Stellantis announces hundreds more job cuts at Belvidere, Illinois plant, as layoffs continue to roil auto global industry

Marcus Day

Stellantis NV, the world’s fourth-largest automaker, is planning to cut hundreds more jobs at its Belvidere assembly plant in northern Illinois, according to a letter sent to workers by United Auto Workers Local 1268 on March 25.

Exterior of Belvidere Assembly (WSWS Media)

A Stellantis spokesman told local news station WREX that the company was “making additional staffing reductions to operate the plant in a more sustainable manner.” The cuts will be achieved through a combination of early retirement packages and involuntary layoffs, the company said.

The Belvidere factory, which produces the Jeep Cherokee SUV, has already suffered thousands of layoffs over the past three years, with five rounds of job cuts in the last 13 months alone. The plant is currently operating with 1,812 hourly workers on just one shift. As recently as 2019, the plant, then operated by Stellantis’ predecessor Fiat Chrysler, had more than 5,000 workers across three shifts.

Stellantis is seeking to reduce employment at Belvidere to “603 non-skilled and 199 skilled trades employees,” the UAW local wrote in its March 25 letter to workers. The company was planning to issue WARN layoff notices to 579 employees beginning March 28, the letter stated, raising the question of whether more cuts are planned later this year to reach the company’s targeted headcount. The layoffs will impact those even with decades of seniority at the plant, as far back as 1994.

Beyond Stellantis, the layoffs will almost certainly cascade throughout the local supply chain, threatening jobs at plants operated by parts producers such as Magna, Syncreon, and Android Industries, as well as others.

Seeking to chloroform workers and block a struggle in defense of jobs, UAW Local 1268 wrote, “We don’t believe they will be able to make all these cuts, don’t make any irrational decisions at this point. We believe this is completely unobtainable and we will know more in the near future.”

Local 1268 officials said they were scheduled to meet in Detroit last week with the UAW vice president for Stellantis, Cindy Estrada, to discuss the layoffs. Such talks, however, have the character of a conspiracy against workers aimed at ensuring an “orderly” draw-down of jobs at the plant and preventing a serious struggle by workers. Estrada—who recently announced she would retire at the end of her term, and had previously been named as a target in the federal corruption investigation into the UAW—is notorious for having repeatedly negotiated painful concessions behind autoworkers’ backs, including outsourcing jobs at GM’s Lake Orion and Lordstown assembly plants.

The savage attack on jobs at Belvidere by Fiat Chrysler and then Stellantis have already had a devastating impact, confronting workers and their families with impossible decisions to either uproot and transfer hundreds of miles away, live apart indefinitely or take lower-paying jobs in the area.

Until recent years, the Belvidere plant had been the largest private employer in the region and one of the few remaining sources of relatively better-paying manufacturing jobs. The unemployment rate in the economically hard-hit Rockford metro area, which is roughly 90 miles northwest of Chicago, stood at 7.9 percent as of February 2022, the highest among major urban areas in Illinois and more than 50 percent higher than the state average.

Pointing to the widespread social, economic, and political crisis in which the layoffs are taking place, a veteran worker at Stellantis Belvidere told the WSWS Autoworker Newsletter, “All of this, including the pandemic and war in Ukraine, is looking more like an economic collapse that’s going to make the recession look like a walk in the park.

“Homelessness is at an all-time high already and it’s only growing,” he continued. “Even when Wall Street takes a nose dive the billionaires, hedge fund managers and too-big-to-fail financial institutions will be insulated from the fallout that is to follow.”

Consumer prices are surging, and the Federal Reserve is moving to raise interest rates to counteract rising wages. Under these conditions, the ruling elite is seeking to distract attention from an increasingly disastrous domestic situation via the rapid escalation of a war drive, he said. “What better way to distract people than to antagonize WWIII.”

Chip shortage, supply chain disruptions continue to idle plants

Intermittent layoffs have continued to grip the global auto industry more broadly, causing considerable uncertainty and financial strain for workers.

In addition to Belvidere, Stellantis announced recently that it would be indefinitely laying off 98 workers at its Sterling Stamping plant in suburban Detroit, where five workers died of COVID-19 in 2021. The company’s Jefferson North Assembly Plant in Detroit is also temporarily shut down until May for scheduled retooling. In Canada, the company is planning to cut the second shift at the Windsor, Ontario van plant later this year.

General Motors announced Thursday that it would be idling its Lansing Grand River assembly plant in Michigan next week, with a spokesman ascribing the downtime to parts shortages unrelated to semiconductors. GM had previously announced that it would be temporarily shutting down its Fort Wayne, Indiana, assembly plant for two weeks beginning April 4 due to a lack of microchips. The Fort Wayne plant produces the lucrative Chevrolet Silverado 1500 and GMC Sierra 1500 pickup trucks.

Ford also announced in recent days that it would idle its Flat Rock assembly plant in suburban Detroit for one week beginning Monday, also due to a chip shortage.

Even as workers at plants such as Belvidere assembly and GM’s Fairfax assembly have faced near-continual layoffs, workers at plants that produce the auto giants’ top-selling, highest-margin pickups and SUVs, such as Stellantis Sterling Heights assembly, have faced relentless demands for overtime, with their plants driven to run almost non-stop.

The impact on autoworkers’ jobs extends internationally, with supply chain disruptions exacerbated by the US-NATO conflict with Russia in Ukraine. Ukraine is a major exporter of neon gas, which is critical for microchip production, and international transportation routes and trade have been snarled by the conflict and US-led sanctions against Russia.

Stellantis CEO Carlos Tavares said this week that the company’s van plant in Kaluga, Russia, operated as joint venture with Mitsubishi, will soon run out of parts and be unable to operate. The company’s Jeep plant in Melfi, in southern Italy, will also a face a slowdown beginning next week due to a worsening chip shortage, with roughly 1,500 workers furloughed a day.

Despite the automakers benefiting from rising prices and reaping bumper profits—with Stellantis seeing its earnings nearly triple from 2020 to 2021—a brutal new wave of restructuring is being prepared, as the corporations engage in a furious struggle to dominate electric vehicle technologies and markets.

The Detroit Three, GM, Ford and Stellantis, have all announced massive investments in EVs over the coming decade, which they expect to offset by dramatically intensifying the exploitation of workers. Stellantis has stated that it will invest $35 billion in EVs by 2025, while at the same time targeting double-digit profit margins.

Stellantis CEO Tavares and his counterparts are all attempting to extort massive tax breaks from local, state, and national governments, in return for promises—easily broken—for new investments in EV manufacturing facilities. Auto industry analysts have for years put a question mark over the future the Belvidere plant, which is situated far from the core of Stellantis’ operations in the Detroit area. To attract renewed investment to the plant as well as other EV makers, Illinois’ billionaire Democratic governor, J.B. Pritzker, signed a package of major corporate tax credits last year. Press reports in recent months have indicated that Stellantis is considering assigning production of new Dodge Charger and Challenger EVs to Belvidere.

The company recently announced that it would be investing $4 billion to construct a battery facility in Windsor, just across the border from Detroit, as part of a joint venture with LG Energy Solution. Ontario Premier Doug Ford boasted that the province put up “hundreds of millions” of dollars in incentives to lure the company. Stellantis is also reportedly searching for a US location for a second North American battery plant.

The UAW, with the support of the White House, is seeking to expand its reach into the new battery plants and other EV facilities, offering its services as a “reliable partner” to the automakers and hoping to secure new dues streams. In remarks at a press event this week, UAW President Ray Curry noted that the battery plants “are joint ventures, and they are apart from the national agreements,” meaning that workers at these facilities will face even more brutal conditions and ultra-low wages.

Heading into the Detroit Three contract negotiations next year, the automakers and the UAW are preparing a similar strategy to the one they carried out in 2019 and in previous years. Massive concessions will be demanded to “save jobs,” with the future of Belvidere or other plants held as ransom. In fact, this is already being carried out in Europe, where Ford is working with the Spanish and German trade unions to pit plants against each other in a fratricidal concessions bidding war, with the losing plant slated to be shuttered. But as previous experience shows, no amount of concessions will provide a guarantee against plant closures and layoffs.

However, the assault being planned against autoworkers threatens to eclipse even the attacks of preceding decades, as brutal as they were. With the enormous capital investments required by the transition to EVs, the auto companies must extract even greater profits. Further, the enormous amounts of resources being channeled by capitalist governments towards war must be paid for by workers, who face an historic battle.

Global food crisis fuels international class struggle

Eric London

The war between the US-NATO and Russia in Ukraine has lit a fuse to the powder keg of the global class struggle. In the span of just a few weeks, the war and unprecedented US and EU sanctions against Russia have profoundly destabilized the world’s productive forces, throwing already-frail global supply chains into disarray, strengthening inflationary tendencies, and crippling global food and gas production.

People queuing for kerosene in Kandy, Sri Lanka on 22 March, 2022 [Credit: WSWS Media]

A social and economic crisis that was worsening before the war began has now metastasized, bringing billions of people to the precipice of destitution and hunger.

Shock is beginning to give way to action. Significant strikes and demonstrations are breaking out across the world in the largest wave of social protest since before the outbreak of the COVID-19 pandemic.

The imperialist politicians and geo-strategists who spent years drawing up the blueprints for war are discovering that despite all their careful planning, they set their bloody plans into motion on top of a massive social fault line.

The protests are heterogenous in terms of race and religious background, international in scope, and are based in a working class that is larger, more urban and more interconnected than ever before. In more advanced and less developed countries alike, the protests revolve around the same demand: the rising cost of living is intolerable, conditions must change, and they must change now.

This is the social force that has the power to stop the drive to world war and prevent nuclear disaster. This global movement is unfolding by the hour.

On Thursday night, a large demonstration blocked the road to President Gotabaya Rajapakse’s private residence in Colombo’s outer suburbs, demanding his resignation. The right-wing government is implementing a ruthless IMF austerity regime as masses of people struggle to find medicine, food, milk and gas.

Diesel fuel has run out, currency is scarce, and long power outages blacken the country. A 31-year-old school teacher in Batticaloa told the Indian Express, “On Sunday I stood in a gas queue starting at 4 am. There is a shortage of milk powder. One has to struggle for rice and daal. There are no candles and many medicines have disappeared. I have a salary, but can we eat money?”

Similar movements are developing across the Middle East and North Africa, where Ukraine and Russia provide the bulk of wheat and cooking oil and where Ramadan, the Islamic holiday of fasting and feasting, is set to begin.

The United Nations declared Thursday that social conditions are “at a breaking point” across the region due to food shortages. The New York Times wrote Thursday that scarcity and price increases “crush household and government budgets alike in countries that had nothing to spare, raising the possibility of the kind of mass popular unrest not seen since the Arab Spring protests a decade ago, which stemmed in part from soaring food prices.”

In Egypt, the Times noted nervously, “videos of ordinary people venting about food prices have gone viral on social media under the hashtag ‘revolution of the hungry.’”

The US-backed al-Sisi dictatorship has deployed the military to distribute food and set price controls for bread. Al-Sisi addressed the nation and urged the population to “rationalize” food consumption during Ramadan.

In Tunisia, where workers first sparked the Arab Spring, the Middle East Eye wrote Thursday that “strikes intensified last week,” and as a result, “Ezra Zia, US undersecretary of state for civilian security, democracy and human rights, visited the country.”

Food riots involving thousands of people took place across Iraq last week as the country, still reeling from a US invasion and occupation that killed a million people, was gripped by a serious shortage of food and flour.

Protests are also developing south of the Maghreb, in African countries where the working class has exploded in size and social weight and whose backbone includes many young people with the Internet in the palms of their hands. The average sub-Saharan African spends 65 percent of his household earnings on food. On Wednesday, the head of the Africa Development Bank said of the surge in food prices caused by the war in Ukraine: “If we don’t manage this very quickly, it will destabilize the continent.”

Protests in Sudan over shortages worsened by the war have coincided with powerful strikes of teachers and youth. Yesterday, a mass protest took place in Khartoum over the military government’s inability to stop the spiraling cost of living and where one 23-year-old protestor was killed.

In the Democratic Republic of the Congo, according to a report published Thursday by Al Jazeera, “rising fuel prices, worsened by the COVID-19 pandemic and more recently the Russian invasion of Ukraine, have sparked fears of increased social unrest,” forcing the government to reshuffle the cabinet to preempt social anger.

In South Africa, where large riots took place last summer, the head of a major youth non-profit described the social situation as “a time bomb that is ticking and could explode in our faces at any given moment.”

This movement is also developing in the world’s imperialist centers. In Spain, a weeks-long strike by truckers has brought international shipping to a standstill and galvanized broader support in the working class over the rising cost of living. The PSOE-Podemos government has ordered grocery stores and retailers to limit what customers can purchase, as the major business confederations demand action to prevent an imminent social explosion.

In Germany and Austria, diesel will now be rationed. Large demonstrations over the cost of living took place last month in Albania.

In the United States, the cockpit of world imperialism, the emerging strike movement is driven above all by inflation and the spiraling cost of living. Five thousand teachers are on strike in Sacramento, California, following a two-week strike by teachers in Minneapolis, Minnesota in March.

In an ongoing strike by 600 oil refinery workers in Richmond, California, workers explain they cannot afford to fill their own cars with the gas they refine.

Thirteen hundred copper miners in Utah and 50,000 grocery store workers in California are slated to strike in the coming days, while a contract for tens of thousands of dock workers on the west coast expires in a matter of weeks.

In the US and Canada, the government has banned or blocked major strikes by rail workers at BNSF and Canadian Pacific.

Rising prices in the main imperialist countries will intensify the class struggle as the war continues. According to Thursday’s US Commerce Department data, inflation will cost households an average of an extra $433 each month, or $5,200 in the next year. Given that half the country has less than $500 in emergency savings, workers will be driven into struggle by urgent necessity.

The impact of the war on living conditions is going to intensify dramatically in all countries in the coming weeks. Strategic food reserves are woefully inadequate in all countries excepting China.

Making matters worse, Ukraine and Russia are not only leading producers of staple food and oil, but Russia and Belorussia also lead the world in the production of most fertilizers, which Putin has announced will be subject to strict export restrictions in response to US and EU sanctions. This could cut global crop yields in half.

Rising cost of Diammonium phosphate (DAP) fertilizer year-to-year

With the pandemic and the threat of world war as the immediate backdrop, a social reckoning of historic proportions is past due. Since the Arab Spring and the global protests of 2018–19, the ruling class’s response to the COVID-19 pandemic has prioritized profits over life and led to the deaths of 20 million people.

Stopping war means ending capitalism, and this requires political leadership. Unlike in an earlier period, the international working class owes no political loyalty to the parties of Stalinism, Social Democracy and bourgeois nationalism, which are seen as directly responsible for existing conditions of poverty and inequality.

In each country, the trade unions are a block on this developing movement, serving the capitalist governments and corporations by isolating workers, preventing them from striking, and demanding that they support the US-NATO war drive, no matter the dangers and no matter the cost to working people.

Representatives of the middle-class pseudo-left who once professed verbal support for socialism are now cheerleaders for NATO’s wars and zealous defenders of the trade unions.

The Financialization of the Global Care Economy

Marina Durano

The promise of 300 million global jobs in care as a key feature of recovery from the Covid-19 pandemic is a tempting invitation for investors seeking new profit opportunities, especially if more public monies are committed. Mature segments of the care sector that have received massive private investments — such as health care, nursing homes, and long-term care — tell us that we need democratized finance to build a care economy that ensures alignment of women’s rights, workers’ rights, and care receivers’ rights.

To generate 300 million jobs by 2035, annual investment of 3.2 percent of global GDP will be required. More than three-quarters of the new employment will benefit women, and over 80 percent of these new jobs will be formal work, according to a new ILO report. Women’s rights organizations want increased public spending on care to redistribute responsibilities between families or households and care provided by government agencies. Meanwhile, care gaps have been filled by arranging services from a spectrum of care givers spanning domestic workers, non-profit or volunteer groups, and corporate or even multinational providers. Should public investments deliver, we can expect a trend towards consolidation in the sector, making it even more attractive for private investors.

Increasingly privatized and financialized

Public spending crowds-in private investment, as health care and long-term care has shown. However, other policies also entice private-sector investment in care, such as public-sector management practices focused on efficiency and productivity (as in Canada, UK, and the United States), more liberal foreign-ownership rules (as in India, China, and some Southeast Asian countries), and greater opening of procurement policies to foreign contractors (as in Turkey). Labor market flexibilization is an essential ingredient, as demonstrated by the long-term care home sector in British Columbia in Canada, where sectoral bargaining and contracting protections for care workers have been removed.

Private equity investments in health care in particular spark serious concerns. Between 2010 and 2019, such investment in the health care sector rose from $41.5 billion to $119.9 billion in the United States, with new investments focused on in-home health care and outpatient care. Multilateral financial institutions, such as International Finance Corporation (IFC) and CDC Group, have partnered with private equity investors in health care to support sustainable development goals for health. In Africa, the IFC launched the Africa Health Care Fund, whose first closing raised $57 million to support small and medium-scale enterprises in health clinics and diagnostic centers.

An estimated 20 percent of global infrastructure projects in health care are in developing countries. Public-private partnerships are a frequent financing option for health care delivery, blending design, build, finance, maintain, operate and manage components. Lesotho and Peru already have complex projects in operation combining infrastructure with clinical and non-clinical services. A few other countries in  Latin America are planning or operating PPPs in health care and many other countries are looking to join the club.

Venture capital firms chasing high returns on technological innovations are interested in telehealth and telemedicine. One major market entrant, Amazon Care, launched nationally in the United States in February 2022, having entered into a partnership in 2019 with the UK’s National Health Service to provide health care information.

Unhealthy outcomes

Private equity investors in health care are gaining notoriety, however, as their profit motives conflict with well-being outcomes for care recipients in their institutions. Case studies bear out concerns about the quality of care and ethical standards in health facilities owned by private equity investors due to the pronounced focus on revenues. Studies comparing for-profit with not-for-profit facilities find lower staffing ratios in the former or highly skilled staff replaced by less skilled teams, all with a view to reducing personnel costs. One study between 2000 and 2017 using data on nursing homes merged with patient-level data in the United States found that “going to a PE [private equity]-owned facility increases 90-day mortality by about 10 percent for short-stay Medicare patients, while taxpayer spending over the 90 days increases by 11 percent”. The same study found a higher probability that patients in private-equity owned facilities would be on anti-psychotic medications, experience reduced mobility, and report more intense pain.

Democratize finance to build care economies

The association of poor health outcomes with private equity raises the question of the feasibility of designing democratic — even egalitarian — financial institutions to fund well-being outcomes. Some proposals include expanding into non-profit credit unions, public investment banking, progressive management of sovereign wealth funds, inclusive ownership funds within corporations controlled by their workers, anti-trust regulation to reduce concentration in finance, and even nationalizing banking. When finance cares, we might have a genuine care economy.

Peru imposes mandatory school attendance as COVID risks rise

Cesar Uco & Don Knowland

Throughout the pandemic, COVID-19 in Peru has claimed more lives per capita than in any other country in the world. Only recently was its death rate surpassed by Bolivia.

Figures announced on March 23 by Peru’s Health Ministry, Minsa, indicate that since the beginning of the pandemic there have been 3,542,602 positive cases and 211,944 deaths.

Between March 14 and Monday, March 28, all Peruvian public schools have reopened. By March 28 more than 8 million students already had returned to classrooms (75 percent public and 25 percent private).

Line for vaccinations and tests at army barracks in Lima (Credit: ANDINA/ Vidal Tarqui)

Peru’s Ministry of Education (Minedu) announced that the reopening is mandatory for all students: “With the new regulation we are working on, the principles of voluntariness and gradualness will no longer apply; therefore, it will be a massive and mandatory return for all.”

To support the back-to-school push, Peru’s bourgeois media has cited statistics from the Johns Hopkins Coronavirus Research Center as of March 22 that COVID deaths over a seven-day average were 39, a significant drop from this year’s peak of 135 on January 22, which was mostly due to the BA.1 Omicron subvariant. This is compared to the worst trimester of the Delta strain, which saw an average of over 700 deaths per month in February-April 2021.

Such figures only provide an illusion that the coronavirus crisis is abating. A deeper look shows the current danger from COVID-19 remains high, particularly at schools.

First, although Minsa announced some minor steps to protect students from contracting COVID-19, they have been effectively eroded by the Ministry of Transport and Communications (MTC) permitting 100 percent occupancy in school buses, and 100 percent class occupancy if a one-meter distance is somehow able to be implemented. Confining students together in close proximity creates a ready transmission belt for spread of the virus, even with masking.

Second, recent figures indicate severe failures in Minsa’s strategy to fight the pandemic, particularly on the vaccination front.

La República recently characterized the fight against the pandemic as “directionless,” specifically referring to “gross errors” in the government’s vaccination program.

According to Minsa, out of a population of 32.9 million inhabitants, 25,188,282 have been fully vaccinated. The number of doses administered is claimed to be 64,576,385.

Minsa had asserted that vaccination numbers are not going down. But data analyst Juan Carbajal told La República he has calculated that since the current Minister of Health Hernán Condori took office on February 8, “the vaccination rate has dropped by 54 percent at the national level,” and that the decrease since February includes the first, second and third doses.

Carbajal added that while pediatric vaccinations had begun on January 24, “such is the drop that we are at the level of the first days and we have yet to give 46 percent of children their first dose.”

The Ombudsman’s Office offered another piece of information pointing to the precariousness of Minsa’s program: there are 15 million Peruvians who have not had a third dose, another indication that vaccinations are in decline.

Condori initially stated that further vaccinations were on schedule, but recently admitted that 2 million vaccines will expire on March 31 before they are administered. The health minister then tried to wash his hands of the matter, stating that throughout the pandemic there have been “expiring vaccines,” and that his predecessors had received the COVID-19 vaccines with two-month expiration dates.

The Comptroller General of the Republic has confirmed that 2,449,000 Astra-Zeneca doses expire March 31, and that an additional 2.6 million will expire April 30.

Third, Peru’s National Health Institute detected cases corresponding to the subvariant Omicron BA.2 beginning in the first half of February. Full opening of schools is especially irresponsible given evidence of its health dangers and its rapid spread in other countries.

As CNN recently reported, “the BA.2 strain is on the rise in the United States and already accounts for one-third of COVID-19 infections.” Moreover, “it can cause more serious disease and appears capable of thwarting some of the key weapons we have against COVID-19 new research suggests … and like Omicron, it appears to largely escape immunity created by vaccines.”

The BA.2 Omicron subvariant is already sweeping Europe and Asia. A massive increase in COVID-19 in Austria has been reported since January, after protective measures were ended, largely due to BA.2. France, Germany and the UK likewise have seen COVID surges due to Omicron BA.2. And the BA.2 subvariant is fueling a new COVID surge in Australia.

Minsa, Minedu and Peru’s bourgeois press appear to be oblivious to all of the above risks. The Peruvian ruling class is “all in” with the strategy of “learning to live with the virus” and “let it rip.”

According to the World Bank, Peru already lags other countries in the region in education spending as a percentage of GDP at 3.9 percent, well behind Brazil (6.2 percent), Argentina (5.5 percent), Chile (5.4 percent), Ecuador (5 percent), and Colombia (4.5 percent).

Also, according to UNESCO, with data adjusted for purchasing power parity (PPP), Peru invests $3,471 per student, less than most South American countries: Chile $8,933, Argentina $7,752, Brazil $6,674, Uruguay $6,192, and Colombia $4,807.

The health of Peru’s students, like education spending, has now become an entirely secondary concern, subordinate to profit interests.

Behind the reopening of schools and relaxing sanitary measures is the Peruvian bourgeoisie’s desperate need to revive the economy by any and all means, as the country faces its greatest economic and political crisis in recent times.

German government steps up its army recruitment campaign in schools

Tino Jacobson

A central component of Germany’s return to an aggressive foreign and great power policy is the militarisation of society as a whole. Against the backdrop of the Ukraine war and the recently announced tripling of the German military budget, the militarisation of society is taking new, unprecedented forms.

On March 7, Germany’s Education Minister Bettina Stark-Watzinger (Free Democratic Party) demanded the increased presence of Bundeswehr (German army) officers in schools.

She justified her demand as follows: “It is important that the Russian attack on Ukraine and the consequences for Germany and Europe are addressed in school lessons in an appropriate way, bearing in mind the age of pupils. Especially in times of social media and disinformation, there has to be an appropriate response that addresses the concerns and fears of the pupils.”

The aim of the campaign is clear. It is not about the “concerns and fears of schoolchildren,” but rather indoctrinating young people with official propaganda and obtaining their consent for militarism and war. For years, the Bundeswehr has been pumping millions into advertising and recruitment campaigns, in addition to sending its officers into schools—so far without success. The vast majority of young people want nothing to do with war and militarism.

Stark-Watzinger’s plans have met with angry opposition in social media. “The Bundeswehr has absolutely no business in schools. If someone comes, I will keep my children at home that day,” Sonja comments. John Klapper thinks that “promoting the trade in murder has no place in schools.” And RicoTV writes: “Do they hate children that much? First the children are to be contaminated in schools and then you allow them to be press-ganged into the armed forces. You are really becoming the second (far-right) AfD.”

Other comments on the Education Minister’s statement denounce the one-sided reporting and unrelenting war propaganda on the part of the official media and politicians.

“Why don’t you tell the children that we have been starving children in Yemen for years!!!!!,” writes elfox. Yemen, one of the poorest countries in the Arab region, has been bombed by Saudi Arabia—with the active or tacit support of the imperialist powers—for years. This criminal war will result in leaving 1.3 million pregnant mothers and 2.2 million children severely malnourished by the end of this year. Already, 17.4 million people in Yemen are suffering from hunger.

With regard to the war in Ukraine, a user by the name of Vita15 raises the question of “how it could come to this” and “what role NATO, the US and Europe have played and are playing here.”

In fact, the Russian invasion of Ukraine is not an “unprovoked war of aggression,” as official propaganda maintains, but rather a reactionary and nationalist response by the Putin regime to the systematic offensive by NATO powers. Since the dissolution of the Soviet Union by the Stalinist bureaucracy, NATO has systematically encircled Russia and in 2014 orchestrated a right-wing coup in Ukraine to bring a pro-Western regime to power.

Now the imperialist powers are using the Russian invasion to bring about regime change in Russia itself and advance their own plans for rearmament and war. The Special Fund of the German Armed Forces (Sondervermögen Bundeswehr) of 100 billion euros launched by the German government is the biggest program for the rearmament of the German military since the days of Adolf Hitler. The deployment of Bundeswehr youth officers to schools is being intensified as part of this program.

A Bundeswehr youth officer in action (picture: “Communication is her job” by Wir. Serve. Germany, CC BY-ND 2.0)

The last annual report on youth officers published by the Bundeswehr in 2020 noted with satisfaction: “The diverse efforts to improve staffing among full-time youth officers bore fruit.” For example, “of the 94 posts for full-time youth officers nationwide, an average of 77 posts had been filled,” corresponding to a staffing level of 82 percent. Since 2010, the amount spent on recruiting youth officers has risen from 12 million to 33.6 million euros.

The report leaves no doubt that it is about recruiting youth for wartime missions. The youth officers had “the task of talking to pupils and students and other interested parties at schools and educational institutions about the role and tasks of the Bundeswehr.” Youth officers “with deployment experience are particularly in demand.” After all, “they can describe their personal experiences, classify and assess the conflict” and “make sense of the conflict.”

Officially, youth officers in schools and universities are not allowed to recruit directly for the Bundeswehr, but this is precisely what is increasingly taking place. In 2021, 1,239 minors were recruited for the Bundeswehr, according to the annual report by Eva Högl (SPD), the Bundestag’s Commissioner for the Armed Forces. This is 91 more (or about 8 percent) than the previous year, when 1,148 minors were recruited.

The German Teachers’ Association (DL) supports the use of youth officers in schools. It is “part of the educational mandate of schools to inform about the work of the Bundeswehr—and to do so through first-hand experts. In this respect, the deployment of youth officers should be a matter of course,” explained DL President Heinz-Peter Meidinger. He dismissed widespread criticism with the provocative remark: “I firmly reject such demonisation of the Bundeswehr.”

The International Youth and Students for Social Equality (IYSSE) strongly condemns the militarisation of schools—especially given Germany’s history. In the 20th century, Germany twice tried to impose its political and economic interests on Europe and the world with military force. The terrible consequences are well known. In the Second World War alone, Germany was responsible for the industrial murder of 6 million Jews and the killing of 27 million victims in the Soviet Union through the Nazi campaign of mass extermination.

In both world wars, pro-war propaganda in schools played a huge role. Pupils were indoctrinated and instrumentalised in the fight for the “German Fatherland.” Millions were used as cannon fodder to advance the imperialist interests of the rich and big business. This cannot be allowed to happen a third time.

What is needed is not army youth officers, but teachers! Higher investment in education instead of billions for the military are necessary! The coronavirus pandemic has increased the burden on teachers and pupils enormously.

According to calculations by the renowned education researcher Klaus Klemm, the shortage of teachers in the next few years will be much greater than the figure predicted by the Conference of Ministers of Education and Cultural Affairs (KMK). According to Klemm, there will be a shortage of 45,000 teachers by 2025, i.e., more than double the total cited by the KMK. For the German ruling class, however, the priority is preparing for war.

Inflation slashes living standards and pushes millions of workers in the US to the brink

Patrick Martin

The rising cost of living will force the average American household to spend $5,200 more a year just to buy the same goods and services as last year, according to a report released Thursday by Bloomberg Economics. This comes to an average of $433 a month robbed from the pockets of workers and their families, under conditions where 60 percent of the US population cannot afford an unexpected expense of $500.

The gasoline price board is shown at a gas station in Menlo Park, Calif., March 21, 2022. (AP Photo/Jeff Chiu)

This staggering fact demonstrates the human cost of the rise in the rate of inflation, which hit a 40-year record of 7.9 percent in December. The rate of increase in the Consumer Price Index slipped slightly to 7.5 percent in January and 6.4 percent in February, but it is still well above the forecast of both the Federal Reserve and the Biden administration.

The core inflation rate, not counting food and energy prices, which fluctuate more from month to month, stood at 6 percent in January and 5.4 percent in February, according to figures released by the federal Department of Commerce Thursday. This means that regardless of efforts by the Biden administration to manipulate temporarily the price of gasoline at the pump, the reduction in the living standards of the working class will continue.

Bloomberg Economics—part of the publishing empire of billionaire Michael Bloomberg—pointed out the benefits for capitalist employers of the inflation “tax” on workers. “Accelerated depletion of savings will increase the urgency for those staying on the sidelines to join the labor force, and the resulting increase in labor supply will likely dampen wage growth,” the authors of the report said.

The American capitalist class as a whole is preoccupied with the problem of a “labor shortage,” which means the refusal of workers to take jobs at the starvation-level wages being offered, particularly to entry-level workers. Retail, restaurant, nursing home and other low-wage employers continually report being unable to hire enough workers.

The New York Times cited this issue in a worried article on its business pages Thursday, headlined, “Rising Wages Could Complicate America’s Inflation Cool-Down.” It cited the hopes of economists that the ending of pandemic-related restrictions—itself entirely unjustified from a public health standpoint—would help shift consumer spending from goods to services, “betting the transition would take pressure off supply chains and help inflation to moderate.”

The article continues: “Rapid wage growth could make that story more complicated. Demand for services is rising just as many employers are struggling to find workers, which could force them to continue raising wages. While positive for workers, that could keep overall inflation brisk as companies try to cover their labor costs, speeding up price increases for services even as they begin to moderate for goods.”

The language here is remarkable. The Times admits that wage growth is “positive for workers”—who happen to comprise the vast majority of the American population. But it is more worried about the downside, i.e., the interests of the employers, especially big corporations and their wealthy shareholders.

The article continues in this vein, citing the concerns of economists that wages might be permanently reset at a higher level, although this is only the abysmal pay offered by Amazon and other giant exploiters of labor. It reports the observation of one employer of low-wage labor, noting that “executives had expected the labor crunch to ease when enhanced unemployment benefits from the federal government ended in September. But while there was some increase in willing workers, there was no sudden flood.”

In other words, despite the best efforts of the Biden administration to force millions of workers back to jobs despite low wages and the dangers of the COVID-19 pandemic, including through the slashing of federal support for the unemployed, workers are still resisting.

That resistance is expressed most powerfully in the mounting wave of strike action that developed in 2021 and continues in the first months of this year. A major feature of this class movement has been a series of rebellions by workers against the pro-corporate trade unions, which have been relied upon by the Biden administration to suppress the class struggle and help the corporations impose brutal conditions of low-wage exploitation on workers.

This is the context in which President Biden announced an executive order Thursday to release a substantial amount of oil from the US Strategic Petroleum Reserve. About 1 million barrels a day will be put on the market for the next six months, for a total of 180 million barrels, nearly one-third of the total reserve. The announcement led to a drop in oil prices, but the effect will only be temporary, since 1 million barrels is less than 5 percent of US daily consumption.

The president claimed that the purpose of his action was to cut the price of gas at the pump for American consumers, and media coverage generally focused on the transparent political motivation of the timing and duration of the move. It is seven months until the US midterm congressional elections, where Biden’s Democratic Party is trailing in the polls, with inflation and the runaway cost of living cited by those polled as the top issue.

Within the constraints of the American two-party system, which offers voters only the choice between two right-wing capitalist parties, the Republican Party is expected to make gains. It is a measure of the bankruptcy of the Democratic Party that it could well lose control of Congress to the Republicans, despite the popular hostility to the previous administration of Donald Trump and the revulsion against his attempted coup of January 6, 2021.

Biden used the announcement of the oil release to beat the drums for his war policy directed against Russia, calling the rise in the cost of gasoline “Putin’s price hike.” He claimed that inflation had two causes, the pandemic and the Russian president. He said nothing about the main driving force of rising prices, the trillions of dollars pumped into the financial system by the Federal Reserve and the US Treasury to bail out Wall Street and corporate America, beginning in March 2020 and continuing to this day.

Instead, he engaged in a bit of anti-corporate demagogy, criticizing oil companies which “sit on record profits” but refuse to increase production “for the good of your country.” This was combined with the reiteration of his loyalty to the profit system: “I’m a capitalist. I have no problem with corporations turning a good profit.”

In a briefing to the media, a “senior administration official” said that US oil companies had pledged to bring a million more barrels a day on line by the fall. He described the release of oil from the government reserve as “a wartime bridge to additional US production.”

The effort to link the crisis at the pump with the war in Ukraine has an unmistakable and ominous meaning. Biden is seeking to use Russia as a scapegoat for the attack on working class living standards being waged by the capitalist class in the United States. This has already led to suggestions that American workers should be willing to make sacrifices for the war in Ukraine, sacrifices that will be imposed by the Democratic Party and the trade union apparatus in the name of “national unity.”

Wealth bonanza for Australia’s billionaires continues as the pandemic rages

Max Boddy

The obscene wealth of Australia’s richest 250 people is being glorified in the pages of the Murdoch-owned Australian, with the release last week of its annual Rich List. The total combined wealth of Australia’s richest now exceeds $520 billion, a $50 billion increase in just 12 months.

This bonanza is amid a meteoric rise of the pandemic and as all basic health measures have been scrapped in the interests of corporate profit.

Led by the New South Wales (NSW) Liberal government of Premier Dominic Perrottet and his Victorian Labor counterpart, Daniel Andrews, all of the state, territory and federal governments have openly embraced the “let it rip” pandemic policies, creating a mass of infection, illness and growing deaths.

In just four months, since the “reopening” of December 2021, more than 4.2 million COVID cases have been detected, nearly 20 times the number of infections recorded in Australia over the previous two years. In the same period deaths have nearly doubled, rising from 2,006 at the beginning of December, to 5,951 as of March 30.

The chronically-underfunded public hospitals have been overwhelmed, with health workers placed under unbearable pressure. The schools have been transformed into petri dishes with the forced return of face-to-face learning. Children are unwittingly bringing the virus home to their families.

The reality of the continued spread of this virus is completely covered over in the media, which largely presents the pandemic as a thing of the past. This year’s Rich List is no exception with COVID barely getting a mention.

Instead, the glossy pages are devoted to a worship of wealth. The Australian hailed the nine new billionaires added to the list, bringing this super-wealthy cohort to 131 in total. They have an average wealth of $2.08 billion. The barrier for entry on the list now exceeds $500 million.

The $520 billion is sharply concentrated in the upper echelons of the list. With the top ten billionaires combined wealth exceeding $224 billion, they represent 43 percent of the total wealth. The top 20, whose wealth exceeds $284 billion, account for more than 54 percent of the total.

Gina Rinehart [Image: Wikimedia]

The two richest individuals remain iron ore magnates Gina Rinehart and Andrew Forrest, who have retained last year’s first and second positions respectively. In 2020–21, both of them more than doubled their wealth as iron ore prices skyrocketed.

While iron ore prices have fluctuated over the past year, the wealth of the mining barons remains at stratospheric heights. Rinehart’s personal fortune is $32.64 billion, down slightly from $36.28 billion last year. Forrest had a $2.6 billion increase in his wealth to $31.77 billion.

Fellow mining magnate Clive Palmer almost doubled his holdings, from $9.76 billion last year to $18.35 billion this year, due to the massive surge in price for nickel. This placed him at number seven on the list.

Four places on this year’s Rich List are occupied by the heads of tech companies. Mike Cannon-Brookes and Scott Farquhar, co-founders of Atlassian, increased their combined wealth by $8.25 billion, placing fourth and fifth.

However, by far the largest increase in fortunes is that of husband-and-wife Cliff Obrecht and Melanie Perkins, who are co-founders of the graphic design platform Canva. Their combined wealth increase was nearly $27 billion, launching them to the number 9 and 10 spots, with more than $31 billion together.

The rise of these tech companies is the direct product of unbridled financial speculation. Investors looking for the next Google gamble incessantly on the potential future profits of these tech start-ups, pushing their shares exponentially higher than the net profits of the business.

This makes the companies highly vulnerable to rises in interest rates as their valuation is based on potential profits at existing interest rates. The tech boom exerts considerable pressure on central banks to keep interest rates at record lows, further fueling inflation.

The Rich List is silent on the plight of workers and the poor. But the astronomical wealth at the top of society is the direct product of mounting poverty and social hardship afflicting millions of ordinary people. The tale of two cities is only becoming more pronounced.

Australia’s official inflation rate increased to 3.5 percent in 2021, in addition to the 21 percent rise over the prior decade. The costs of essential goods far outstrips the official rate, however, with non-discretionary goods increasing by 4.5 percent according to the Consumer Price Index (CPI).

Housing costs, most of which are not covered by the CPI, have hit record highs. Average house prices in Sydney and other capitals are in excess of a million dollars. Any increase in interest rates could push hundreds of thousands, or even millions of mortgage holders over the financial cliff.

Average daily petrol prices are surging, reaching as high as $A2.25 a litre in some areas. Wage stagnation is continuing, with a rise of less than 3 percent predicted for this year as governments, the employers and the trade unions seek to slash business costs. Families and workers are forced to live paycheck to paycheck, with any unexpected costs spelling potential disaster.

In contrast the rich live in a different world. Typical of the Rich List is the worship of the obscene spending habits of the super wealthy. In one article the Australian writes of the “Gulfstream buying spree,” referring to the purchase of multi-million-dollar private jets used by the billionaires to get around in.

Paul Little, worth $1.53 billion and 78th on the list, is pictured with his “pride and joy,” an $85 million Gulfstream G650 private jet. This was the “gold standard” of private jet five years ago, but alas has now been outstripped by the Global Express 7500, the world’s largest business jet.

Only property developer John Gandel, worth $5.05 billion and ranked 16th, has the $100 million aircraft in Australia. Not to be outdone, Andrew Forrest, Kerry Stokes, worth $7.43 billion placed 13th, and Laurence Escalante, placed 33rd with a worth $2.99 billion, all have one on order.

Andrew “Twiggy” Forrest [Image: Wikimedia]

In one of the few mentions of the pandemic, a Rich List article hails the fact that the health crisis, which has killed an estimated 20 million people, has seen an “explosion” in private jet purchase and travel globally. While workers are funneled into cramped airports, in which they risk spreading and catching COVID-19, the billionaires jet off privately.

The Liberal-National Coalition government, supported by the Labor opposition, claims there is no money to address bushfires, floods or to increase the below-poverty unemployment payment. Public health, vitally needed during the pandemic, is to be further reduced by $10 billion or ten percent in real terms under the 2022 budget.

The obscene wealth at one pole of society, and the growing poverty and social crisis at the other, is setting the stage for major social explosions.