As inflation surges, Spanish unions and Podemos slash real wages

Alejandro López

The spectacular increase in inflation throughout 2021 and 2022 has been a severe blow to the wages and living conditions of workers in Spain and internationally, further aggravated by European Union (EU)-NATO sanctions imposed on Russia amid the NATO war drive against Moscow.

Podemos party leader Pablo Iglesias speaks in the Spanish parliament in Madrid, Spain, Monday, Dec. 30, 2019. (AP Photo/Paul White)

Spain’s inflation accelerated well above expectations in February to its fastest pace in nearly 33 years. Consumer prices rose 7.4 percent in February from a year earlier driven by food, beverages, fuel and energy, mainly the price of electricity, which last week reached a new maximum of €442 per megawatt hour.

According to data from the Ministry of Labor published in February, wages established in collective bargaining agreements between employers and the trade unions in the first quarter of 2022 saw an average wage increase of only 2 percent, 0.5 percentage points above the December figure, but four points below the inflation registered in January (which was 6 percent, according to the National Institute of Statistics). This is based on the analysis of 1,554 collective bargaining agreements that cover 4.1 million workers.

Significantly, this is also below the minimum wage rise agreed between the Socialist Party (PSOE)-Podemos government and the trade unions for 2022: it will rise 3.6 percent, to €1,000 monthly. Celebrated as a progressive measure, the minimum wage increase in fact nonetheless remains below inflation. That is to say, workers’ real purchasing power will go down.

According to the Ministry of Labor report, most collective agreements closed with an increase of between 1 percent and 2 percent: eight out of 10 workers have seen their salary increase in that range. Only one in 10 have seen their payrolls grow at the same rate as inflation, shielded by salary review clauses that legally oblige companies to increase salaries in the same proportion as inflation.

This is an unusual practice among Spanish business, located mainly in industries where militant struggles took place during the transition to parliamentary rule after the death of fascist General Francisco Franco.

However, as El Periódico noted, “this is not always a guarantee that companies will comply with it, especially at the present time when the increases are usually agreed upon [between unions and employers] are far from the highest inflation in 30 years.” In these industries, like in the poultry and rabbit slaughterhouses or the metal and chocolate industry, unions are scrambling to suppress the workers’ struggles to keep wages below inflation.

At national level, CCOO, UGT and Spain’s largest business federation, CEOE, are preparing the Agreement for Employment and Collective Bargaining (AENC), a kind of “agreement of collective agreements” where these pro-capitalist organisations set recommendations to update salaries. These negotiations are leading to mass poverty. There are 11 million poor people in Spain of a population of 47 million, of which 4.5 million suffer from severe poverty, according to Oxfam. Among those living below the poverty line, 1 in 4 is an active worker.

Meanwhile, as workers are receiving poverty wages, banks and corporations have received lucrative profits. The 34 largest companies in Spain have declared a combined net profit of more than €54 billion, the maximum ever recorded. Banks earned €20 billion last year, the highest profits since the previous crisis in 2008. The five banks on Spain’s stock exchange—Ibex 35, Santander, BBVA, CaixaBank, Sabadell and Bankinter—have achieved the highest profit in the last decade. All these banks have been involved in mass redundancies, totaling over 20,000 last year.

Surging inflation is a byproduct of two interrelated policies. The first, the policy adopted by the ruling class in the US and Europe in response to the pandemic of pumping trillions of euros into the financial markets to prop up share values. Further adding to inflationary pressures are disruptions in supply chains due to the refusal of capitalist governments to implement an eradication strategy against the pandemic, which has led to massive infections and deeply disorganized the economy.

Second, the crippling economic sanctions imposed by the US and EU against Russia. The imperialist powers claim the destruction of the Russian economy and the ruble will deepen divisions within the Russian oligarchy and fuel social discontent, creating the conditions for regime change and even the breakup of the resource-rich country. However, by trying to cut Russian oil, gas and wheat out of world markets, they are creating conditions for an unprecedented surge in prices for essential commodities.

The trade unions and the ‘Left Populist’ Podemos party, in government with the PSOE, function as key tools of the ruling class to impose this policy. They have not only implemented a policy of mass infection during the COVID-19 pandemic, but also are pouring weapons into Ukraine to fight Russia troops. This goes hand-in-hand with war on the working class at home.

Over the past year, the PSOE-Podemos has passed reactionary labour reform presented as “progressive,” which in fact consolidates the right-wing Popular Party’s 2012 labour reform, the largest attack on Spanish workers since the Franco era. An increase in the minimum wage is below inflation levels. And a Minimum Vital Income subsidy only affects 160,000 households.

The Podemos-backed government is making it clear it is opposed to any salary increase. Mimicking the voices of powerful sections of finance capital that are demanding central banks lift interest rates to suppress the growing movement of the working class for wage rises, the Minister for Economic Affairs, Nadia Calviño, said: “From the point of view of economic stability in the medium term, we have to avoid a sharp rise in wages that produces structural inflation, what is known as second-round effects.”

Prime Minister Pedro Sánchez said wages should not increase, to “avoid what economists call the second-round effect, that is, that this rise in prices ends up permeating the entire economy.”

CCOO and UGT unions are supporting the mass COVID-19 infection policy and the EU-NATO war drive. Having backed the sanctions against Russia, they are now calling for rallies in front of workplaces throughout the country so that workers can “condemn” the invasion of Ukraine by “Putin’s Russia.” The rallies will last five minutes and, according to CCOO’s leader Unai Sordo, will allow the workers to “express their condemnation of this law of the fittest” imposed by the Russian president.

The CCOO leader acknowledged that, although the sanctions that are being imposed on Russia are “necessary,” they will “carry a slowdown in the economy” and a rise in prices, which “has a very decisive impact on wages.”

The NATO campaign against Russia will drive escalating class struggle across the world

Tom Hall

The reckless escalation of economic, political and military pressure by the United States and NATO against Russia is rapidly leading to a major global economic crisis with serious repercussions for the international working class.

At least 2,000 striking Minneapolis teachers, support staff and their supporters rallied outside the State Capitol in St. Paul, Minn., on Wednesday, March 9, 2022. (AP Photo/Steve Karnowski)

The campaign against Russia, which includes a crippling sanctions regime aimed at starving out the Russian people which has all but cut off Russia from the world economy, is aimed at the conversion of that country into a colony of western imperialism and the plundering of its natural resources. Putin’s invasion of Ukraine, while it is reactionary and must be opposed, is the product of a years-long campaign of escalating provocations by NATO against Russia, using Ukraine as bait.

Millions around the world look at the unfolding events in eastern Europe with anxiety and fear that they could rapidly escalate into a nuclear war. But the crisis is also triggering immense economic dislocation that is driving towards a massive explosion of class conflict. The orientation of those who seek to oppose the drive to a third World War must be, as Leon Trotsky observed in 1934, not to the war map, but to the map of the class struggle.

In a statement last week on the economic impact of the war and western sanctions against Russia, the International Monetary Fund predicted, “Price shocks will have an impact worldwide, especially on poor households for whom food and fuel are a higher proportion of expenses. Should the conflict escalate, the economic damage would be all the more devastating. The sanctions on Russia will also have a substantial impact on the global economy and financial markets, with significant spillovers to other countries.”

This is already beginning to take place. Oil prices have reached $130 per barrel, and in the United States, gasoline prices at the pumps have surged past $4 a gallon to their highest levels ever. In France, the price of gas has gone from €1.65 per liter at the end of last year to €2.20 per liter, or $9.16 per gallon. Wheat futures have already risen by 70 percent this year–Russia and Ukraine together account for one-quarter of all grain exports. In Europe, industrial production is beginning to shut down due to soaring energy prices.

In the month of February, US inflation reached 7.9 percent, and in the Eurozone it reached 5.8 percent, the highest level on record since the creation of the single currency in 1997. Inflation is expected to rise sharply in March as the consequences of sanctions reverberate throughout the world economy.

But among the worst hit will be developing countries in Africa and the Middle East. Starvation and famine in this region of the world is a real possibility. Eighty percent of grain in Egypt is purchased from Russia. Other major importers of Russian grain include Turkey, Bangladesh, Nigeria and Yemen.

The impact on the working class will be enormous. It is already reeling from more than two years of the pandemic, in which millions have died and living standards have been eroded to the breaking point by inflation caused by pandemic-induced chaos in global supply chains. This social trauma is the product of deliberate rejection of necessary public health measures by the world’s governments, above all the United States, in the name of “herd immunity,” or the sacrificing of life to profit.

Governments are using Ukraine to deflect attention from the war which should be waged against the pandemic, which is not over and is already beginning to surge again. They are also using it to recast inflation, which was already at its highest level in decades before, as a “Putin price hike” entirely the fault of Russia, in an attempt to deflect economic anxiety towards hatred of a foreign enemy. But while the wealthiest layers of society, including the most privileged layers of the middle class, have been gripped with war hysteria, there are no signs that this campaign is having any significant effect within the working class.

In a speech last week announcing a ban on Russian oil imports to the United States, President Biden presented the economic impact of these measures in the United States as a necessary sacrifice in the name of “defending freedom.” But neither Biden nor anyone else ever bothered to ask workers in the United States, much less workers in Africa and the developing world, whether they wanted to make such sacrifices for a reckless campaign which raises the danger of World War III.

No such sacrifices are being demanded of the corporate oligarchy, who will make money hand over fist from the war just as they have during the pandemic. Indeed, the stock prices of major US defense contractors such as Northrup Grumman and Raytheon have risen sharply in recent weeks. Western oil companies and agribusiness are also licking their chops at the prospects of superprofits from worldwide shortages derived from the removal of their Russian rivals.

The war in Ukraine is being used as cover to redirect billions in resources away from social programs benefiting the working class towards war. The latest spending bill making its way through Congress includes nearly $800 billion for the military, including $15 billion in spending for Ukraine, while omitting $15 billion in pandemic-related funding. The corporate media in Britain is calling for the gutting of the postwar welfare state for the sake of increasing military spending. Most ominously, Germany has rammed through a tripling of the military budget for this year, the largest increase since Adolf Hitler.

The attitude of the ruling class was summed up most crudely and bluntly by a Wall Street Journal editorial, whose headline declared, “NATO Needs More Guns and Less Butter.” The phrase recalls the infamous statement by Hermann Goering that “iron has always made an empire strong, at most butter and lard have made the people fat.”

The social consequences of this reckless campaign are preparations for a showdown between the working class and the capitalist class in each country, in which mass anger will intersect with the growing radicalization which is already underway as a consequence of the pandemic. The past two years have seen major strikes by industrial workers in the United States, the growth of wildcat strikes throughout Turkey, the defiance of anti-strike injunctions by healthcare workers in Sri Lanka and Australia, and other significant expressions of social opposition.

The ruling class itself is deeply concerned about this possibility, and nervous comments in the press have appeared comparing the current situation to the oil shocks of the 1970s, which drove a major strike wave in industrialized countries, as well as the Arab Spring of 2011, in which mass anger over the cost of living fueled revolutions in Tunisia and Egypt.

The response of capitalist governments claiming to be “defending freedom” in Ukraine will inevitably involve the greater use of state repression, including injunctions, anti-strike legislation, executive orders and other measures to suppress working class opposition at home. Already, an anti-strike injunction has been issued against 17,000 BNSF railroad workers in the United States, justified on the basis of protecting national supply chains. Many more such measures can be expected.

This campaign of repression also directly involves the cooperation of the pro-corporate unions. The United Steelworkers is openly boasting of its sellout “non-inflationary” contract limiting wage increases for 30,000 US oil refinery workers to 3 percent, an agreement which was worked out in direct behind-the-scenes personal discussions between USW head Tom Conway and Biden. At the same time, the corporate press will be counted on to brand any resistance from workers as the result of Russian sabotage, with workers acting as “Putin’s patsies,” as the British press recently branded striking London underground workers.

The social basis for the fight against war is the international working class. In contrast to the capitalist ruling class and the most privileged layers of the middle class, the social interests of the working class are irreconcilably opposed to war. Workers have nothing to gain from war, but as always will be made to foot the bill.

While Biden and other heads of state preach “national unity” in the name of fighting Russia, the consequences of the drive to war and the divergent responses of different layers in society will more and more openly reveal that the real dividing line in world society is not between NATO and Russia, but between the working class and the capitalist class in all countries.

Above all, the squandering of social resources for war raises the basic conflict between the capitalist system, which is based on the private accumulation of profit and national rivalries leading inevitably to war, with the maintenance and growth of a modern industrial society.

British ruling class to vastly increase military spending

Robert Stevens

NATO’s long-planned conflict with Russia over Ukraine has triggered an explosion of imperialist militarism. British capitalism is fighting to keep its place as lead dog in the US war drive.

After Brexit, the UK based its foreign policy on cleaving as closely as possibly to US imperialism. It sought to strengthen its naval power in the Asia-Pacific, targeting China, while carrying on as America’s chief anti-Russian sabre rattler in Europe.

The run up to and aftermath of the Ukraine war have been touted by Prime Minister Boris Johnson’s government and its supporters as proof of the success of this policy, proclaiming Britain’s ability to marshal Europe behind the US even from outside the EU, by leveraging its military credentials.

Tanks uploaded on military truck platforms as a part of additional British troops and military equipment arrive at Estonia's NATO Battle Group base in Tapa, Estonia, Friday, Feb. 25, 2022. (AP Photo/Sergei Stepanov)

However, Russia’s invasion has been used to justify a massive rearmament of the UK’s European rivals. This is led by Germany, now planning a €100 billion “German Army Special Fund” and at least an additional €24 billion a year for the defence budget, meeting NATO’s minimum 2 percent of GDP mandate.

An open discussion has begun on the transformation of Europe into an independent military bloc. The Telegraph writes that the “war in Ukraine has supercharged efforts to build an EU [European Union] army”. Leading member of the European Parliament Guy Verhofstadt told the Austrian newspaper Wiener Zeitung, “We need a united EU military. The member states were always against it, now hopefully they are waking up.”

These moves, especially by the much larger economy of Germany, threaten to crowd Britain out of its coveted position as the premier military power in Europe. It has so far attempted to carry out its foreign policy objectives while maintaining defence spending at just over 2 percent GDP. Its two new multi-billion-pound aircraft carriers have been built as troop numbers have been steadily cut, from 24,940 in 2010 to a planned 19,400 by 2024/5.

Europe’s military ambitions prompted the Guardian to argue in an editorial for the UK to seek a more balanced relationship with the EU and the US-dominated NATO. Declaring “Putin’s military aggression” a threat to both, the editors concluded, “For the foreseeable future, British interests will require institutional partnership with the EU on the level of foreign and security policy.”

The Tory Brexiteers counter that there must now be a massive increase in UK military spending to maintain Britain’s standing on the world stage.

On Tuesday, former Thatcher aide Nile Gardiner argued in the Daily Express, “Defence spending should double from two percent to four percent in the coming years if Britain is serious about being a world power again that can stand up to the likes of Russia and China.

“Britain has demonstrated tremendous political leadership on so many fronts with regards to Ukraine but the reality is, we need to be able to fight and win a ground war against the Russians in Europe.”

“We have to have that capability we had generations ago.”

UK military spending was almost 8 percent of GDP in the mid-1950’s, a decade after World War Two, and was still 4 percent in 1980.

Gardiner’s call is echoed in the highest echelons of the military and government.

Sir Michael Fallon, defence minister under prime ministers David Cameron and Theresa May, told the Sunday Telegraph that the case for more spending was now “unanswerable”. He called for an immediate 25 percent increase “building beyond 2.5 percent by the end of the Parliament. That’s the kind of ambition we need.”

General Lord Dannatt, former Chief of the General Staff intervened to demand an end to “cutting the size of the army any further”. Lord West, formerly a Labour government minister responsible for security and an adviser to Prime Minister Gordon Brown, demanded, “we should be looking at a minimum of 3 percent of GDP for defence”.

Tobias Ellwood, the Tory chair of the House of Commons defence select committee, argued for “a minimum of 3 percent of gross domestic product if Britain wants not only to defend its interests but play an enhanced leadership role on the international stage in these uncertain times”.

The first mammoth increase will be announced in Chancellor Rishi Sunak’s March 23 spring statement. Sky News reported Sunday that the “Treasury received almost £9bn more in tax receipts in January 2022” and that two sources told the broadcaster most of this windfall was earmarked for military spending.

This is only a down payment. Far more will come from savage cuts to social spending.

Ben Zaranko, a senior research economist at the Institute for Fiscal Studies, penned a revealing article for The Conversation on Monday, “Defence cuts effectively paid for UK welfare state for 60 years—but that looks impossible after Ukraine”.

He writes, “The ‘peace dividend’ from lower spending on defence has, in effect, allowed successive governments to pay for a growing welfare state without having to increase the overall size of the state. In other words, more healthcare without a higher tax burden. That’s been a handy trick—but you can only repeat it for so long.”

Zaranko explains, “If Germany succeeds in meeting its 2% of GDP target, the UK would need to boost its own spending by around 20% to retain its number two spot within Nato.”

Healthcare, pensions, welfare and education currently account for nearly 60 percent of all government spending. Total military spending, including military defence, civil defence, foreign military, foreign economic aid, and defence R&D, consumes 5 percent. Making resources available for a stepped-up military confrontation with Russia means radically shifting this balance.

Within days of the outbreak of war in Ukraine, all social spending is being spoken of as an unaffordable luxury to be done away with.

Sunday Telegraph editor Allister Heath spelled out how brutal the offensive will be: “The post-Blairite era of social-democratic largesse must end: the state needs to refocus on its core function of defending lives, liberty and property. We require less redistribution, and enhanced resilience. This implies large spending cuts. The social care plan will need to be abandoned, the pensions triple-lock axed, the NHS reformed and numerous wasteful subsidies, pseudo-levelling-up policies and other programmes and handouts ended.”

The Blairite Labour Party has no differences with this agenda. Party leader Sir Keir Starmer was calling on Johnson even before the Russian invasion to “reverse the government’s plans to axe 9,000 soldiers and 79 tanks from the army after a ‘decade of decline’ in the armed forces,” in the words of the Times. Shadow Defence Secretary John Healey said yesterday he expects a “big boost to defence” in the Chancellor’s spring statement.

Workers must be warned: This devastating onslaught on the living standards of millions is not being readied for the future. The offensive is underway, with the ruling class on a war footing abroad and at home.

The government has already funneled hundreds of millions of pounds to Ukraine’s government in the first weeks of the war and on Wednesday Defence Minister Ben Wallace vowed to step up its supply of arms, with the UK now sending anti-aircraft missiles. It has already sent over 3,600 anti-tank weapons as well as other small arms and ammunition. The cost of every one of these weapons will be clawed out of the backs of the working class.

War in Ukraine and Russia sanctions threaten food supplies in Middle East and North Africa

Jean Shaoul

The US-NATO provoked war in Ukraine threatens food supplies around the world, not least in the Middle East and North Africa where food is already unaffordable for millions thanks to the decades-long wars of US imperialism.

Russia and Ukraine account for nearly one third of the world’s grain exports, one fifth of its corn trade and almost 80 percent of sunflower oil production.

Exports from both Russia and Ukraine have virtually ground to a halt because of sanctions imposed by Washington and the European powers on Russia’s banks, shipping and airlines. The northern Black Sea ports, a key battleground in the war and through which most of Russia and Ukraine’s grain exports are shipped, have closed because of the fighting, halting dozens of cargo vessels. Ships are not available for chartering. Flight bans are causing cargo planes to divert around Russian airspace, increasing costs and travel time.

Wheat field in Tomsk, Siberia (Creative Commons)

According to the International Monetary Fund (IMF), the price of wheat increased 80 percent between April 2020 and December 2021 as the pandemic took hold and geopolitical tensions mounted, while wheat prices have jumped 37 percent and corn prices 21 percent so far in 2022.

Price rises are due in part to investor speculation, about which little is said, the diversion of arable land to ethanol production, droughts and climate change in key-producing countries, including Iran, which has suffered its most severe drought in 50 years, Syria, Morocco, Iraq, Turkey, and Egypt. The wheat carry-over—what’s left from past crops—is at its lowest since 2008, when food prices surged, triggering food riots in more than 60 countries. Even before Russia’s invasion of Ukraine, geopolitical tensions had roiled global food markets, with dire consequences for countries reliant on imports from the Ukraine, including Lebanon and Yemen where more than half the population already suffer from acute food insecurity.

The UN’s World Food Program (WFP), which provides food for the Middle East and North Africa’s poorest and most food-vulnerable countries such as Syria and Yemen, is dependent on Ukrainian wheat. WFP chief David Beasley told the BBC World Service that the number of people facing potential starvation across the world had already risen from 80 million to 276 million in the four years before Russia's invasion, due to what he called a “perfect storm” of conflict, climate change and the pandemic.

Egypt, the world’s largest wheat importer, gets around 86 percent of its imports from Ukraine and Russia and has been unable to find significant alternative supplies. Turkey sources 75 percent of its wheat imports from the two countries. Lebanon imports 60 percent of its total wheat consumption from Ukraine, Tunisia nearly 50 percent, Libya 43 percent and Yemen 22 percent.

The US Department of Agriculture expects that Iran, Syria, Iraq, Turkey and Egypt will together have to increase grain imports in the 2021-22 agricultural year to 35.5 million metric tons, or 17 percent of the world total, up from 25.9 million tons in 2020-21 when it constituted 13 percent of the total.

Bread prices are particularly sensitive in Egypt, where 30 percent of the population lives on less than $1.50 a day and relies on subsidized bread for one third of their calories and 45 percent of their protein. The ruling elite is acutely conscious that attempts to raise the price, unchanged since the 1980s, set off food protests in 1977 and demonstrations in 2008, and was a major factor in toppling President Hosni Mubarak in 2011. Since then, protests have taken place in 2017, 2019 and 2020 over the soaring cost of living. Last year, President Abdel Fatteh el-Sisi announced he would raise subsidised bread prices, a move yet to be implemented, but with Egypt’s bread subsidies already costing $3.2 billion a year, the Finance Ministry estimates it will have to budget an additional $763 million in 2021-22.

In Lebanon, where prices have soared by 1,000 percent in less than three years, there is only a month’s worth of supplies on hand. Amid a collapsing economy, in March 2020 the government defaulted on its international debt and has reduced subsidies on a range of goods, including bread, some types of which now cost five to nine times more than three years ago.

Yemen has faced a catastrophic war following the US-backed Saudi invasion of the country in April 2015 to put down the Houthi-led insurgency that had ousted the Western-backed government. It is highly dependent on bread, which accounts for more than half of the calorie intake for the average household. Rama Hansraj, Yemen’s director of Save the Children, said, “In Yemen, 8 million children are already on the brink of famine. Families are exhausted. They’ve faced horror after horror through seven years of war. We fear they will not be able to endure another shock, especially to the main ingredient keeping their children alive.” She warned of a global “ripple effect” that could unleash “additional horrors” in other vulnerable countries.

Tunisia, where President Kais Saied dismissed parliament last summer amid unrest over unemployment and soaring inflation, was already struggling to pay for grain imports. While the government controls the price of bread, it has for months failed to reimburse the bakeries for the cost of flour, leading bakeries to close early or ration supplies. Saied is desperate for an IMF loan to cover international debt, whose conditions require cuts to public sector wages and subsidies.

Sudan is also dependent on wheat and vegetable oil imports from Russia and Ukraine. Its foreign reserves have plummeted to less than $3 billion this month and faces the threat of renewed US sanctions after the mass killing of pro-democracy activists. Sudan’s deputy leader Mohamed Hamdan Dagalo flew to Moscow to offer Russia a naval base on the Red Sea in a bid to pre-empt sanctions.

The cost of fertilisers for domestic production is likewise soaring. The price of gas and potash, used in production, have risen, after the European Union announced sanctions on Belarus, a leading producer of potash, and Russia—which supplies about a quarter of the key nutrients used in European food production—along with China, took steps to safeguard their own supplies. Yara International, the Norwegian chemical company, told the BBC that a shortage of fertilisers could hit crop yields, leading to “a global food crisis.”

There is a further issue, as Frank Fannon, former assistant US secretary of state for energy told the Financial Times, “Commodities have been weaponised for a long time… it’s always a question of when does a state pull the trigger.”

Washington and the major powers see the war in Ukraine as a foreign policy “opportunity” to force their client states into line and reorder the world economy in their interests. In the context of wheat, other exporting countries such as the US, Canada and Australia—while they cannot make up the shortfall—stand to benefit from a surge in demand.

The world’s ruling elites are acutely conscious that the food price crisis will stoke social instability, migration and political unrest as was the case with the Arab Spring revolutions in 2011.

Last month, anti-government protests and food riots broke out in Morocco. This week, truck drivers struck for three days in protest at spiraling fuel costs and called for a cap on prices and profiteering by the distributors.

Australia: Flight attendants’ union orchestrating sell out of Qantas workers

Terry Cook

The Flight Attendants Association of Australia (FAAA) is holding meetings this month to ram through a new enterprise agreement (EA) virtually identical to the deal overwhelmingly rejected by 2,500 Qantas long-haul cabin crew in December.

A section of a Qantas airplane [Credit: pxfuel.com]

Qantas executive Rachel Yangoyan admitted in an email sent to staff late last month that, apart from a few “clarifications” relating to fatigue management and crew availability requirements, the company’s current proposal “is the same.”

After 97 percent of long-haul flight attendants at Australia’s largest airline rejected the deal last year, the company applied to the Fair Work Commission (FWC) to have the existing EA terminated. The manoeuvre threatened to slash wages and conditions for cabin crew on the airline’s international routes, forcing them onto the industrial award—the minimum pay and conditions legally allowed for the sector.

Under the award, hourly base pay for flight attendants would be reduced by 20–40 percent, and crew could be forced to work 48–88 more hours per 56-day roster period.

Now, management and the union are using this threat to browbeat workers into accepting the rotten EA. The FAAA has made clear it will not mount any challenge whatsoever to the company’s grubby manoeuvres with the FWC. On the contrary, the union is urging workers to back the deal, telling them the only alternative is being forced on to the award.

In a statement responding to the company’s ultimatum, FAAA national secretary Teri O’Toole cynically declared: “Seventy-four percent of our crew said they would have to leave the profession if they had to work under the modern award. This becomes too high a risk, and so we have the deal back on the table and will support it.”

In other words, O’Toole is telling Qantas, and every other airline, the union will back any EA, whatever assault on jobs, pay and conditions it contains, as long as the minimum wage award looms as, in her own words, “a gun to the head” of workers.

Now, the union is working to deliver precisely the outcome Qantas was hoping for when it made the FWC application. At the time, Qantas International chief executive Andrew David said: “We’re open to putting the same deal that was rejected back on the table.”

The FAAA has no objection to workers’ fates being decided by the federal government’s anti-worker tribunal, as long as the union has a seat at the table. Last month, the union lamented the fact that Qantas had sought to tear up the agreement “without even contemplating asking for the assistance of the Fair Work Commission to try and reach agreement.”

O’Toole claimed: “This is EBA11 and the conditions that were traded on the previous 10 could be lost if the union pushes with a challenge to the termination.” In fact, the deal on the table represents a dramatic acceleration of the erosion of working conditions enforced by the union over decades.

The proposed four-year EA will impose a wage freeze until June 2023, followed by sub-inflationary 2 percent annual increases in the third and fourth years. It will also enforce a raft of regressive changes to working conditions including to rostering. One such change would enable management to roster all crew for up to 240 hours per 56-day period, a 20 percent increase for many flight attendants.

The current seniority-based rostering system would be abolished, allowing all crew schedules to be allocated at the absolute discretion of the company. In addition, the deal would substantially increase the number of days per roster cycle that crew must be available for work at short notice if required.

Yangoyan declared the company’s deal “a positive outcome for everyone and an important step in securing the critical changes we need to support the recovery of our international business.”

In other words, Qantas, which sacked or stood down thousands of workers during the pandemic, is now seeking to maximise profits with the resumption of international travel by slashing wages and conditions.

The unconditional commitment by the FAAA to enforce the company’s dictates is not an aberration. It is the continuation of the airline unions’ decades-long collaboration with Qantas and other carriers to restructure operations and cut costs.

In 2007, the FAAA rammed through a sell-out enterprise agreement allowing Qantas to establish a second-tier workforce with vastly reduced pay and conditions for new hires. In preparation for the addition of the Airbus A380 to its fleet, the company established a subsidiary, QF Cabin Crew Australia, to employ new staff on inferior base salaries and conditions. The FAAA hailed this development as “overwhelmingly positive.”

In 2020, the airline unions, including the FAAA, signed off on EAs covering their members at Virgin Australia that imposed an 18-month to two-year pay freeze. The unions argued the deal provided “job security” by placing “Virgin on the footing it needs to be a strong, competitive airline.” In reality, the deal was part of an ongoing vicious restructuring of the airline carried out at workers’ expense, including the axing of 3,000 jobs ahead of its sale to private equity firm Bain Capital.

Even as the airlines utilised the COVID-19 pandemic to restructure their operations and bring forward long-planned cost-cutting measures, the airline unions continued to plead for increased government assistance to the carriers that would eventually amount to billions of dollars.

In another cynical move, the FAAA is looking to channel the widespread anger generated by Qantas’s ongoing attacks, which are fully backed by the Liberal-National government of Scott Morrison, into the election of an equally pro-market Labor government in the upcoming federal election.

This is the purpose behind O’Toole’s recent comment that the current industrial relations system, “which allows businesses to throw out entire agreements, was unfair” and her call for “a government that does not allow business to trash its employees.”

In fact, the current “Fair Work” laws were introduced by Labor in 2009 with the full support of the unions. The draconian industrial laws include harsh anti-strike provisions and provide the FWC extensive powers to terminate enterprise agreements, shut down industrial action and impose heavy fines on workers for breaching its directives.

Labor Party leader Anthony Albanese has promised a Labor government he leads would be “first and foremost” in “the business of creating wealth.” Albanese vows to follow the lead of former Labor prime ministers Bob Hawke and Paul Keating, who, in close collaboration with the unions, established the anti-worker enterprise bargaining system and laid the groundwork for the “Fair Work” legislation.

The track record of the airline unions, and the FAAA’s current collaboration with Qantas, demonstrates that to oppose the management offensive and advance the fight for better pay and conditions, airline workers must take matters into their own hands.

Omicron wreaks death in Quebec on a scale not seen since the pandemic’s first wave

Hugo Maltais

As the right-wing Coalition pour l’avenir du Québec (CAQ) provincial government eliminates the last mitigation measures against the COVID-19 pandemic, mortality statistics are revealing the catastrophic consequences of its pursuit of a “profits before life” policy during Canada’s Omicron variant-fueled fifth wave.

A member of the Canadian Armed Forces working at a Quebec nursing home. (Canadian Dept. of Defence)

According to the latest data from Quebec’s Institute of Statistics, Quebec saw 24 percent more deaths in the third week of January 2022 than prior to the pandemic. This is the highest level of excess morality since the pandemic’s first wave in spring 2020, when the excess mortality rate peaked at 57 percent. In the first wave, Quebec had one of the highest per capita mortality rates in the world, due in part to the ruinous conditions in seniors’ nursing homes, public and private alike.

In total, Quebec recorded 7,900 deaths in January 2022, a 13 percent increase in mortality from the month of January in the years that preceded the pandemic.

According to Statistics Canada, excess mortality represents “mortality above what would be expected based on the non-emergency mortality rate in the target population” and is “a better indicator” than officially-recorded COVID deaths “for monitoring the magnitude of the pandemic and making comparisons.”

The Omicron wave is proving to be the deadliest in absolute numbers since the second wave (October 2020–January 2021) when vaccines were not yet widely available. According to Quebec’s official tally of COVID-19 deaths, since the beginning of December 2021 the Omicron wave has caused approximately 2,550 deaths, or more than 18 percent of the 14,100 COVID deaths the province has recorded since the beginning of the pandemic two years ago this month. It is the deadliest wave for people under 60 years of age since the first wave, causing at least 116 deaths in this age group.

Discussing the Omicron wave’s impact at the pan-Canadian level, University of Toronto Professor Tara Moriarty recently explained that deaths in the 19 and under age group during the Omicron wave account for more than 42 percent of all COVID deaths in this age group throughout the pandemic. Omicron is also responsible for nearly 45 percent of all intensive care hospitalizations for COVID among those 19 and under, and 57 percent of all hospitalizations.

These figures are a tragic exposure of the lying propaganda promoted by the Justin Trudeau-led federal Liberal government, its provincial counterparts, and the corporate media that the Omicron variant is “mild.” Canada’s political establishment has also claimed that schools are “safe” and the virus’ impact on young people is benign or akin to that of a cold. This propaganda has had only one objective: to silence opposition to the elimination of any public health measures that might impede the accumulation of profit by big business, the banks and the rich.

In Quebec, the CAQ government, led by multi-millionaire and ex-Air Transat CEO François Legault, is rushing to eliminate whatever limited and insufficient anti-COVID mitigation measures remain.

In a matter of weeks in February, the government allowed restaurants to operate at maximum capacity and allowed all businesses to reopen, announced plans to completely phase out vaccine passports by March 14, and removed the mask mandate in elementary and high school classrooms. During this period, hardly a day went by without the government making a new announcement that an anti-COVID public measure was being rolled back or completely scrapped.

On March 2, the CAQ government announced that the requirement to wear masks in public places will be eliminated “by mid-April at the latest.” This announcement was accompanied by the now customary statement that Quebecers must “learn to live with the virus,” which means, as Legault himself admitted, accepting more hospitalizations and deaths.

Quebec’s Public Health Director Dr. Luc Boileau said that wearing a mask would become “a personal choice as part of a progression towards a normal life.” Since most of the population no longer has access to PCR tests to detect the virus and data on the extent of mass infection is otherwise increasingly unreliable and difficult to obtain, the government is leaving this “choice” to be made blindly by each individual.

Premier Legault’s office confirmed that “in the future, vaccines and masks will be the insurance policy to avoid new lockdowns.” Made in conjunction with the government’s announcement of the closure of some vaccination centres and the impending elimination of the mask mandate, this statement confirms that the CAQ is determined to declare the pandemic over. And this, even as scientists are sounding the alarm about the danger of a new, more deadly wave fueled by the Omicron BA.2 sub-variant, which recent studies have found to be more contagious, more virulent, and more vaccine resistant than its BA.1 parent.

For the ruling class and its political representatives, the entirely preventable deaths of 2,500 Quebecers in less than 100 days are of no consequence. This is underscored by the recent announcement that the government will not hold a ceremony this year to officially mark the March 11 National Day of Remembrance for the victims of COVID-19.

In January, government officials publicly rejoiced that 2 million Quebecers had been infected during the Omicron wave, falsely claiming that this would confer immunity to the coronavirus. This figure was later revised upwards to about 3 million, provoking further expressions of joy from Quebec’s Chief Medical Officer Dr. Boileau, who declared that “everything is going in the right direction.”

In the up-side-down world that these ruling class mercenaries inhabit, the shocking revelation that about 40 percent of Quebec children were “exposed” to the virus during the Omicron wave in COVID-infested schools was the occasion for announcing not a tightening of measures to protect children, but the lifting of the mask mandate in classrooms.

By putting profits ahead of lives, the ruling class has not only condemned thousands to die. It is also covering up the other perverse health consequences of the pandemic.

According to a recent study published in the medical journal The Lancet Child & Adolescent Health, 5.2 million children worldwide have lost a parent or primary caregiver to the pandemic. This figure has doubled in the last six months. In Canada, some 2,000 children have lost a parent.

Legault, Boileau and Health Minister Christian Dubé, who all frequently invoke the “mental health” of children in arguing for schools to be kept open and the mask mandate ended, have nothing to say about the psychological wounds inflicted on children who have lost a parent. Nor will they address the trauma suffered by children who know or fear that they have involuntarily infected a deceased relative. According to Dr. Joanne Liu, a pediatrician at the Sainte-Justine University Hospital in Montreal, the trauma of children who have infected a loved one is very real: “We feel the impact of the psychological distress experienced by children who have unfortunately infected one of their grandparents.”

The CAQ government is also blithely ignoring the devastating impact of Long COVID. It is scientifically established that a significant number of people who have contracted COVID-19 suffer from long-term symptoms such as heart problems, brain fog, headaches, muscle pain, shortness of breath and extreme fatigue. Studies suggest that 10 to 20 percent of people stricken with COVID-19, including children, experience such symptoms three months after their infection. For some, symptoms have persisted for a year or more.

Experts say that at least 9,000 Quebecers currently suffer from the disease. The three clinics that specialize in caring for people with Long COVID have waiting lists of hundreds of names. Across Canada, there are an estimated 170,000 people suffering from Long COVID.

By knowingly allowing millions of people to be infected with a disease that is likely to have such a long-term impact, the ruling class is creating a generation of sick and disabled people. With the federal government’s elimination of pandemic assistance to workers, those who suffer from Long COVID to the point of being unable to work are threatened with destitution.

This situation is exacerbated by the widespread official denials of the severity or even existence of Long COVID. For the thousands of people who have contracted the virus in the workplace, the process of having their occupational disease recognized and receiving compensation is in most cases a long road that ends in a refusal. Some worker compensation boards, such as WorkSafe NB in New Brunswick, simply do not recognize the existence of Long COVID syndrome, dismissing evidence of its existence as “anecdotal.”

In Quebec, the Workplace Health and Safety Commission (CNESST) claims to recognize Long COVID as an occupational disease or syndrome, but many workers have reported that their claims have been rejected. This is either because the CNESST has deemed the medical evidence of post-COVID symptoms as insufficient or because they were unable to demonstrate to the agency’s satisfaction that they had contracted COVID at work. Due to the absence of PCR testing, it will henceforth be almost impossible for a worker to prove that they were infected at work and thus satisfy the CNESST bureaucrats.

German trade unions support military build-up and declare an industrial truce

Ulrich Rippert

A few days after Chancellor Olaf Scholz (Social Democratic Party, SPD) announced a gigantic increase in the German military budget in the Bundestag (federal parliament) to frenetic applause from all parties, the trade unions signaled their approval.

Two days after the chancellor’s war speech, the IG Metall (IGM) union and the Federation of German Industries (BDI) issued a joint statement, signed by IGM President Jörg Hofmann and BDI President Siegfried Russwurm. It says, “The top representatives of the BDI and the IGM, who are also co-founders of the ‘Future of Industry’ alliance, strongly support the sanctions against Russia imposed by the German government, the European Union and the Western allies.”

Members of Ukraine’s Territorial Defense Forces, volunteer military units of the Armed Forces, train in a city park in Kyiv, Ukraine, Jan. 22, 2022. (AP Photo/Efrem Lukatsky, File)

IG Metall not only supports the war hysteria against Russia, but it also agrees to pass on the devastating economic consequences of the sanctions policy—skyrocketing fuel and energy prices, high inflation, layoffs, short-time working and wage losses—onto its members and stifle any resistance to them.

The sanctions would “also lead to disadvantages for Germany, its companies and employees,” the joint statement says, which must be cushioned “as far as possible.”

As at the beginning of the First World War, when the trade unions concluded an industrial truce with the Kaiser’s imperial government and the employers’ associations, today the unions are dropping any pretences that they are pursuing any other interests than those of the wealthy corporations and the German government. In this way, they are playing an integral role in the German state’s preparation for a third world war.

Even clearer is a joint statement by IG Metall Baden-Württemberg and the Südwestmetall employers’ organisation, which declares that it is Russia’s military aggression which has necessitated and impressively produced a “united and determined” response by Germany, Europe and its allies. “We support the measures adopted,” both organisations stress.

The joint statement leaves no doubt this will require a dramatic increase in military spending. The sanctions against Russia are expressly welcomed, despite their dire effects on the population in Russia and in Germany. “These measures will demand sacrifices from all of us,” the highly paid union and business executives declare, knowing full well they won’t have to do any “belt-tightening.”

In its statement, the German Trade Union Confederation (DGB) also supports the sanctions, stressing the “adverse consequences” of them “will not leave us unscathed.” In addition to disrupting supply chains, Germany’s high dependence on Russian natural gas, coal and oil imports was particularly problematic, it says. Through new “energy policy framework conditions,” the government must ensure that “this dependence is significantly reduced.”

Then the DGB issued its praises, saying, “The federal government has rightly reacted quickly to the Russian war of aggression against Ukraine, in terms of defence policy.” This is unequivocal. On behalf of all eight individual trade unions, the DGB is supporting the biggest military rearmament programme since Hitler, and the massive weapons-running operation to Ukraine.

Well aware that they will encounter widespread opposition to the demands for more “sacrifice,” the DGB leaders try to assuage anger by declaring, “The permanent increase in the arms budget to meet NATO’s two percent [of GDP] target continues to be critically assessed by the DGB and its member unions.” This massive increase, they say, must be weighed with “urgently needed future investments in the socio-ecological transformation and in the effectiveness of our welfare state.”

In other words, the union sees its task as shaping the military build-up in such a way that it does not jeopardise the long-planned cuts in jobs, wages and social benefits associated with the “socio-ecological transformation” and increasing “effectiveness of our welfare state.”

In an interview, IG Metall treasurer Jürgen Kerner put it in a nutshell: “Our priority has turned around within a week.” The Oberpfalz Medien summarised his view by saying, “Of course, according to Jürgen Kerner, it is proper to support Ukraine with weapons now and to restore the Bundeswehr’s [Armed Forces] military capability.”

The trade unions are an inseparable part of the war coalition. They embrace the mendacious war propaganda of the government and the media, which places responsibility for the war exclusively with Putin and takes the Russian population hostage as a result. The well-paid bureaucrats in the union headquarters are hostile to a principled, left-wing position, which opposes Putin’s reactionary invasion without giving any support to the warmongering by NATO and the US.

When NATO bombed Belgrade in 1999 and spread “Shock and Awe” in Baghdad with a days-long missile bombardment in 2003, no comparable protest was heard from the trade union offices. Nor did this happen when NATO planes devastated Libya in 2011. Nor do they say a word now about the fact that under the slogan 'Defend Ukraine!” the country is being filled with weapons and international mercenaries.

NATO has systematically provoked the current war through the military encirclement of Russia, the right-wing coup in Kiev eight years ago, in which fascistic forces played the leading role, and the arming of the Ukrainian military. After luring Russia into a trap, NATO is using the invasion to advance its strategy of regime change in Moscow, eliminating Russia as a strategic rival, and gaining unrestricted access to its vast mineral resources.

For all the crocodile tears their representatives shed every day over the fate of the Ukrainian people, NATO is using them as pawns in a war it has been planning and preparing for years. Germany, the US and other imperialist powers are doing all of this without the slightest regard that they are bringing the world to the brink of nuclear war.

A principled opposition to the war, which opposes the Russian nationalism without adapting to imperialism, requires the unity of the workers in Ukraine, Russia, Germany and throughout the world. It does not advocate rearmament, but the disarmament of the capitalists and the dissolution of the military alliances through the revolutionary action of the international working class.

Such a perspective is a nightmare for the trade union bureaucrats, who no longer even speak of “solidarity” in Sunday speeches. They are nationalist to the core and the worst warmongers.

Back in 2014, the DGB reacted enthusiastically when Frank-Walter Steinmeier (SPD), then foreign minister and now president, called for Germany to pursue a great power policy and take on more military responsibility internationally. To promote this policy, Steinmeier set up the website “Review 2014” at the time. One contribution came from the newly elected DGB leader Reiner Hoffmann, who unreservedly backed military rearmament.

Hoffmann’s predecessor Michael Sommer maintained close contacts with the Bundeswehr, the armed forces of Germany. In a joint statement with the military, the DGB had the audacity to claim that unions and the Bundeswehr were both part of the country’s “peace movement.” Shortly afterwards, DGB officials participated in the 60th anniversary celebrations of the Bundeswehr’s founding.

Support for war propaganda and military rearmament derives not only from the fact that many trade union officials are members of the SPD and of the Greens, which are both currently intensively pushing the development of war. Rather, the close collaboration with the government, state and army results from the nationalist and pro-capitalist politics of the trade unions, which are directed towards defending Germany’s imperialist interests around the world.

At the beginning of the Second World War, Leon Trotsky explained the integration of the trade unions into the capitalist state. He wrote:

There is one common feature in the development, or more correctly the degeneration, of modern trade union organizations in the entire world: it is their drawing closely to and growing together with the state power. This process is equally characteristic of the neutral, the Social-Democratic, the Communist and “anarchist” trade unions. This fact alone shows that the tendency towards “growing together” is intrinsic not in this or that doctrine as such but derives from social conditions common for all unions.

Monopoly capitalism does not rest on competition and free private initiative but on centralized command. The capitalist cliques at the head of mighty trusts, syndicates, banking consortiums, etcetera, view economic life from the very same heights as does state power; and they require at every step the collaboration of the latter. In their turn, the trade unions in the most important branches of industry find themselves deprived of the possibility of profiting by the competition between the different enterprises. They have to confront a centralized capitalist adversary, intimately bound up with state power.

Trade Unions in the Epoch of Imperialist Decay, Leon Trotsky, 1940

Trotsky’s analysis was very far-sighted. The “tendency for the trade unions to grow together” with the state and the capitalist corporations continued after the Second World War. The global integration of the world economy and the rise of transnational production processes deprived the trade unions of the national ground upon which they could exert pressure for limited social reforms. This led to their final transformation. Instead of extracting concessions from the corporations, they became appendages of the state and the corporations, extracting concessions from the workers in the form of wage reductions and social cuts.

Support for rearmament, and war to secure raw material supplies, markets and access to cheap labour, is the logical continuation of this nationalist policy.

It is no coincidence that the German government—and the governments of other countries—are undertaking targeted measures and legislative initiatives to strengthen the trade unions and their workplace institutions. The unions’ control over the working class is relevant to waging war.

But even before the war crisis, the level of class struggle in Germany, Eastern Europe and Russia was rising—and these struggles increasingly took the form of a rebellion against the corporatist trade unions. Over the last few years, autoworkers at VW in Slovakia (2017), Ford in Romania (2018), Mercedes Benz, BMW and Porsche in Germany (2018) and Audi in Hungary (2019) have walked out.

As the pandemic broke out, Siberian oil workers in Russia struck over horrific working conditions (2020) and Ukrainian doctors and nurses walked out over unpaid wages (2021). Over the last two years, German metal, health care, meatpacking and logistics workers, along with educators and students, have been in the forefront of the fight against the ruling class’ policy of prioritising profit over life.