn behind any of the contending camps. All of them stand for social austerity, militarism, and the defense of the legacy of 20th century European fascism—from German militarist professors seeking to rehabilitate Hitler, to far-right ministers in Italy who hail Mussolini, to Macron, who declared his admiration for Pétain.

The critical issue is the struggle to unify the European and international working class against war on a revolutionary, socialist program. To the European militarists’ drive to war, the International Committee of the Fourth International counterposes the struggle for the United Socialist States of Europe.

Balochistan: Contextualising the Recent Spike in Attacks

Anwar Ali Tsarpa


On 23 November 2018, a Baloch insurgent group, the Balochistan Liberation Army (BLA) attacked the Chinese consulate in Karachi, Pakistan. In a statement, the BLA said the “objective of the attack was to highlight Chinese exploitative designs to the world.”

The attack on the Chinese consulate took place merely two weeks after the mastermind of the attack, Aslam Baloch, initiated the formation of the Baloch Raaji Ajoi e Sangar (BRAS), a united front of Baloch insurgent groups, namely the Baloch Liberation Army, the Balochistan Liberation Front, and Baloch Republican Guards. Subsequently, on 14 December 2018, BRAS also carried out a major attack on Pakistani forces in the Tagran area of Balochistan province’s Turbat district. Some other smaller scale attacks on security forces too were reported in the meantime, indicative of a spike in insurgent activity.

These recent attacks could be viewed as an outcome of China’s failure to convince the groups to negotiate. Ever since the China Pakistan Economic Corridor (CPEC) has been in the works, Beijing has made clandestine attempts to negotiate with Baloch insurgent groups to ensure security for the US$ 60 billion project. The recent Beijing-led attempt to initiate negotiations did not succeed probably because of the groups’ scepticism regarding how the post-negotiation period would pan out. The issue of ‘breach of trust’ is a major concern that looms large in Baloch insurgents’ minds. This phenomenon is a result of historical memory arising from experiences such as the execution of surrendered insurgents by the Pakistani state in post-settlement period of the first (1948) and second (1959) phases of the insurgency.

Days before he was killed in a suicide attack in Afghanistan on 25 December 2018, Aslam Baloch had described the “partnering” between China and Pakistan as a “challenge” to “the future of the Baloch people,” and flagged the “outnumbering” of indigenous Baloch population by outsiders as a concern. It is true that the general Baloch population has been facing economic, socio-cultural and political marginalisation since independence. However, in today’s situation, the disenchantment borne out of the discrimination and marginalisation is compounded by fears of demographic change and loss of land due to the ongoing land acquisition related activities in Balochistan.

To illustrate, Balochistan’s port city of Gwadar is a rapidly growing urban centre. Gwadar is a key component in the CPEC, and recent development activities in the area have involved extensive land acquisition. For instance, thousands of acres of land have been acquired by the Pakistani navy and land grabbers, through uneven means around the Kalmat Khor lagoon, among others. As a result, the livelihoods of local fishermen, who comprise 80 per cent of the total population of 185,000, have been affected. According to media reports citing official documents, a range of ministries, and state-run defence sector institutions and departments are collectively seeking over 60,000 acres of land for them in different the area.

Given the scale of the Gwadar port project and CPEC, local fishermen fear that after the infrastructure is developed, they would not be allowed to enter the sea. Additionally, their grievances also stem from the fear that the local population would not benefit from development projects. In the past, such as in the Saindak Copper Gold Project and the Sui gas field project, the federal government gave only a meagre share of profits to the Balochistan provincial government. In the case of the Gwadar port project too, China is set to receive 91 per cent of the profits for the next 40 years. Past experiences of marginalisation have caused a severe trust deficit in case of ongoing Chinese-led development projects as well.

Meanwhile, in the aftermath of the failed talks, incidents of forced disappearances of Baloch persons have risen in the province. A judicial “Commission of Inquiry on Enforced Disappearance” has recorded 84 cases of forceful disappearance as of end of October 2018. According to the government of Pakistan, there are 5507 alleged victims of forceful abduction, but the actual numbers are estimated to be much higher.

It is possible that Baloch insurgent groups have increased attacks on Pakistani security forces also as retaliation to the sudden upsurge in the instances of forced disappearances of locals through October and November 2018. It remains to be seen whether the recent spate of attacks escalate or abate. A lot depends on the availability of arms and the will of the groups. Significantly, it also depends on the state’s counter-insurgency approach and the manner in which the state addresses local grievances.