After Russian debacle in Ukraine, US escalates conflict with Russia and China

Andre Damon

Following the collapse of Moscow’s northern front of Russia’s six-month-old invasion of Ukraine, the United States has responded by further intensifying its involvement in the war against Russia in Ukraine and preparations for war with China over Taiwan.

In the course of one week, Ukrainian forces advanced dozens of miles, capturing massive quantities of Russian weapons and ammunition, along with, according to Ukrainian officials, thousands of Russian soldiers.

On Thursday, the Biden administration announced an additional $600 million in weapons to Ukraine, adding to the more than $50 billion in armaments and other assistance that has been allocated to date.

The new arms shipment, the 21st such “drawdown” since the start of the war, includes ammunition for the HIMARS missile system, 36,000 rounds of 105mm artillery, counter-battery radar and a thousand precision-guided 155mm artillery rounds.

This adds to the tens of thousands of antitank missiles, hundreds of drones, 15 HIMARS missile launchers, and hundreds of vehicles, as well as the US’s most advanced anti-ship and anti-aircraft missiles, that have been delivered to date.

US Senators called for even more weapons to be provided to Ukraine, with US Senate Minority Leader Mitch McConnell demanding that the White House provide Ukraine with the long-range ATACMS missile capable of striking deep inside Russian territory.

“The Ukrainians need more weapons than what we’re giving them. They need to start getting them faster, and they need new capabilities like long-range ATACMS missiles, large drones and tanks,” McConnell said.

Senator Marco Rubio added, “I think the concern some would say is that the longer-range missiles could target deep inside of Russia and trigger a broader conflict. I’m not sure I’m as troubled by that.”

These demands for expanding the range of weapons delivered to Ukraine were accompanied by the most explicit declaration to date of US goals in the conflict.

“The momentum has really shifted in favour of Ukraine and they’re the ones that are literally calling the shots,” declared former US Army Europe Commander Ben Hodges.

He added that “we may be looking at the beginning of the collapse of the Russian Federation, adding, “ it’s a population that by and large is not truly let’s say ethnic Russian, I mean there’s 120 different ethnic groups out there…

“I think people out in Tuva and Siberia and Chechnya and others... may see opportunity… to to break away so… um i think that we... collectively the west need to be... thinking… about what are the implications for this?”

The statement by Hodges developed his declaration in April, in the aftermath of Russia’s retreat from Kiev and the allegations of Russian atrocities in Bucha, that the aim of the United States is “breaking the back of Russia’s ability to project power outside of Russia.”

As in April, the renewed escalation of US involvement in the war is accompanied by allegations that Russia systematically murdered civilians, this time in the outskirts of Izum.

These military moves have been accompanied by an escalation of the US-NATO economic war. On Friday, the German government took control of three refineries owned by Russian oil company Rosneft. “This is a far-reaching energy policy decision to protect our country,” German Chancellor Olaf Scholz said.

Alongside the escalation of the war with Russia, the US escalated its conflict with China in the wake of the Russian collapse.

On Wednesday, the Senate Foreign relations Committee voted to move forward the Taiwan Policy Act, a bill that would send $6.5 billion in weapons to Taiwan and effectively end the US’s One China Policy.

The Bill states that “Taiwan shall be treated as though it were designated a major non-NATO ally,” effectively implementing a military treaty with Taiwan, obliterating the US’s formal position that it has no diplomatic ties with Taiwan.

Critically, it replaces provisions that arms provided to Taiwan be used in a “defensive manner” with the declaration that the US will provide “arms conducive to deterring acts of aggression by the People’s Liberation Army,” raising the prospect that this weapons could be used in a “preemptive” conflict.

As the US escalated its involvement in the war against Russia and its conflict with China, Russian president Vladimir Putin and Chinese President Xi Jinping held their first in-person meeting since the start of the war at the Shanghai Cooperation Organization summit. The crisis triggered by Russia’s military debacle was on display.

“We highly appreciate the balanced position of our Chinese friends in connection with the Ukrainian crisis,” Putin said at the start of the meeting. “We understand your questions and concerns in this regard.”

Similar tensions were on display in Putin’s discussion with Indian President Narendra Modi. “I know that today’s era is not an era of war, and I have spoken to you on the phone about this,” Modi told Putin. “I know your position on the conflict in Ukraine, the concerns that you constantly express,” Putin said. “We will do everything to stop this as soon as possible.”

Despite the crisis triggered by the Russian military debacle, Russia and China are being objectively driven closer together by the escalating US war drive.

In a statement to the Financial Times, Alexander Gabuev, senior fellow at the Carnegie Endowment for International Peace, commented  “If Putin is that obsessed with Ukraine, what can [Xi] realistically do?” Gabuev said… “the departure of the Putin regime and the unlikely prospect of a pro-western government in Russia is a terrible nightmare for China.”

Emboldened by the Russian debacle in Northern Ukraine, the US is only escalating its preparations for a global military conflict that threatens all of humanity.

Luring Doctors from Poorer Countries is the UK’s Quiet Scandal

Patrick Cockburn

Photo by Ehimetalor Akhere Unuabona

The looting of artistic and religious objects from Africa and Asia by British invaders in the 19th century causes much rancorous debate about whether the artefacts should be returned to the countries they were originally stolen from. But discussion is much more muted about equally acquisitive expeditions launched by Britain today that may ultimately cause more suffering than those imperialist ventures long ago.

At issue is the policy of deliberately luring badly needed and expensively trained doctors and nurses from poor African and Asian countries to Britain. This happens because we train far too few doctors and nurses, offering only 7,500 medical school places when twice that number is needed. The shortage is made up by battening on the disintegrating health systems of poor and middle-income countries, mostly in Africa and Asia.

The exodus from there of medical professionals is high and getting higher. From the start, the National Health Service (NHS) has recruited from overseas. But within the last decade the influx has vastly increased, with the share of doctors recruited by the NHS from outside the UK and EU rising from 18 to 34 per cent and nurses from seven to 34 per cent between 2015 and 2021, according to statistics compiled by the BBC’s Shared Data Unit. The proportion of British-trained doctors in the health service has fallen from 69 to 58 per cent and nurses from 74 to 61 per cent over the same period.

On occasion, the scale of the loss of skilled medical staff has caused a scandal in their own country. In July 2020, for instance, Nigeria’s immigration service stopped 58 Nigerian doctors from flying out of Lagos international airport on a single plane bound for Britain. The Nigerian press protested that there were already 4,000 Nigerian doctors working in Britain, despite the fact that Nigeria has less than 15 per cent of the doctors needed by its 182 million people.

Syphoning off skilled medical workers from those who can least afford to lose them is not new, but the numbers involved have risen sharply. The NHS has always known that it is training too few doctors but the Treasury has refused to pay for more. Britain has tried to have a first-class health service on the cheap, but this has meant recurrent crises even before Covid-19 along with increasing reliance on medical expertise paid for by others.

Since Brexit the proportion of doctors and nurses coming from EU members has fallen and the numbers coming from poorer non-EU states has increased. Dr Alexia Tsigka, a consultant histopathologist at Norfolk and Norwich University Hospital, is quoted by the BBC Data Unit as saying that in her specialty only three per cent of UK departments are fully staffed.

“And I haven’t seen anyone European coming after Brexit, at least in our department,” says Dr Tsigka. “Doctors that have applied to our department mostly come from India, Egypt and some from Sri Lanka.”

In the past the NHS has denied or played down its dependence on poaching staff abroad. In August, the then Health Secretary Steve Barclay was reported as wanting to send NHS managers to countries like India and the Philippines to recruit thousands of nurses. A Department of Health and Social Care spokesman said the department would be “working with recruitment experts to examine how to recruit staff from overseas more effectively”.

“It is a ghastly development since most of the recruits will come from low and middle income countries that have a low proportion of doctors [to patients] and high infant and maternal mortality rates,” says Rachel Jenkins, professor emeritus of epidemiology and international mental health policy at King’s College London, who has previously emphasised the damage done to poor countries by lessening their already limited medical resources which they cannot afford to replace.

She is scornful about the British health authorities’ claim that they are only accessing a global pool of doctors and nurses, saying “there is no pool but a desert out there”.

Despite knowing that the biggest problem facing the health service is the lack of doctors and nurses, the Government makes clear that it will not train more of them in Britain. A letter to Jesse Norman MP from the Department of Health and Social Care says that it has increased the number of places in medical schools it funds each year from 6,000 to 7,500. “The Government currently has no plans to increase the number of places beyond this,” says the letter.

The parasitic dependence of the UK heath service on recruiting staff who would naturally prefer to work and live in a rich country than a poor one is set to grow rather than diminish. It is foreign aid in reverse, flowing from the poor to the rich and works too much to the advantage of the latter for them to give it up. Bogus claims made in justification for this include the claim that doctors go back to their countries of origin bringing back fresh expertise, but in reality there are few who return.

The real reason for sticking with the present toxic system is simply that the NHS would cease to function without foreign trained medical staff in huge numbers. Personal experience fully supports the statistics as in every medical facility I have been in in the last few years, foreign born staff have been in the majority.

When I broke my leg in 2009, the three doctors who carried out surgery were all from the Middle East. Impressed by their expertise, I wondered about the gap their departure must have left in Cairo or Beirut.

The impact on the NHS of its dependence on non-EU foreign staff is becoming greater, but the same thing has happened in other walks of life. This is strange since Brexit was in part propelled by the belief that Britain was being swamped by immigrants over whose inflow the British government had no control.

A Leave voter might naturally have assumed that, once Britain had left the EU, that the flow of immigrants would be reduced. But instead the number has soared. The Home Office says that 1.1 million visas were issued to those coming to work or study in the UK in the last year, which is an 80 per cent increase on the year before.

This is all legal immigration and it completely dwarfs the 23,000 migrants who have crossed the Channel illegally so far this year. But it is the pictures of migrants being picked up at sea or landing on the beaches of south east Kent that dominate the newscasts about immigration.

So far, the arrival of great numbers of legal immigrants has had surprisingly little political effect. The Government is happy to point to its non-functional plan to deport migrants to Rwanda as its response to the boat people. Labour wants to keep away from the topic. The fact that many migrants are qualified and are being absorbed into big diverse cities makes them less of a rival for jobs in the eyes of poorly educated workers.

Unlike 2016, no political party or media outlet has whipped up anti-immigrant feelings. Nevertheless, I would be surprised if such a big demographic change will not create some sort of backlash.

Japan to further militarize the East China Sea

Ben McGrath

Japan is engaging in the militarization of the East China Sea while increasing the ability of its military to launch offensive, first-strike attacks amid preparations for war with China by the US and its allies.

US Secretary of Defense Lloyd Austin stands with Japan's Minister of Defense Yasukazu Hamada at the Pentagon, Wednesday, Sept. 14, 2022, in Washington. [AP Photo]

In an interview with Nikkei Asia on September 6, Japan’s Defense Minister Yasukazu Hamada stated that the ministry would “radically strengthen the defense capabilities we need, including our capacity for sustained and flexible deployment… To protect Japan, it’s important for us to have not only hardware such as aircraft and ships, but also enough ammunition for them.”

Tokyo intends to construct an ammunition depot on Amami Island in the Ryukyu Island chain that is part of Kagoshima Prefecture. The depot will be located at the current site of a Ground Self-Defense Force (GSDF) base. The GSDF is the formal name of Japan’s army. The government is also examining building additional port facilities and fuel tanks in the region, which also includes Okinawa Prefecture.

Hamada claimed in the interview that the decision is based on a potential crisis over Taiwan and the military’s need to shift resources into the region. At present, approximately 70 percent of the Japanese military’s ammunition is stored on Hokkaido, in the north, while only 10 percent is stored in Kyushu and Okinawa.

Tokyo also intends to conclude the scheduled deployment of surface-to-ship and surface-to-air missiles to islands in the region. The deployment of the missile batteries, with a range of 300 kilometers, was announced in 2016. They have subsequently been installed on Amami Island in 2019 and Miyako Island in 2020. A third deployment to Ishigaki Island will be completed by next March. Miyako and Ishigaki are further south of Amami and are a part of Okinawa Prefecture.

Tokyo also intends to send electronic warfare units to at least three locations in the Ryukyu Island chain, including Yonaguni Island next year. These units are used to jam an enemy’s communications and radar and would target Chinese vessels that use the sea routes around the islands to access the Pacific Ocean. Yonaguni Island lies just 110 kilometers to the east of Taiwan.

The Ryukyu Islands, also known as the Nansei Islands, stretch from Kyushu in an arc down to Taiwan. For the past decade, Tokyo has exploited and inflamed tensions over the disputed Senkaku/Diaoyu Islands—claimed by Tokyo and Beijing—in the East China Sea in order to justify militarizing the Ryukyus. In 2015, Tokyo also announced it would deploy hundreds of additional troops to the islands of Ishigaki, Yonaguni, Miyako, and Amami.

Hamada’s statement that Tokyo is planning for a “sustained and flexible deployment” violates Japan’s constitution, specifically Article 9, known as the pacifist clause. The article explicitly states “land, sea, and air forces, as well as other war potential, will never be maintained. The right of belligerency of the state will not be recognized.”

However, Tokyo has exploited both the US/NATO proxy war against Russia in Ukraine as well as the US manufactured tensions over Taiwan to further dispense with the constitutional restraints on the Japanese military and to push through remilitarization in the face of widespread anti-war sentiment. Prime Minister Fumio Kishida has regularly stated that “Ukraine today may be East Asia tomorrow,” claiming that Beijing may invade Taiwan in the near future.

In reality, the United States, backed by allies like Japan and Australia, have denounced China over phony “human rights” concerns; accused Beijing of being responsible for the COVID-19 pandemic; and dangerously challenged the “One China” policy, which states Taiwan is a part of Chinese territory. Both Washington and Tokyo acknowledge the “One China” policy and have no formal diplomatic relations with Taipei. This has not stopped the US from agreeing to massive arms deals with Taipei and conducting provocative visits to the island, including a trip last month by US House Speaker Nancy Pelosi.

In line with this agenda, Japan’s Defense Ministry recently requested its largest-ever military budget for the 2023 fiscal year, surpassing last year’s record budget. The Defense Ministry submitted its request for 5.59 trillion yen ($US39.19 billion) on August 31, which will likely grow in the future when supplementary budgets are added. The latest increase, which is sure to pass with little to no opposition, comes as Tokyo plans to raise military spending over the next five years to two percent of GDP, a doubling of the current budget. This would make Japan the third-largest spender on the military in the world.

There are seven “pillars” to the new budget, which the Defense Ministry states are “necessary efforts to drastically strengthen Japan’s defense capabilities within five years.” This includes the development and mass production of longer-range missiles, which would give Japan the ability to launch offensive strikes on distant targets. Tokyo also intends to produce the upgraded Type-12 missile with a range of up to 1,000 kilometers that will also be deployed to the East China Sea region.

Another significant item includes additional funds to further modify Japan’s two “helicopter carriers,” JS Izumo and JS Kaga, to convert them into full-fledged aircraft carriers capable of handling F-35B fighter jets. In the past, Japan has avoided the acquisition of nakedly offensive weaponry such as aircraft carriers so as to maintain the presence of abiding by Article 9. The conversion of the Izumo and Kaga would make the two vessels the first new aircraft carriers in Japan’s fleet since World War II.

The other “pillars” in the budget request include improving air and missile defense capabilities, the use of drones, the improvement of intelligence-related functions, “sustainability and resiliency,” deployment capability, and the improvement of capabilities in space, cyberspace, and electromagnetic fields.

In an indication of how far Japan may go in acquiring offensive weaponry, in February, former Prime Minister Shinzo Abe seized on the war in Ukraine to raise the possibility of Japan hosting US nuclear weapons as part of a weapons sharing program. Before his assassination in July, Abe had been one of the most belligerent anti-China voices in Tokyo. With the issue raised, it has already become an open debate in the Japanese establishment.

Fiji government prepares for another anti-democratic election

John Braddock

The Fiji government, led by prime minister and 2006 coup leader Frank Bainimarama, this month pushed through a controversial bill to ramp up powers of the Supervisor of Elections. The Electoral (Amendment) Bill 2022 was passed as parliament sat for its final session before general elections later this year.

FijiFirst election poster of Prime Minister Voreqe Bainimarama outside Fijian village, 2018. [AP Photo]

Introducing the bill, Attorney-General Aiyaz Sayed-Khaiyum, who is also the elections minister, claimed the changes to the Electoral Act were simply made “to reflect practical ways of implementing existing provisions of the Act.”

In fact, with Bainimarama facing his most serious challenge since elections were reinstituted in 2014, powerful sections of the ruling elite are clearly concerned about the possible outcome. The new law places extraordinary, sweeping and intrusive powers in the hands of the Supervisor of Elections (SoE) to intervene in the event of any disputes.

The amendments have three main parts. The first, and most contentious, gives the SoE the “power to direct a person, by notice in writing, to furnish any relevant information or document.” Existing laws relating to privacy are being overridden. Targeted individuals must comply with demands for information “notwithstanding the provisions of any other written law on confidentiality, privilege or secrecy.” Sayed-Khaiyum claims this power is required to allow for any inquiries into “allegations of breaches of campaign provisions.”

The second part entrenches the current opaque and complicated polling system, which uses numbers on ballot papers to replace candidates’ names. Each party may nominate up to 55 candidates, meaning with 10 parties there can be up to 550 numbers on the ballot. The amendment makes it possible for the number used by a candidate to be retained in future elections.

Finally, a new section empowers the Electoral Commission to adopt and publish “guidelines” on opinion polls, surveys and research. The pro-government Fiji Sun, which has previously been criticized by the Commission for its polling methods, immediately announced it would discontinue its monthly public opinion surveys due to the “onerous” new requirements.

Opposition parties voted against the amendment and the Fiji Law Society (FLS), Law Council of Australia and Citizens’ Constitutional Forum earlier all called for the bill to be withdrawn. Most criticism centred on the first amendment with the FLS declaring the SoE could compel any person to provide him with all or any information or documents on “virtually any pretext.”

FLS president Wylie Clarke claimed that the bill “unnecessarily attacks citizens’ rights to privacy, including the legal professional privilege.” People will not be able to appeal any decision except to the Electoral Commission whose ruling is final and cannot be appealed to or reviewed by any court.

Reacting to the widespread condemnation, on September 12 Bainimarama told the Fiji Sun the elections would be “free and fair.” “Rumours of unfair elections,” he said, “serve only to scare the general public and cause societal disruptions. I assure every Fijian that we will have elections before the cut-off date of January 2023.”

Bainimarama’s FijiFirst Party (FFP) currently rules with an extremely narrow majority, having been installed in 2018 with just over 50 percent the vote. The new law follows polls in recent months showing the FFP in some trouble, with support oscillating between 20 and 30-odd percent—roughly the same as the main opposition People’s Alliance.

Significantly, a majority of the nearly 690,000 registered voters are for the first time aged under 40, with a large cohort in the 21-30 age range.

Elections in Fiji are “democratic” in name only. Eight years of direct military rule followed Bainimarama’s 2006 coup before formal elections in 2014, won by the FFP and again in 2018. The US and its local allies, Australia and New Zealand, legitimised Bainimarama’s governments. They have supported coups in Fiji as long as the resulting regime lined up with their imperialist interests.

Fiji’s administrations, resting directly on the military, have all been authoritarian and anti-working class. The imposition of inequality and social misery—28 percent of the population lives below the poverty line—has been accompanied by harsh austerity measures, along with intimidation of opposition parties, repressive laws, media restrictions and rampant violence by the police and military.

Opposition by workers is ruthlessly suppressed. In March 2019 a stoppage by 33 air traffic controllers at Fiji Airports was declared unlawful. Shortly afterwards, the government banned two May Day protests and arrested over 30 workers and trade union officials, accusing them of breaches of “public order.” They included protesting workers who had been sacked and locked out by the Fiji Water Authority.

The deepening economic and social crisis of the past two years has undermined Bainimarama’s support. A COVID outbreak that began in April 2021 quickly spread, rising to 3,306 active cases in just eight weeks. For a considerable period, the country’s vaccination program proved inadequate and the health system faced collapse. Bainimarama repeatedly refused to implement a nationwide lockdown to control the escalating numbers, saying it would “destroy” the economy.

The pandemic sharply exacerbated the country’s social disaster. Fiji’s unemployment rate, which hovered around 6 percent before COVID hit, increased to 35 percent. The tourism industry, the main foreign exchange earner, collapsed with the loss of 100,000 jobs. Half the country’s 880,000 population experienced extreme financial hardship and food shortages.

According to the Economy Ministry’s Pre-election Economic and Fiscal Update, the COVID pandemic and a series of natural disasters had “devastating impacts” on the economy, jobs, public finance and social conditions. Fiji recorded its largest-ever economic contraction of 17.2 percent in 2020 with a further 4.1 percent contraction for 2021. Total debt is 88.6 percent of GDP. In line with global trends, Fiji now faces escalating inflation, forecast to hit 5 percent by the end of the year.

Bainimarama seized on the crisis to tighten his rule. Amid emerging protests, nine opposition MPs were arrested after criticizing a government land bill, while the foreign-born vice-chancellor of the University of the South Pacific was summarily deported for exposing corruption in the university’s FFP-linked administration.

The coming election is again shaping as a contest between two former coup leaders and military strong men. In 2018, Bainimarama’s main challenger was SODELPA, led by Sitiveni Rabuka, the instigator of two military coups in 1987, and prime minister following the 1992 election. Rabuka now leads a new party, the People’s Alliance (PA).

Rabuka is a former chair of the Great Council of Chiefs—which Bainimarama has since dissolved—and advocates for the traditional privileges of indigenous Fijian landholders. This has involved stirring up chauvinist politics aimed at the minority Indian population.

Under the proportional electoral system, it is possible that no party will get 50 percent of the vote. Bainimarama could well refuse to quit. The anti-democratic 2013 constitution, which empowers the military forces “to ensure at all times the security, defence, and well-being of Fiji and all Fijians,” could even be triggered, initiating yet another military intervention.

Washington and Canberra are not beyond playing a role. Fiji is pivotal in the escalating US-led geo-strategic confrontations in the Pacific against China. As chair of the Pacific Islands Forum, Bainimarama was instrumental in arranging a presentation by US Vice President Kamala Harris to the organisation’s summit in July, from which China had been excluded.

Harris used the speech to announce an expansion of US diplomatic and financial presence in the Pacific, including three new embassies. With Bainimarama emerging as a key ally, signing military agreements with both Australia and New Zealand and supporting the US over the Ukraine, Washington has earmarked Fiji as one of the main “hubs” of its upgraded engagement in the region.

German corporations use economic crisis to impose mass layoffs

Gregor Link

With the explosion of energy and commodity prices, an economic crisis is developing in Germany unprecedented since the end of World War II. It is the price that the working class is being asked to pay for the economic war being waged against Russia. It has been systematically provoked by the German ruling class and the European Union.

While German banks are profiting from a government credit glut, and the big energy and auto companies report record profits, small and medium-sized business are being driven into insolvency en masse and tens of thousands of workers are being laid off.

A detailed report in news weekly Der Spiegel speaks of a “systemic collapse” and quotes economists from the Kiel Institute for the World Economy (IfW), who most recently had to revise their growth forecasts for the coming year downward by four percentage points. The IfW researchers warn of a “massive recession” and put the additional national costs for energy imports at €123 billion this year and €136 billion next year. This would mean GDP shrinking by up to 1.4 percent.

In an interview with Der Spiegel, the Institute for Economic Research (Ifo) in Munich predicts inflation rates of up to 11 percent for the first months of 2023. The researchers noted that wage increases and the German government’s recently approved third “relief package” would “not compensate for this at all.” According to Der Spiegel, “Citizens are losing more purchasing power than at any time since modern national accounts began in 1970,” adding, “The energy cost shock is more severe than in the two oil crises. Natural gas currently costs five times as much wholesale in Europe as it did a year ago.”

To protect owners’ and shareholders’ profit incomes, companies are trying to pass on the price increases to consumers, making workers pay twice--even though they are already forced to pay higher electricity and gas bills as domestic consumers. Many companies are brazenly using the high energy prices as an excuse to pocket government funds and carry out restructuring at workers’ expense through mass layoffs and insolvency funds.

According to a survey by the Federation of German Industries (BDI), more than one in three small and medium-sized companies sees its existence at risk—an increase of 50 percent compared to February. In August alone, the number of insolvencies among joint-stock companies and partnerships, mostly medium-sized companies, grew by a quarter compared to the previous year. For next October, economists at the Leibniz Institute for Economic Research predict a one-third increase over 2021. Increased energy costs and inflation are not even reflected in this forecast.

Among small and medium-sized enterprises, 90 percent said they were facing a “strong” (58 percent) or “existential” (34 percent) challenge. 71 percent of all companies surveyed cited delivery problems and delays, and almost one in ten companies in Germany have currently curtailed or interrupted production. Industrial jobs account for 40 percent of those affected by insolvencies.

Energy-intensive companies, such as paper manufacturers, fertilizer producers and steel producers, are trying to pass high electricity and gas prices “down the line” and pocket government funds. For example, hygiene paper manufacturer Hakle—which has filed for self-administered insolvency—announced a “tough restructuring program” to “make much-needed adjustments to its business model possible.”

The century-old company, which consumes 60,000 megawatt-hours of natural gas and 40,000 megawatt-hours of electricity annually at its Düsseldorf plant alone, employs 225 people, whose situation will be uncertain from December at the latest. Hakle’s competitor Fripa, which consumes around 300,000 megawatt hours a year, employs 450 workers and reported to broadcaster Bayrischer Rundfunk a “very threatening” situation.

SKW Piesteritz, Central Europe’s largest fertilizer producer, completely halted production for more than three weeks, threatened all 860 employees with short-time working and demanded “massive support” from government officials. The diesel engine additive AdBlue produced by SKW is a urea product that is indispensable for modern diesel engines and is consumed daily in around 800,000 trucks in Germany.

Following this show of force, an SKW spokesman said Tuesday that they would restart one of the two plants but would not resume production until officials “send a reliable signal” and exempted the company from the gas surcharge. SKW produces urea and ammonia and competes in part with industry giant BASF, which had already reduced ammonia production last year due to high gas prices.

Speaking to Der Spiegel, the Georgsmarienhütte Group of Companies (GMH), which has 21 sites with its own foundries and forges and employs 6,000 people, threatened to raise steel prices by 50 percent, otherwise “energy-intensive industry in Germany will not survive.”

Rival ArcelorMittal recently announced that it would shut down two production plants in Hamburg and Bremen until further notice. In addition to the “exorbitant rise in energy prices,” there was “weak market demand,” the corporation said. Last week, the world’s second-largest steelmaker had already initially put all 500 workers at the plant in the port of Hamburg on short-time working. At the time, the company had given assurances that it intended to continue essential processes. Now, short-time working will also be introduced at production sites in Duisburg and Eisenhüttenstadt.

Overall, the German Engineering Federation (VDMA) forecasts a two percent decline in production in 2023, following a 14 percent drop in new orders in July.

Food production has also been hit hard by skyrocketing energy prices. The Franconian bakery chain Goldjunge, with 26 branches and 300 employees, had to file for insolvency at the end of August. Cologne-based bakery Schlechtrimen, with 40 long-standing employees, also recently announced the closure of its operations after flour and margarine prices doubled and monthly energy costs rose by €100,000.

The situation is also dire for suppliers to the automotive industry. For example, BIA, which produces chrome-plated plastic components used by all major car manufacturers in Europe, announced on Thursday that it would close its plant at Forst, meaning 150 workers will lose their jobs by the end of the year. The bankruptcy of automotive supplier Dr. Schneider affects all 2,000 employees, who are forced to draw insolvency benefits as part of an ongoing reorganization plan. Vitesco, which supplies drivetrain and power-train technologies, is cutting 810 jobs at its Nuremberg site over the next few years.

Carl Leipold, which produces around one billion precision turned parts a year, filed for insolvency earlier this month. According to management, the reason was “exploding energy costs as well as price increases for operating and auxiliary materials, which could only partly be passed on to customers and with a time lag.” This affects 300 employees in Germany.

Last week, the German Association of the Automotive Industry (VDA) revised its market forecast for Germany downward, from the previous three percent growth to minus six percent. VDA President Hildegard Müller complained that “our economic model is in question” and that only three out of five car manufacturers in Germany were able to “pass on energy costs to their customers.”

The automotive industry’s price increases are in fact part of an explicit “luxury strategy” designed to bring the industry astronomical profits and “EBIT [earnings before interest and taxes] margins of 35 percent per year.” Under the slogan “Luxury instead of volume, make hay with [luxury brand] Maybach,” financial websites report manufacturers such as Mercedes-Benz and its subsidiaries have long been profiting from higher prices.

For example, amid growing quarterly profits, Daimler Truck recently announced it would relocate 1,000 jobs in Mannheim to the Czech Republic and lay off 3,600 workers in Brazil. The company will not renew the temporary contracts of 1,400 workers at the São Bernardo plant from December and will lay off 2,200 more. In Germany, 600 current jobs are also to be cut at Evobus’ Neu-Ulm site. Daimler Trucks’ adjusted operating profit grew 15 percent to €1.01 billion in the latest quarter.

Carmaker Opel, part of the Stellantis Group, plans to cut up to 1,000 more jobs in Germany. Labour Director Ralph Wangemann announced Thursday in Rüsselsheim that the company plans to continue existing programs on partial retirement, early retirement, or severance payments, which could mean 1,000 jobs could be eliminated by the end of the year. Stellantis raked in record profits of €8 billion in the first half of 2022 and plans to become the most profitable car company in Europe.

Stellantis’ rival Volkswagen announced Friday it would close a distribution centre near Kassel by the end of 2024, affecting 300 employees. A crisis staff team at the VW group, DerSpiegel reports, “are also discussing with the works council how far down they may lower the temperature on factory floors to save on heating gas.” Volkswagen reported an operating profit of €4.7 billion in the second quarter.

Overall, the operating profits of the 16 largest international car companies in 2021 rose 168 percent year-on-year to a total of around €134 billion, despite the semiconductor crisis.

In the retail sector, shoe vendors Ludwig Görtz GmbH filed for insolvency on September 6, 2022. The company filed for protective bankruptcy for the parent company, as well as self-administered insolvency proceedings for its store and logistics subsidiaries. The insolvency affects 160 stores and 1,800 employees, who are to receive their salaries from the Federal Employment Agency until December. Addressing creditors, Görtz CEO Frank Revermann said they could “expect a successful future after the company reorganization.”

The Galeria Karstadt Kaufhof (GKK) retail group, owned by Austrian real estate multi-billionaire René Benko, has already gone through insolvency and has since been propped up by the federal government to the tune of €700 million. But as Der Spiegel reports, “reserves” are “melting away” as customers are running out of cash and energy costs at branches have increased tenfold in some cases in recent months.

“Consumer sentiment is as bad as never before in the history of the Federal Republic,” the news magazine notes. Millions of people were having to put purchases on hold and massively restrict consumption. The Ifo Institute warns that “private consumption is likely to fail as an economic engine in Germany for the rest of the year.” Meanwhile, according to the daily Süddeutsche Zeitung, the business climate in the cyclical construction industry was “cooling as sharply as it last did in the financial crisis of 2008.”

Triggered by the growing doubts of venture capitalists, unprecedented mass layoffs are now taking place even in the previously booming start-up and platform branches. A report by Business Insider cites planned and imminent layoffs of more than 20 percent of all employees in some cases—including at food delivery services Gorillas (300), Getir (4,480) and Zapp (200 to 300), payment services Klarna (700), Sumup (100) and Nuri (45), and 180 at Tier Mobility.

However, according to a report in Der Spiegel, there was a “gold-rush atmosphere” among the assembled managers at the world’s largest energy industry trade fair, Gastech, this year. European energy company Uniper—which received €15 billion worth of state aid from the German government and has applied for four billion more—sponsored the fair with €175,000 and financed a “prestigious dinner” in a posh Milan villa for another €175,000. Business Insider magazine quotes Uniper CEO Klaus-Dieter Maubach from a now-deleted tweet: “We definitely have a good crisis, so let’s not miss it!”

Putin, Xi meet as Shanghai Cooperation Organization summit opens in Uzbekistan

Alex Lantier

Russian President Vladimir Putin and Chinese President Xi Jinping met yesterday at the opening of a two-day security summit of the Shanghai Cooperation Organization (SCO) in the Uzbek city of Samarkand.

Chinese President Xi Jinping, left, and Russian President Vladimir Putin pose for a photo on the sidelines of the Shanghai Cooperation Organization (SCO) summit in Samarkand, Uzbekistan, Thursday, Sept. 15, 2022. [AP Photo/Alexandr Demyanchuk]

The SCO is a Eurasian regional organization founded in 2001 by the “Shanghai Five”: China, Russia, and former Soviet Central Asian republics of Kazakhstan, Kyrgyzstan and Tajikistan. They have since been joined by India, Pakistan and Uzbekistan. Afghanistan, Belarus and Mongolia have “observer status” in the SCO, which also has Armenia, Azerbaijan, Cambodia, Nepal, Sri Lanka and Turkey as “dialogue partners.” SCO member states account for one-quarter of the earth’s surface, 30 percent of the world economy and 40 percent of its population.

The summit is however overshadowed by the US-NATO war with Russia in Ukraine, combined with growing US threats against China over Taiwan. A week before the Samarkand summit began, Russian troops suffered a devastating defeat at the hands of Ukrainian troops trained, armed and coordinated by the NATO powers.

Speaking to Xi, Putin acknowledged Chinese concerns with the Kremlin’s invasion of Ukraine and the debacle suffered by the Russian army in Kharkov. “We highly value the balanced position of our Chinese friends when it comes to the Ukraine crisis,” Putin said. “We understand your questions and concern about this. During today’s meeting, we will of course explain our position.”

Putin also explicitly condemned US moves to arm Taiwan and, repudiating the “One China” principle that Washington adopted in its 1972 Shanghai Communiqué, press Taiwan to formally declare independence and break with Beijing. “We intend to firmly adhere to the principle of ‘One China,’” Putin said. “We condemn provocations by the United States and their satellites in the Taiwan Strait.”

Putin asserted that the “Moscow-Beijing tandem” plays a “key role” in ensuring global stability and indirectly criticized Washington, declaring: “Attempts to create a unipolar world have recently acquired an absolutely ugly form and are completely unacceptable.”

Calling Putin an “old friend,” Xi replied: “China is willing to make efforts with Russia to assume the role of great powers, and play a guiding role to inject stability and positive energy into a world rocked by chaos.”

In a press release, China’s Ministry of Foreign Affairs said: “President Xi emphasized that China will work with Russia to extend strong mutual support on issues concerning each other’s core interests, and deepen practical cooperation in trade, agriculture, connectivity and other areas.”

Putin’s public acknowledgment of Chinese concerns over the Ukraine war point to the enormous tensions and political crisis inside the SCO as Washington and its NATO allies intensify operations against Russia and China. During the war in Ukraine, Beijing has pursued a delicate balancing act. It rejected NATO calls to impose sanctions on Russia but, at the same time, took no overt action in support of Moscow that could provide a pretext for NATO sanctions against China.

Last week, Li Zhuanshu, the president of the Standing Committee of China’s National Popular Assembly and number three official in the Chinese state hierarchy, traveled to Russia and made a more direct statement of support for Moscow, declaring: “Just like the Ukraine issue now, the United States and NATO had pushed straight to Russia’s doorsteps. This involves Russia’s national security and the safety of its people’s lives. In light of this, China understands that Russia needed to do what is appropriate and is giving coordinated support on multiple fronts.”

Clearly, however, concerns are mounting behind the scenes in Beijing that the Kremlin has no solution to avert an escalation and end its war with NATO in Ukraine.

The SCO, and its predecessor, the “Shanghai Five” association formed in 1996, has developed under the shadow of imperialism and the Stalinist bureaucracies’ restoration of capitalism and the dissolution of the Soviet Union in 1991. The Soviet bureaucracy’s final act of treachery against the Soviet workers and socialism threw Eurasia open to imperialist military intervention. After the SCO’s foundation, Washington seized on the September 11 attacks to occupy Afghanistan and set up military bases in Central Asian countries.

This unleashed a bloody imperialist drive to dominate strategically vital areas of Central Asia and the Middle East and plunder their resources. US and NATO forces have since intervened militarily in Iraq, Pakistan, Libya, Syria and Ukraine, where in 2014 the NATO powers backed a far-right putsch in Kiev that split Ukraine and set into motion the current war. Collectively, these wars cost millions of lives and turned tens of millions into refugees.

Deepening US economic decline and military defeats in Afghanistan and Iraq, coupled with China’s growing economic influence in Eurasia, has brought the struggle over Eurasia to a new peak of intensity. In this, military and financial considerations are inseparably linked. NATO’s waging of war against Russia in Ukraine is in the final analysis, like the world wars of the 20th century, the product of the insoluble contradiction between global economy and the capitalist nation-state system.

A September 14 editorial in China’s state-run Global Times titled “Non-dollar settlement in energy trade will break US hegemony” called on Russia and China to “step up cooperation to break the US dollar’s dominance in the energy market.” It pointed to the devastating inflationary effects of the Ukraine war and the current surge in prices for energy, which is traded in dollars, combined in the dollar’s rise in value against other currencies as the US Federal Reserve raises interest rates.

The Global Times wrote, “A strong dollar means energy products will become more expensive in terms of other currencies. When energy and raw material prices rise, the prices of other products will go up, leading to high inflation globally. … The reason why the US can, time and again, export its own inflation crisis caused by its previous monetary easing policy to the world is mainly because the dollar still holds the dominant position in the global foreign exchange market, reserve assets, trade settlement and other fields.”

It called for using the SCO as a forum to develop trade in oil and gas in non-dollar currencies. It noted that China buys Russian oil and gas with a mixture of Chinese yuan and Russian rubles, while India has paid for Russian energy in dirhams, the currency of the United Arab Emirates.

US imperialism is bitterly hostile to such a policy. In 2019, Denmark’s Saxo Bank calculated that a shift of intra-Eurasian trade out of the US dollar could lead the dollar to collapse, losing 30 percent of its value against gold.

A significant event at yesterday’s summit in Samarkand was the announcement that Iran, previously an SCO “observer” state, will formally join the SCO next year. Iran has faced two decades of US war threats and crippling sanctions, as Washington cut it out of all dollar-denominated financial transactions. Last year, it signed a 25-year military alliance with China and held naval exercises with Russian and Chinese warships in the Indian Ocean.

“The relationship between countries that are sanctioned by the US, such as Iran, Russia or other countries, can overcome many problems and issues and make them stronger,” Iranian President Ebrahim Raisi said while meeting Putin in Samarkand. “The Americans think whichever country they impose sanctions on, it will be stopped. Their perception is a wrong one.”

The various capitalist regimes in the SCO are however neither willing nor able to wage a consistent struggle against imperialism or resolve the bitter legacy of the Stalinist dissolution of the Soviet Union. The case of Putin, who launched his ill-fated intervention in Ukraine while denouncing the Bolshevik revolutionaries who founded the Soviet Union for making too many concessions to Ukrainians, is the starkest illustration of this point.

It is impossible to unify Eurasia against imperialism under the leadership of capitalist regimes. Indeed, shortly before the Samarkand summit, two former Soviet republics and SCO observer states, Armenia and Azerbaijan, plunged back into war over the disputed Nagorno-Karabakh region. It is unclear, moreover, whether Xi will meet Indian Prime Minister Narendra Modi, after clashes in 2020 along the unresolved Sino-Indian border inherited from British rule over India.

Irish government moves nearer NATO and war with Russia

Dermot Quinn & Steve James

The Irish coalition government made up of Fianna Fáil, Fine Gael, and the Green Party has seized on the humanitarian crisis generated by the Russia-Ukraine war to intensify efforts to abandon Ireland’s formal neutrality and lead the country into the imperialist war fighting alliance, NATO and related European Union (EU) military structures.

Over 47,000 Ukrainian refugees have now arrived in Ireland. This has emboldened mainstream media efforts to echo the remarks of Ireland’s former Taoiseach and deputy premier Leo Varadkar, who branded Russian premier Vladimir Putin “the Hitler of the 21st century'”. A wave of anti-Russian hysteria has been whipped up, sanctioned by the government and encouraged and egged on by the state broadcasting service RTE.

In April, US puppet and Ukrainian President Volodymyr Zelensky told Ireland’s Dáil (parliament), “Although you are a neutral country, you have not remained neutral to the disaster and to the mishaps that Russia has brought to Ukraine.”

Address by the President of Ukraine, Volodymyr Zelenskyy, at a Joint Sitting of Dáil & Seanad Éireann in Leinster House on April 6, 2022 [Photo by Houses of the Oireachtas/Flickr / CC BY 4.0]

There has been a backlash from right-wing pro-NATO members of the Dáil and media over remarks made by Sabina Higgins, the wife of President Michael D. Higgins, who wrote a letter to the Irish Times at the beginning of August calling for peace talks between Ukraine and Russia. Higgins’ letter enraged those leading the pro-NATO campaign, particularly as her proposal for talks had avoided the requisite anti-Russian rhetoric.

The move to formally abandon neutrality coincides with decisions by Sweden and Finland to join NATO. The Irish shift is part of the massive escalation in efforts by the US and European imperialist powers to encircle Russia and accelerate the drive to all-out war. The Irish ruling elite want to show just how loyal they are to their imperialist allies.

This is in defiance of overwhelming opposition from working people. A recent Irish Times/lpsos poll showed that 66 percent of Irish people do not want any change in Ireland’s current position. Only 24 percent supported change, while 11 percent did not know. Ireland’s currently policy precludes the country from joining any military alliance and requires a United Nations Security Council resolution for Irish troops to be committed abroad.

Origins of Irish neutrality

Popular support for military neutrality is bound up with hostility among Irish workers to the horrors of imperialism. By contrast, the Irish ruling class has for decades employed neutrality as a tactic to advance its own class interests by attempting to use one or other imperialist power as a counterweight to Britain.

The Irish Free State (later the Republic of Ireland) was founded one hundred years ago in 1922 based on crushing all working class demands that went beyond the interests of the Irish bourgeois nationalists. These later founded Fianna Fáil and Fine Gael, still the two main bourgeois parties.

The intention of those who took control of the 26-county state in the South of Ireland, after bloody partition by Britain, and having suppressed the working class, was to keep the South of Ireland subordinate to imperialist interests. The Irish Free State came into existence as a mechanism by which the British ruling class could rely on the weak Irish bourgeoisie to prevent opposition to British domination of the island spilling over into a struggle for socialism in Ireland and Britain itself.

The 1922 Constitution of the Irish Free State stated that “Save in the case of actual invasion, the Irish Free State shall not be committed to active participation in any war without the assent of parliament”.

The Free State remained a dominion of the British Commonwealth with the UK remaining in control of marine defence as well as three naval bases known as the “Treaty Ports”—at Berehaven, Loch Swilly and Spike Island.

The Treaty Ports were handed back to the Irish government as part of a 1938 settlement. This followed five years of the Anglo-Irish Economic War in which Eamonn de Valera’s new Fianna Fáil government implemented, at great social cost, protectionist measures against Britain designed to foster Irish capitalism. In consequence, the Irish government remained at least nominally neutral during World War Two, although neutrality in practice had a pro-British bias.

British wartime Prime Minister Winston Churchill was urged by Northern Ireland Prime Minister Lord Craigavon to invade the South. Churchill in the end relied on agreed military overflights of Donegal to Northern Ireland during the “Emergency” of world war. Close co-operation with Britain against a possible German invasion was also prepared.

There were limits, however. In 1940 a British delegation floated the possibility of ending partition if the Irish government would fully support the British war effort. De Valera refused, seeking to advance Irish capitalism by balancing between the imperialist combatants. Relations were maintained with Japan and Nazi Germany, while close relations with the US also served as a growing counterweight to British influence.

Ireland eventually joined the United Nations in 1955, having been blocked by the Soviet Union in 1945, although Ireland refused to join NATO due to British membership of the anti-Soviet alliance. The Irish government sought an alliance with the US outside the confines of NATO, but this was refused by Washington. Cooperation was nevertheless continually deepened with the US on security matters.

Ireland’s formal neutrality, and history of brutal national and class oppression, was used by the US and other powers to obscure the barbaric aims of imperialism, particularly in Africa. Between 1960 and 1964, for example, over 6,000 Irish soldiers served in the Congo, in a brutal war following Congolese independence from Belgian colonialism. Subsequent UN deployments saw Irish troops dispatched to many of the world’s poorest countries, including Haiti and Angola, seeking to secure imperialist interests.

By the 1960s, Ireland had abandoned its protectionist experiments, reducing tariff barriers on trade and opening up the economy to US capital and investment. The South became a hub for multinational companies attracted by low taxes and compliant unions. The integration of the ruling elite as junior partners of the imperialists was accelerated by accession to the European Community in 1973. Today more than a thousand large global American companies have operations in Ireland, paying one of the lowest corporation tax rates in Europe at 12.5 percent, and enjoying access to the EU’s huge single market.

Partnership for war

Irish integration into Europe also drew Ireland into European and NATO mechanisms. In 1999 Ireland was accepted into NATO’s Partnership for Peace programme (PfP), which serves as a waiting room for NATO membership. Candidate countries are set targets in terms of military organisation, spending and equipment. As of July 2022, Ireland was deemed to have 15 of 27 set goals outstanding.

In 2003, to stress its loyalty to the US, the Fianna Fáil government supported the invasion and occupation of Iraq, assisting US “shock and awe” bombing by offering Shannon Airport in the west of Ireland as a hub and refueling depot. The invasion resulted in the death of more than a million people and the destruction of an entire society.

Shannon Airport terminal and control tower [Photo by Joseph Mischyshyn / CC BY-SA 4.0]

By 2006 the airport became one of the main locations for “rendition flights” carrying prisoners held by the CIA to countries where they were subsequently tortured. Shannon is currently used to refuel daily arms flights to Ukraine.

By June this year, the Irish government was also considering joining the joint NATO/EU hybrid and cyber warfare thinktank based in Helsinki, Finland, and has already joined the NATO Co-operative Cyber Defence Centre of Excellence in Tallinn, Estonia.

Taoiseach Martin has been floating plans to avoid a referendum on NATO membership, which would stand a high chance of losing. In June, Martin declared, “We need to reflect on military non-alignment in Ireland and our military neutrality. We are not politically neutral.” He continued, “We don’t need a referendum to join NATO. That’s a policy decision of government.”

Ireland is also integrating its forces into the EU’s own military apparatus. In 2006, Willie O’Dea, then the Minister of Defence, announced that Ireland would seek to join European Union battle groups. It has subsequently participated in a succession of battle groups involving up to 1,500 troops.

In 2017, the Dáil voted to join the European Union’s Permanent Structured Co-operation (PESCO) Agreement, made up of 25 of the EU’s 27 member states. Thus far, the country has only participated in one of PESCO’s 60 projects. In June, however, the Dáil voted to participate in four more, including work against cyber threats, medical training, disaster relief—“both within and outside EU territory”—and sea mine clearance.

Also driving the ruling elite in Ireland towards NATO militarism is the very real threat from the working class, which has seen living standards plummet and poverty increase.

More than 781,794 people are experiencing deprivation in Ireland, with 660,000 people now living in poverty, of which 210,000 are children. Over 133,000 people living in poverty are in employment. According to the latest data produced by Eurostat, energy prices have risen by 39.1 percent in the past twelve months, driving overall yearly price inflation to 7.3 percent.

The housing and rental crisis has extended its shadow over the whole country, particularly in larger towns and cities. The latest figures released by the Department of Housing show that the number of homeless people increased in June to 10,492, up more than a quarter on the same period last year. The number of homeless families has now increased to 1,385 and there are over 3,000 children homeless. The NATO-Russian war crisis serves to divert class tensions against an “external foe.”