Unions sabotage struggle against 3,600 layoffs at Mercedes in Brazil

Eduardo Parati

On September 6, the announcement by Mercedes-Benz of 3,600 layoffs at its plant in São Bernardo do Campo, in the ABC industrial region of São Paulo, provoked enormous opposition from workers. The company announced that 2,200 permanent employees would be laid off and another 1,400 temporary workers would not have their contracts renewed.

Mercedes-Benz workers rally after layoff announcement (Photo: Adonis Guerra/SMABC/FotosPublicas)

Employing about 9,000 workers, 6,000 of them in production, the São Bernardo plant is Mercedes’ largest plant outside Germany. According to data from the Inter-Union Department of Statistics and Socio-Economic Studies (DIEESE), the dismissal of the 3,600 employees will have an indirect impact on another 18,000 jobs.

Facing the workers’ opposition, the Metalworkers Union of ABC (SMABC), affiliated to the Workers Party (PT)-controlled CUT, was forced to announce a three-day strike at the plant. In this period, the union called no joint action of the ABC autoworkers, much less a general strike to reverse all the layoffs. By Monday, everyone had returned to work while the union continued to meet with Mercedes-Benz behind the workers’ backs.

During an assembly at the plant gate on September 8, two days after the layoffs were announced, SMABC president Moisés Selérges indicated his readiness to assist the company with the cuts. Selérges said that “many times, in a negotiation process, not everything the union wants will prevail, but neither will everything the company wants.”

SMABC executive director Aroaldo da Silva admitted to the Mercedes workers that the union leadership already knew about and was participating in cost-cutting discussions with the company. Silva declared to the crowd of workers: “We have been dialoguing about these issues. Mercedes management began to present a scenario in which the company has not been earning the expected profit. The company’s headquarter had to make an investment in Brazil, and, according to them, it was necessary to start discussing about the São Bernardo plant to prevent the worst from happening.” Silva said that the need for “restructuring” areas, lack of parts and semiconductors have been discussed by the union with the plant management “for some time now.”

Silva’s statements that one must accept the massive layoffs or face “the worst” show that, far from acting against the layoffs, the union is discussing with the company the best way to suppress opposition inside the factory.

Contrary to the lying statements of Mercedes and the union bureaucrats, the auto industry has posted huge profits. In the second quarter of the year, the Mercedes-Benz group posted a profit of 3.11 billion euros, or R$16.4 billion.

The true class character of these trade union organizations, which call themselves defenders of the workers, was exposed in the last few days with the organization of a series of meetings to promote their “Industry Plan 10+.”

Since August, IndustriALL-Brazil, a merged union created by the CUT and Força Sindical, has been presenting its plan for Brazil’s industry in a series of meetings with businessmen and union members. In addition, the project aims to be integrated into the program of a future PT government. IndustriALL’s president, the same Aroaldo da Silva from SMABC, held a meeting at the end of last month with the union federations and Geraldo Alckmin, the vice-presidential running mate of the PT’s candidate, former president Luís Inácio Lula da Silva.

The Plan’s document constitutes a call for the construction of a corporatist apparatus to suppress working class struggles based on a defense of “national development.”

The Plan calls for the creation of “multipartite” organizations, bodies supposedly controlled by government, business, and labor. According to the plan, these organizations would prevent excesses by larger companies, arbitrate labor disputes, and encourage the development of key sectors, including the defense industry. The document points out that “this space [the multipartite Sector Competitiveness Councils] cannot promote specific debates that benefit one company or another; it must be aligned with the objectives of the ‘Industry 10+ Plan.’”

In the section “Environment to promote industry,” the document points out among the policies “for a reindustrialization strategy” that “foreign policy should be guided towards a sovereign insertion of Brazil in the new industrial paradigm.”

The true meaning of the “insertion of Brazil in the new industrial paradigm” promoted by the unions and Lula is the imposition of ever-increasing cuts in wages and jobs in the name of the “national development” of Brazilian capitalism.

In recent years, several auto companies have cut thousands of jobs. After more than one hundred years of operations in the country, Ford closed all of its plants in Brazil by 2021. This year, SMABC helped Toyota close down in ABC, and the Metalworkers Union of São José dos Campos and Region affiliated to CSP-Conlutas, led by the Morenoite PSTU, did the same in relation to the closing of the Caoa-Chery plant in Jacareí.

The layoffs at the Mercedes plant in ABC occur in the context of a huge social crisis. After two and a half years of the COVID-19 pandemic, which followed more than five years of job and wage cuts, and an inflation not seen in decades, massive working class strikes and demonstrations are the order of the day. As the auto industry goes through a global restructuring, with plans to fully transition to electric vehicle production by the next decade, the unions are looking to prove their ability to suppress working class struggles and defend the interests of the bourgeoisie.

In Spain, the Workers Committees (CCOO), linked to the pseudo-left Socialist Party (PSOE)-Podemos government, and the General Union of Workers of Spain (UGT) worked to suppress a strike at the Mercedes-Benz plant in Vitoria, in the Basque Country in northern Spain.

In June, the factory with 5,000 workers remained on strike for nine days. With 95 percent approval for the strike, the workers defied the union, which had declared only three days on strike. The workers’ anger reached its boiling point after the company announced that it would approve wage increases of less than 2 percent a year, while inflation has already risen to over 10 percent. Mercedes was able to impose the cuts only after the union announced as a victory the company’s withdrawing from the introduction of a sixth night shift. During the strike, workers protested by shouting, “The UGT and CCOO, sold out!”

CDC report: More than 80 percent of US maternal deaths are preventable

Kate Randall

More than four out of five maternal deaths in the United States are preventable. This is the sobering news from an analysis of federal maternal death data released Monday by the Centers for Disease Control and Prevention (CDC).

A pregnant woman waits in line for groceries with hundreds during a food pantry, sponsored by Healthy Waltham for those in need due to the COVID-19 virus outbreak, at St. Mary's Church in Waltham, Mass. (AP Photo/Charles Krupa)

The analysis is based on figures from Maternal Mortality Review Committees (MMRCs) in 36 states that investigate circumstances around maternal deaths. Pregnancy-related deaths analyzed by the CDC include deaths during pregnancy, delivery and up to a year postpartum.

A Commonwealth Fund study in April also found that US women of reproductive age (18 to 49) have the highest rates of death from avoidable causes, including pregnancy related complications, far outpacing deaths of women in 10 other high-income countries.

The COVID-19 pandemic has served to exacerbate this already damning state of affairs. Based on National Center for Health Statistics (NCHS), a JAMA Network Open research letter published in June found an 18.4 percent increase in US maternal mortality between 2019 and 2020. The JAMA figures include deaths during pregnancy or within 42 days of pregnancy.

As women are 14 times more likely to die from giving birth than from a safe, legal abortion, the reactionary ruling of the US Supreme Court in June, tearing away the constitutional right to abortion by overturning the 1973 landmark Roe v. Wade decision, is certain to increase the already abysmal maternal death rate.

According to a CNN analysis of 2018 data from the CDC, maternal mortality rates are already 47 percent higher than the national average in those states certain or likely to ban abortion in the wake of the Dobbs v. Jackson Women's Health Organization ruling.

The CDC studied 1,018 pregnancy-related deaths occurring in the US between 2017 and 2019 and found that a staggering 84 percent of these were due to preventable causes. Black and Indigenous women were significantly more likely than white women to suffer deaths in pregnancy and postpartum. Mental health conditions were the top underlying cause of death.

Of the 1,018 maternal deaths, about 22 percent took place during pregnancy and a quarter occurred on the day of delivery or within a week after delivery. Mental health conditions, including deaths by suicide or overdose, were the top underlying cause of death, followed by extreme bleeding, or hemorrhage, according to the report.

These causes were followed by infection, embolism, cardiomyopathy and high blood pressure-related disorders.

African American mothers were three times as likely as white mothers to die, with most likely due to cardiac and coronary problems. Both white mothers, who made up 14 percent of deaths, and Hispanic mothers, who made up 14 percent of deaths, most frequently died of mental health conditions.

Almost all—90 percent—of American Indian and Alaska Native maternal deaths were preventable, with most due to mental health conditions and hemorrhage. This is an indictment of care given under the Indian Health Service, the federal program tasked with providing medical services to this population.

The JAMA study exposes the dramatic impact of the COVID-19 pandemic on maternal mortality in the US. The NCHC reported a 16.8 percent increase in overall mortality in 2020, the first year of the pandemic, and an 18.4 percent increase in maternal mortality. The relative increase in maternal deaths was 44.5 percent among Hispanic women, 25.7 percent among non-Hispanic black women and 6.1 percent among non-Hispanic white women.

Maternal deaths studied by JAMA were separated into deaths before the pandemic (2018, 2019 and January-March 2020) and during the pandemic (April-December 2020). A total of 1,588 maternal deaths (18.8 per 100,000 live births) occurred before the pandemic versus 684 deaths (25.1 per 100,000 live deaths) during the pandemic, for a relative increase of 33.3 percent. Late maternal mortality—within 6 weeks of delivery—increased by 41 percent.

The increase in maternal deaths during the pandemic period studied, at 33.3 percent, was higher than the 22 percent overall excess death estimate associated with the pandemic, according to the JAMA study.

The Commonwealth Fund study on health and health care for women of reproductive age (18-39 years) shows that US maternal mortality rates correspond with higher overall avoidable death rates when compared to women in other high-income countries. US women are also less likely to have a regular doctor and more likely to report problems paying medical bills.

Using data from the Commonwealth Fund’s 2020 International Health Policy Survey and the Organisation for Economic Co-operation and Development, the brief compares measures of health care access and outcomes for women of reproductive age in the US and 10 other countries.

Among US women ages 18-49, only 26 percent rated overall performance of the US health care system as “good” or “very good.” This compares to 58 percent of women in Sweden and 84 percent in Switzerland.

How German imperialism is gearing up for World War III

Johannes Stern

Germany’s ruling class is using NATO’s war in Ukraine against Russia to aggressively reinvigorate militarism both at home and abroad. Recent speeches by Defence Minister Christine Lambrecht and Chancellor Olaf Scholz (both Social Democrats, SPD) leave no doubt about this.

German self-propelled howitzers 2000 before being transported to Lithuania at the Bundeswehr [Armed Forces] base in Munster on Feb. 14. Defence Minister Christine Lambrecht (SPD) assured Ukraine of the delivery of four additional self-propelled howitzers plus ammunition on Sept. 19. [AP Photo/Martin Meissner]

In a foreign policy keynote speech on September 12, Lambrecht said Germany must play a leading role not only economically and politically, but also militarily: “Germany’s size, its geographic location, its economic power, in short, its weight, make us a leading power, whether we like it or not. In military terms, too.”

Seventy-seven years after the fall of Hitler’s Third Reich and the terrible crimes committed by the Wehrmacht (Nazi Armed Forces) in World War II, Germany should once again be able to act as a war power, and the German army should be able to wage comprehensive wars. “We ourselves need strong, combat-ready armed forces so that we can defend ourselves and our alliance in case of need,” Lambrecht stressed.

On Friday, the chancellor himself followed up. In a speech at the Bundeswehr (Armed Forces) conference in Berlin, Scholz told the assembled military leadership: “As the most populous nation with the greatest economic power and a country in the middle of the continent, our army must become the cornerstone of conventional defence in Europe, the best-equipped force in Europe.”

Both Lambrecht and Scholz spelled out that this means the complete militarization of German society and politics. “The Bundeswehr in particular will play a more important role in our political thinking and actions in the future,” Lambrecht declared. The time when the German armed forces were perceived “exclusively as an actor in crisis operations abroad or in assisting the civilian powers” was over, she said. “The Bundeswehr must once again be seen as a central authority for our provision of public services. And do so every day,” she added.

Scholz praised the establishment of a special fund of 100 billion euros for the Bundeswehr, which he had announced in the Bundestag at the end of February. At the same time, he made clear the gigantic sum was only the beginning and that the new “foreign policy epoch” he had proclaimed—a euphemism for the return of German militarism to the world stage—encompassed much more.

“The special fund is a reality. My statement that we will continuously increase the defence budget to 2 percent of gross domestic product also applies! You can count on that,” he assured the military. “The capability gaps of the Bundeswehr are large,” but they were in the process of “closing the most pressing of them very quickly,” he said. Priority was being given to “combat aircraft, heavy transport helicopters, Eurofighters, the successor to the Marder infantry fighting vehicle, 130 corvettes and 126 frigates.”

Germany needed “aircraft that can fly, ships that can set sail, soldiers who are optimally equipped for their dangerous tasks,” Scholz growled. “A country of our size, which bears special responsibility in Europe, must be able to provide all this.” Germany also owed this to its “allies in NATO,” he said.

The strategy that the ruling class is pursuing in its third grab for world power was clearly outlined by Scholz. Germany is seeking to organize Europe militarily under its leadership in order to pursue its imperialist interests worldwide. As long as German imperialism cannot (yet) openly confront the US, rearmament will take place within the framework of NATO.

Among other things, the chancellor called for “a European headquarters [...] that can lead missions.” Perhaps the “most pressing problem in Europe” was “the completely confusing number of weapons systems and armaments.” Only the “coordinated development of European capabilities” would lead to “a Europe capable of action. In this context, he said, “the area of air defence is particularly important—coordinated at European level and as a contribution to strengthening the European pillar of NATO.”

Scholz boasted of Germany’s “leading role” in the NATO war offensive against Russia. “Precisely because of the substantial German contribution of 30,000 soldiers, 85 aircraft and ships,” he said, “NATO’s response capability and deterrent effect were being drastically increased.” Germany had “taken a leading role in all this from the very beginning—that was important to me.”

As a result, he said, “hundreds of German soldiers are in the Baltic states, in Romania, in Slovakia. Our navy and air force are increasingly patrolling the Baltic Sea and the eastern Mediterranean.” This, he said, provided “more than reassurance to our eastern allies.” Germany, he said, was “ready to take on responsibility for the security of our continent in a leading role.”

He then impressed upon in his audience, “Ladies and gentlemen, a new epoch—that means saying goodbye to old certainties. It means rethinking, also strategically. Within NATO, we did this at the Madrid summit and with the new Strategic Concept. Our combat power and operational readiness will be significantly increased.”

Scholz preferred not to explain in more detail what NATO’s new Strategic Concept actually entails: Preparing for a nuclear third world war against Russia and China.

The Madrid document states, “We will individually and collectively
deliver the full range of forces, capabilities, plans, resources, assets and infrastructure needed for deterrence and defence, including for high-intensity, multi-domain warfighting against nuclear-armed peer-competitors.”

The cost of this madness will be borne by the working class—as cannon fodder in the war and in the form of billions in social attacks to finance the arms build-up. While rapidly rising energy prices and galloping inflation are already plunging millions into poverty, the traffic light government of the Social Democrats, Liberal Democrats and Greens is planning stark cuts in its current draft budget for 2023. The health budget alone is to be cut from €64 billion to €22 billion—and this in the midst of an ongoing coronavirus pandemic, which has already led to some 150,000 deaths in Germany alone.

The official propaganda that NATO was merely responding to “Russian aggression” and fighting for freedom, human rights and democracy is a bold-faced lie.

In fact, NATO powers have systematically encircled Russia since the dissolution of the Soviet Union, with the aim of subjugating and dividing the resource-rich country so that it can be exploited by the imperialist powers. Putin’s invasion on February 24, 2022, was the desperate response of a reactionary capitalist regime to NATO’s offensive.

The return of German militarism has been long prepared behind the backs of the population and was publicly announced as early as the 2014 Munich Security Conference. Federal President Frank-Walter Steinmeier (SPD), as foreign minister at the time, declared that Germany was “too big and economically too strong for us to comment on world politics only from the sidelines.”

A short time later, this megalomaniacal claim was put into practice for the first time with the pro-Western coup in Ukraine. Even then, the Sozialistische Gleichheitspartei (Socialist Equality Party) analyzed the historical and political driving forces behind the war policy and warned of the enormous implications of the return of German militarism:

History is returning with a vengeance. Almost 70 years after the crimes of the Nazis and its defeat in World War II, the German ruling class is once again adopting the imperialist great power politics of the Kaiser’s Empire and Hitler. The speed of the escalation of the war propaganda against Russia recalls the eve of World War I and World War II. In Ukraine, the German government is cooperating with the fascists of Svoboda and the Right Sector, which stand in the tradition of Nazi collaborators in the Second World War. It is using the country that was occupied by Germany in both world wars as a staging ground against Russia.

Now those plans are being put into action. Germany and NATO are waging a war in Ukraine against the nuclear power Russia, which they continue to escalate, supplying even more heavy weapons to Kiev following the debacle faced by the Russian army in northern Ukraine. In recent days, Germany announced the additional delivery of multiple rocket launchers, armoured vehicles and another four howitzers from Bundeswehr stocks.

In addition, German politicians and media are calling for Ukraine to be equipped with Leopard 2 heavy battle tanks. In the US, preparations are underway for the delivery of missiles with which the Ukrainian army can attack Russian territory. Although the danger of a nuclear third world war is acute, no one is talking about the possible consequences.

On the contrary, the policy of war and social spending cuts is being pushed forward primarily by the nominally “left-wing” parties in the Bundestag. With Scholz, the SPD supplies the chancellor and heads the defence ministry with Lambrecht. The Greens head the foreign and economic ministries and are the most aggressive within government pushing for the supply of heavy weaponry to Ukraine.

The Left Party also toes the same line. It unconditionally backs the war policies of the German government and NATO, a fact underscored by the recent controversy surrounding Sahra Wagenknecht. The former leader of the Left Party’s parliamentary group in the Bundestag is being attacked not because of her outbursts against refugees, in the manner of the far-right Alternative for Germany (AfD), but because she criticizes NATO’s war course against Russia from the standpoint of German nationalism.

Crisis-ridden Kremlin pushes through new law on wartime mobilization, prepares referendums in East Ukraine

Clara Weiss

Ten days after the Russian army suffered a major military debacle in northeastern Ukraine, with troops fleeing from about a tenth of the territory Russia had occupied, there are signs that the Kremlin is preparing for a significant escalation of the conflict. 

In a live-streamed session on Tuesday, the overwhelming majority of the Russian parliament (Duma) approved a new bill in both the second and third readings that will introduce, for the first time, the terms “mobilization”, “martial law” and “war time” into the Russian criminal code. 

Based on the bill, under conditions of martial law, Russians in reserve will now be subject to criminal prosecution if they avoid or desert military service. For civilians, the bill adds a new, aggravating circumstance to any crime that is committed “in the period of mobilization or under conditions of martial law, [and] in times of war.” 

Moreover, the bill significantly increases the prison sentences for soldiers who voluntarily give themselves up as prisoners of war—they will be punished with between 3 and 10 years in prison—and for looting during war time, which will be punished with up to 15 years in prison. Soldiers in combat who fail to follow orders of their military commanders will face between 2 and 3 years in prison. The failure to fulfill state orders for defense production, as well as the violation of state contracts, will be punished with up to 10 years in prison.

The bill was first introduced on Monday, September 19, by a coalition of deputies from the ruling United Russia Party, the far-right Liberal Democratic Party, the “New People” party, as well as the two main loyal opposition parties Just Russia and the Stalinist Communist Party of the Russian Federation. 

The Russian Federal Council will be voting on the bill on Wednesday, September 21, and then it will go on to President Vladimir Putin to be signed into law, a process that could be completed within a matter of days.

The bill has been interpreted by Russian commentators as a sign that the Kremlin is preparing the proclamation of martial law and a mobilization. Dmitry Zhuravlev, a political expert who used to work in Putin’s first presidential administration, said that the bill indicates that “a mobilization will be proclaimed in the very near future. And the fact that the deputies adopted the amendments immediately both in the second and third reading of the bill indicates that they are in a hurry.” 

A mobilization can only be proclaimed by the Russian President and it can be imposed on either the entire or only parts of the country. 

Since the invasion of Ukraine in February, the Kremlin has insisted before the Russian public that what was taking place was not a war, but a “special military mobilization.” The term “war” is banned from the media and public discussion about what has ever more openly and directly become a war between NATO and Russia, fought out on Ukrainian soil. Only a small fraction of the Russian army has been deployed to Ukraine and the Kremlin has stressed throughout that all those fighting are there voluntarily.

However, in the wake of the collapse of Russian defenses in Ukraine’s northeast, bitter conflicts erupted within the oligarchy last week. While pro-US liberal politicians in Petersburg launched a petition to impeach Putin on grounds of “national treason,” leading pro-Kremlin politicians like the arch-Stalinist and head of the Communist Party of the Russian Federation Gennady Zyuganov called for a mobilization and a public acknowledgement that a war is, in fact, taking place. In response, the Kremlin insisted that a general mobilization is not even a subject of discussion in the government. 

Yet since then, the Russian media has been filled with articles about what a general mobilization would entail. Several regional governors have also expressed support for a proposal by Ramzan Kadyrov, the regional head of the North Caucasus, to implement a “self-mobilization.”

In another indication that Moscow is preparing for a significant expansion of the conflict, shortly after the news about the bill broke, the Kremlin announced that it will hold referendums about joining the Russian Federation in the occupied Lugansk, Donetsk, Zaporizhzhia and Kherson regions in eastern and southeastern Ukraine between September 23 and 27.

The referendums are no doubt, in part, an effort to consolidate whatever military gains the Kremlin has made since February and to bolster the faltering morale of Russian troops. 

On his Telegram channel, former President and deputy head of the Security Council, Dmitry Medvedev, said that the referendums will turn these regions into part of Russian territory. Should they then still be attacked, the Russian army would reserve the right to deploy nuclear weapons. 

Clearly, the bankrupt calculation of the Kremlin oligarchy is that this could deter the imperialist proxy war army in Ukraine from attacking. But there is little question that it will be seized upon by Western imperialism and its stooges in the Ukrainian oligarchy and military to further escalate the war.

Already, both the US and Kiev immediately denounced the holding of the referendums, calling them “sham referendums.” Ukrainian Foreign Minister Dmitry Kubela insisted that “Ukraine has every right to liberate its territories and will keep liberating them whatever Russia has to say.” 

The latest moves by the Kremlin are, above all, signs of a profound political crisis not only of the Putin regime but the entire Russian ruling class. In a stark indication of the disorientation prevailing in the Kremlin, an address to the nation by Putin on the referendums was suddenly announced late Tuesday night Moscow time and then just as suddenly postponed until early Wednesday morning.

The crisis of the Russian oligarchy, as is the war itself, is ultimately the product of the disastrous dissolution of the Soviet Union by the Stalinist bureaucracy, out of which the ruling oligarchy arose. All of its factions, while torn by bitter disputes over foreign policy, are ultimately dependent on imperialism and fear nothing more than a movement within the working class. 

The Kremlin’s reactionary invasion of Ukraine was itself a desperate attempt by the Putin regime to force the imperialist powers to the negotiating table. This attempt has backfired catastrophically. The entire strategy of “national defense” upon which the Kremlin has based this war has been blown to pieces by the incredibly aggressive escalation and direct intervention of the war by all the imperialist powers.

In his first public acknowledgement that the war was not going as planned at all in response to a rebuke over the war by Indian Prime Minister Narenda Modi, Putin stressed last week, “We will do our best to stop this as soon as possible.” He added that it was “unfortunately, the opposing side, the leadership of Ukraine” that was determined to “achieve its goals by military means” and was opposed to negotiations. 

But the main force behind Kiev and opponent of Russia in this conflict is, of course, NATO. The offensive in the northeast was proposed and directly prepared by NATO. The Ukrainian troops carrying it out had been armed, trained and directed by Washington. The offensive was aimed at provoking precisely the kind of expansion of the war that is now underway. In the words of the Financial Times, it “put the Kremlin on the ropes, and forces choices the Russian president has tried to avoid since the invasion began.”

The strategy of the imperialist powers is to do everything they can to expand and escalate the war in order to bring about the fall of the Putin regime and, indeed, the disintegration of Russia itself. It is a strategy that is mind-boggling in its recklessness, and directly risks a full-blown world war, fought with nuclear weapons. 

The events of the past two weeks have made abundantly clear that the Putin regime and the various oligarchic and nationalist forces upon which it rests have absolutely no progressive response to this danger. Driven into a corner by imperialism, the main concern of the Russian oligarchs is not the threat of nuclear annihilation, but the prospect of social revolution. They see their main enemy not in imperialism but in the working class.

Drastic increases in commodity prices pummel Peruvian working class

Cesar Uco & Don Knowland

The sharp increases in the prices of food, fertilizers, fuel, and public transportation, combined with the uncertainty of the exchange rate and unemployment remaining high, are having a devastating effect on Peru’s urban and rural working class, on students, and on the poor more generally.

Long line of people waiting to get into bank in Lima [Photo by Victor Idrogo/World Bank]

The higher cost of urea fertilizer, a result of the war in Ukraine, increases the cost of food from farms, and a resulting fall in production drives up prices in retail markets. It is estimated that, if the war in Ukraine continues, the price of fertilizer could increase by 40 percent by the end of 2023.

The Ukraine war is also affecting the price of energy. In Repsol gas stations, the main fuel supplier in Peru, the pre-pandemic price of 90 octane gasoline on December 31, 2018, was 4.85 nuevo (new) soles per gallon. On September 4 this year, it was quoted at 19.95, an increase of 307 percent, equivalent to an astonishing 45.4 percent annually.

As a result of gasoline price hikes, public transportation fares in Lima, the capital, rose on July 16 from 2.50 to 3.50 nuevo soles, a 40 percent increase.

Last month the private public transportation companies in Arequipa, the second most populous city in Peru, which transport 800,000 passengers, announced that they would raise the base fare from one sol to 1.40 soles, an increase of 40 percent from one day to the next.

The daily Peru21 reported that in Arequipa an average family of four spends a minimum of 168 soles per month on public transportation. With the new increase it would rise to 235 soles, 22 percent of the minimum monthly living wage (SMV) of 1,025 soles (US$265.27).

To get an idea of the true dimensions of the precarious economic situation Peruvian workers face, for every dollar that a worker in New York state earning minimum wage receives, his Peruvian counterpart is paid only 11.5 cents.

Though in August there was a small decrease from July, the inflation rate as to consumer prices remained high. The monthly report in August of the Central Reserve Bank of Peru (BCRP) placed inflation in the previous 12 months at 8.41 percent, well above the bank’s 1 percent to 3 percent target. This was slightly lower than the 8.5 percent rate in the U.S., and the 10.07 percent rate in Brazil, the Latin American country with the highest rate.

The week before last the BCRP raised its inflation forecast for 2022 and 2023. Speaking at a news conference in Lima, bank chief Julio Velarde said the bank had raised its inflation estimate for 2022 to 7.8 percent from a previous 6.4 percent and for 2023 to 3 percent from 2.5 percent.

To cope with inflation, on July 7 the BCRP had fixed the policy interest rate at 6.00 percent. A year ago, on August 8, 2021, it was just 0.50 percent.

At that time, the bank was trying to reactivate an economy hit by shutdowns and a high unemployment rate resulting from the pandemic. Since then, the BCR has raised the rate numerous times. Today it is not about stimulating the economy, but curbing inflation, and above all, keeping wages from rising.

On Friday, the bank raised the key rate to a 20-year high of 6.75 percent. This was slightly less than expected, because September’s inflation rate compared to August’s showed a second monthly slight decrease. The 6.75 percent rate was nonetheless the 14th straight increase in a cycle that has pushed up borrowing costs 650 basis points. And the bank emphasized that it was not ruling out additional interest rate increases depending upon incoming data.

On top of attempting to tame inflation, constrain wages and protect the national currency, political instability – i.e., country risk – also looms large in the rate calculations. The possibility of a mass uprising, following on half a year of incessant strikes and demonstrations, has led the national bourgeoisie to excessive purchases of dollars.

On last Friday, the currency closed at 3.877 nuevo soles per US dollar, equivalent to a devaluation of over 19 percent since the start of the pandemic, which was quoted at 3.1268 on March 12, 2019. The exchange rate peaked at 4.1198 nuevo soles per U.S. dollar on October 13 of last year. Throughout the last nine months it has oscillated between a floor of 3.62 and a ceiling of 4.10, swinging according to the bourgeoisie’s perception of Peru's risk.

The BCRP’s growth projections reveal the precariousness of the political-economic situation. It revised its economic growth estimates for the current year downward from 3.8 to 3.0 percent for 2022 and from 3.2 to 3.0 percent for 2023.

The slowdown hits hard the production of basic foods for the urban and rural working class. For example, newspapers report that rice production decreased 7.5 percent and potato production 11.73 percent in July.

Likewise, oil and liquid gas production has slowed. Exploration contracts for hydrocarbons were reduced to half the figure of 2019, the last pre-pandemic year.

According to the National Institute of Statistics and Informatics (INEI), “In the December 2021-January-February 2022 quarter, the official unemployment rate in Metropolitan Lima–where one third of the national population resides and economic activity is concentrated– was 8.9 per cent, lower by 5.6 percentage points compared to the same quarter of 2021 (14.5 per cent).” However, when compared to the same quarter of 2020 (7.1 per cent) it was higher by 1.8 percentage points.

And these figures do not capture the fact that the share of the working population trapped in informal jobs exceeds 70 percent.

But it is the fall in production, partially due to the economic contraction in the pandemic years, and the increase in the price of basic necessities, that has hit the working class the hardest. The main factor now is the slowdown of the capitalist economy worldwide, which has pushed Peru into a technical recession.

Finally, adding to the gloomy economic outlook is the fourth wave of Covid-19, with the Omicron strain, which arrived in June, now lashing the population.

According to data published by the Ministry of Health (Minsa), the monthly number of deaths in June was 334 It increased to 854 in July, and then reached 1,428 in August. That is, in the space of three months, the mortality rate jumped 260 percent.

Since the beginning of the pandemic, the number of positive cases has risen to 4,131,966. and the number of dead to 216,287, representing a mortality rate of 5.23 percent as of September 18.

These interlocking crises are intersecting with charges of corruption on the part of President Pedro Castillo, his family and government officials, creating a crisis of governability and laying the basis for a social and political explosion.

Social attacks continue in Greece despite end of enhanced EU financial surveillance

Katerina Selin

On August 20, the so-called enhanced financial surveillance of Greece by European Union (EU) lenders ended. After 12 years of austerity dictates and strict control of the Greek budget, the finance ministers of the eurozone countries and EU Commissioner Paolo Gentiloni voted in favour of this step.

Greek and European politicians alike exceeded each other with their excessive flattery and promises. An “historic day for Greece and all Greeks,” proclaimed Prime Minister Kyriakos Mitsotakis of the right-wing conservative Nea Dimokratia (ND), predicting a new beginning “full of growth, unity and prosperity.”

Greek Prime Minister Kyriakos Mitsotakis at the Thessaloniki International Fair on Sept. 10 [AP Photo/Giannis Papanikos]

EU Commission President Ursula von der Leyen tweeted that Greece could now close this chapter “thanks to the determination and resilience” of its people and “look to the future with confidence.”

To decipher the phrases, replace “prosperity” with poverty, “confidence in the future” with fear of job loss, “resilience” with suffering and hardship. What is being celebrated here as a chapter closed and an historic new beginning means the Greek population faces the continuation of austerity and aggravation of the social crisis over further decades.

The cost of the loans of almost €289 billion that Greece received from the EU in three “memorandum” programs in recent years was paid by the working class with income losses of 25 percent, mass unemployment and pension cuts. With public debt at 189.3 percent of GDP in the first quarter of 2022, the country remains at the top of the EU debt table. According to Eurostat, Greece recorded the highest youth unemployment rate (28.6 percent) and the second highest unemployment rate (11.4 percent) after Spain in the month of July.

Since the financial crisis of 2008, the EU, under German leadership, has used Greece as the spearhead of its austerity policies. Within a few years, with the help of the trade unions and pseudo-left parties, led by the Syriza government (2015-2019), it broke the strong resistance of the working class and lowered living standards to the level of a developing country. In response to the pandemic and NATO’s proxy war in Ukraine, European governments are building on the Greek experience and intensifying social attacks across Europe.

What does the end of “enhanced surveillance” mean? The mechanism had been adopted in 2018 for a period of four years following Greece’s formal exit from the so-called “bailout” programs of the European Commission, the International Monetary Fund (IMF) and the European Central Bank (ECB)—the “Troika” for short. Greece had to continue to pass regular quarterly budget audits by creditors in order to obtain debt relief and access to the capital market. Now, far from ending this scrutiny, there will only be a transition to “simple surveillance,” with semi-annual rather than quarterly reviews.

Like other European countries, including Ireland, Spain, Cyprus and Portugal, Greece will remain under EU control until 75 percent of its loans are paid off. According to the Greek newspaper Ethnos that would be in 2059, following current calculations, and as late as 2070 according to other sources. That means that for up to 50 more years, the EU’s dictates will continue, inevitably involving austerity measures and privatization.

The latest move gives Greece greater budgetary freedom, but it will not be to the benefit of the working class. Above all, the Greek elite—as well as Europe’s corporations and banks—have in mind incentives for investments and lucrative business deals. Greek Finance Minister Christos Staikouras stressed that the new regulation would strengthen the country’s position on the world market and make it more attractive to investors.

The EU had ordered a rigorous privatization policy and the systematic erosion of the welfare state, labour laws and the right to strike in order to turn Greece into a low-wage country. Having bled the country dry economically and socially, transnational corporations are falling over the spoils like vultures. Governments of all political stripes, especially the previous government under Syriza, privatized state-owned assets on a massive scale, selling them off to international companies and shareholders on favourable terms.

This month, the privatization process for the ports of Igoumenitsa and Alexandroupoli is entering the next round. While the former is an important link to Italy, the latter is currently of great geopolitical significance. The northern Greek port of Alexandroupoli serves as a hub for NATO arms deliveries to Ukraine in the war against Russia. The sale of state-owned natural gas company DEPA Infrastructure, which owns stakes in 7,500 kilometres of gas networks, to Italy’s Italgas was also completed in early September.

Mitsotakis also hopes to attract large investments via closer ties with reactionary regimes such as the al-Sisi dictatorship in Egypt and the Gulf monarchy of the United Arab Emirates, with which he negotiated a Strategic Partnership in 2020 and signed 12 agreements and the establishment of an investment fund this year.

German corporations are also benefiting. Frankfurt-based flight operator Fraport bought the rights to 14 Greek regional airports. IT companies are taking advantage of access to cheap skilled labour, including Göppingen-based software company Teamviewer, which in 2020 opened a site in the city of Ioannina in northern Epirus, one of Greece’s poorest regions. Companies such as Essen-based utility RWE, Bremen-based solar and wind farm developer wpd and Germany’s largest wind turbine manufacturer Enercon are also getting involved in the wind energy and solar markets.

While rents and housing expenses for Greek workers rose rapidly in 2022, especially in metropolitan areas such as Athens, the luxury real estate market in Greece is celebrating a record year, according to real estate agency Sotheby’s International Realty, with wealthy buyers coming mainly from the United Kingdom, United States and France.

The Greek government boasts of economic growth of 8 percent of GDP last year and an expected 4 percent in 2022. It is using this as window dressing, which has little to do with the real situation, to distract attention in the run-up to next year’s elections from the deep political crisis that has gripped it and the entire ruling class. ND is not only shaken by a far-reaching wiretapping scandal that is exposing the authoritarian tendencies of its rule. It also fears an escalation of social tensions in the face of skyrocketing prices for food, electricity, and heating gas.

In his opening speech at the Thessaloniki International Trade Fair, which ran this week, Mitsotakis promised a package of €5.5 billion for 2022 and 2023. This includes minimal special payments for low-income earners, families, pensioners, farmers and students, as well as relief for businesses, funding for the tourism industry and higher salaries for the armed forces, according to Euronews.

The official inflation rate was 11.4 percent in August. According to the latest figures from the Greek Statistical Office, bread and cereal products cost 18.5 percent more, dairy products 18 percent, and oils 25.5 percent. Travel costs also rose rapidly: airline tickets were 71 percent more expensive, ship tickets 25.4 percent and taxis around 33 percent—and that in a country with countless islands, where many people rely on ship and air transport. Even before the Ukraine war, prices for most foodstuffs were at the same level as in Germany, while the official minimum monthly wage is only about a third at €663 euros.

As in other European countries, the price explosions in the energy sector are particularly glaring: the price of natural gas rose by 261.3 percent in one year, heating oil by 65 percent and electricity by 38.5 percent.

In early September, speaking on Mega TV, Adonis Georgiadis, Minister of Development and Investment, warned of the “worst winter since 1942” and blamed the situation on “Putin’s energy war against Europe.” Georgiadis—a well-known right-winger who began his career as a historian and publisher and was a deputy for the ultra-right Laos Party before joining ND—knows exactly what he is talking about.

Under the yoke of Nazi occupation in Greece during World War II, tens of thousands died in the 1941-1942 Winter of Hunger. The Nazis had plundered the economy for their military campaigns and starved the population. During the unusually cold winter, many people also froze to death because fuel was confiscated. The gruesome images of emaciated starving people and piles of corpses in the capital Athens still make one shudder today.

With his comparison to the winter famine of 1941/1942, Georgiadis is directing an open threat to the Greek population. Not Putin, but the sanctions and rearmament mania of the NATO powers has led to the collapse of gas supplies from Russia and the price speculation of powerful corporate monopolies.

Greece is one of the closest allies of the US and Germany in the war, spending 3.59 percent of GDP on its military apparatus even before the outbreak of war in 2021, according to NATO figures—more than all other NATO countries, including the US. On Friday, the Greek Defence Ministry confirmed the start of a so-called back-fill operation with Germany. Athens will supply Ukraine with 40 Soviet-designed BMP-1 tanks. In return, Greece will receive 40 Marder infantry fighting vehicles from Berlin.

The burden of the war policy is to be shouldered by working people. That is why they are already being prepared for a new “winter of hunger.”

The fascistic attitude contained in the government’s reaction to the human emergency could be seen on Tuesday when Deputy Minister of the Interior Stelios Petsas addressed the media. On the morning program on the ANT television channel, he referred to the gigantic increase in the price of natural gas and urged households with a natural gas supply to make an expensive switch to heating oil (whose price is also increasing sharply). When asked by a journalist if there will be solutions provided for affected households, he said, “In these cases, the main thing is to show adaptation. Those who don’t want to adapt will unfortunately die.”

This is the Social Darwinist logic of survival of the fittest in the “struggle for existence” pursued by the Greek ruling class in the last three years of the pandemic, with its herd immunity policy of allowing infections to run wild, and in the preceding years of austerity policies under the dictates of the Troika.

Petsas’ statements triggered an outcry on social media and an exchange of blows with the opposition Syriza party in parliament. In fact, however, he was merely stating bluntly what has been the mindset of the Greek elite and international capital for years. In order for stock market profits to continue to soar, workers are supposed to starve, freeze and die. Or as Marx once wrote, “To the outcry as to the physical and mental degradation, the premature death, the torture of overwork, it [capital] answers: Ought these to trouble us since they increase our profits?”

Protests erupt across Haiti against hike in fuel prices

Alex Johnson

Haiti’s capital city Port-au-Prince and other major cities reached a new level of turmoil this week as a result of mass protests against Prime Minister Ariel Henry’s pledge to end fuel subsidies and raise gas prices. The crippling price hike comes after weeks of growing political opposition among Haiti’s working class to the US puppet regime headed by Henry, the warring gangs representing rival sections of Haiti’s kleptocracy and the nation’s business elite.

A man waves a red flag during a protest against fuel price hikes and to demand that Haitian Prime Minister Ariel Henry step down, in Port-au-Prince, Haiti, Thursday, Sept. 15, 2022. [AP Photo/Odelyn Joseph]

Amid spiraling inflation and rising costs, the government announced Sunday that the price of a gallon of gasoline would rise from 250 gourdes ($2) to 570 gourdes ($4.78), while diesel prices would go up from 353 gourdes per gallon ($3) to 670 gourdes ($5.60). The price of a gallon of kerosene would rise from 352 gourdes ($3) to 665 gourdes ($5.57). 

Thousands of demonstrators have blocked traffic throughout the capital with rocks and burnt tires, metal gates and other items. Video footage showed protesters targeting several banking institutions and others were filmed seizing hundreds of pounds of rice from a warehouse run by one of Haiti’s biggest import companies. US media outlets have sought to slander the protesters as “looters” and championed police repression to quell the rebellion. 

Anti-government protests had been building since last month when hundreds of workers descended on the capital demanding the resignation of Henry, a longtime asset of the US ruling class who was placed in power by the so-called Core Group, led by the ambassadors from the US, Canada, Germany, France, Spain, the EU and Brazil, amid a reshuffle of the government after the assassination of President Jovenel Moise in July 2021. 

This week’s protests came on top of weeks of unrest caused by a slew of problems that have deepened the nation’s economic crisis and the social devastation felt by millions of its toiling masses, including the devaluation of the local currency coupled with higher food prices, a lack of US dollars and the increasing shortages of gas and propane. Another central demand of the protesters is the ousting of Henry, whose regime has been mired in political criminality and scandals, the most notable being the widespread belief that he and other figures helped orchestrate Moise’s assassination with the assistance of American intelligence. 

The administration has claimed that its widely opposed austerity measure is needed to clamp down on inflation, which hit a 30.7 percent rate increase in July compared to 2021, and because the government could no longer afford to subsidized fuel, on which the government spends $400 million annually. 

It is far more likely that Henry’s effort to deepen mass impoverishment is not aimed at combating inflationary pressures but to broker future parasitic deals with lending agencies and financial institutions. In June, the International Monetary Fund (IMF) approved a Staff-Monitored Program (SMP) for Haiti to track its financial records and serve as a prerequisite for loan authorizations. 

The IMF’s report lamented the substantial sums the government was pouring into fuel subsidies and that this sector was absorbing at least one-third of Haiti’s domestic revenues. The statement blames central bank financing as the reason behind spiraling inflation, noting, “Satisfactory performance under the SMP could lead to an IMF-supported program under a multi-year arrangement that would require approval of the IMF’s Executive Board.” What lies behind the SMP and Henry’s clampdown on fiscal deficits is a desire to line the nation up for yet another round of debt and plunder by imperialist finance capital. 

The ending of state subsidies will prove disastrous for millions that suffer from chronically low wages. The decades since the fall of the US-backed “Papa Doc” and “Baby Doc” Duvalier dictatorships have seen American administrations, both Democrat and Republican, reconstruct Haiti into a vassal state protecting the investments and profits of US companies lured by starvation wages. In the face of large-scale demonstrations for higher pay in February, the government increased the minimum wage by 54 percent to less than $7.50 per day, which is far less than the still meager $15 per day that some workers had demanded.

The massive earthquake in 2010 plunged the nation deeper into poverty and the only response since on the part of Haiti’s venal political elite has been to act in the interest of US multinational corporations and Haiti’s oligarchy. Gilbert Bigio, Haiti’s sole billionaire and head of the industrial conglomerate GB Group, presides over a virtual monopoly of the Haitian steel market while the average Haitian steel worker is paid around 34,000 gourde ($300) a month. Dozens of American garment and textile companies generate mountains of profit from the unlivable wages workers receive in Haiti’s sweatshops. 

The social upheaval has intersected with immense political instability wracking the country, as Henry heads a de facto dictatorship since the government failed to organize presidential elections after his term ended on February 7. The political crisis and protest movement has evoked concerns among the imperialist powers, above all the United States and Canada, that the demonstrations could lead in a revolutionary direction while foreign policymakers are questioning Henry’s ability to suppress opposition. 

Susan D. Page, a former special representative of the UN secretary general in Haiti and former head of the deadly United Nations Mission for Justice Support in Haiti (MINUJUSTH) operation, floated the notion earlier this month that Henry’s ruling coalition of the Musseau Accord be replaced by another layer of equally privileged and corrupt bankers’ politicians and journalists that comprise Musseau’s arch rival, the Montana Accord. 

In an article published by the Council on Foreign Relations, Page referred to the Montana Accord as “a broad group of Haitian citizens [which] has coalesced to form a roadmap to the restoration of democratic norms without the interference of foreign powers. For the United States, working in greater partnership with such organizations … could help restore Haitian confidence.” 

Page’s comments echo a piece written by former National Endowment for Democracy (NED) vice president George Fauriol, which was published by the pro-Washington think tank Center for Strategic and International Studies in February. 

Highlighting the “near collapse of Haitian public authority,” the article is a road map for regime change. Fauriol lauded the Montana accord for generating “a plausible transition formula out of the crisis” and establishing ties with a political coalition made up the Protocole d’Entente Nationale (PEN), a coalition of some 70 political organizations and groups. 

The protest movement has also triggered renewed calls from Caribbean political officials that Washington and the other imperialist powers intervene in Haiti through another colonial style military intervention paralleling the United Nations “peacekeeping” forces that were deployed under the United Nations Stabilization Mission in Haiti (MINUSTAH) after the 2010 earthquake. In a meeting this week with Vice President Kamala Harris, US lawmakers and leaders of the Organization of American States, Dominican Republic President Luis Abinader warned that Haiti’s crisis was approaching “a low-intensity civil war.” 

Another component of the crisis is the acceleration of gang violence organized by the notorious G9 Family and Allies gang, which is run by former policeman Jimmy “Barbecue” Chérizier. Cherizier has longstanding ties to a section of Haiti’s bourgeoisie represented by the Haitian Tèt Kale Party (PHTK), which includes the Clinton-backed puppet regime of former president of Michel “Sweet Mickey” Martelly and Moise, the latter being notorious for unleashing such forces in violent crackdowns against popular opposition to his presidency.

Over the past several months G9 has routed Haiti’s frail security forces and police, seizing control of significant chunks of territory including much of the shantytown of Cité Soleil. The gang wrested control of the city after significant gun fighting against G-Pep, the next largest gang federation in the country. 

Although posturing as opponents to Henry and claiming to lead a popular “revolution” in response to the Moise’s assassination, G9 has been utilized to crush opposition and consolidate power for Haiti’s business elite. Earlier this month, Cherizier’s G9 led a violent assault in Cité Soleil, where resistance has broken out in the face of extreme repression and where several local activist groups have organized mass protests.

Christella Delva, a 17-year-old student protester, was killed by the gang with a bullet to the head, while two young Haitian journalists, Tayson Lartigue and Frantzsen Charles, were also killed by G9 while returning from an interview with the parents of Delva. 

The ubiquitous gang violence and kidnappings along with the entrenched corruption of Haiti’s ruling class serve as components for maintaining capitalist rule in Haiti, whose chief headmasters, US and European imperialism, have for decades utilized such forces to enforce a climate of brutal social inequality, political oppression and squalor. The demands of Abinader for a “peacekeeping” intervention is part and parcel of US imperialism’s continued domination of Haiti, which can be traced back to the 1915-34 US occupation and the series of bloody invasions and violent dictatorships directed against Haiti’s insurgent working class. 

After a massive nationwide rebellion deposed “Baby Doc” Duvialer’s dictatorship in 1986, the CIA orchestrated the overthrow of theologian priest Jean Bertrand-Aristide in the early 1990s, while Washington used Haiti’s army and remnants of the Duvalier’s Tonton Macoutes paramilitary as its principal instrument for terrorizing the population. Upon returning to power, Aristide’s pledge to carry out piecemeal reforms while accommodating imperialism did nothing to prevent the US, Canada and France from kidnapping the former president and transporting him on a plane destined for the remote Central African Republic in 2004. 

In the face of demands for new elections, a warning must be made that in countries of belated capitalist development such as Haiti there is no section of the national bourgeoisie that is capable of or willing to wage a revolutionary struggle against imperialism that is needed to secure the elementary democratic and social aspirations of the workers and toilers. 

No illusions should be held in Aristide and other nationalist parties such as Lavalas, which itself carried out IMF and World Bank demands for “structural adjustment” policies and inundated Haiti with US goods and privatized profitable government-owned companies. Aristide headed a regime that for the masses of Haitian workers meant further destitution and the elimination of tens of thousands of jobs. 

Aristide has continued this role since the coup, as he met with Henry at the former’s Tabarre home as part of the prime minister's efforts to form an alliance with several middle-class groups and enlist their efforts to derail social opposition. Two weeks prior, Aristide hosted Helen La Lime, the former US ambassador to Angola and current special representative of the United Nations Integrated Office in Haiti (BINUH), at his home, revealing the deep ties the Lavalas leader maintains with imperialism.