The Art of the Deal, Pentagon-Style: Wars Without Victories, Weapons Without End

William Astore

The expression “self-licking ice cream cone” was first used in 1992 to describe a hidebound bureaucracy at NASA. Yet, as an image, it’s even more apt for America’s military-industrial complex, an institution far vaster than NASA and thoroughly dedicated to working for its own perpetuation and little else.

Thinking about that led me to another phrase based on America’s seemingly endless string of victory-less wars: the self-defeating military. The U.S., after all, hasn’t won a major conflict since World War II, when it was aided by a grand alliance that included Soviet dictator Josef Stalin’s godless communists. And yet here’s the wonder of it all: despite such a woeful 75-year military record, including both the Korean and Vietnam wars of the last century and the never-ending war on terror of this one, the Pentagon’s coffers are overflowing with taxpayer dollars. What gives?

Americans profess to love “their” troops, but what are they getting in return for all that affection (and money)? Very little, it seems. And that shouldn’t surprise anyone who’s been paying the slightest attention, since the present military establishment has been designed less to protect this country than to protect itself, its privileges, and its power. That rarely discussed reality has, in turn, contributed to practices and mindsets that make it a force truly effective at only one thing: defeating any conceivable enemy in Washington as it continues to win massive budgets and the cultural authority to match. That it loses most everywhere else is, it seems, just part of the bargain.

The list of recent debacles should be as obvious as it is alarming: Afghanistan, Iraq, Libya, Somalia, Yemen (and points around and in between). And even if it’s a reality rarely focused on in the mainstream media, none of this has been a secret to the senior officers who run that military. Look at the Pentagon Papers from the Vietnam War era or the Afghanistan Papers recently revealed by the Washington Post. In both cases, prominent U.S. military leaders admitted to fundamental flaws in their war-making practices, including the lack of a coherent strategy, a thorough misunderstanding of the nature and skills of their enemies, and the total absence of any real progress in achieving victory, no matter the cost.

Of course, such honest appraisals of this country’s actual war-making prowess were made in secret, while military spokespeople and American commanders laid down a public smokescreen to hide the worst aspects of those wars from the American people. As they talked grimly (and secretly) among themselves about losing, they spoke enthusiastically (and openly) to Congress and the public about winning. In case you hadn’t noticed, in places like Afghanistan and Iraq that military was, year after endless year, making “progress” and “turning corners.” Such “happy talk” (a mixture of lies and self-deception) may have served to keep the money flowing and weapons sales booming, but it also kept the body bags coming in (and civilians dying in distant lands) — and for nothing, or at least nothing by any reasonable definition of “national security.”

Curiously, despite the obvious disparity between the military’s lies and reality, the American people, or at least their representatives in Congress, have largely bought those lies in bulk and at astronomical prices. Yet this country’s refusal to face the facts of defeat has only ensured ever more disastrous military interventions. The result: a self-defeating military, engorged with money, lurching toward yet more defeats even as it looks over its shoulder at an increasingly falsified past.

The Future Is What It Used to Be

Long ago, New York Yankee catcher and later manager Yogi Berra summed up what was to come this way: “The future ain’t what it used to be.” And it wasn’t. We used to dream, for example, of flying cars, personal jetpacks, liberating robots, and oodles of leisure time. We even dreamed of mind-bending trips to Jupiter, as in Stanley Kubrick’s epic film 2001: A Space Odyssey. Like so much else we imagined, those dreams haven’t exactly panned out.

Yet here’s an exception to Berra’s wisdom: strangely enough, for the U.S. military, the future is predictably just what it used to be. After all, the latest futuristic vision of America’s military leaders is — hold onto your Kevlar helmets — a “new” cold war with its former communist rivals Russia and China. And let’s add in one other aspect of that military’s future vision: wars, as they see it, are going to be fought and settled with modernized (and ever more expensive) versions of the same old weapons systems that carried us through much of the mid-twentieth century: ever more pricey aircraft carriers, tanks, and top of the line jet fighters and bombers with — hey! — maybe a few thoroughly destabilizing tactical nukes thrown in, along with plenty of updated missiles carried by planes of an ever more “stealthy” and far more expensive variety. Think: the F-35 fighter, the most expensive weapons system in history (so far) and the B-21 bomber.

For such a future, of course, today’s military hardly needs to change at all, or so our generals and admirals argue. For example, yet more ships will, of course, be needed. The Navy high command is already clamoring for 355 of them, while complaining that the record-setting $738 billion Pentagon budget for 2020 is too “tight” to support such a fleet.

Not to be outdone when it comes to complaints about “tight” budgets, the Air Force is arguing vociferously that it needs yet more billions to build a “fleet” of planes that can wage two major wars at once. Meanwhile, the Army is typically lobbying for a new armored personnel carrier (to replace the M2 Bradley) that’s so esoteric insiders joke it will have to be made of “unobtainium.”

In short, no matter how much money the Trump administration and Congress throw at the Pentagon, it’s a guarantee that the military high command will only complain that more is needed, including for nuclear weapons to the tune of possibly $1.7 trillion over 30 years. But doubling down on more of the same, after a record 75 years of non-victories (not to speak of outright losses), is more than stubbornness, more than grift. It’s obdurate stupidity.

Why, then, does it persist? The answer would have to be because this country doesn’t hold its failing military leaders accountable. Instead, it applauds them and promotes them, rewarding them when they retire with six-figure pensions, often augmented by cushy jobs with major defense contractors. Given such a system, why should America’s generals and admirals speak truth to power? They are power and they’ll keep harsh and unflattering truths to themselves, thank you very much, unless they’re leaked by heroes like Daniel Ellsberg during the Vietnam War and Chelsea Manning during the Iraq War, or pried from them via a lawsuit like the one by the Washington Post that recently led to those Afghanistan Papers.

My Polish mother-in-law taught me a phrase that translates as, “Don’t say nothin’ to nobody.” When it comes to America’s wars and their true progress and prospects, consider that the official dictum of Pentagon spokespeople. Yet even as America’s wars sink into Vietnam-style quagmires, the money keeps flowing, especially to high-cost weapons programs.

Consider my old service, the Air Force. As one defense news site put it, “Congressional appropriators gave the Air Force [and Lockheed Martin] a holiday gift in the 2019 spending agreement… $1.87 billion for 20 additional F-35s and associated spare parts.” The new total just for 2020 is “98 aircraft — 62 F-35As, 16 F-35Bs, and 20 F-35Cs — at the whopping cost of $9.3 billion, crowning the F-35 as the biggest Pentagon procurement program ever.” And that’s not all. The Air Force (and Northrop Grumman) got another gift as well: $3 billion more to be put into its new, redundant, B-21 stealth bomber. Even much-beleaguered Boeing, responsible for the disastrous 737 MAX program, got a gift: nearly a billion dollars for the revamped F-15EX fighter, a much-modified version of a plane that first flew in the early 1970s. Yet, despite those gifts, Air Force officials continue to claim with straight faces that the service is getting the “short straw” in today’s budgetary battles in the Pentagon.

What does this all mean? One obvious answer would be: the only truly winning battles for the Pentagon are the ones for our taxpayer dollars.

“Dopes and Babies” Galore

I can’t claim that I ever traveled in the circles of generals and admirals, though I met a few during my military career. Still, no one can question that our commanders are dedicated. The only question is: dedication to what exactly — to the Constitution and the American people or to their own service branch, with an eye toward a comfortable and profitable retirement? Certainly, loyalty to service (and the conformity that goes with it), rather than out-of-the-box thinking in those endlessly losing wars, helped most of them win promotion to flag rank.

Perhaps this is one reason why, back in July 2017, the military’s current commander-in-chief, Donald Trump, reportedly railed at his top national security people in a windowless Pentagon room known as “the Tank.” He called them — including then-Chairman of the Joint Chiefs of Staff Joseph Dunford, Jr. — “a bunch of dopes and babies.” As the president put it, America’s senior military leaders don’t win anymore and, as he made clear, nothing is worse than being a loser. He added, “I want to win. We don’t win any wars anymore… We spend $7 trillion, everybody else got the oil and we’re not winning anymore.” (And, please note, that hasn’t changed a whit in the year and a half since that moment.)

Sure, Trump threw a typical tantrum, but his comments about losing at a strikingly high cost were (and remain) absolutely on the mark, not that he had any idea how to turn America’s losing wars and their losing commanders into winners. In many ways, his “strategy” has proven remarkably like those of the two previous presidents, George W. Bush and Barack Obama. Send more troops to the Middle East. Drone and bomb ever more, not just in Afghanistan and Iraq but even in places like Somalia and Libya. Prolong our commitment to “loser” wars like the Afghan one, even while talking ceaselessly about ending them and bringing the troops home. And continue to “rebuild” that same military, empowering those same “dopes and babies,” with yet more taxpayer dollars.

The results have been all-too predictable. America’s generals and admirals have so much money that they don’t ever have to make truly tough choices. They hardly have to think. The Air Force, for example, just keeps planning for and purchasing more ultra-expensive stealth fighters and bombers to fight a future Cold War that we allegedly won 30 years ago. Meanwhile, actual future “national security” threats like climate-related catastrophes or pandemics go largely unaddressed. Who cares about them when this country will clearly have the most stealth fighters and bombers in the world?

For the Pentagon, the future is the past and the past, the future. Why should military leaders have to think when the president and Congress keep rewarding them for lies and failures of every sort?

Trump believes America doesn’t win anymore because we’re not ruthless enough. Take the oil, dammit! The real reason: because America’s wars are unwinnable from the git-go (something the last 18 years should have proved in no uncertain way) and — irony of all ironies — completely unnecessary from the standpoint of true national defense. There is no way for the U.S. military to win “hearts and minds” across the Greater Middle East and Africa with salvos of Hellfire missiles. In fact, there’s only one way to “win” such wars: end them. And there’s only one way to keep winning: by avoiding future ones.

With a system that couldn’t work better (in Washington), America’s military refuses to admit this. Instead, our generals just keep saluting smartly while lying in public (the details of which we’ll find out about only when the next set of “papers” is released someday). In the meantime, when it comes to demanding and getting tax dollars, they couldn’t be more skilled. In that sense, and that alone, they are the ultimate winners.

“Dopes and babies,” Mister President? No, just men who are genuinely skilled in the art of the deal. Small wonder America’s leader is upset. For when it comes to the military-industrial complex and its power and prerogatives, even Trump has met his match. He’s been out-conned. And if the rest of us remain silent on the subject, then so have we.

Australian government intensifies punitive drive against welfare recipients

Margaret Rees

Prime Minister Scott Morrison’s government has announced a draconian new income reporting regime for welfare recipients, hoping to gouge out $2 billion in “savings” over the next four years. Draft legislation is to be released this week, the first week of parliament for the year, making it a top government priority for 2020.

This is despite the computerised “robo-debt” system that clawed back hundreds of millions of dollars from welfare recipients being ruled unlawful last November by the Federal Court. Before even paying back the money wrongly taken from unemployed and under-employed workers and some of society’s most vulnerable people, the government is moving to punish them again.

Last April, in its 2019–20 budget the Liberal-National Coalition government flagged the use of new data-matching technology to automatically report employment income using a single touch payroll system. Welfare recipients will have to report any income fortnightly, to be checked against business payroll data held by the Department of Human Services.

Social Services Minister Anne Ruston unveiled the new “income compliance” plan last week. It will gut welfare spending at the behest of the corporate elite and will have the effect of forcing thousands of welfare recipients off benefits and into lower-paid employment.

At present, 1.2 million welfare recipients are required to report their income each fortnight to Centrelink, the government’s monitoring agency. They are permitted to earn small amounts before their welfare payments are progressively reduced by 40 to 50 cents per dollar earned. A job seeker on Newstart benefits, for example, can earn a pittance of $104 a week, to supplement the poverty-level welfare payment of $555 per fortnight.

Centrelink reporting periods often do not match workplace pay cycles, so welfare recipients are left having to estimate or predict their earnings. Casual work and unpredictable hours can make a nightmare of this requirement to report, leaving welfare recipients exposed to accusations of understating their income.

The robo-debt system largely utilised automated income averaging to clawback alleged overpayments. The Federal Court outlawed the averaging, yet the new system uses much the same methods. The Australian Council of Social Services (ACOSS) commented: “We still don’t know how much the government owes people who have paid false robo-debts over the past three years.”

Government Services Minister Stuart Robert told parliament last year that “data matching” would continue, even though the government was forced to pause the use of the robo-debt technology for new alleged debts. The government is also still enforcing existing robo-debts through debt collectors and garnishee orders.

That is, the overall drive is continuing to impose the dictates of the banks and corporations on the welfare recipients, most of whom are struggling to survive. Ordinary people are framed as dishonest, while the banks and insurance companies that have defrauded customers of millions of dollars have escaped virtually scot free, with minuscule penalties compared to their profits.

For some time the government has been working with the big four banks and two major supermarket chains, Coles and Woolworths, on new technological measures to extend “cashless welfare cards” to a national rollout. Since 2016, trials in regional and remote areas have imposed stringent controls on social security payments, especially for indigenous people, restricting nearly all spending to authorised essentials.

Ruston recently boasted on Twitter of visiting the Northern Territory to “consult” remote communities on the “Cashless Debit Card.” Her travels relate to the plans for wider use of the card, and proposals to widen and extend the existing trials from June 2020 to June 2021.

Ruston also has hailed “quite successful” work with the banks and supermarket chains on payment systems that could enable trials to impose the cashless card on welfare recipients in the major cities. As the WSWS has long warned, the initial trials were directed against the most oppressed sections of the working class, in preparation for a frontal assault on all welfare recipients.

This offensive is well underway. As at November 2019, at least 104,480 people were no longer receiving Newstart or the Youth Allowance because of suspensions. This is intensifying a process that accelerated under the last Labor government. It was kept in office by the Greens from 2010 to 2013 as it cut thousands of sole parents off parenting payments, imposed harsh eligibility tests on injured and disabled workers, and privatised disability services via the National Disability Insurance Scheme.

Opposition to these measures must be based on the socialist perspective that welfare itself is a fundamental democratic right, required to protect workers and the most vulnerable members of society from the brutal drive for capitalist profit at any cost.

Coronavirus outbreak disrupts global auto industry as carmakers shut down production in China

Jessica Goldstein

The outbreak of the 2019-nCoV coronavirus in China, declared a global health emergency by the World Health Organization, is rattling the global auto industry. International auto manufacturers have shut down production in facilities across China in response to the spread of the deadly coronavirus outbreak, which originated in Wuhan, the capital city of China’s Hubei province at the end of December 2019.

Many manufacturers are further extending the annual Lunar New Year holiday shutdown at least through February 10. So far, 11 of China’s 31 provinces have announced extended holiday shutdowns of all non-essential industries for at least an additional week in attempt to contain the spread of the virus. These provinces are Hubei, Shanghai, Guangdong, Chongqing, Zhejiang, Jiangsu, Anhui, Yunnan, Fujian, Jiangxi and Shandong. According to IHS Markit, a global industrial analytics and research group, the 11 provinces are responsible for two-thirds of China’s automotive production.

Wuhan [Credit: ZhengZhou]

Wuhan, the epicenter of the coronavirus outbreak, is an important production hub for the global auto industry. Known as China’s “Motor City,” major global auto manufacturers rely on production in Wuhan for large portions of their Chinese output: 54 percent for French automaker PSA, 47 percent for Japanese automaker Honda, 19 percent for American automaker General Motors (GM) and 15 percent for Chinese automaker Donfeng.

GM, Toyota and Volkswagen have closed their plants in the region at least through February 9 in light of advice from local authorities. Honda and Nissan, which have also suspended operations in the region, are expected to have operating profits decline by 11 percent and 6.1 percent, respectively, for each month of production stoppage, according to JP Morgan Chase.

IHS Markit further predicts that the continued idling of the plants in these areas will lead to a first-quarter production loss of 350,000 units, or 7 percent, if the shutdown is extended to February 10. However, if the shutdown extends through mid-March, first-quarter output is expected to take a 32.3 percent hit, a loss of more than 1.7 million units, according to the report.

The coronavirus outbreak will have a much more serious impact on the Chinese and global markets than the 2003 Severe Acute Respiratory Syndrome (SARS) outbreak, which had little impact on the global auto sector. Today, China’s auto industry is six times the size it was in 2003 and is the world’s leading automaker, producing 25 million vehicles or a quarter of cars and trucks manufactured each year. Approximately 1.6 million of the more than 9 million workers directly employed by the global auto industry work in China.

The country is also the world’s largest car market with 23 million new vehicles registered in 2018, compared to 17 million in the US. The country’s domestic auto market has recently declined, however, largely due to the trade war measures of the United States and the slowing global economy. Even before the outbreak of the coronavirus, Bloomberg reported that China was heading toward its lowest sales forecast in five years.

The impact of the shutdowns will reach throughout the world. Due to China’s central position in the world automotive industry and world economy as a whole, production delays will impact the international supply chain for transnational corporations producing vehicles around the world. Sig Huber, senior managing director at the consultancy Conway Mackenzie and former global director of purchasing at Fiat Chrysler Automobiles NV, told Bloomberg that “If work stoppages are extended, we could start to see production disruptions in other parts of the world.”

Electric vehicle producer Tesla is among the companies monitoring the situation for supply chain impact outside of China. It expects a 10-day delay in operations at its new Shanghai plant, the first Tesla plant built outside of the US.

China eclipsed Japan as the world’s second-largest economy in 2010. With a current gross domestic product of nearly $14.55 trillion, it accounts for over 16 percent of the global GDP and is expected to reach as high as 21 percent of the world’s output by 2024.

The impact of the coronavirus on the world economy has been reflected in the sharp drops of the global stock markets as the deadly virus has continued to spread.

The livelihoods of autoworkers in China and their families hang in the balance as plants are shut down for indefinite periods across the country. The virtual lockdown of Wuhan has entered its second week. One of the reasons for the extended shutdown cited by global auto manufacturers is the uncertainty that workers would be able to travel to work in factories, as public transportation systems such as buses and subways have been suspended throughout Wuhan, in addition to workers in other areas taking their own precautions and choosing not to travel out of fear of contracting the virus.

Chinese autoworkers and their families will no doubt struggle financially during the extended shutdown period and its aftermath. Over the last year and half, GM, Ford, Volkswagen (VW) and other carmakers have already embarked on a global rampage against jobs, announcing layoffs and plant closures in response to the shift towards electric vehicles and falling demand in China and around the world. GM and VW expect production in the region to be reduced by 11 percent year-over-year as a result of the crisis.

While the vast majority of workers in the US and other countries feel nothing but sympathy for their counterparts in China, the Trump administration has sought to use the virus to whip up anti-Chinese nationalism. During a TV interview last week, Trump’s commerce secretary, Wilbur Ross, said the outbreak of the virus “will help to accelerate the return of jobs to North America.” He told Fox Business News, “I don’t want to talk about a victory lap over a very unfortunate, very malignant disease. The fact is, it does give business yet another thing to consider when they go through their review of their supply chain.”

While seeking to stoke up economic nationalism, Ross could care less about the jobs of US workers. The billionaire made his fortune buying up distressed steel, coal mining and auto parts companies, stripping them of their assets and flipping the companies for huge profits, leaving thousands of workers without jobs and pensions. In conducting these corporate raids, the asset stripper enjoyed the backing of the United Steelworkers, the United Auto Workers and other unions, which blamed the job losses on Japan and other US competitors.

Vast resources exist in the US and China, the world’s two leading economies, to combat the spread of the virus, which now has confirmed cases reported across Asia, Europe, North America and Australia. However, the division of the world into rival nation states is the biggest obstacle to the collaboration of scientists, health care professionals and workers around the world, and the marshaling of the necessary global resources to combat the spread of this and future epidemics.

That the spread of the virus has also underscored the vast economic inequality in China and rapacious character of the capitalist ruling class, which has made huge fortunes from exploiting the working class and providing a cheap labor platform for the transnational corporations. The financial losses incurred by the profit-hungry corporations as a result of the spread of the coronavirus outbreak will be shifted onto the backs of the working class in China and worldwide, through job cuts, cuts to safety and health benefits, shortened hours and wage losses, and forced overtime to make up for lost production.

Wall Street rises as coronavirus weighs heavily on global economy

Nick Beams

The growing divergence between financial markets, boosted by continual injections of cheap money, and the underlying real economy, has been further underscored by the impact of the coronavirus outbreak.

While the Chinese economy has been at a virtual standstill this week and the effects of production cutbacks are starting to flow to the rest of the world, Wall Street has nevertheless undergone a rapid rise, after significant falls, and returned to positive territory for the year.

Yesterday the Dow finished 408 points higher, or 1.4 percent up, after being up more than 500 points during the course of the day. The S&P 500 was up by 1.5 percent and the tech-heavy Nasdaq index rose by 2.1 percent to finish at a record high.

Stock trader works at the New York Stock Exchange [Credit: AP Photo/Mark Lennihan]

The rise in the market was the result of major central bank interventions both in China and the US. Share prices in China rose yesterday—after falling by more than 8 percent when markets re-opened on Monday after the extended lunar New Year break—due to a $174 billion intervention by the People’s Bank in China and indications that state-run institutional investors were buying up stocks to support the market.

In the US, the market was boosted by a $94 billion injection of cash by the New York Federal Reserve in the short-term repo market in order to keep down overnight interest rates.

The Wall Street Journal reported that the upward movement in the market was the “growing belief that fiscal and monetary policy will blunt the impact of the virus outbreak” and pointed to “investor psychology” that central banks “will do whatever they need to.”

A comment reported by CNN from Michal Every, senior Asia-Pacific investment strategist at Rabobank put the issue more directly.

“The underlying market hope is clear: central banks will save us, not just from the business cycle, and not just from climate change, but not from global pandemic too,” he wrote.

This week, 21 provinces in China told businesses not to resume work at least until February 10 and that the shutdown could be extended if the virus continues to spread. According to calculations by the US business channel CNBC, the shutdown covers areas that account for more than 80 percent of China’s gross domestic product and 90 percent of its exports.

In the Hubei province, where the disease outbreak began in the city of Wuhan, businesses have been told not to re-open before February 14, with provincial authorities stating they could extend the shutdown to an “appropriate extent.”

China is the world’s largest exporter of intermediate manufactured products that form part of the global supply chains of major corporations. It is the source of 20 percent of the global total of such products and 40 percent for production carried out in South Korea, Japan, Vietnam and Cambodia.

The effects have already begun to be felt. Yesterday Hyundai, the world’s fifth largest carmaker by sales, announced that it was shutting down all its car factories in South Korea because it had run out of components from China.

European car production could soon be affected. The Financial Times has reported that parts manufacturers Continental and Thysssenkrupp both held crisis meetings this week. Travel restrictions in China are preventing the normal resumption of work and while companies have said they expect to resume production next week it is by no means guaranteed.

Analysts at the Japanese financial firm Nomura pointed to the effect of the shutdown of the car industry.

“Restrictions on movement and other measures have raised the risk of disruption to supply chains, and we see potential for a stalling in automobile production within China. We also see a risk that supply chain issues could have knock-on effects in Japan and elsewhere in Asia,” they said.

Seventeen years ago, the outbreak of the SARS virus delivered a hit both to China and the rest of the world. The new coronavirus has a much greater potential for damage because of the growth of the Chinese economy. In 2002–2003 China accounted for about 4 percent of global GDP. Now, that figure is over 16 percent and China accounts for about one-third of all global growth annually—more than the US, Japan and Europe combined.

The increased weight of China in the global economy is reflected in the sharp fall in the prices of industrial commodities, of which it is a major consumer.

The price of oil has fallen by around 20 percent over the past three weeks and has officially entered bear market territory. Earlier this week the Kremlin issued a statement that President Vladimir Putin had taken a call from Saudi Arabia’s King Salman and the two sides were ready to coordinate their actions to “ensure stability on the global oil market.”

Olivier Jakob at the consultancy firm Petromatrix told the Financial Times that, while initially the estimates of reduced consumption were focused on air transport, “the true risk is lower economic activity. That’s much bigger in scale.”

Estimates for the growth of the Chinese economy, at least for the first quarter, have already been revised sharply down from just below 6 percent to as low as 4.5 percent or even 4 percent.

With China accounting for around half the consumption of the world’s metal and mining resources—a level double what it was when the 2003 SARS outbreak took place—the price of metals has fallen sharply. Copper, often regarded as a bellwether for global industrial production, is down 13 percent and the price of iron ore has dropped by more than 8 percent. The price of liquefied natural gas has also fallen sharply, with a key price index used in Japan and Korea dropping to a record low on Monday.

In contrast to the surge on the markets, the Wall Street Journal warned in an editorial this week of the effects on the US economy. It noted that Apple, McDonald’s, Levi Strauss and Starbucks have announced temporary closures of their stores, and manufacturers such as Ford, Apple and Tesla have temporarily halted production.

It pointed out that one sixth of Apple’s sales and nearly half of the chip-maker Qualcomm’s revenues come from China and that 80 percent of the active ingredients used by drug-makers used to produce finished medical products in the US are sourced from China.

“Because China is the world’s largest manufacturer and an enormous consumer market, the economic freeze will disrupt supply chains and reduce corporate earnings,” the Journal commented.

Goldman Sachs said last week it expected the impact of the virus to cut US output by between 0.4 and 0.5 percentage points in the first quarter of this year, with a rebound to follow in the second quarter. But with the full effects as yet unknown there is no way of determining the accuracy of such an assessment.

With industrial production falling in China and the knock-on effects in Japan, Asia, Europe and the US, an ongoing rise in US markets—fueled by the belief that cheap money will continue to be pumped out by the Fed—could create the conditions for a financial crisis whose economic contagion would exceed those of the coronavirus.

Microsoft Research Dissertation Grant 2020 for Doctoral Students

Application Deadline: 30th March 2020 at 5:00 PM Pacific Time.

Eligible Groups: Women, African-Americans/Blacks, Latinos, American Indians/Alaskan Natives, Native Hawaiians/Pacific Islanders, and/or people with disabilities.

To Be Taken At (Country): U.S. and Canada

About the Award: Microsoft recognizes the value of diversity in computing. The Microsoft Research Dissertation Grant aims to increase the pipeline of diverse talent receiving advanced degrees in computing-related fields by providing a research funding opportunity for doctoral students from groups underrepresented in computing (women, African-Americans/Blacks, Latinos, American Indians/Alaskan Natives, Native Hawaiians/Pacific Islanders, and/or people with disabilities).

Type: Grants

Eligibility: 

• Microsoft’s mission is to empower every person and every organization on the planet to achieve more. Grant recipients should support this mission and embrace opportunities to foster diverse and inclusive cultures within their communities.
• PhD students must be enrolled at a university in the United States, Canada, or Mexico.
• Proposed research must be closely related to the general research areas carried out by Microsoft Research as noted in the Research areas tab above.
• PhD students submitting a proposal for this grant must self-identify as a woman, African American, Black, Hispanic, Latinx, American Indian, Alaska Native, Native Hawaiian, Pacific Islander, and/or person with a disability.
• Students must be in their fourth year or beyond in a PhD program when they submit their grant proposal. Students must have started their PhD in September 2016 or earlier to be considered in their fourth year of the program.
• PhD students must continue to be enrolled at the university in the fall of 2020.
• Payment of the award, as described above, will be made directly to the university and dispersed according to the university’s policies. Microsoft will have discretion as to how any remaining funds will be used if the student is no longer qualified to receive funding (e.g. if the student unenrolls from the program, graduates, or transfers to a different university). Grants are not available for extension; however, leaves of absence will be considered on a case by case basis.
• Funding is for use only during the recipient’s time in the PhD program; it cannot be used for support in a role past graduation, such as a postdoc or faculty position. Those interested in receiving this grant will need to confirm their PhD program starting month and year, as well as their expected graduation month and year.
• A recipient of the Microsoft Research Dissertation Grant subject to disciplinary proceedings for inappropriate behavior, including but not limited to discrimination, harassment (including sexual harassment), or plagiarism will forfeit their funding.

Number of Awards: Not specified

Value of Award: 

• The 2020 Microsoft Research Dissertation Grant recipients will receive funding up to $25,000 USD for academic year 2020-21 to help them complete research as part of their doctoral thesis work.
• An invitation to the PhD Summit: a two-day workshop in the fall held at one of Microsoft Research’s labs where fellows will meet with Microsoft researchers and other top students to share their research.

How to Apply: Doctoral students enrolled in their fourth year or beyond of PhD studies and who are underrepresented in the field of computing must submit their proposal directly.

• It is important to go through all application requirements in the Award Webpage (see Link below) before applying.

Visit the Program Webpage for Details

We Live in a Disintegrating World

Patrick Cockburn

My favourite slogan about Brexit over the past three years is written in large white letters on a red gable wall in the Tigers Bay district of Belfast. It was painted before the referendum of 2016 and, below a union flag, reads: “Vote Leave EU. Rev 18:4.”

The biblical reference is to a verse in the Book of Revelations that reads: “And I heard another voice from heaven, saying, come out of her, my people, that ye be not partakers of her sins, and that ye receive not of her plagues.”

These seemed to me, when I first saw a picture of the mural, to be compelling reasons for leaving the EU and about as truthful as many other reasons advanced by those in favour of doing so. The verse cited is, in fact, more pertinent to the issue of resisting a large and oppressive international organisation than the muralist may have realised. Revelations is filled with mysterious references to monsters, such the “beast from the land” and the “beast from the sea” who has “seven heads and 10 horns”. But experts consider these weird creatures to be coded hostile references to the Roman Empire and to Roman Emperors who were persecuting the early Christians, of whom the author of Revelations was one, in Asia Minor at the end of the first century AD.

The Belfast muralist has finally got their way as the UK escapes from the supposedly diabolical clutches of the EU. Leavers consider today to be one of liberation and Remainers lament a self-inflicted disaster that they see as being against the flow of history. But in both cases, this is a very west European view that gives a very partial and misleading view of recent history: if we include the eastern side of the European continent from the Atlantic to the Urals over the past 30 years, the trend towards the greater integration within the EU is more than counter-balanced by disintegration to the east.

The break-up of the Soviet Union and Yugoslavia in the 1990s are seldom considered to have any lessons for the EU: the Soviet Union was believed by much of the rest of the world as an evil empire and Yugoslavia similarly as a sort of mini evil empire, the demise of both being both inevitable and a good thing.

But the forces favouring disintegration that broke up the Soviet Union and Yugoslavia have ominous points in common with those now threatening the EU. Fairly or unfairly, people outside the decision-making hub in Moscow, Belgrade and Brussels felt that their wishes were being ignored and power monopolised by unrepresentative elites at the centre. Local politicians rode a nationalist wave, claiming that all sorts of good things would happen once self-determination had been achieved.

In some cases, these promises were kept; in others they were soon discarded and forgotten, at least by those who made them. In many senses, we have long been living in an era of disintegration without quite realising it, as multinational federations break up and international organisations, such as the UN and World Trade Organisation (WTO), fragment or become moribund. President Emmanuel Macron was lambasted for describing Nato as “braindead”, but it is scarcely alone. This trend is obscured because academics and politicians in western Europe have tended to be enthusiasts for the EU and for the integration of nation states, as if there was no chance of a shift in the opposite direction. Timothy Less, of the Centre of Geopolitics and Grand Strategy at Cambridge, formerly a diplomat at the Foreign Office specialising in eastern Europe, points out that there have always been plenty of expert institutions in Europe “focusing on integration, but very few study disintegration”. Along with others with experience of eastern Europe in recent decades, he is sceptical about the prospects for the EU surviving the permanent crisis stemming from the diverging national interests of its members.

The nation state is being re-energised because multinational entities like the EU failed to cope successfully issues like immigration, deindustrialisation and globalisation. But the process of disintegration happens within as well as between states, producing winners and losers in close proximity to each other. In the UK, the referendum and two general elections highlighted the political and economic split between metropolitan cities plugged into the global economy and the hinterland around core urban areas. The gilets jaunes in France draw on a similar pattern of support, as does Donald Trump in the US.

A central question for both the UK and the EU post-Brexit is whether or not this impulse towards disintegration will continue, or whether it will be counterbalanced by a contrary trend towards consolidation. The Brexit crisis fostered the growth of nationalism in England and Scotland, as well as of nationalist/Catholic and unionist/Protestant nationalism in Northern Ireland. The Scottish National Party leaders were jubilant at their success in the general election in December as were Irish nationalists in Northern Ireland, encouraged by the Tories abandoning the DUP and proposed tariff barrier down the Irish Sea.

But the break-up of the UK may be further off than many believe at the height of the crisis because a strong Tory majority makes Scottish and Irish separatism less of a practical possibility. The SNP might have been better off avoiding a general election and keeping a weak minority Tory government in office, whose feebleness would have further disillusioned Scots with the union. In Northern Ireland, Sinn Fein is very much a constitutional party these days, looking for Irish unity to be delivered by demographic change and a border poll.

As for the EU, it has looked strong when negotiating with weak UK governments, but in other tests of strength, such as defending the nuclear deal with Iran from demolition by Trump, it has been pathetically ineffectual. For all its commercial clout, it appears incapable of withstanding pressure from the US, Russia and China. The decay of multinational institutions and alliances may not lead to an apocalyptic crisis, as the author of Revelations foretold, but it will certainly produce a more dangerous world.

Rising “under-employment” fuels discontent in Australia

Mike Head

The soaring number of workers who are either jobless or under-employed—struggling to get more work—especially in outer working-class suburbs and regional areas, is driving down wage levels and fueling seething unrest in Australia.

In parts of the country, such as the Shoalhaven region, south of Sydney, Mandurah, south of Perth, and western Brisbane, the official “underutilisation” rate has risen sharply over the past six years to near 18 percent. This is more than three times the official national unemployment rate of 5.1 percent.

This rate was registered prior to the ongoing bushfire disaster devastated lives, homes and businesses, and travel bans imposed to try to curb the coronavirus epidemic further crippled tourism-related industries.

While the share market hit record high levels earlier this month, reflecting the vast accumulation of wealth in the hands of the financial elite, that enrichment is taking place at the expense of the working class. That is especially so for the young people and other workers pushed into the ruthless and insecure “gig economy” of casualised, temporary and part-time employment.

Regional figures, compiled by the federal Parliamentary Library based on data from the Australian Bureau of Statistics (ABS), provide a clearer picture of the mounting pressure on low-paid workers who cannot get the hours they want, and need, but who do not show up in the ABS’s official unemployment figures.

The ABS defines underutilisation as those who are unemployed, under-employed or marginally attached to the labour force. Someone who works only one hour a week is not counted in its unemployment rate but would be considered under-employed and therefore appear in the underutilisation rate.

The analysis showed that ABS national underutilisation rate rose to 13.8 percent in October owing to an increase in under-employment to 8.5 percent from 8.3 percent. But the figures varied markedly by region, with the highest levels and steepest growth in outer suburbs and regional centres, where there are large concentrations of working-class households.

Even before the bushfire calamity hit the Southern Highlands and Shoalhaven regions of New South Wales (NSW), the underutilisation rate in those areas was 18 percent.

In Western Australia, the unemployment and under-employment rate had gone from 11.5 percent to 17.5 percent in southwest Perth since 2013 and 12.2 percent to 18.1 percent in Mandurah, an outlying southern suburb.

In Queensland, the proportion of unemployed and under-employed workers had swollen over six years to 16.2 percent from 11.4 percent in west Brisbane and to 14.8 percent from 6.9 percent in the Darling Downs, further to the west.

The underutilisation hit 16.1 percent in southeast Melbourne, 18.1 percent in the mid-north-coast of NSW, 15.5 percent further north in and around Coffs Harbour and Grafton, 15.5 percent on the Gold Coast, and 18.6 percent in the northern area of Moreton Bay near Brisbane.

Corporate and academic economists told Nine Media outlets that the rates, among the highest in the world, were a major factor in driving down wages, which have stagnated or fallen in Australia since the global financial crisis of 2008-09.

AMP Capital chief economist Shane Oliver said the underutilisation rate was now a “chronic problem,” higher than in other developed economies and twice the rate of the United States.

“It has been trending up this year and has been high for a while now, since the global financial crisis,” Oliver said. “It’s indicative of a greater level of hardship for some workers.”

Far from Australian capitalism being isolated from the global processes driving the staggering growth of social inequality, it is one of the most exposed economies in the world—largely because of its high dependence on mineral exports to Asia—as corporations scour the planet for cheaper resources and sources of labour.

Last week, Prime Minister Scott Morrison’s Liberal-National government hailed a drop in the ABS jobless rate from 5.2 percent to 5.1 percent in December. Yet full-time employment fell by 300 to 8,834,700, while part-time employment increased by 29,200 to 4,146,900, continuing the long-term trend. A wave of retrenchments by retail chains that have gone into liquidation since late 2019 have taken place since.

The ABS underutilisation statistics analysed by the Parliamentary Library understate the situation. The latest data from the privately-run Roy Morgan monthly employment surveys showed that in December more than 1.2 million Australian workers were unemployed (8.7 percent of the workforce), with an additional 1.38 million (9.9 percent of the workforce) under-employed. That amounted to a national underutilisation toll of over 2.5 million workers, or 18.6 percent, which was up 118,000 workers during 2019.

This too may be an underestimate. The biennial ABS survey, the “Barriers and Incentives to Labour Force Participation,” last released in late 2017, produced a higher figure of 2.7 million people who would like a job or to work more hours—including 1.1 million who wanted a job but were not classified as being currently in the “Labour Force.”

This reality is producing a sea change in sentiment about the future under the capitalist profit system. A Roy Morgan survey last December showed that a record low 12 percent of people thought 2020 would be “better” than 2019. That was down precipitously by 23 percentage points from a year earlier. Two-fifths (40 percent) thought 2020 would be “worse” than 2019. The net negative rating of 28 percentage points was the largest negative gap in the survey’s history, going back nearly 40 years.

The Parliamentary Library analysis was requested by the Labor Party’s spokeswoman on innovation and the future of work, Clare O’Neil. “Today, almost a third of all Australian workers are part-time,” she said in a speech last year. “And, for the first time ever we are working in an economy where we have on-demand work through companies like Uber or Airtasker.”

But the Labor Party is pledged to assist big business to intensify the “gig economy” in order to boost corporate profits and investment. Last November, in his first major speech since being installed as Labor leader following its devastating May 2019 federal election defeat, Anthony Albanese vowed that his party would be “first and foremost” in “the business of creating wealth.”

Albanese’s “vision” speech to a corporate audience specifically pledged a Labor government would ensure that businesses “thrive and flourish,” including by restructuring the industrial relations system to produce a “21st century workforce” that would need to be “as flexible as the gig economy jobs” that workers would fill.

Albanese depicted the “gig economy” as a fait accompli, glossing over the role of governments, both Labor and Coalition, aided by the trade unions, in imposing it. In fact, he vowed to emulate the Hawke and Keating Labor governments of 1983 to 1996, which worked with the unions to smash up workers’ jobs and conditions in the quest to make Australian capitalism globally “competitive.”

The commitment by the entire political establishment to intensify the decades-long imposition of the requirements of the ruling class is generating explosive political disaffection, that has already seen levels of public “trust” in the political system fall to historic lows.

Australian political establishment once again in turmoil

Mike Head

Just a day before parliament was due to resume for the year, mayhem erupted throughout Australia’s political order yesterday, with the leaders of three parties suddenly either stepping down or being challenged by factional rivals.

Greens leader Senator Richard Di Natale stunned his colleagues by resigning yesterday morning, effective immediately, in the midst of the country’s ongoing bushfire and climate change disaster. Barnaby Joyce, the populist ex-leader of the rural-based National Party, launched a bid to oust the party’s leader, Deputy Prime Minister Michael McCormack. Bob Katter, who heads one of the smaller right-wing rivals of the National Party, announced he was handing over to his son Robbie.

In this morning’s vote by the Nationals’ 21-member parliamentary party room, McCormack barely survived as Nationals leader. They did not release a vote count. Whatever the margin, the party is split and Joyce’s bid will continue to destabilise the party and the Liberal-National Coalition government.

Meeting at the same time, the Greens’ 10 parliamentarians quickly installed co-deputy leader Adam Bandt unopposed as leader, brushing aside calls from some party members for a membership ballot. Senators Larissa Waters and Nick McKim were elected as Bandt’s co-deputies, narrowly beating two rivals, also pointing to ongoing rifts.

The turmoil is a symptom of an intractable political crisis. After years of bitter experiences at the hands of successive Labor and Coalition governments, public trust in the parliamentary establishment had already fallen to a record low, even before the political fallout from the current government’s contemptible response to the ongoing bushfire and climate change disaster.

The hostility toward the government has been compounded by its blatant cover-up of the sports grants pork-barrelling scandal, and its draconian entry ban on all non-citizens who have been in China, which is severely affecting the lives of thousands of residents and students on the pretext of stemming the spread of the coronavirus.

Economists are predicting that the combined economic impact of the bushfires and the coronavirus outbreak is likely to cause a recession in Australia, especially due to the impact on mining exports to China and the multi-billion dollar revenues derived from Chinese students and tourists.

An economic slump will intensify the political unrest already generated by rising under-employment, falling wages, worsening living conditions and growing social inequality. It will also shatter the government’s claim, issued last year, that it has produced a budget surplus as demanded by the financial markets.

The split in the National Party underscores the fragility of its coalition with the Liberals. Joyce, who was ousted by the party’s agribusiness interests as the Nationals’ leader two years ago via allegations of sexual misconduct, is calling for the party to distance itself from the Liberals, currently headed by Prime Minister Scott Morrison. “We’ve got to make sure that we are not a shadow of another party,” he said in announcing his leadership challenge yesterday.

Joyce also declared that the Nationals’ support base was “being attacked on all sides,” notably by Senator Pauline Hanson’s anti-immigrant One Nation and another right-wing rural populist formation, the Shooters Fishers and Farmers Party. These nationalist parties have cynically exploited the worsening hardship among rural and regional farmers and workers caused by the Coalition’s pro-big business program.

If successful, Joyce would have issued the Liberals with new policy demands, forcing a reworking of the coalition agreement. His loss is still expected to pave the way for another challenge, guaranteeing that the instability will continue.

Adding to the volatility, Resources Minister Senator Matt Canavan quit his cabinet post to back Joyce. Canavan, like Joyce, is associated with the most right-wing faction in the Coalition and advocates more corporate coal mining and land clearing. His departure will force Morrison into a more disruptive cabinet reshuffle than the one already required to replace deputy National Party leader Senator Bridget McKenzie, whom Morrison forced to resign on Sunday as the scapegoat for the sports grants rorting scandal.

For now, McKenzie’s deputy party leadership has gone to Drought Minister David Littleproud, who also aspires to replace McCormack.

Even more politically revealing was Di Natale’s abrupt resignation after leading the Greens for five years. He claimed he wanted to spend more time with his family yet admitted that was “one of the biggest clichés in politics.” His departure, coming just as Australia’s bushfire catastrophe highlights the global environmental crisis created by capitalism, underscores the bankruptcy of the Greens’ claims that pressure within the corporate-dominated parliamentary order can lead to policies that stem global warming.

Di Natale’s central perspective—of forming a coalition government with the Labor Party—was dashed by last May’s federal election, in which Labor’s vote fell to a century low. When he was installed as Greens leader in 2015, he claimed the party could double its primary vote to 20 percent in a decade. Instead its vote has stagnated at around 10 percent, and is mostly concentrated in affluent inner-city electorates, despite the falling support for both Labor and the Coalition.

In announcing his resignation, Di Natale still insisted that Australia would have to get used to “power-sharing parliaments” featuring the Greens because of the erosion of support for the two traditional ruling parties. He boasted of what he said the Greens delivered in its last formal alliance with Labor, which propped up the minority Labor government from 2010 to 2013. Among the proudest achievements he cited was the Labor-Greens carbon pricing scheme, which actually saw emissions rise.

New leader Bandt, who once professed to be a socialist, is identified with the party’s supposed “left” wing, which has anxiously sought to appeal to the growing protests over global warming involving large numbers of school students.

Yesterday’s Australian Financial Review editorial gave an insight into the fears and frustration gripping the corporate ruling class over the political turbulence, which has seen six prime ministers, along with dozens of ministers and state premiers, come and go since 2007. Referring to the Coalition’s unexpected and narrow win in last year’s election, it stated: “The hope had been the political miracle of last May would end the instability that has plagued Australia for a decade.”

Less than nine months since the election, however, the hopes of the ruling elite for a stable government that could fully impose the brutal demands of the financial markets on the working class has been dashed. This will only intensify the drive to develop more authoritarian forms of rule to suppress the discontent.

Morrison, who rests on the Liberal Party’s most right-wing factions, ousted Malcolm Turnbull, from the party’s supposed “moderate” wing, as prime minister in August 2018. Morrison, who set about trying to refashion the Coalition into a Donald Trump-style populist movement in order to divert and suppress the rising popular discontent, is now thoroughly discredited. He may soon face a leadership challenge himself.

At the same time, the Labor Party, led by Anthony Albanese, is doing everything it can to divert rising disaffection back into the straitjacket of the parliamentary framework. Far from calling for the government’s removal, Labor is constantly offering advice to Morrison on how to stem public outrage, including by sacking McKenzie over the sports grants affair.

Since being installed as Labor leader after last year’s election debacle, Albanese has sought to woo big business with promises to form a government that would enhance “wealth creation” and initiate a new wave of profit-driven economic restructuring. He repeatedly invokes as his inspiration the Hawke and Keating Labor governments from 1983 to 1996, which, with the collaboration of the trade unions, carried out a historic assault on wages and working conditions while cutting corporate and income taxes, privatising state assets and deregulating the financial system.

The entire Labor and union apparatus is committed to defending the financial and corporate ruling class, which means inflicting even greater attacks on the working class as global capitalism plunges into economic breakdown, trade wars, climate and disease-related disasters and potentially catastrophic military confrontations.

Brazilian oil workers strike against mass layoffs, privatization threat

Gabriel Lemos

Oil workers at Brazil’s giant state-owned energy conglomerate, Petrobras, went on an indefinite strike Saturday, February 1, against the announcement of the closure of the Nitrogen Fertilizer Factory (Fafen) in the southern state of Paraná and moves to privatize the company.

The strike has already met with threats of naked repression. On Monday the Military Police deployed 120 riot-equipped officers and 32 police cars at the gates of the Duque de Caxias refinery in Rio de Janeiro.

Allcontrol outsourced workers at Petrobras strike. (Credit: SindiPetro-LP)

The closure of Fafen, announced on January 14 by Petrobras, will lead to the layoff of 396 full-time employees and another 600 contract workers. Two thousand workers in the production chain will also be affected by the closure. Since January 21, Fafen workers have been blocking the factory’s entrance and keeping it in operation to prevent its complete dismantling.

According to the oil workers’ union federation FUP, which is affiliated to the Workers Party (PT)-controlled CUT union federation, in addition to the action of workers at Fafen, on Saturday morning the strike spread to 12 of the 13 Petrobras refineries and four terminals of Transpetro, the subsidiary responsible for transporting oil and gas, in nine Brazilian states. Twelve offshore oil platforms are also paralyzed by the strike.

The closure of Fafen is part of a broader program announced last June by the government of Brazil’s fascistic President Jair Bolsonaro and his economy minister, “Chicago Boy” Paulo Guedes, to privatize eight Petrobras refineries and Transpetro. These eight refineries are responsible for 50 percent of national oil refining and represent one of the greatest divestment plans in Petrobras’ history. Almost 5,000 workers could be laid off as a result of the refineries’ privatization.

In addition to Petrobras subsidiaries, the Bolsonaro government’s privatization program, announced last August, targets 18 of the 130 federal state-owned companies, such as the giant Postal Company Correios, the electricity and telephone companies, Eletrobrás and Telebrás, the statistics and information technology agencies Dataprev and Serpro, and the Brazilian Mint (Casa da Moeda do Brasil).

Over the past two years, 24 state-owned companies have already been privatized or liquidated, including BR Distribuidora, a former Petrobras subsidiary responsible for the distribution and sale of fuels. Between December of last year and January of this year, 600 workers from BR Distribuidora have been laid off, and almost 1,200 will leave the company through a voluntary dismissal program. These nearly 1,800 workers represent 57 percent of the company’s workforce.

Petrobras workers at Cubatão stop work in solidarity with Fafen and outsourced workers of Allcontrol. (Credit: SindiPetro-LP)

Workers in federal state-owned companies have already begun to respond to the Bolsonaro government’s privatization program. On Monday, some 2,000 workers launched a 24-hour “warning strike” at the Brazilian Mint.Their contract expired this year and they are confronting cuts in food and health benefits as well as the threat of privatization. The Mint workers carried out a two-day wildcat strike, occupying the company during the afternoon and evening of January 10. It was the first strike by this section of workers since 1989.

In addition to the oil and Mint workers 3,000 Dataprev workers from across Brazil have  been on strike since January 24 against the threat of privatization, the announcement of the closure of 20 of the agency units and the layoff of nearly 500 workers.The agency is responsible for paying 35 million retirees. It is one of the largest strikes in Dataprev’s history. Last Friday, in response to the strike, the company was forced to suspend the announced 500 layoffs.

Even as the struggle among workers at the state-owned companies against the Bolsonaro government’s attacks is growing, the unions are already showing the first signs of betrayal. Contract workers at the Petrobras refinery in Cubatão, on the coast of the southeastern state of São Paulo, went on strike on January 21 against a cut in wages of up to 50 percent, cuts in food and health benefits and delays in the payment of wages. On January 28, after the Labor Court ruled the strike illegal and the local union isolated it, failing to call a broader strike involving Petrobras’s full-time employees, 50 contract workers were forced to resign.

The union in Cubatão is one of the five oil workers’ unions of the FNP oil union federation, which is affiliated to the Morenoite-led union federation Conlutas. Unable to wage a united struggle against the company, the FNP called a workers’ assembly only on Monday to decide on the strike, two days after the FUP workers had already begun their job action.

Fafen workers protest in front of the company on January 17. (Credit: FUP)

The most open betrayal is being carried out by the unions against the more than 100,000 postal workers at Correios, which the government plans to privatize in 2021. Like oil workers, postal workers are divided between two postal union federations, the CUT-affiliated Fentect and the Findect, which is affiliated to CTB, the union federation linked to the Maoist Communist Party of Brazil (PCdoB).

Last year, after the announcement of the Bolsonaro government’s privatization program, under  immense pressure from rank-and-file workers, both unions held strike votes on September 10. On the first day, the walkout had a massive participation of 80 percent of Correios’ workforce. 

A week later, on September 17, both union federations shut down the greatest strike of postal workers since 1985 after the Labor Court set a collective bargaining hearing for October 2. The Labor Court then dictated a salary increase of 3 percent—below the 4.3 percent rate of inflation in 2019—the denial of wages for the days workers were on strike and the acceptance of the company’s demand to exclude the parents of workers from the health care plan, except for those who are under medical treatment. According to a report in the daily Agora at the time, Fentect considered the agreement “strategic in the fight against the privatization of the company.”

During the eight-day strike, the CUT, CTB and other union federations kept the postal workers’ strike isolated, calling a demonstration for “national sovereignty” only after the strike had been called off.

Striking workers occupy Casa da Moeda. (Credit: Gabe Lavigne)

Another measure that union federations considered a victory for workers was the Labor Court’s decision not to increase the workers’ contributions to the health care plan. However, on January 23, Federal Supreme Court minister Luiz Fux overruled the  decision, allowing Correios to increase the workers’ contribution by 20 percent. This decision came after Economy Minister Paulo Guedes stated during the World Economic Forum in Davos that the American giant UPS would be interested in the privatization of Correios. The daily Folha de S. Paulo reported on January 15 that 40,000 workers could lose their jobs with the privatization of the company.

The postal workers’ union federations last week postponed an assembly initially scheduled for January 29 to decide on a strike to begin March 18, when the Brazilian union federations will hold a “National Day of Struggle”.

The struggle of Petrobras, Mint and Dataprev workers against the privatization of the companies takes place 25 years after the historic struggle of the federal public sector workers against the privatization program of the neoliberal government of President Fernando Henrique Cardoso (PSDB).

In 1995, after workers in the oil, electricity and telephone sectors, as well as federal university workers, went on strike in early May, the CUT isolated the 32-day strike of oil workers, the longest ever staged against Petrobras. Even as  private sector workers carried out isolated strikes in solidarity with the oil workers, mainly in the so-called ABC industrial belt, Workers Party leader (and subsequent president) Luiz Inacio Lula da Silva went to the newspapers to say that the strike was causing problems for the population due to the lack of gas and fuel. After workers had been on strike for almost a month, he went on to say that, “if it were up to me and [then CUT president] Vicentinho, the strike would be over.”

This statement came after the cutting of strikers’ wages, government threats to arrest and fire workers who occupied refineries and brutal repression by the army, which occupied four refineries. The strike failed to prevent Petrobras from surrendering its monopoly on Brazilian oil exploration, in addition to having 73 workers laid off and the suspension for up to 30 days of thousands of others. 

Today, the CUT and Lula are playing the same traitorous role as 25 years ago. Lula has kept totally silence regarding the Petrobras workers’ strike as well as the strikes by other federal public sector workers. As Folha columnist Bruno Boghossian noted yesterday, “Lula seems to have given Bolsonaro a break,” which “adds to the timid behavior of the opposition to the government.” Lula’s posture is an expression of what he said shortly after leaving prison last November: “There are people who say they need to overthrow Bolsonaro ... [but] he was elected,” adding, “Democratically, we accept the election result. Bolsonaro has a four-year term ... to govern for the Brazilian people”.

No other entity represents this “timid opposition” to the Bolsonaro government as well as the CUT. Last year witnessed the lowest number of strikes since 2013, with a little more than 1,000 strikes in 2019, half of what was seen in each year in the 2014-6 period. In the strikes that were carried out, such as at Correios and by teachers in several Brazilian states, the CUT refused to mobilize broader sectors of workers, allowing the strikes to be isolated and shut down without workers winning their demands.

Since Bolsonaro was elected, the CUT has sought to “negotiate” the interests of Brazilian workers with the fascistic president. In February and March of last year, CUT leaders met with his vice-president, Gen. Hamilton Mourão, to discuss Ford’s plant closure in São Bernardo do Campo. At the time, the president of the ABC metal workers union, Wagner Santana, said that “the country needs to have a strong industry that generates jobs ... it needs incentives, a stronger BNDES [National Development Bank] .... that will make Brazil a competitive country.” This chauvinistic appeal to the Bolsonaro government did not prevent Ford from closing the plan in October of last year, leading the same union to meet with the BNDES officials to request a loan for Grupo Caoa, one of the companies interested in the purchase of the plant for the purpose of exploiting low-wage labor.

The latest expression of the pro-corporate and nationalist policy of the CUT and the rest of the Brazilian unions was Monday’s demonstration in front of the Industry Federation of the State of São Paulo (FIESP), where Bolsonaro will meet with the employer group’s president. The demonstration was called against the “deindustrialization” of Brazil. Nothing has been said about the strike at Petrobras.

This pro-corporate union front has counted on the presence of Conlutas. Despite its rhetoric describing the defense of the national industry as “a delicate topic” and its initial statement that it “would not be part” of today’s demonstration, the federation ended up endorsing it. According to Conlutas national secretary, Paulo Barela, “there is a need for a united front” of union federations against the Bolsonaro government.

Petrobras workers and other federal public sector workers who are coming into struggle must draw the political lessons from the total capitulation of the union federations in the face of the Bolsonaro government’s austerity and privatization programs. The CUT, Lula and the PT are accomplices in the fascistic president’s attacks. This has been made most apparent by the  PT governors of the Northeast region of Brazil, who have imposed state pension reforms mirroring Bolsonaro’s own attack on pensions and backed the repressive policies of  Justice Minister Sergio Moro.

To fight the attacks of Bolsonaro government, and its accomplices in the nationalist and pro-corporate unions, Brazilian workers must form their own rank-and-file committees with the aim of uniting workers of all sectors in the defense of jobs and working conditions and against the privatization of state-owned companies. Above all what is required is a revolutionary workers party to politically mobilize the working class in the fight for a workers’ government and socialist policies.