Guatemala election rocked by prosecutor’s “coup” attempt

Andrea Lobo

On Wednesday, more than two weeks after the June 25 presidential elections, the Guatemalan electoral court (TSE) certified the results and declared that a second round will take place on August 20 between former first lady Sandra Torres of the UNE party and ex-diplomat Bernardo Arévalo of the Semilla Movement. 

Bernardo Arévalo and Sandra Torres [Photo: Javier Arango and Carlos Sebastián CC BY-NC-SA 4.0]

Simultaneously, a criminal court announced that it had suspended the legal status of Semilla in support of a fraudulent public prosecution alleging false signatures and illegal campaign financing. In a Solomonic ruling the following day, the Constitutional Court ordered both the second round to proceed as planned and the prosecution to go forward. 

The ruling acknowledges that the attempt to suspend the legal status of Semilla amid ongoing elections was unconstitutional, but it allows the prosecution and the court to continue an investigation aimed at fabricating a pretext to repeal a popular election and consummate a coup.

The Constitutional Court was responsible for the initial delay, ordering on July 1 a review of ballot box reports in favor of a lawsuit filed by several right-wing parties, including Vamos of incumbent President Alejandro Giammattei, which placed third. 

Ominously, heavily armed police, with their faces covered and dressed as civilians, raided TSE headquarters in Guatemala City on Thursday, allegedly to look for documents that can incriminate Semilla. Under the pretext of an innocuous excursion, military students were deployed to the National Palace, the former seat of power, where social protests have concentrated in recent years. This followed repeated mobilizations by fascist groups tied to the military denouncing an electoral fraud. 

Only scattered demonstrations, mainly of Semilla supporters, took place on Wednesday and Thursday to protest the coup attempt. The criminal attempts by Semilla to sow complacency and the moves by the pseudo-left to align themselves behind Arévalo have only emboldened the coup plotters.

In media interviews and statements at rallies Arévalo warned of an attempted “technical coup” and a “rupture of the constitutional order” by forces aligned with the current administration. However, he appealed for “calm” and for the unity of “all sectors of society, independently of their ethnic, political, religious or any background.” He also made reassurances that the TSE “will simply disregard this illegal injunction,” ignoring that it had already obeyed the initial illegal intervention by the Constitutional Court—only the Supreme Justice Court could challenge an election.

Moreover, the first round revealed, above all, overwhelming opposition to the entire political establishment, with more than half of the electorate abstaining or casting null or blank ballots. Torres and Arévalo combined won the support of only 1.5 million out of 9.36 million voters.

While the corrupt clique in power seeks to defend its privileges, Washington has repeatedly backed the electoral results, which favor their preferred candidate, Arévalo. Assistant Secretary of State for the Western Hemisphere Brian A. Nichols plainly declared in a tweet on Thursday: “We expect a free and just runoff in Guatemala on August 20 between Sandra Torres and Bernardo Arévalo.” 

The Semilla Movement, whose constituency is limited to the universities, NGOs and other sections of the upper-middle class, has demonstrated that it will do the bidding for US imperialism. 

This was most clearly demonstrated by its pressures on the Giammattei government to support sanctions against Russia and Russian companies in Guatemala over the US-NATO war in Ukraine. Arévalo even opposed the buying of Sputnik V vaccines, and has made clear that he does not plan to switch diplomatic relations from Taiwan to Beijing.

The party was created in 2015 by former ministers, diplomats and others belonging to the political elite in support of the International Commission against Impunity in Guatemala (CICIG). The commission was created by the UN with direct orders and financing from Washington to employ select criminal investigations to pressure local political and business leaders. At the time a lobbying group, Semilla took the first steps toward becoming a party under marching orders from US officials, particularly after corruption charges brought by CICIG against then president Otto Pérez Molina and Vice-President Roxana Baldetti triggered mass protests and forced their resignations. 

One of the party’s main founders, Alberto Fuentes Knight, a finance minister under UNE later convicted for corruption, has openly acknowledged: “before making the jump from a social to political [organization], we traveled to America to consult with Democrat and Republican representatives on whether it was the right or wrong decision.”

The open secret that Semilla operates as a US State Department puppet should be a warning to workers in Guatemala. It is mortally hostile to the working class and will work to suppress any mass mobilization of workers in defense of democratic rights, including its own popular election.

An Arévalo administration will not present any challenge to the super-exploitation of Guatemalan workers and natural resources by US corporations and finance houses and their local partners. Amid a global resurgence of the class struggle against social austerity and attacks on living standards, Arévalo would respond to any struggle by Guatemalan workers through repression and a shift to dictatorial forms of rule, just like every so-called “progressive” government currently in power across the region has done. 

Semilla will only further drag the country and the region into a future global maelstrom, with the Pentagon already requesting Latin American governments to send military aid to Ukraine.

The recent history of Guatemala, including in the 1980s when Arévalo was climbing up the diplomatic ranks, has been marked by brutal dictatorships backed by US imperialism that crushed any opposition to social inequality and the unfettered operations of foreign capital. 

In June 1954, the CIA orchestrated and launched a military attack from Honduras to overthrow the elected Jacobo Arbenz administration, which had carried out limited agrarian and social reforms. The US provided pilots, warplanes, napalm, Green Berets and organized paramilitary groups that would form death squads in the following decades. Their methods of disappearances of left-wing activists largely helped pioneer those used by the dictatorships in Brazil, Argentina, Uruguay, and Brazil. 

Arbenz and his predecessor, Juan José Arévalo—Bernardo Arévalo’s father—had been backed by the Stalinist Guatemalan Workers Party (PGT), which was chiefly responsible for betraying the struggle against imperialism and the defense of democratic rights. At the time, its advisers entered the government and openly advocated the development of capitalism, while promoting “Mayan Marxism,” seeking to present the predominantly indigenous peasantry as the revolutionary force in Guatemala and their naturalist beliefs as “Marxist.” At the time, the rich Indians largely backed the CIA coup and consistently conspired against the poorest layers. In the 1960s, the PGT dissolved into Castroite guerrillas that were swiftly crushed by the fascistic military, which during the 1980s also waged a genocidal campaign against the Mayan population. 

On December 5, 1982, US President Ronald Reagan visited Guatemala to meet General Efraín Ríos Montt, who had recently taken power in a military coup and used the courts—historians still don’t know who the judges were—to sentence oppositionists to death. Reagan described him as “a man of great personal integrity” who was “totally dedicated to democracy.” During the following three days, the country’s elite platoon killed 162 people in the village of Las Dos Erres, including 67 children. The women were raped and buried alive, with placentas and umbilical cords found scattered on the ground. Such massacres by the troops trained and armed by the United States were widespread, when the military did not simply bombard the villages.

Study finds correlation between Long COVID and a particular human gene variant

Philip Guelpa

A new pre-print study, coauthored by over 70 individuals and groups, provides significant insight into the relative susceptibility of COVID-19 patients to develop Long COVID based on their genetic makeup. The study is based on a review of data gathered from 24 previous studies in 16 countries, encompassing up to 6,450 Long COVID patients and nearly 1.1 million control individuals (i.e., with no known SARS-CoV-2 infection).

The study found a significant association between patients suffering from Long COVID and those possessing one of several particular variants of the FOXP4 gene in their DNA. Importantly, the study also found that the genetic susceptibility to Long COVID was greater than that associated with the severity of the COVID-19 disease episode alone, meaning that the effects of the FOXP4 variants could not be explained away by severity of COVID-19.

“Long COVID” refers to long-lasting, often debilitating symptoms which can persist for months or years after the acute phase of infection has passed. Estimates of Long COVID prevalence typically range from 10 to 30 percent of those who survive initial or repeated bouts of the disease. More than 200 symptoms, affecting nearly every organ in the body, including debilitating cognitive and lung impairments, chronic fatigue, thyroid dysfunction, kidney disease and more have been associated with COVID-19.

The newly reported study analyzed 24 genetic data sets from over 1 million individuals in North America, Europe and Japan. The data set included 6,450 individuals with Long COVID and over 1 million controls, who did not have Long COVID. The study identified a segment of the human genome near the gene known as FOXP4, which is active in the lungs and other organs, as being significant.

Individuals who possess any of several particular variants of the FOXP4 gene were found to have 1.6 times the odds of developing Long COVID than those who do not.

Having a mutation in the FOXP4 gene appears to increase one’s chances of developing Long COVID, but not having the mutation does not mean that a patient will not develop Long COVID. As with any pathogen, COVID-19 is a very complex disease process, and the interaction between certain genetic mutations and the human body is complex. It is still critical to avoid infection to the greatest extent possible through the use of well-fitting N95 masks and other measures, as the risks of Long COVID remain high for the general population.

Previous research had identified an association between variants of the FOXP4 gene and the likelihood of suffering a severe bout of COVID-19. However, the new research found that its association with Long COVID was even higher than its association with increased severity of the acute phase of SARS-CoV-2 infection. So, the severity of a COVID-19 attack does not account for all of the observed association between FOXP4 variants and Long COVID.

Forkhead box protein P4 ( FOXP4 ) is a gene in the subfamily P of transcription factors that regulate and direct tissue specific genes from embryonic development through adulthood, including the generation and regulation of T-cells. They also function in the development of tumors in the kidney or larynx. In particular, FOXP4 is known to be expressed in the proximal and distal epithelium of the airway, as well as the cells in the gut. “Polymorphisms” seen in the gene correlate with lung disease like Long COVID as well as cancers and other diseases.

The authors noted that the frequency of the FOXP4 mutation varied in frequency based on the populations that were studied, with the lowest in non-Finnish Europeans at 1.6 percent to 7.1 percent in Finnish, 19 percent in “admixed” Americans and highest in East Asians at 36 percent.

Furthermore, they wrote, “We observed the highest expression of FOXP4 in type 2 alveolar cells, a cell type that is capable of mounting robust innate immune responses, thus participating in the immune regulation of the lung.”

They explained, “Type 2 alveolar secrete surfactant, keep the alveoli free from fluid, and serve as progenitor cells repopulating damaged epithelium after injury. In addition, we observed nearly equally high expression of FOXP4 in granulocytes that similarly participate in regulation of innate immune responses.”

They concluded that these findings could link the mutation in FOXP4 to its “role of both immune and alveolar cells in lung in Long COVID.”

Further analysis found that the particular FOXP4 variants associated with Long COVID are also associated with the occurrence of lung cancer, at least in part by affecting the immune response of lung cells. Since it has previously been demonstrated that SARS-CoV-2 also impacts immune response by unleashing a cytokine storm, the effects of these two factors may compound each other.

Although the frequency of the gene variants in question varies somewhat between the six different genetic ancestries studied, the overall association remained consistent across all of them.

The findings of the new research point to the highly complex nature of the mechanisms whereby SARS-CoV-2 interacts with the human body and its genome, in particular. It is unlikely to be the only factor in producing Long COVID. Much more research will be needed to reveal the myriad effects of this deadly virus. It is a tragedy of immense proportions that the uncontrolled spread of COVID-19 being permitted and indeed encouraged by the ruling class’s “profits before lives” policy will provide an ever larger body of data on which to base such studies.

The now more than three-year-long experience with the COVID-19 pandemic has thoroughly exposed as a crime against humanity the “herd immunity” strategy of the ruling class, which posited that allowing the SARS-CoV-2 virus to run rampant throughout the world’s population would result in widespread acquired immunity that would end the pandemic. Instead, the virus continues to mutate and find new ways to evade the human immune system with deadly results.

This study adds to the evidence of the bourgeoisie’s criminality in its propaganda campaign pushing the lie that COVID-19 has become “mild” and that the pandemic is “over” by shutting down virtually all testing and monitoring. Recent spikes in infections in such places as Okinawa and the rampage of the virus after the lifting of the Zero-COVID policy in China demonstrate clearly that the virus is not done with humanity.

The authors of the study predict that “Future studies and iterations of this work will likely grow the number of observed genetic variants and further clarify the biological mechanisms underlying Long COVID.”

What this study already pointedly demonstrates is that when the scientific resources that are available are marshaled in a concentrated effort, valuable information necessary to confront this deadly disease can be obtained.

It also makes clear that while the information about the nature and consequences of COVID-19 is vital in educating the public and mobilizing a coordinated global effort to end the pandemic is available, the ruling class and its political lackeys will do everything in their power to block that effort.

Record breaking US heatwave demonstrates the growing dangers of climate change

Alex Findijs

A wave of extreme heat and weather has swept across the United States and around the globe over the past month. Record breaking heat has pummeled the Southern US and Europe as floods and storms have caused billions in damage across the northern United States and northern India. 

Electricians with IBEW Local 11 pull out an old copper cable line under excessive heat from the old Cesar Chavez Avenue Viaduct in Los Angeles, Thursday, July 13, 2023. [AP Photo/Damian Dovarganes]

In the Southwestern United States temperatures have reached well into the triple digits. Las Vegas, Nevada has already seen several weeks with temperatures reaching above 110 degrees Fahrenheit (43 Celsius) and is forecasted to break the record for its hottest day, potentially reaching or exceeding the record of 117 degrees over the weekend. 

Phoenix, Arizona has likewise seen two weeks of temperatures reaching or exceeding a high of 110. With temperatures forecasted to remain above 110 into next week, the city is set to break its record for 18 straight days of 110 degree or hotter weather. And with nighttime temperatures remaining in the 90s, it may also break its record for the longest run of nights above 90 degrees. 

Meanwhile El Paso, Texas has already broken its record for longest run of 100 degree plus weather with 28 straight days above 100 degrees and counting. 

The extreme heat over the Southwest is the product of a high pressure “dome” stagnating over the region. The high pressure system is pressing hot air over the region, causing peaks of record high temperatures. 

Global weather patterns tend to move from high pressure systems to low pressure systems. This prevents cooler air from entering the high pressure area and has pushed the Northern jet stream further to the north, resulting in the extreme weather conditions over the past few weeks. 

The dome has also caused hot, humid air from the Gulf of Mexico to move north into the American Southeast and Great Plains region where it is also causing dangerously high temperatures. 

Florida and much of the Deep South have seen temperatures in the high 90s and much of Texas, Oklahoma and parts of Kansas are expected to see temperatures over 100 degrees over the weekend. The ocean off the coast of Florida has reached a record 98 degrees, threatening marine life.

Across the country more than 100 million people are affected by the extreme heat. 

Both high heat weather systems are dangerous and deadly for humans. In the dry Southwest, the air is so hot that it pulls moisture from human skin before people can sweat. This creates a dangerous situation where a person is not aware of how much water they are losing and increases their risk of dehydration and heat stroke. 

In the humid Southeast, the air is so humid that the heat index reaches well into the triple digits. With so much moisture in the air, it is difficult for sweat to evaporate and cool the human body down, creating a similarly dangerous potential for heat-related health risks.

Extreme hot weather is the leading cause of death from natural hazards in the United States. On average, the US sees 700 heat related deaths every year, with over 9,000 people hospitalized from heat exposure. A significant portion of these are the homeless, who have no reliable shelter from the oppressive heat. 

Last year, heat contributed to the deaths of 425 people in Maricopa County (Phoenix, Arizona) alone, with roughly 56 percent of those deaths among the homeless population. 

Prolonged exposure to such heat increases the risk further, making the current heat wave even more dangerous.

And it is not just the United States that is being affected. A similar heatwave in Europe, named Cerberus, has shattered temperature records in France, Italy, Switzerland, Germany and Spain. 

Greece has seen temperatures reach 104 degrees Fahrenheit and parts of Spain saw temperatures above 104. Some parts of Spain around Extremadura even saw land temperatures exceed 140 degrees, while Sardinia and Sicily could see temperatures as high as 118. 

The record heat and the deadly consequences of it are the product of capitalist induced climate change and the complete indifference to it by governments around the world. 

James Edward Hanse, director of Climate Science, Awareness and Solutions at Columbia University’s Earth Institute tweeted in response to the heat wave, “Climate seems headed for a new frontier, not seen in more than a million years. Look for continual monthly records, driven by the current extreme planetary energy imbalance.”

This imbalance is the product of prolonged release of greenhouse gasses like carbon dioxide and methane. These gasses trap infrared radiation in the Earth’s atmosphere that otherwise would have reflected out into space. The excess energy in the Earth’s climate system has contributed to higher than average temperatures on land and sea.

High ocean temperatures are creating excess moisture in the atmosphere, resulting in increasingly frequent high rainfall events like the ones in the Northeast US last week that flooded downtown Burlington, Vermont and the Hudson Valley in New York. Meanwhile, higher temperatures are drying out parts of the earth beyond normal, exacerbating and prolonging droughts and heat waves. 

Such extremes are only bound to worsen as El Niño returns after three years. El Niño is the warming cycle in the El Niño Southern Oscillation. The last three years were a La Niña, when the waters off the western coast of South America are cooler than normal. El Niño conditions form when the cool waters sink and are replaced by warmer than normal surface water. This warm water makes the Southwest wetter than in La Niña years but contributes to hotter than average global temperatures. This year’s El Niño is just beginning and it will likely contribute to an already disaster-packed 2023. 

Hotter and drier conditions in Canada have resulted in massive wildfires whose smoke has moved down into the United States, posing a risk to human health as people breathe in the smoke hundreds of miles away.  According to the National Oceanic and Atmospheric Administration (NOAA), there have been 12 individual disasters causing more than $1 billion in damage in the US so far this year. These events have caused 100 fatalities and caused more than $32.7 billion in damages. 

Scientists have been warning for years about the impact that climate change will have on the intensity and frequency of major weather events and natural disasters. A recent study published by the World Weather Attribution found that an earlier record-breaking heat wave that hit the Mediterranean this year would likely have not been possible without global warming and that the temperature would have most likely been several degrees cooler if it occurred in a world not struck with climate change.

The study also notes that observed extreme weather events are worse in some parts of the world than climate models are predicting, demonstrating how rapid the rate of climatic change is occurring. 

In April, Zeke Hausfather, a climate scientist at Berkeley Earth, predicted that the likelihood of 2023 exceeding the extremes of 2016, a record breaking year, was just 22 percent. Now that figure is “roughly 77 percent.” 

“We expect 2024 to be even warmer, as the majority of the El Niño’s effects will be felt then,” he added. 

Evidence of the role of carbon dioxide in the warming of Earth’s atmosphere dates back to the 19th century when Swedish scientist Svante Arrhenius first predicted that changes in atmospheric carbon dioxide levels could alter the surface temperature of the Earth. 

By 1956, Gilbert Plass had developed his Carbon Dioxide Theory of Climate Change and scientists began issuing warnings that rising greenhouse gas levels in the atmosphere could have long reaching consequences for the climate. 

In 1966, Nobel Prize winning scientist Glenn Seaborg warned, “At the rate we are currently adding carbon dioxide to our atmosphere (six billion tons a year), within the next few decades the heat balance of the atmosphere could be altered enough to produce marked changes in the climate—changes which we might have no means of controlling even if by that time we have made great advances in our programs of weather modification.”

Today carbon emissions are reaching 37 billion tons a year, over six times what worried scientists in the 1960s. 

However, despite the clear warnings and the overwhelming evidence that human actions are causing climate change and that it is contributing to ever greater natural hazards, there is virtually no effort to combat climate change by the capitalist governments of the world. 

The limited efforts that have been taken on so far are overwhelmingly designed to generate profits for so called “green” industries. And while great advancements have been made in the production of alternative forms of energy to fossil fuels, the severity of the climate crisis demands far more than a passive and complacent attitude by the capitalist governments, which are all subservient to the demands of the profit system. 

Too much of capitalist industry is bound up with the fossil fuel industry to make a scientific approach to combating climate change feasible. All talk of reducing carbon emissions and phasing out fossil fuels is in the time frame of decades, as if there were decades left to address the crisis.

Combating the climate crisis is incompatible with a global economic system that places profit over human life and the environment. As was shown by the COVID-19 pandemic, the capitalist class is more than willing to sacrifice as many lives as it takes to keep profits flowing.

Biden administration announces new limited student loan forgiveness program for 804,000 borrowers

Kevin Reed

The Biden administration announced on Friday a new plan for a total of $39 billion in “automatic loan forgiveness” for more than 804,000 student loan borrowers. This is just over 2 percent of the $1.78 trillion collective student loan debt held by 43 million borrowers.

President Joe Biden speaks at Howard University’s commencement in Washington D.C. on Saturday, May 13, 2023. [AP Photo/Alex Brandon]

The new limited program comes less than two weeks after the US Supreme Court struck down an earlier plan by the Biden administration to forgive more than $400 billion in federal student loan debt for all eligible borrowers.

In a statement from the US Department of Education, Secretary of Education Miguel Cardona claimed that the measure is “another historic step” by the Biden administration to right wrongs and ensure that “everyone gets the forgiveness they deserve,” including “students who were cheated by their colleges, and borrowers with permanent disabilities, including veterans.”

Cardona also asserted that the Democratic Party administration “will not stop fighting to level the playing field in higher education.” However, other than a vague reference to “past administrative failures,” neither the education secretary nor anyone else in the Biden-Harris White House named precisely who or what entities were involved in cheating students and their families out of their hard-earned wages for decades as part of the US student loan racket.

Instead of stating the obvious—that powerful financial interests have taken advantage of laws passed in 1976 that make it impossible for student borrowers to discharge crushing debt obligations through personal bankruptcy filings—the administration is presenting the crisis facing millions of working class families as the result of “mistakes,” a case of borrowers falling “through the cracks of a broken system” and “historical inaccuracies” in the manner payments were counted toward forgiveness.

It is notable that—just at the point when the American ruling elite began changing laws to make it possible for a layer of billionaires to game the financial system for personal wealth accumulation and also reduce their tax obligations—Congress amended the Higher Education Act in 1976 and, two years later, modified the bankruptcy code to make it nearly impossible for student loan debt to be discharged in bankruptcy court.

In 2005, Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act and adopted rules against private student loans being eligible for bankruptcy protections just like other forms of private credit. This measure was passed with the support of the 18 Democratic Party senators, including then-Senator from Delaware Joe Biden, an enthusiastic advocate of the credit industry that had given him hundreds of thousands of dollars in campaign contributions.

Indicating the scaled down nature of the new plan as compared to Biden’s original loan forgiveness program, department Under Secretary James Kvaal said the administration was “holding up the bargain we offered borrowers who have completed decades of repayment.”

The new program will bring relief to student loan borrowers who have made 240 or 300 monthly payments on an income-driven repayment (IDR) plan. Borrowers have been able to enroll in IDR programs that allow their monthly payments to be set based on a range of factors, including monthly income and family size.

The announcement says that borrowers will receive notifications in the coming days, including “those with Direct Loans or Federal Family Education Loans held by the Department (including Parent PLUS loans of either type) who have reached the necessary forgiveness threshold as a result of receiving credit toward IDR forgiveness,” based on the duration of their account status, whether it is in repayment, forbearance or deferment.

On June 30, the Supreme Court blocked an executive order issued by the President which would have provided up to $20,000 per borrower for up to 43 million Americans, 90 percent of whom come from zip codes with a median income of $60,000 or less and over 60 percent from zip codes with a median income of between $20,000 and $40,000.

The far-right dominated court voted 6-3 and sided with the Republican Party, billionaires and some Democrats who complained bitterly that the White House did not have the authority to forgive student loan debts under provisions of the HEROES Act emergency powers granted to the President. It was, according to the reactionary court majority, an end run around the US Congress, which controls the purse of the American government.

Meanwhile, there has been no hue and cry within any branch of the US government about the trillions of dollars spent on wars and on bailouts of the banks and corporations.

According to media reports, the Department of Education claims the authority to implement the new plan announced on Friday because it falls within the education secretary’s power to administer loan repayment programs.

This, of course, is not stopping the right wing from continuing its campaign against any relief, no matter how limited, for the working class.

For example, Lindsey Burke, director of the Center for Education Policy at the Heritage Foundation, said, “In the wake of the court decision, the administration is really abusing its authority and trying to give people breaks that they didn’t earn. This is ultimately going to continue to drive up college tuition and drive up prices and is going to lay the groundwork for more borrowers to demand loan cancellation in the future.”

The Washington Post quoted Republican Representative from North Carolina Virginia Fox on Friday, saying, “The Biden administration is trampling the rule of law, hurting borrowers, and abusing taxpayers. From day one, this administration has encouraged borrowers not to repay their loans and has expected taxpayers to foot the bill.”

The Wall Street Journal editorial board called the plan a “new entitlement,” adding that it is “debt cancellation on the installment plan.” 

These statements and others like it are thick with cynicism, since everyone in the Washington D.C. political establishment is well aware that massive sums were handed out to the financial and corporate elite with no strings attached during the 2008 crash and again during the bailout of Wall Street with the USA CARES act in the early months of the pandemic.

Australian construction insolvencies hit record highs

Martin Scott

Australian construction businesses are failing at record rates, leaving millions of dollars owing to workers and thousands of buyers out of pocket for unfinished homes.

House under construction in Manly, Queensland [Photo by Orderinchaos via Wikimedia Commons / CC BY-SA 4.0]

In the 2022–23 financial year, 2,170 construction businesses have gone into administration, 69 percent more than in 2021–22, and 20 percent more than the previous decade-high of 1,802 recorded in 2013–14.

The trend is expected to continue. While previous collapses have been driven by delays and cost blowouts for builders, the industry now confronts a potential crisis on the demand side. With inflation massively outstripping wage growth and successive interest rate rises by the Reserve Bank of Australia driving up home loan rates, new homes are increasingly unaffordable for working-class families.

As the cost of living soars, there are signs that the wave of business failures is spreading to other industries as well. Overall, 7,764 insolvencies have been recorded in 2022–23, 58 percent higher than the previous year, including 1,086 in accommodation and food services, and 449 in manufacturing, a 148 percent increase.

Timothy Hibbert, head of construction and property forecasting at Oxford Economics, told the Australian, “new home sales, dwelling approvals and home construction loans have deteriorated, setting the scene for a deep residential downturn.” He anticipates a 21 percent reduction in building activity over the three years to 2025.

Luxury home builder Millbrook Homes, based in New South Wales, went into administration on June 26, owing more than $4 million to around 80 creditors. The director of Millbrook Homes also ran Elderton Homes, which collapsed in late 2022, leaving 75 home builds incomplete and 127 new projects in the “pipeline.”

Just four days later, Victorian residential builder Bentley Homes appointed liquidators, with around 50 customers with unfinished builds impacted.

Sydney apartment builder Toplace went into administration last week. The company’s director, Jean Nassif, is subject to an arrest warrant over claims he obtained a $150 million loan from Westpac bank using falsified documents. His daughter has also been charged with falsifying pre-sale documents relating to a 900-unit complex built by the company at Castle Hill, in the city’s north west.

The company has multiple residential and commercial developments under construction across Sydney, meaning there are potentially hundreds of subcontractors who have not been paid.

Also left stranded are thousands of customers who pre-paid for units in unfinished Toplace buildings, as well as those who own units in completed apartment buildings that have been found to feature dangerous construction defects.

The most prominent collapse in the homebuilding sector this year was Porter Davis, which went into administration on March 31, leaving around 1,700 houses partially built in Victoria and Queensland.

The liquidation process at Porter Davis demonstrates that it is workers, subcontractors and ordinary working-class home buyers who pay the steepest price for the failure of these businesses, although it is completely out of their control.

A creditors report released in June stated, “it appears unlikely that sufficient funds will be recovered in the liquidations to enable a dividend to be paid to ordinary unsecured creditors.”

The report showed that Porter Davis amassed debts of around $557 million before its collapse, $481.6 million of which is owed to unsecured creditors. While the largest of these, Commonwealth Bank, is expected to receive the entire $32.9 million outstanding, “employee priority creditors” will be paid only a fraction of the $18 million they are owed.

Liquidators have not brought any claim against Porter Davis directors and they have not been ordered to sell their properties, valued at a total of around $10 million.

It is alleged that Porter Davis was slow to take out compulsory insurance on builds after customer paid deposits, possibly due to cash flow problems, leaving around 600 buyers without coverage.

Both the Queensland and Victorian governments have implemented schemes to allow some buyers to recover their deposits, placing the burden of corporate failures on the shoulders of the taxpaying working class. The Victorian bailout, expected to cost $28 million, was expanded on July 1 to cover buyers who had paid deposits to other failed builders as well.

Multiple factors have been blamed for the wave of business failures, all of which are themselves a product of the deepening crisis of capitalism, in Australia and globally.

The former Liberal-National federal government’s introduction of HomeBuilder grants as a COVID-19 stimulus measure in April 2020, after the Reserve Bank of Australia lowered interest rates to 0.25 percent the previous month, contributed to a surge in demand. Construction approvals for new houses soared 40 percent in 2020–21.

But the actual completion of house constructions fell far short of the number of builds started. In 2020–21, just 75 percent of new house builds that were commenced were completed, the lowest rate since the Australian Bureau of Statistics (ABS) began recording it in 1956–57. In 2021–22, this only increased to 88 percent, the fourth worst completion rate on record.

A long-term decline in domestic hardwood production and the destruction of 130,000 hectares of commercial softwood plantations in the bushfires that ravaged the east coast in 2019–20 led to a greater reliance on imported timber.

Global supply chain issues, especially at the beginning of the pandemic, and increased demand around the world meant timber was in short supply, even as prices skyrocketed. This was worsened with the start of the US-NATO war against Russia, a major global timber producer, in early 2022 and the federal government’s imposition of a 35 percent import tariff on “conflict timber” from Russia and Belarus.

By December 2022, the import price of cork and wood to Australia had increased to more than two-and-a-half times the cost just a decade earlier, according to the ABS.

The construction industry was also hit by labour shortages, particularly of skilled workers. Government funding for vocational education and training has been slashed over decades, starting with the Hawke-Keating Labor governments in the late 1980s.

In 1989, there were around 160,000 trade apprentices in training across the country. In 2019, there were 181,000, an increase of just 13 percent over a 30-year period in which Australia’s population grew by 50 percent.

The construction industry, along with many others, is therefore reliant on skilled migration, both permanent and temporary, which was heavily impacted during the first 18 months of the pandemic, when border closures were in place.

The sector was granted exemptions from most lockdowns and other restrictions, in line with the union-backed demands of major construction companies that workers’ health and lives must not be allowed to stand in the way of profits. But with the virus allowed to spread freely among workers, their families and the broader community, the industry still faced delays due to the infection and illness of workers.

The weather also played a role. Last year was Sydney’s wettest on record, and the ninth wettest across the country, forcing projects to be repeatedly put on hold due to rain and multiple catastrophic floods.

Fixed-price contracts, under which the builder is responsible for most unexpected cost blowouts, are common in the industry and even mandatory in some states, especially in the private residential sector. Under conditions of rapidly rising input costs, this means that delays can more than wipe out profit margins that are already narrow due to the highly competitive nature of the industry.

Following the collapse of Porter Davis, Brett Boulton, director of Bold Living, which took over some of the company’s uncompleted builds, told Business News Australia, “what we’re finding is there’s a very large difference in terms of what their price is and what their price should be.”

The string of collapses in residential construction illustrates the irrationality of the capitalist system itself, taking place as it does amid a major shortage of affordable housing across the country.

Australia already has a shortfall of more than 500,000 social housing dwellings, a figure expected to reach 671,000 over the next ten years. The Labor government’s troubled “social and affordable” housing bill would do nothing to resolve this, promising to finance the construction of a meagre 30,000 homes over five years.

A $2 billion scheme backed by the Greens will also not make a dent in the housing affordability crisis, but will be accompanied by sweeping reviews of state and territory planning laws, aimed at fast-tracking major projects and boosting the profits of the largest corporate developers.

Junior doctors begin five-day strike as Sunak offers “final” public sector pay deals to end strikes

Thomas Scripps

45,000 junior doctors began a five-day strike Thursday, the latest in an industrial dispute ongoing since February and the longest single walkout by doctors in NHS history. The members of the British Medical Association (BMA) previously held a 3-day strike in March, a 4-day strike in April and another 3-day strike in June.

A separate 48-hour consultants’ strike, also organised by the BMA, is due to start next Thursday and a two-day strike by the Society of Radiographers the following Tuesday.

Striking junior doctors on the picket line at Royal Bournemouth Hospital, March 13, 2023

Junior doctors are demanding a 35 percent increase in pay to make up the real terms losses suffered since 2008. Government underfunding of the National Health Service and its workforce has led to intolerable working conditions and plummeting outcomes for patients.

The government imposed a 2 percent pay rise for 2022-23, a year in which prices rose by 11.4 percent according to the Retail Prices Index. It had grudgingly offered 5 percent in recent negotiations for 2023-24 but cancelled all talks when new strikes were scheduled.

On Thursday, however, Prime Minister Rishi Sunak announced a “final” series of public sector pay offers, to be funded by cuts to government budgets, including a 6 percent pay rise for junior doctors. He told the press, “Today’s offer is final. There will be no more talks on pay. We will not negotiate again on this year’s settlements and no amount of strikes will change our decision.”

Sunak’s speech was accompanied by a joint statement signed by himself, Education Secretary Gillian Keegan and the leaders of the four main teaching unions hailing a 6.5 percent offer for teachers, declaring the unions’ intentions to recommend it to their members and breathing the sigh of relief: “This deal will allow teachers and school leaders to call off strike action and resume normal relations with government.”

On the day doctors began a new round of action, the education unions pulled strikes set to involve hundreds of thousands of school workers. All talk a few months ago of solidarity and coordinated action has evaporated.

Sunak’s ultimatum is designed to bring all the remaining national strikes to an end in the same way. Although BMA Chair of Council Prof Phil Banfield denounced the offer as “yet another pay cut in real terms” which “serves only to increase the losses faced by doctors after more than a decade’s worth of sub-inflation pay awards,” for the union bureaucracy it is only a question of timing, presentation and finessing some sell-out deal.

Even prior to the announcement of 6 percent, BMA co-chairs Vivek Trivedi and Robert Laurenson had promised, “We can call this strike off today if the UK government will simply follow the example of the government in Scotland and drop their nonsensical precondition of not talking whilst strikes are announced…

“The pay offer on the table to junior doctors in Scotland and how it was reached throws into sharp relief the obstinate approach being taken by the prime minister and the health secretary.”

Strikes in Scotland were called off last week following an improved offer of a 12.4 percent pay rise for 2023-24 from the Scottish government. This must be taken in the context of the 4.5 percent award made for 2022-23, nearly 7 percentage points below the rate of inflation.

In other words, doctors’ pay was massively outstripped by price rises last year and they are now playing catch up. With inflation stubbornly high, the deal could well amount to a real terms cut by the end of the period, worsening the fall since 2008.

Specific details of the deal aside, the front has been broken with doctors in England, representing the vast majority of the workforce—Scotland’s population is less than a tenth of England’s.

Junior doctors represented by the BMA in Wales have not even been balloted for action, with the union explaining, “In Wales, we’ve not had to make the difficult step of moving towards a ballot or taking IA just to get the government to talk… the Welsh Government has been open to discussing pay with us.”

Like doctors in Scotland, those in Wales received a 4.5 percent award for 2022-23. A survey conducted by the BMA in Wales was published last December showing 78 percent of members wanted a pay rise that matched or exceeded inflation, and two thirds were prepared to take industrial action. This sentiment, fully aligning doctors in Wales with their colleagues throughout Britain, has been squashed.

Globally, the trade unions use international borders to divide workers doing the same job at the same company in different countries. In Britain, they have the benefit of doing the same internally.

The Scottish and Welsh devolved governments, overseeing a small section of the workforce, are given the freedom to make relatively better pay offers, then used to split off sections of workers from a national strike action. This creates a precedent for the same process, almost invariably involving a smaller offer, to be played out in England.

Nurses suffered the same at the hands of the Royal College of Nursing as part of the union’s efforts to grind down workers’ resistance to this May’s sellout pay deal. The national rail strike has been carved up the same way, with similarly disastrous results even before the plug is finally pulled on action in England.

It is in large part thanks to these union-inflicted defeats, especially of the nurses and other NHS workers, that the government feels so bullish in its dealings with the BMA.

By favourably citing the 12.4 percent offer in Scotland, the BMA leadership is not seriously suggesting that the Tory government match that figure but beginning the process of lowering its members’ expectations from the 35 percent demand. The march towards the government’s 6 percent, perhaps with a sweetener or two, has begun.

A year of strikes has proved beyond all question that workers cannot defend their pay, jobs and conditions while they remain shackled by the trade union bureaucracy. A working-class offensive is being turned by a handful of privileged leaders into a rout.

House Subcommittee on the Coronavirus Pandemic begins political inquisition of scientists

Benjamin Mateus

On Tuesday, the House Select Subcommittee on the Coronavirus Pandemic, led by Republican Representative Brad Wenstrup, a podiatrist and former US Army reservist, interrogated two leading authors of the research note titled Proximal Origin of SARS-CoV-2, published in March 2020 and well known in the scientific community for being the first significant investigation into where the virus which causes COVID-19 came from.

The purpose of the hearings was intended to discredit Dr. Kristian Andersen, professor in the Department of Immunology and Microbiology at Scripps Research Institute, and Dr. Robert Garry, professor of Microbiology and Immunology at Tulane Medical School, by claiming they “vilified and suppressed the lab leak theory in pursuit of a preferred, coordinated narrative that was not based in truth or science.”

Wenstrup claimed that he had evidence “that the conclusions championed by the co-authors of Proximal Origin are not only inaccurate but were crafted to appease a stated political motive.” This involved a supposed cover-up of the real source of the virus, the Wuhan Institute of Virology (WIV), in which the scientists engaged at the direction of two top health officials, Dr. Anthony Fauci and Dr. Francis Collins.

The Republican-based scenario, initially advanced by fascist Trump counselor Steve Bannon, insists that Fauci and Collins had pushed to publish the paper showing a natural origin of SARS-CoV-2 to escape responsibility for creating the virus. They feared that otherwise they would be implicated in offering millions in grants to EcoHealth Alliance, a US-based global nonprofit scientific research organization, which worked with the Chinese lab to conduct studies on bat coronaviruses.

Dr. Kristian Andersen testifying before the House Oversight Select Subcommittee on the Coronavirus Pandemic on July 11, 2023. [Photo: C-SPAN.org]

Dr. Andersen addressed this right-wing conspiracy theory in his prepared testimony to the hearing. He declared, “The title of this hearing, ‘Investigating the Proximal Origin of a Cover-Up,’ is directly targeted at our March 2020 peer-reviewed study in Nature Medicine titled ‘The Proximal Origin of SARS-CoV-2.’”

He continued:

It has been alleged that our paper was initiated and orchestrated by Dr. Anthony Fauci to disprove, dismiss, and cover up a lab origin of SARS-CoV-2 as directed at a February 1, 2020, conference call. ... It has also been suggested that a $8.9 million federal “WARN-ID” grant awarded in 2020 to myself and colleagues from five different countries was a quid-pro-quo we received for changing our conclusions about the likely origin of SARS-CoV-2. Let me categorically say that these allegations are absurd and false.

Throughout the hearing, the two scientists gave calm and measured testimony rebutting the conspiracy theory at every point and arguing that proponents of the “lab leak” had not offered a shred of factual evidence. The Republicans howled and preened before the television cameras, appealing to Donald Trump and his fascist supporters.

And the Democrats contented themselves with a few “for the record” statements of support for the scientists but otherwise did nothing to interrupt the display witch-hunting worthy of Senator Joe McCarthy at his worst. They are far more concerned with maintaining bipartisan support for the war in Ukraine than in fighting a conspiracy theory launched by fascists like former Trump counselor Steve Bannon.

During the hearing, Representative Ronny Jackson (Republican—Texas) told Andersen and Garry, “What a lot of people think is going on here is that Dr. Anthony Fauci and Francis Collins realized that they had been implicated in the creation of the virus, and they were doing everything they could, including getting both of you to come on board as tools or vehicles, to undermine that theory.”

These are, based on accumulated evidence acquired over the last three years that include their own intelligence reports on the subject, bald-faced lies that perpetuate the conspiracy first raised by Bannon and his cronies to shift the blame for Trump’s criminal response to the pandemic onto China.

Dr. Andersen is an internationally renowned researcher whose main work has focused on understanding the complex relationships between human hosts and infectious pathogens. He has conducted extensive work in the genetics of these interactions, as well as field work and computational biology to better elucidate these natural processes. More so, he has been the lead investigator in many international collaborations that not only included SARS-CoV-2, but also the Zika virus, Ebola virus, West Nile virus and Lassa virus.

In late January 2020, after a preliminary review of the SARS-CoV-2 genome, Dr. Andersen and colleagues Dr. Robert Garry and Dr. Edward Holmes (leading researcher on the evolution and emergence of infectious diseases) had contacted Dr. Fauci to discuss their concerns over the mutation seen at the furin site of the coronavirus’ spike protein, which they felt was a possible indicator of bioengineering.

Fauci and the scientists and other health experts discussed this possibility and asked Andersen to get a group of scientists together “to examine carefully the data to determine if his concerns were validated.” Specifically, Fauci had told Andersen then that “if you think it came from a lab, you should write this up as a peer-reviewed paper.”

In others, the email record shows the diametrically opposite of the right-wing conspiracy theory. The scientists were initially concerned about the possible creation of a bioweapon, which would have enormous implications both politically and in terms of health care, and they were tasked with investigating the issue.

Fauci and Collins were merely facilitators in organizing the international investigation without once indicating any particular conclusion should be arrived at or forced. This was an open collaborative process free from any form of coercion, deceit or ill intentions. A February conference call among leading scientists demonstrated this, as Andersen noted in his testimony:

There is clearly much to understand in this. This call was very helpful to hear some of our current understanding and the many gaps in our knowledge. I do not believe this is a question of a binary outcome, it is more a question of “What are the evolutionary origins of 2019-nCoV, important for future risk assessment and understanding of animal/human coronaviruses.”

We on this call are not the only ones with scientific expertise in this area, and this was an ad hoc group that came together to air some thoughts. It is clearly not the sole group to take this forward, that will need a broader range of input and a respected international body to ask an expert group to explore this, with a completely open mind. In order to stay ahead of the conspiracy theories and social media, I do think there is an urgency for a body to convene such a group and commission some work to “Understand the evolutionary origins of 2019-nCoV, important for this epidemic and for future risks assessment and understanding of animal/human coronaviruses.”

In other words, a completely open minded and neutral question bringing the best minds and under the umbrella of a respected international agency. I hope this is a reasonable approach, please send any thoughts or suggestions.

In a matter of a few days in February 2020, after studying the virus’s genome and the available literature on coronaviruses in bats and their spillover into human populations, and entertaining various lab leak accident scenarios, Andersen and his colleagues arrived at an “agnostic” consensus, stating in their Letter published in Nature Medicine: “Although the evidence shows that SARS-CoV-2 is not a purposefully manipulated virus, it is currently impossible to prove or disprove the other theories of its origin described here [various hypotheses of how the virus made its way from the animal reservoir to human beings]. However, since we observed all notable SARS-CoV-2 features, including the optimized RBD [Receptor Binding Domain] and polybasic cleavage site [Furin Cleavage Site], in related coronaviruses in nature, we do not believe that any type of laboratory-based scenario is plausible.”

They added, “More scientific data could swing the balance of evidence to favor one hypothesis over another. Obtaining related viral sequences from animal sources would be the most definitive way of revealing viral origins.”

Since that publication, the weight of the evidence has only given further support to their “proximal” conclusions. Four publications in particular are relevant to the examination of these and have been linked here for the reader’s review:

• The origins of SARS-CoV-2: a critical review (September 16, 2021)
• The Huanan Seafood Wholesale Market in Wuhan was the early epicenter of the COVID-19 pandemic (July 26, 2022)
• SARS-CoV-2 furin cleavage site was not engineered (September 29, 2022)
• COVID-origins study links raccoon dogs to Wuhan market: what scientists think (March 22, 2023)

And these are only a few in a long list of publications in high visibility journals that include most recent evidence of SARS-CoV-2-like viruses have emerged as well as bat coronaviruses that harbor FCS and most recently work by Dr. Edward Holmes and his group that found a recombinant “SARS-1-like and SARS-2-like viruses [that has] a receptor binding domain that is as close as any to SARS-CoV-2.”

On the side of the lab leak conspiracy, not one piece of even circumstantial evidence has come to light in defense of their hysterical allegations. Not even the US intelligence services, with a vested interest in spreading anti-Chinese propaganda, have been able to reach any consensus or offer more than a “low confidence” assessment—little more than speculation.

As the World Socialist Web Site noted last month after the Office of the Director of National Intelligence (ODNI) released its report on the potential links between the Wuhan Institute of Virology (WIV) and the origin of COVID-19, “Not only does the ODNI report offer not one shred of evidence in support of the fascistic right-wing Wuhan lab leak conspiracy, but it goes far to corroborate the earlier statements made by the WIV scientists and the WHO officials on the topic.”

Despite the oft inflammatory remarks made by various Republicans, including the outright fascist Marjorie Taylor Greene, not once did they offer any evidence to the allegations that Andersen and colleagues changed their views from a bioengineered to zoonotic origin hypothesis because of political coercion or bribery. Nor could they refute the science as it was presented during the testimony.

As Andersen quietly observed, unfazed by the attacks, “[it seems we are] pawns in a political game.” Despite these, he continued to patiently explain when he was given an opportunity to get a word in edgewise. “I think it’s important that we take a step back and focus on what’s possible versus what is probable. … We conclude that the virus very likely emerged as the result of a zoonosis, that is, a spillover from an animal host. This remains the only scientifically supported theory for how the virus emerged. If convincing new evidence were to be discovered, suggesting otherwise, we would, of course, revise our conclusions. This is science.”

Later he noted, “If there were any new evidence that were to be unearthed suggesting that this could potentially have been associated with a lab, of course, we will consider that.”

Dr. Andersen explained that the threats to himself and his colleagues had reached a fever pitch, so much so that he has found his name on various kill lists posted by right-wing Trump supporters and other fascists.

As Wenstrup brought the hearings to an end, he defended the two federal agencies that supported the lab-leak hypothesis—the FBI and the Department of Energy—for their positions, and he warned that he was going to investigate the other intelligence units for not reaching similar conclusions. This is McCarthyism in a nutshell.

One can assume that Eco Health Alliance and Dr. Fauci will be next on the subcommittee hit list. These proceedings only underscore the deeply reactionary and degenerated state of US politics and global capitalism, where science is deeply maligned and mistrusted if it does not adhere to the demands placed on it by political reaction.