When the US jobs figures for June were issued on Friday, Wall Street’s S&P 500 and NASDAQ indexes both climbed to new record highs, because the jobs data were regarded as a “Goldilocks” moment—neither too hot, nor too cold.
A sign for a Wall Street building, Wednesday, May 19, 2021, in New York. (AP Photo/Mark Lennihan)
Coming in at 850,000, the jobs growth number—beating economists’ estimates of 720,000 and well above the figure of 583,000 for May—was regarded as a sign of recovery for the US economy, but not enough to push the Federal Reserve towards tightening its monetary policy, as the data showed there were still 9 million people unemployed, compared with 5.7 million in February 2020, before the pandemic hit.
As one analyst told the Financial Times, the jobs figures “couldn’t have delivered better news for Wall Street. Enough new jobs to confirm the economy is on a roll, [but] enough jobless to give the Fed’s current strategy a warm hug.”
Another part of the good news for Wall Street was that, despite evidence of labour shortages in parts of the US economy, and the payment of higher wages, the rise in average hourly earnings for the month was only 0.3 percent, down from the increases in April and May.
The significance of the wages, jobs growth and overall employment data for Wall Street is not so much what they signify in and of themselves—though that is factor—but their implications for the policies of the Fed.
Since the Fed’s massive intervention in March 2020, when it stepped in to halt a meltdown of the financial system with the injection of around $4 trillion, Wall Street has become ever more dependent on the flow of ultra-cheap money from the central bank.
This inflow is continuing at the rate of $120 billion a month—more than $1.4 trillion a year—through the purchase of Treasury bonds and mortgage-backed securities, and the financial markets are fearful that even a slight lessening of this support could have major effects.
Consequently, some analysts are issuing warnings that the present situation, in which markets continue to rise, based on continued economic growth, combined with monetary support from the Fed, is inherently unstable.
In a comment published in the Financial Times last week, Mohamed El-Erian noted that, as recorded by a recent Bank of America survey, markets were currently dominated by three core hypotheses: durable high economic growth; transitory inflation and “ever-friendly central banks.”
El-Erian wrote that while he did not have a serious quarrel with the higher growth scenario, he did “worry a great deal about the widespread conviction that the current rise in inflation will be transitory.”
He did not expect a return to the inflation levels of the 1970s, but “we have to respect the possibility of a shock to a financial system that has been conditioned and wired for the persistence of lower and more stable inflation.”
If inflation remains low, and present rises prove to be transitory, then the Fed will maintain low interest rates. But if that proves not to be the case, then “a late slamming of the brakes, rather than easing off the accelerator, would significantly increase the rise of an unnecessary economic recession.”
A much sharper warning about the state of the US and global financial system has been delivered by economist Nouriel Roubini, who came into public prominence because of his warnings prior to the financial crash of 2008.
In a comment in the Guardian last Friday, he warned that conditions were ripe for a repeat of the 1970s stagflation and the 2008 debt crisis.
He noted that debt ratios today were much higher than in the 1970s, while a mix of loose economic policies threatened to fuel inflation, rather than the deflation that occurred after the 2008 crisis.
“For now, loose monetary and fiscal policies will continue to fuel asset and credit bubbles, propelling a slow-motion train wreck,” he wrote, and pointed to the warning signs.
These included: high price to earnings ratios for shares, inflated housing and tech assets, irrational exuberance surrounding special purpose acquisition companies (firms that are floated on the stock market on a cash only basis, with the aim of taking over another firm seeking a public listing) the crypto-currency sector, the level of high yield corporate debt (junk bonds), collateralised loan obligations, the increased use of private equity, meme stocks and runaway retail daily trading.
At a certain point this would trigger a loss of confidence and a crash, but in the meantime, loose monetary policies will continue to drive inflation, creating the conditions for stagflation, when the next economic shock arrives.
He noted that central banks were in a “debt trap.” If they start to raise interest rates to combat inflation, they “risk triggering a massive debt crisis and severe recession” but if they continue on the present course, they risk double-digit inflation.
Roubini pointed out that the Fed was already in a debt trap, and its recent adjustment from an “ultra-dovish stance to a mostly dovish stance”—when its “dot plot” of interest rates at its June meeting showed a rise in 2023, rather than 2024—changed nothing.
The debt trap was in evidence at the end of 2018—more than a year before the onset of the pandemic—when the Fed dropped proposed interest rate rises and ceased its wind-down of asset holdings, because of the adverse reaction in financial markets.
In response to the Fed’s plan to continue interest rates in 2019, after four rises in 2018, Wall Street had its worst December since 1931, and Fed chair Jerome Powell reversed course and then began cutting rates in July 2019.
“With inflation rising and stagflationary shocks looming, it is now even more ensnared,” Roubini wrote.
There is also clear evidence that financial authorities are no better prepared to deal with a crisis than they were in 2008, or in the March 2020 meltdown, which triggered the latest round of massive financial support.
This was highlighted in a recent blog post by the Bank of England on the events of the spring of 2020. It was potentially more serious than that of 2008, because it centred on the $21 trillion US Treasury market—the bedrock of the global financial system, and supposedly a “safe haven” in times of stress, as investors buy government bonds. In the March crisis however, Treasuries were sold off.
The blog began by noting that while financial markets reflect changes in the economy, they can amplify them as well, and this was evident as the COVID-19 pandemic materialised.
It then drew attention to the role of margin calls in precipitating the crisis. Investors in financial assets use borrowed money at cheap rates to finance their activities, but have to place some collateral with the lender.
This enables them to make huge profits, so long as the underlying asset continues to rise in the market. But if there is a downturn, the lender demands more collateral, a margin call, to cover the fall and this can precipitate a “dash for cash,” leading to a negative feedback loop because the value of financial assets falls further as they are sold off.
The blog post noted that net outflows reached more than 5 percent of assets under management for corporate bonds in the March crisis—the highest since the global financial crisis of 2008.
The risks of a self-reinforcing spiral, inherent in the operations of highly leveraged hedge funds, “crystallised in the US Treasury market in March 2020. ... Notably, hedge funds unwound US Treasury positions following severe portfolio losses and margin calls, contributing to a sharp rise in yields [interest rates] and market illiquidity.”
As the blog noted “large-scale intervention by the Federal Reserve managed to restore market liquidity and break the self-reinforcing loss spiral.”
But as other reports on the March crisis have noted, none of the underlying issues that produced it have been resolved, and no solutions were advanced by the Bank of England blog to prevent a recurrence.
In fact, it concluded with a profession of ignorance, saying merely that it had identified “key questions, emphasised by the Covid-related financial stress in early 2020, that warrant further investigation” and that the authors would “welcome further engagement with the research community on these issues.”
Such a conclusion only emphasises the fundamental point that, in the final analysis, the destructive anarchy of the capitalist economy and its financial system, arising from the system of private ownership, is outside of conscious control and regulation.
Bob Hawke, who later became a Labor Party prime minister, was a highly-valued “informer” to the US government while the head of the Australian trade union movement and president of the Labor Party during the 1970s, a new study of declassified US diplomatic cables has demonstrated.
Bob Hawke, 1982 [WSWS Media]
The documents provide a graphic picture of the true character and role of the Labor Party and the unions, which have always fought to tie workers to the requirements of the corporate profit system and to the Australian ruling elite’s alignment with the dominant imperialist power of the time—initially Britain and then, after World War II, the United States.
Hawke was among a whole multitude of informants in the Labor and union leadership, conspiring with the US embassy and key figures in the Australian ruling elite, behind the backs of the working class, to defend the interests of US and Australian capitalism.
The cables point to how Hawke became a central figure in plans to suppress the eruption of working-class struggles in Australia, as part of a global upsurge, during the late 1960s and 1970s, via a “tripartist” partnership with big business and government. This later gave rise to the Hawke-Keating government’s corporatist Accords with the union apparatuses in the 1980s and 1990s, which transformed the unions completely into industrial police forces against workers.
Covering the period 1973 to 1979, the cables show that Hawke worked intimately with US officials, notably Ambassador Marshall Green, on every key aspect of trade union and Labor policy. Their other preoccupation was how to muzzle rising opposition to the US alliance as a result of the barbaric Vietnam War and to protect highly strategic American military-intelligence bases in Australia.
New light is also shed on Governor-General John Kerr’s anti-democratic dismissal of the Whitlam Labor government in 1975. What is partially documented is how closely Hawke worked with the US embassy in preparing for Whitlam’s removal. And the cables confirm that Washington’s ruling circles did not move against Whitlam because they doubted his own firm commitment to the US alliance, but because they became increasingly concerned that Whitlam could not control explosive working-class militancy.
Mass protest against dismissal of Whitlam government, Sydney November 24, 1975 [Source: Wikipedia]
Extracts from the cables, held by the US National Archives and Records Administration, have been published by Cameron Coventry, a tutor and PhD student at Federation University, in a peer-reviewed article in the Australian Journal of Politics and History, entitled “The ‘Eloquence’ of Robert J. Hawke: United States Informer.”
The documents prove that Hawke was just one of many secret US confidantes throughout the Labor and union leadership, including Gough Whitlam himself. Another prolific informer was John Ducker, the president of New South Wales (NSW) Labor and a member of the Australian Council of Trade Unions (ACTU) executive alongside Hawke.
Among the others conspiring with US officials behind the backs of the population were future Labor leader, foreign minister and governor-general Bill Hayden, future NSW premiers Barrie Unsworth and Bob Carr—later a foreign minister too—Whitlam’s foreign minister Don Willesee and South Australian Premier Don Dunstan.
These systemic relations with US representatives were clearly known, accepted and supported throughout the Labor and union machine, but kept from the view of workers and youth for fear of the hostility that would greet such revelations.
Hawke was just the most prized asset, providing constant inside information and political intelligence to US representatives, who described him as a “bulwark” against anti-US sentiment in the 1970s and an “ideal Australian Labour leader.”
The political context: Hawke and the working-class upsurge
To understand the significance of what the cables show of Hawke’s role in the evolution of the Labor Party and the unions, it is necessary to review the political context of his cultivation and rise to the leadership of both.
A law graduate, Hawke had no working-class background. He came from a relatively privileged and Labor Party family upbringing, which led to him becoming a Rhodes Scholar at Oxford University in 1953. Hawke was initially recruited from doctoral studies at the Australian National University to the ACTU in 1958 as a research officer and advocate by Albert Monk, the ACTU’s longtime right-wing president.
Significantly, the trigger for Hawke’s elevation into the ACTU presidency came in 1969 when rising working-class hostility to two decades of rule by the Liberal-Country Party Coalition government and anti-strike “penal powers” exploded in a three-day near general strike against the jailing of Victorian tramways union official Clarrie O’Shea for the non-payment of a fine that had been imposed on the union.
Monk, who unsuccessfully opposed the strike, saw that his time was up and decided to step down. Hawke was narrowly elected, by 399 votes to 350, to replace him as ACTU president, entirely due to the backing of the “left” union bureaucrats, particularly those from the long-Stalinised Communist Party of Australia, such as metalworkers union official Laurie Carmichael.
The election of the Whitlam government in 1972, finally ending 23 years of Coalition rule, sparked a rising tide of industrial struggle. Workers took the return of a Labor government as a signal to seek to regain lost living standards and demand better social conditions.
In 1972, 2 million working days were lost as a result of strikes; in 1973, 2.6 million and in 1974, almost 6.3 million. This was the most since the industrial and political turmoil of 1919 following the horrors of World War I and the inspiration of the 1917 Bolshevik-led revolution in Russia. Wage claims leapfrogged as workers won first $15 per week, then $24 and even $40 increases.
The Whitlam government’s initial program of limited social reforms, such as universal health insurance, soon gave way to efforts to stifle this movement, impose austerity measures and restructure the economy. Already, the emerging worldwide globalisation of production was shattering the previous program of Labor and the unions of seeking to extract partial concessions from the corporate elite within the framework of wage labour and an insulated national economy.
In December 1973, one year after taking office, Whitlam’s government unsuccessfully tried to pass a referendum to legalise government controls over wages and prices. That referendum, which the Socialist Labour League (SLL), the forerunner of the Socialist Equality Party, strongly opposed, was roundly defeated, setting off the resumption of a wages’ offensive by the working class.
This was part of an international movement by the working class, from the May–June 1968 general strike in France to the defeat of the Heath Tory government in Britain and the collapse of the Nixon administration in the United States, both in 1974, and the downfall of the dictatorships in Portugal, Greece and Spain in 1974–75. In Southeast Asia, US imperialism was being defeated in Vietnam and the dictatorships it had helped install in Indonesia and the Philippines were facing difficulties.
It was this turmoil that led to a CIA-backed campaign to destabilise and oust the Whitlam government, fearing it could not maintain control of the working-class upsurge. But Whitlam’s sacking on November 11, 1975 sparked walkouts by tens of thousands of workers across Australia for days.
Together with Whitlam, Hawke played the pivotal role in shutting down the developing uprising. At a media conference, Hawke summed up the alarm of the Labor and union leaders: “What has happened today could unleash forces in this country the like of which we have never seen. We are on the edge of something quite terrible and therefore it is important that the Australian people should respond to leadership.”
The suppression of that movement, with the help again of the Stalinist and other “left” union bureaucrats, paved the way for the election of the Fraser Coalition government of 1975 to 1983. During that period Hawke became known as the “industrial fireman” for hosing down and selling out industrial struggles, especially when they threatened to politically challenge the government.
Nevertheless, in the wake of the class tensions produced by the 1975 “Canberra Coup,” Fraser’s government was unable to contain the working class. That came to a head in October 1982, when thousands of miners and steelworkers demonstrated outside parliament house, eventually bursting through the doors, in a protest against BHP’s decision to sack 384 miners and more than 3,000 steelworkers.
Under those conditions, Hawke was installed as Labor leader via a backroom parliamentary party caucus move on the eve of the 1983 federal election, with the backing of the Murdoch media. His assignment was to cement a partnership with the unions to strangle the discontent and impose the intensified pro-market restructuring requirements of the corporate elite.
Hawke’s agenda was based on further “opening up” the economy to international finance capital and smothering working-class opposition to the associated destruction of jobs and working conditions. Within weeks of taking office, the Labor government floated the Australian dollar, and soon privatised key state-owned corporations, such as the airline Qantas and the Commonwealth Bank.
Hawke, the US and the Accords
One of the most telling cables points to the US State Department origins of Hawke’s “tripartist” and “consensus” agenda that later underpinned the Hawke-Keating Labor government’s 1983–96 Accords with the unions. These Accords provided the mechanism for shutting down strikes and using the unions to enforce the drive to make Australian capitalism “globally competitive,” at the expense of their members.
Workers protest Labor government’s Accord in December 1984 [WSWS Media]
These proposals were connected to parallel processes internationally, including in the American trade unions. Global industrial relations were of “vital concern” to the United States, according to the cables. Its diplomats wanted to align the ACTU with the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO).
In preparation for a 1974 trip by Hawke to the US and the UK, Ambassador Green told Washington that Hawke “has every prospect of being a major figure on political scene for next 20 years or so, and it will be worth our while to make a real effort to develop a worthwhile program for him.” Green proposed meetings with Chase Manhattan, the International Chamber of Commerce and the Brookings Institution, as well as the AFL-CIO.
The cables confirm that Washington had mended earlier tense relations with Whitlam after he had reassured the Nixon administration of support for the US alliance and American bases in Australia, including the key Pine Gap satellite communications facility in central Australia. US officials feared that these installations were under threat from shifting Australian public opinion.
The embassy’s concern, expressed in August 1974, was that “Whitlam’s weakened position within ALP government has worrisome implications for US. We have relied upon his basic moderation and his support of US defence facilities and other US interests […] ALP is undergoing a crisis of leadership.”
Hawke floated with US diplomats the possibility he would propose a “national unity” government to deal with the crisis. In conversation with US embassy representatives in Canberra in late 1974, he recounted receiving “several feelers about political realignment,” including one from his lifelong friend, business magnate Sir Peter Abeles.
Another cable indicates the involvement of Rupert Murdoch, the then rising media tycoon, in discussions about installing Hawke. Murdoch told the US ambassador: “Hawke is now talking ‘national government,’ which would give him the best chance personally [at becoming prime minister].”
Hawke’s crucial role in the 1975 Canberra Coup itself is not referred to in Coventry’s journal article. The cables do show, however, that Hawke denounced accusations by some Labor “left” figures of US orchestration of the destabilisation of the Whitlam government. In 1974, Hawke publicly rebuked Senator Bill Brown for accusing Ambassador Green of interfering in Australian politics. Green thanked Hawke in person during a meeting at Hawke’s house.
Hawke’s personal relationship with Green is particularly revealing. Before his appointment to Australia in 1974, Green had a record as a coup master. During Green’s term as charge d’affaires in Seoul, General Park Chung Hee had carried out a military coup in 1961, initiating nearly three decades of US-backed military dictatorship. As US ambassador to Indonesia, Green was a key participant in the 1965–66 military coup that brought General Suharto’s brutal junta to power for two decades.
After the dismissal of the Labor government in 1975, plans “intensified” to parachute Hawke into parliament and subsequently the Labor leadership. Hawke briefed US diplomats that he would “move over” from the ACTU to replace Whitlam as leader. Ducker later told them the “cabal conspiracy” to install Hawke failed because the plotters made “a bad mistake to tip their hand prematurely.”
Nevertheless, US officials continued to work very closely with Hawke, regarding his “subtle dampening” of workers’ wage demands as preferable to Fraser’s counterproductive “union-bashing” because Australia was a “highly volatile country.” Hawke understood that unions should not engage in “economy-disrupting industrial clashes.”
This is extremely revealing. It underscores the overwhelming reliance by the ruling class on Labor and the unions, not Coalition governments, to stifle the working class, especially in periods of social unrest and political crisis. That dependence has only intensified ever since, even as Labor and union betrayals have caused their memberships to plummet, reducing them to bureaucratic shells.
Hawke and US militarism
Against the developing public hostility to US militarism as a result of the Vietnam War, Hawke helped cement the absolute commitment of the Labor Party and the union apparatus to the US alliance. Today, this apparatus has lined up unequivocally behind the Biden administration’s intensification of US preparations for war against China to reassert the global hegemony that the American ruling elite secured through World War II.
Bob Hawke with US Secretary of Defense Caspar Weinberger in the Pentagon, in June, 1983 [Credit: Department of Defense Photo, by Robert Ward]
At times, Hawke publicly expressed his desire for an “independent non-aligned Australia,” thus promoting nationalism, while privately telling the US officials he wanted to expand the ANZUS military pact beyond a “purely defensive military alliance.” The US embassy in Canberra saw this “duality” as a means of garnering “left-wing” support.
For several years, to try to poison public opinion in preparation for involvement in a US-led war, the corporate media and the political establishment has bombarded the population with allegations of Chinese “interference” in Australia. Yet the documents again show the real source of intervention, over many decades—that of US imperialism.
In 2010, that “interference” was again behind the ousting of Prime Minister Kevin Rudd, orchestrated by numerous US “protected sources” in the Labor Party, for suggesting that the Obama administration should make some accommodation to China’s rise as an economic power. That operation was laid bare by US diplomatic cables published in 2010 by WikiLeaks, led by Julian Assange. They documented how key coup plotters in the Labor Party and unions—including senators Mark Arbib and David Feeney, and Australian Workers Union chief Paul Howes—secretly provided the US embassy with regular updates on internal government discussions and moves to install Julia Gillard to replace Rudd.
Julia Gillard and Kevin Rudd [Source: Wikipedia]
The latest revelations underscore the necessity for workers and youth to seriously examine this history and draw the necessary political conclusions. What is required is a conscious break from the entire pro-capitalist Labor and union bureaucracy, and a turn to the alternative socialist and internationalist program and leadership fought for by the Socialist Equality Party.
The Conservative party-led House of Commons Education Committee produced a report on June 22 titled, “The Forgotten: how White working-class pupils have been let down, and how to change it.”
Its publication is another cynical move by the Tory government to capitalise on the anti-class identity politics of the affluent petty-bourgeoisie, and has been met with a storm of hypocrisy and racialist reaction in these layers.
House of Commons Education Committee, “The Forgotten: how White working-class pupils have been let down, and how to change it.” (credit: UK Parliament)
By “working class”, the report refers exclusively to pupils eligible for free school meals (FSM)—the poorest 20.8 percent of pupils in January 2021, up from 17.3 percent a year before.
The education committee noted that in 2018/19 White British children eligible for FSM recorded the poorest scores by Development Goals, Attainment 8 scores, Progress 8 scores, GCSE English and Maths pass rates, and entry to higher education of all ethnicities other than Irish Traveler and Gypsy/Roma.
Its report criticises the concept of “white privilege”, calling it “divisive” and “alienating to disadvantaged white communities” and arguing that it “may have contributed towards a systemic neglect of white people facing hardship”.
The Tory chair of the committee, Robert Halfon, told Sky News, “The concept of white privilege is entirely wrong-headed, because white working-class boys and girls from disadvantaged backgrounds under-perform compared to most other ethnic groups.”
He added, “Disadvantaged white children feel anything but privileged when it comes to education. Privilege is the very opposite to what disadvantaged white children enjoy or benefit from in an education system which is now leaving far too many behind”.
The report recommends that schools “consider whether the promotion of politically controversial terminology, including White Privilege, is consistent with their duties under the Equality Act 2010,” and calls on the Department for Education to “take steps to ensure that young people are not inadvertently being inducted into political movements”.
This document has been drawn up by a party which has imposed devastating social spending cuts year after year that are overwhelmingly responsible for “leaving far too many behind”. It is a call for antidemocratic state interference in the education system, used to advance the Tories’ right-wing, nativist appeal to the “White British” population.
But opposition to the naked hypocrisy and authoritarian and reactionary intervention of the Tory government does not imply the slightest support for the proponents of “white privilege” theories, whose racialist irrationalism the Tories have refashioned for their own purposes.
The Tory party has no monopoly on hypocrisy. Labour MP Kim Johnson and her fellow Labour members of the education committee opposed the Tories’ report and submitted an alternative document which begins, “While this inquiry began with a focus on disadvantaged White pupils (specifically, those eligible for free school meals, or FSM), the evidence that we have received clearly indicates that this is an issue of class and often regional inequalities, rather than being about ethnicity.”
Prominent Corbynite Diane Abbott wrote in the Independent, “The reality of course is that the education system has failed whole cohorts of pupils because of factors including austerity, underfunding, and efforts to homogenise the curriculum, as well as the underpayment and mistreatment of hardworking teachers and staff.”
These are representatives of a Labour Party that has dutifully implemented rafts of Tory cuts in the major urban conurbations where it holds power.
Both Johnson and Abbott accused the government of stoking a “culture war”, as did the Guardian. The newspaper editorialised, “MPs ought to be embarrassed by a stunt designed to whip up animosity without addressing real problems of inequality and disadvantage.” It quoted Maurice Mcleod, from thinktank Race on the Agenda, who stated, “Instead of honestly accepting that children from all backgrounds have been badly let down by decades of neglect, this report attempts to create unhelpful divides between children based on their race.”
Such protests are the height of political cynicism. It was not the Tory government which introduced a debate on social disadvantage devoid of class and framed entirely in terms of competing ethnicities. That work was done for them by the same forces now lambasting the Tory Party for its failure to recognise the class roots of deprivation and inequality. The right-wing has walked through the door to ethnic politics held wide open by the putative left.
For years, the Guardian and sections of the Labour Party have waged a determined campaign to racialise every aspect of political debate and social inquiry, holding “white people” and racism responsible for the class-rooted oppression suffered by ethnic minorities. Only two months ago, Labour’s shadow women and equalities secretary, Marsha de Cordova, responded to the government’s rotten Commission on Race and Ethnic Disparities report, commissioned after the UK’s George Floyd protests, with the outraged comment, “The report appeared to claim that socioeconomic conditions drive inequality more than racism.”
The global multi-ethnic protests against police brutality sparked by Floyd’s murder were given the same treatment. The Guardian published, “White America has an ingrained fear of blackness”; the Independent, “White people, the responsibility of ending racist systems rests on your shoulders”.
Even the pandemic, the sharpest demonstration of the common suffering of the international working class under capitalism, has been routinely described as proof of the fundamental societal division of race. The significance of COVID-19, the Guardian ’s contributors have written, is its “ultimate demonstration of the real-world impact of racism” and exposure of “how riddled Britain is with racial inequality”. A report commissioned by the Labour Party, partners in enforcing a policy of social murder with the Tory party, described coronavirus as having “exposed the devastating impact of structural racism”.
It has taken a transparent political manoeuvre by the Tory party, which poses point-blank the disadvantage suffered by the poorest white children, to force these people, who pass broadly for the “left” in British politics, into acknowledging basic class realities. But this is no road to Damascus moment. Labour and the Guardian ’s invocation of class is raised only to dismiss the education report then quickly discarded as they return to their own racialist agenda.
The Guardian rushes to turn the ethnic appeal by Prime Minister Boris Johnson’s government on its head, criticising the government for basing its conclusions on FSM pupils alone and claiming, “Official statistics show that for the 88% of pupils not in receipt of free meals, white British children are ahead, in GCSE English and maths, of their black Caribbean, Pakistani and Gypsy/Roma heritage counterparts.”
These are carefully chosen figures. Just under half (49.1 percent) of White children get grade 5 or above in GCSE English and Maths—higher than the groups cited by the Guardian but lower than Black African (50.7 percent) children and all Asian groups (58.3 percent) except Pakistani.
It is striking that once the focus shifts from the very poorest sections of society, there is barely a social statistic to cite on education that is not based on ethnicity, despite the Guardian itself acknowledging that “a majority (60%) of people identify as working class”.
In an earlier period, even bourgeois sociologists would speak broadly in terms of class privilege and advantage. Academic reports and government statistics would break down results according to the categories, A (upper middle class), B (middle, middle class), C1 (lower middle class), C2 (skilled working class), D (working class) and E (not working), based on the occupation of the head of household.
These classifications were informed by a sociological narrative aimed at combating the influence of Marxism and the definition of class based on ownership and control of the means of production, the bourgeoisie, and the necessity to work for this capitalist class, the proletariat. Today what is called for from the petty-bourgeois ideologists is not the distortion of a class analysis but its complete obliteration in order to better conceal and suppress the class struggle.
What social research is done in this field proves that ethnic differences are cut across and dwarfed by the influence of class. A study by academics at the London School of Economics reported last August that whereas the average child of parents in “higher professional occupations” gained eight GCSEs, the children of parents in “routine occupations” gained half as many, just four.
It is the same story with Labour’s alternative education committee report. After referring to the importance of class in its first paragraph, the authors are compelled to state: “For every £1 of White British wealth, Pakistani households have around 50p, Black Caribbean have 20p and Black African and Bangladeshi have 10p.”
What useful meaning can these cited ethnic terms possibly have? “White British wealth” is an aggregate of FSM children and billionaires like Sir James Dyson. “Pakistani households” include Pakistani-British billionaire Sir Anwar Pervez. Bangladeshi households include some of the poorest communities in the country and Bangladeshi-British multi-hundred millionaire Iqbal Ahmed OBE.
The averages show that the richest sliver of the white population holds larger fortunes than the richest sliver of the ethnic minority population. At most they indicate that a higher proportion of ethnic minorities are working class and poor. What the figures obscure is that they share this status with thevastmajority of the white population. This multi-ethnic class has the shared social interest of overthrowing the whole system of capitalist inequality and exploitation and must be politically united in pursuit of that end. Dividing workers along racial lines serves to undermine that struggle and to promote the interests of a small, affluent layer of ethnic minorities who use the plight of their “racial group” as leverage for personal advancement and securing a larger slice of the wealth in the richest 10 percent of society.
This is the purpose of the “white privilege” racket, which claims that white people in general are conferred social advantages over, and are complicit in the oppression of, non-white people in general, for which whites must atone—usually by financially supporting the BAME bourgeoisie and petty-bourgeoisie.
In the words of Kelsey Smoot, writing in the Guardian last June, white people share “culpability in White supremacy”, leading her to question, “Would they truly want to wake up tomorrow, in an America in which my life mattered just as much as theirs, if it came at the cost of all they have come to know and enjoy in the vein of White privilege?”
The answer to their complicity and guilt is “a willingness to lose things. Not just the extra $50 in one’s monthly budget by way of donating to an organization working towards racial justice. I mean palpable, incalculable loss. The loss of the charmed life associated with being a White person in America. Refusing a pay raise at one’s job and insisting that it be reallocated to co-workers of color who are undoubtedly being underpaid.”
The BBC gave a more shamefaced definition of “white privilege” in the aftermath of the education committee report, provided by American rapper JT Flowers, “You might be a white person and still be poor with a lack of access to education or face a language barrier in the workplace. It doesn't mean you can't be disadvantaged in other ways. It just means with respect to that one particular thing—your race and skin colour—you do have the luxury of not being able to think about it.”
In this account, all that is left of the concept is the facile analysis that white British people are not the subject of racism, from which is hung the filthy lie that racism flows collectively from “white people” and underlies all hardship suffered by non-whites.
There is nothing left-wing or progressive in these theories. An especially pernicious role is therefore played by the pseudo-left who attempt to give racialist politics a socialist gloss.
Writing on the education committee report, the Socialist Workers Party repeats the line of the Guardian et al with the headline, “Anti-racism isn’t to blame for Tory education failures”. The article maintains the pretence of a class perspective, while continuing to hold out an olive branch to the proponents of white privilege, employing the weasel formulation, “Theories of ‘white privilege’ are right to point to racism in society. But they don’t identify the system that produces it.” In fact, these theories identify racism as a universal and inherent divide in the working class and actively oppose any attempt at a class analysis.
The danger of the Johnson government’s increasingly strident appeal to “whites” is not that it challenges the identity politics which has been allowed to define the “left” for decades, but that this left, together with the entire Labour Party and the trade unions, has done all it can to undermine class consciousness, sow divisions in the working class and thereby prevent a unified struggle against capitalism. The construction of a mass socialist movement of the working class against all inequality and oppression depends on a root-and-branch rejection of racialism and its ideological siblings.
Last week as the Delta variant of Covid continued to spread internationally, Ireland's Fine Gael, Fianna Fáil, and Green Party coalition reluctantly postponed lifting the final phase of public health restrictions, scheduled for July 5, which would have seen the reopening of indoor restaurants and pubs.
The token delay in no way confronts the growing threat posed by the Delta variant, which now accounts for over 50 percent of daily infections in Ireland.
Micheál Martin (credit: Wikimedia Commons)
The National Public Health Emergency Team (NPHET), the overall medical professional body advising the government, warned last week of 'a peak of deaths in August' with projections showing the variant infecting 'thousands of people per day'. Taoiseach (Prime Minister) Micheál Martin who leads Ireland's coalition government told the Dáil (parliament), 'I spoke... with Nicola Sturgeon First Minister of Scotland and she used a very telling phrase. She said Delta will rip through an unvaccinated population. All their eggs are in the vaccination basket'.
Even this was too much for Ryanair boss Michael O'Leary. The billionaire airline CEO rubbished NPHET’s warnings as a 'variant scariant' narrative in an open letter to Transport Minister Eamon Ryan. Earlier this year, O'Leary complained that NPHET was disseminating misinformation, 'scare stories' and stoking 'mass hysteria' despite much evidence that hasty opening of travel restrictions contributed to the second COVID wave.
As of July 1, there have been 5,000 deaths from Covid-19 in Ireland. A further 448 infections were reported on Thursday, with 44 hospitalised and 14 in [intensive care units. Chief Medical Officer Dr Tony Holohan warned Taoiseach Martin that despite the vaccination programme the 'black cloud of the Delta variant loomed as a clear threat... The rise in the number of cases in the past week is following a similar pattern that is being seen across a number of European countries.'
Delta is proven to be 40 to 60 percent more infectious than the Alpha strain, previously the dominant variant in Ireland. Despite this, the government, with broad support from Sinn Fein, the main parliamentary opposition, has opened up almost all workplaces and schools thereby gambling with the lives of millions of workers for the sake of profit. Only about 44 percent of Irish adults have been fully vaccinated.
The strategy from business and the ruling elite is to push the lowest paid and most exploited workers back to work. These workers are mainly young and unvaccinated. The government is also aiming to claw back from working people the greater portion of the huge debt burden the state has accrued during the pandemic.
In March, the European Commission reported that Ireland is forecast to have run up a total government debt of €241.6 billion for 2021, up almost 10 percent on 2020. This amounts to €48,291 this year per person, which is the highest across the European Union and higher than the UK. It is forecast to rise a further € 1,509 per person in 2022. Martin told a business function last week that 'the level of spending by the Government during the pandemic, is 'not sustainable' and must 'move to the next stage'.
The 'next stage' as outlined by Martin and other representatives of corporate interests will swiftly emerge as a huge attack on workers living standards and rights in order to maintain the flow of profits. Last month the government introduced a series of measures including the cutting of Covid-19 jobless benefit, increases in taxes on the family home, the lifting of eviction restrictions on landlords introduced at the start of the pandemic, and a draconian increase in the powers of the Gardaà (Police).
Last week, the Gardaà set up vehicle checkpoints (Multi Agency Vehicle Checks) targeting recipients of social welfare entitlements, including Pandemic Unemployment Payment (PUP). This payment was first introduced in March of 2020, to compensate those who lost all their employment due to the Covid-19. To enforce a full return to work, particularly in low paying jobs, the coalition government last month outlined its intention to cut the PUP in September and November. Workers receiving just €250 per week will see a cut of €50 euro to bring them down to a subsistence unemployment rate.
The IrishMailonSunday, for example, ran a front page tribute to the far right businessman and owner of the Supermac's chain, Pat McDonagh, who has attacked the meagre PUP payment to workers made jobless by the pandemic. The banner headline read, 'Supermac's Boss: 'Covid Payments claimed By Fraudsters''
While workers are facing immediate reductions in benefit, as rent and mortgage debts pile up, the government has developed a host of schemes benefiting the corporations and rich.
At the beginning of this month the coalition outlined a €3.6 billion package of spending supports to boost the Irish economy in the form of further grants to employers. Part of the package is an extension of the Emergency Wage Subsidy Scheme introduced in March 2020 at the start of the pandemic which gives a flat rate subsidy to employers. These latest generous subsidies to business can be added to a long list of grants and loans now estimated at €8.5 billion.
Danny McCoy, CEO of the Irish Business and Employers Confederation (IBEC), Ireland's largest lobby and business group, welcomed the giveaway, telling the Irish Times, 'Focus must now turn to ensuring the activation of the labour market and safely returning workers to the workplace as swiftly as possible.'
While handouts to business run to billions, there is deepening poverty in the working class. A new report from Oxfam shows the fortunes of Ireland's billionaires rising €3.3 billion since the start of the Covid-19 pandemic. Jim Clarken, CEO of Oxfam Ireland, told RTE news recently that 'a rich elite are riding out the pandemic in safety, while those on the frontline are struggling to pay the bills and put food on the table. In Ireland, the fallout from the pandemic on employment has disproportionately hit young adults as well as people in low-paid occupations, all of whom are more likely to be paying rent'.
Latest figures from advocacy group Social Justice Ireland predict that due to the pandemic the unemployment rate will increase by the end of this year to 390,000, or 16.1 percent of the workforce. This is far beyond the highest rate recorded during the banking crash and economic meltdown in 2008 when unemployment in Ireland peaked at 14.6 percent.
The delayed 2020 UEFA (Union of European Football Associations) Football Championship (Euro 2020) began a year late on June 11 and is now at the semi-final stage. While in previous Euro cups one nation has hosted the competition, Euro 2020 has seen 24 national teams play in 11 different cities across Europe, from Seville to Baku.
Tournament matches have been attended by over 800,000 fans despite the resurgence of COVID-19. Many of those in attendance travelled hundreds or thousands of miles to watch their team play.
Prime Minister Boris Johnson poses for a photograph outside 10 Downing Street with a giant St George's flag ahead of the England Quarter Final game against Ukraine. July 1, 2021 (Picture by Simon Dawson/No 10 Downing Street/Flickr)
Next week’s semi-final and final matches are due to be attended by over 60,000 fans each at London’s Wembley stadium, though Britain is deep into a third wave of coronavirus driven by the more deadly and more infectious delta variant.
England’s Round of 16 victory against Germany at Wembley Stadium, attended by more than 40,000 fans, led to wild celebrations of thousands of closely-packed home fans shouting and singing arm-in-arm despite the “official” implementation of social distancing within stadiums. The government pushed forward with the large attendance at matches, and the media promoted celebrations violating social distancing measures as part of the ruling class’ effort to promote a “back to normal” attitude.
Britain’s Conservative government also hopes to use the strong performance of the England team, which will play a semi-final against Denmark at Wembley Stadium on Wednesday. The intent is to raise nationalist fervour and distract from the government’s deadly herd immunity policy that has led to over 152,000 deaths where a death certificate mentions COVID-19 as one of the causes. On Saturday, Prime Minister Boris Johnson stood on a massive English flag draped across Downing Street to declare his support for the team before its quarter-final against Ukraine that evening.
On Saturday, the UK had a seven-day average of 23,115 cases, up from 13,835 a week earlier. According to the British Medical Association, COVID-19 hospitalizations in Britain have risen 55 percent over this period. On June 30, the UK saw 331 new hospitalizations from COVID-19, the most since March 18. The spread of the delta variant in Britain is a warning for what is to come on the European continent, which has an even lower vaccination rate.
London is using its higher vaccination rate compared to other European countries to give a false, anti-scientific rationalization of its herd immunity policy. New Health Secretary Sajid Javid, who aims to prematurely end all social distancing restrictions on July 19, repeated the murderous mantra of French President Emmanuel Macron, asserting in an op-ed for the Mail on Sunday, that the British population must “learn to live with COVID.”
The resurgence of the virus in Europe, driven in no small part by the Euro 2020 cup, threatens a catastrophe on a largely unvaccinated population. Only 39.7 percent of the European Union’s (EU) population have received two doses. In the wider European area, including Russia and other non-EU countries, many of which played in Euro 2020, only 24 percent are vaccinated, according to the World Health Organization (WHO). Half of elders in the continent remain unprotected as well as around 40 percent of health care workers.
On Thursday, WHO regional director for Europe, Dr Hans Henri Kluge, warned: “By August, the WHO European Region will be ‘delta dominant’; but by August, the Region will not be fully vaccinated (63 percent of people are still waiting for their first jab); and in August, the WHO European Region will still be mostly restriction-free, with increasing travels and gatherings.”
Kluge added, “The three conditions for a new wave of excess hospitalizations and deaths before the autumn are therefore in place: new variants, deficit in vaccine uptake, increased social mixing.” After a 10-week decline in cases across Europe, Kluge revealed that the number of cases rose 10 percent last week.
Asked by a reporter whether Euro 2020 games were acting as “super-spreader” events, Kluge cautiously responded: “I hope not … but this can’t be excluded.”
In fact, it is already clear that stadiums have been major vectors for the spread of the virus:
*Public Health Scotland said that there had been 1,300 cases among Scottish fans who travelled to London for Scotland’s game against England.
*Finnish health authorities reported nearly 100 confirmed cases among fans who travelled to St. Petersburg—which saw 115 COVID-19 deaths on July 1—for Finland’s game against Russia.
*Danish authorities are currently trying to track down 4,000 contact cases after three fans tested positive for the delta variant after a match in Copenhagen.
The English, Swedish, Spanish, Scottish and Slovakian national football teams all have reported cases either in preparation for, or during, the tournament.
While stadiums are a major concern, these are not the only places that infections linked to Euro 2020 occur. Senior Emergency Officer for WHO Europe Catherine Smallwood raised concerns about travel to the stadium, asking, “How are people getting there? Are they travelling in large-crowded convoys of buses? Are they taking individual measures when they are doing that?” Infection rates have also been driven by large groups of fans congregating at bars, “fan zones” and private residences to watch games.
Speaking to AFP , Antoine Flahault, the director of the Institute of Global Health at the University of Geneva, said of the tournament, “if we want to spread the Delta variant around Europe then this is the way to go.”
As infections accelerate, sections of the ruling class are distancing themselves from the decision to press ahead with the tournament with tens of thousands of fans attending. In a joint press conference with Johnson, German Chancellor Angela Merkel said she was “very concerned” that 60,000 fans in Wembley “might be a bit too much.”
This came after Merkel’s interior minister, Horst Seehofer, called UEFA’s decision to host 42,000 fans at the June 29 Germany-England match “absolutely irresponsible,” adding: “I have the suspicion this is about commerce again.”
Merkel and Seehofer are cynically trying to distance themselves from Johnson’s brazen “herd immunity” policy, though they pursued this same deadly policy in all but name—forcing a premature reopening of schools and businesses in Germany that led to 91,032 deaths.
UEFA’s decision to go ahead with Euro 2020 was, however, undoubtedly determined by the profit interests of Europe’s multi-billion-dollar media and sporting conglomerates. According to insideworldfootball.com, revenue from Euro 2020 is expected to exceed €2.5 billion. At Euro 2016, UEFA made €847 million in profits from a smaller revenue of €1.92 billion. While figures from ticket sales are currently unavailable for Euro 2020, Euro 2016, held in France, raised €269 million from attending fans.
Brazil has averaged 1,500 daily deaths throughout the tournament and now has an official tally of over 523,000 COVID-19 related deaths.
The decision taken by UEFA to push ahead with Euro 2020, without the necessary safety measures in the face of a mass resurgence of the virus, exposes the financial aristocracy’s contempt for the lives of millions of European football fans. The full support capitalist governments across Europe have given the tournament underscores their determination to allow the virus to continue spreading unchecked in the population.
