Ukrainian President Volodymyr Zelensky has officially dismissed General Valery Zaluzhny as Commander-in-Chief of Ukraine’s armed forces, marking a significant turning point in the nearly two-year long NATO proxy war that has claimed the lives of at least 400,000 Ukrainian soldiers.
Ending speculation about Zaluzhny’s imminent dismissal that first began over 10 days ago, Zelensky announced the move on his X/Twitter and Telegram channels on Thursday night.
“I met with General Valery Zaluzhny. I thanked him for the two years of defending Ukraine. We discussed the renewal that the Armed Forces of Ukraine require. We also discussed who could be part of the renewed leadership of the Armed Forces of Ukraine. The time for such a renewal is now. I proposed to General Zaluzhny to remain part of the team. We will definitely win! Glory to Ukraine!,” Zelensky wrote.
Zelensky’s announcement was accompanied by a photo of both Zaluzhny and Zelensky shaking hands and smiling, clearly intending to signal a friendly exchange between the two despite a well-documented, extremely strained relationship.
As Seymour Hersh reported last week, Zelensky feared having “mutiny on his hands” from both the armed forces and the country’s far-right political groups who are the most vociferous backers of the war and play a vital role, most notably in Ukraine’s special operations. One American official cited by Hersh called Zelensky “a dead man walking” should he fire Zaluzhny. Hersh also reported that Zaluzhny had been meeting with American and Western officials on negotiating a ceasefire with Russia, angering Zelensky.
Zaluzhny will be replaced by General Oleksandr Syrsky, who previously served as head of the Ukrainian Ground Forces since 2019.
Prior to Zaluzhny’s firing, both Ukrainian and Western outlets had reported that Zelensky often purposely communicated his orders directly with Syrsky, bypassing Zaluzhny. Syrsky is also notorious for leading the defense of Bakhmut, which cost the lives of tens of thousands of Ukrainian soldiers in a battle that became known as a “meat grinder” due to high casualties on both sides.
Similar tactics are now being employed in the eastern city of Avdiivka, which Zelensky has reportedly ordered to be held despite the high-risk of encirclement of Ukrainian forces and heavy casualties as earlier in Bakhmut. Syrsky’s appointment will thus likely result in continued high casualties and growing resentment from the frontlines towards Zelensky.
Reporting on the initial reaction to the move, the Financial Times wrote, “Ukrainian troops and western officials speaking on condition of anonymity told the FT that Syrsky’s appointment as top commander bodes ill for the war. Soldiers who have criticized him in interviews say that he has callously thrown away troops. Some have dubbed him ‘the butcher.’”
The Financial Times also quoted a Ukrainian soldier on X/Twitter as saying “We are all screwed”. He added that this was the sentiment among troops in a private chat group “who went through all stages of the defense of Bakhmut with Syrsky.”
Illia Ponomarenko, a right-wing war reporter for the pro-NATO Kyiv Independent who was previously embedded with the neo-Nazi Azov Battalion, signaled his resentment with the switch to Syrsky from the standpoint of Ukrainian nationalism, stating on X/Twitter: “Yes, Ukraine’s new top commanding general in its war against Russian invasion is an ethnic Russian born and raised in Russia. He studied military affairs to be commissioned as an officer in Moscow. He moved to Ukraine as a teen in 1980.”
Ponomarenko also reported that he believed Zaluzhny would soon retire from the military to start his “political career,” which served as the alleged initial source of tensions between Zelensky and Zaluzhny.
Despite the failed counteroffensive that cost the lives of over a reported 125,000 Ukrainian soldiers this past spring and summer, Zaluzhny remains a popular figure as a “war hero” in Ukraine and was rumored to be Zelensky’s main rival in presidential elections originally scheduled for 2024. Zelensky canceled the elections as tensions with Zaluzhny escalated last fall.
Zaluzhny has been polling higher than Zelensky in almost every major poll. Above all, he has established a close relationship with the country’s far-right. He has publicly expressed admiration for the Ukrainian fascist leader Stepan Bandera and has been photographed repeatedly with far-right paraphernalia.
Last week, following rumors of impending dismissal, a picture of Zaluzhny meeting with the commander of the neo-Nazi Right Sector Andriy Stempitsky was posted to Facebookwith a portrait of Bandera in the background. Such photos are clearly meant to send a menacing political message to anyone opposing Zaluzhny within Ukrainian politics, and especially Zelensky.
Organizations like the Right Sector have been armed for over a decade by the imperialist powers and had played a central role first in the US- and EU-backed far-right coup in Kiev in February 2014, and, since 2022, in the NATO proxy war against Russia.
Valery Zaluzhny (left) with Andriy Stempitsky, a commander of the fascist Right Sector during his last days in office. Both men are photographed in front of a portrait of Ukrainian fascist leader Stepan Bandera
In an attempt likely intended to keep Zaluzhny under Zelensky’s control, he was reportedly first offered several different lesser positions within the Ukrainian government, including ambassador to the United Kingdom and head of the National Security and Defense Council, both of which he apparently refused. According to Ponomarenko, Zaluzhny’s refusal to accept these positions under the Zelensky government could signal his turn toward direct involvement in Ukrainian politics in opposition to Zelensky.
Despite the crisis within the Zelensky government, National Security Council spokesman John Kirby signaled that Washington would continue to back Kiev stating “we’re not concerned about Ukraine stability” as a result of the move.
On the same day that Zaluzhny’s firing became official, the US Senate voted to advance a $95 billion foreign aid package for both Ukraine and Israel, signaling that it views both states as essential outposts from the viewpoint of American imperialism. According to the initial version of the bill, Ukraine would receive $60 billion of the $95 billion in aid.
Every so often there is an incident which draws attention to the deep-going rot within American capitalism which is the essential driving force behind its volcanic eruption of militarism over the past 30 years that now threatens to plunge mankind into World War III.
The head of Emirates Airline, Sir Tim Clark, did not intend it to be so, but his recent interview with the Financial Times (FT), warning that the US aircraft manufacturing giant Boeing was in the “last chance saloon” to fix its major manufacturing problems, is one of these.
It pointed to the decline of American industrial power and the threat this poses to its global hegemony which it is desperately seeking to counter with the use of military force.
Clark would like to ascribe the problems of Boeing to the outlook of its executives.
He indicated the two crashes of Boeing’s Max 737 plane in 2018 and 2019, killing 346 people and the blowout of a section of the fuselage of the Boeing 737 Max 9 last month, which could have led to a similar disaster, were caused by major manufacturing problems that had their roots in the very financial and profit structure of the company.
National Transportation Safety Board investigator examines section of missing panel on a Boeing 737-9 MAX in Portland, Ore that blew off the jetliner in midflight. [AP Photo/National Transportation Safety Board]
However, Boeing’s modus operandi was no means atypical. It is symptomatic of what has taken place more broadly.
Clark told the FT the airline would now send its own engineers to observe production processes at Boeing and its supplier Sprit AeroSystems.
“The fact that we’re having to do this is testament to what has happened,” he said. “This would not have happened in the old days. You know, we trusted these people implicitly to get it done.”
The fact that his remarks and actions were directed at Boeing, at one time an icon of American manufacturing prowess, points to deeper historical processes.
Clark called for a “root and branch” examination of manufacturing at the company and directly pointed to the reasons it has been so severely undermined such that airlines which purchase its planes have no confidence in it.
This examination, he said, had to be based not on “‘what is the return on investment? What is the bottom line? What is the free cash flow? What is shareholder value? What is my bonus?’”
He also noted that one of the company’s cost-cutting moves—the shift of parts of 787 production from Seattle, Washington, to South Carolina had led to manufacturing problems because Boeing had lost “skills and competencies” as a result of the decision.
In its interview article, the FT noted that Aengus Kelly, the chief executive of Aercap, the world’s biggest aircraft leasing company, said last month that Boeing needed to put aside financial targets and focus solely on the quality and safety of its planes.
Both men expressed the hope that Boeing would undertake the necessary refocus away from finance to the production of high quality and safe planes.
That flick-the-switch approach might be considered a viable option were it not for the fact that the policies undertaken by successive Boeing executives did not arise from their individual mindset but were a response to powerful forces emanating from the very centre of the capitalist profit accumulation process itself.
Over the past 40 years these forces have led to the rise and rise of financialisation—that is the ever-increasing shift towards the accumulation of profit, not by production as such, but through what is known as “financial engineering.”
One of the central features of this turn has been the ever-increasing use of share buybacks in which companies purchase their own shares either using their profits, or, in some cases by taking on increased debt in order to do so. Apple is an example of the latter.
The chief beneficiaries are the private equity firms and hedge funds which hold an increasing portion of company shares, placing them in a powerful position to determined corporate practices.
Rather than having to wait for the company to spend money on developing a new product that will keep profits flowing in and face the risk that, because of market conditions or the development of a better product by a rival it may not, they obtain an immediate boost from the increased stock price that share buybacks bring.
These demands are enforced by the ever-present threat that any company which does not obey the command to increase “shareholder value” will be the subject of a hostile takeover, made possible by the mobilisation of tens of billions of dollars, sometimes hundreds, on financial markets.
The demands of finance capital are not primarily transmitted to corporate executives in the form of salary packages, even though they may run into the millions or even tens of millions. Rather executive wealth is more and more grounded on stock options which can often bring in billions so long as the share price keeps rising, thereby ensuring that executives are aligned with financial market demands.
The recent case of Tesla chief Elon Musk is illustrative. He receives no salary directly but stood to gain $55 billion from a remuneration package based on stock options. While this was disallowed by a Delaware court last month, it is certain ways will be found to get around the decision, at least to some extent.
So far as share buybacks are concerned, Boeing has been a world leader.
Between 1998 and 2018, according to data compiled by the economist William O. Lazonick, Boeing outlaid $61 billion in stock buybacks, equivalent to 81.8 percent of its profits. The addition of dividend payments meant that shareholders received in total 121 percent of its profits.
The bulk of the share buybacks—some $43 billion—came between 2013 and the beginning of 2019, when it retired 200 million shares, or 25 percent. This was the period in which Boeing was developing the 737 Max. And in order to meet the demands of finance capital, Boeing decided to save money on the plane.
As the FT reported in August 2019: “Instead of building a wholly new aircraft, Boeing simply bolted new fuel-efficient engines on to a tweaked existing airframe. That significantly reduced the airframe development costs of the project, according to company insiders. Boeing was able to redirect some of those ‘savings’ to repurchase stock instead.”
As another comment recently published on the website Common Dreams, noted: “Boeing facing the obsolescence of its 737 planes, could have created an entirely new airplane from scratch with fully modern technology. Instead, the company decided to re-engineer the older model, name it the 737 MAX, and save $7 billion. Perhaps not coincidentally, the $7 billion ‘saved’ is the amount of stock buybacks Boeing made each year between 2013 and 2019.”
The decision to tack the new engines on to the old air frame was the ultimate cause of the problems in the plane’s operating system which resulted in the “nosedives” which led to the two crashes.
Another way of making “savings” was to cut the workforce—between the end of 1998 and the beginning of this year Boeing has laid off a total of 45,000 workers—and outsourced key areas of production.
Boeing’s chief subcontractor is Spirit AeroSytems, which was responsible for securing the door panel that blew off in mid-flight last month. According to a preliminary report issued by the National Transportation Safety Board earlier this week, “four bolts that prevent the upward movement of the plug were missing” before it detached from the plane.
There is a litany of malpractices too numerous to detail here. But the full meaning of the Boeing experience can only be grasped if it is placed within the nature of capitalist production itself and its historical development.
The aim and driving force of capitalist production is not material wealth as such—the production of commodities—but the accumulation of money. The circuit of capital begins with money and ends with an expanded quantity of money, which then resumes the circuit. It is its alpha and omega of the capitalist system.
As Karl Marx noted: “The production process appears simply as an unavoidable middle term, a necessary evil for the purpose of money making.”
And as Frederick Engels commented, this explained why all nations were periodically seized by “fits of giddiness in which they try to accomplish money making without the mediations of the production process.”
But increasingly from the 1980s onwards rather than a fit of giddiness these efforts became the dominant feature of capitalist accumulation, above all in its heartland the US.
This was because the method of profit accumulation of the post war boom—the expansion of productive investment and the exploitation of a larger industrial workforce—had run into one of the fundamental laws of capitalist production, uncovered by Marx, the law of the tendency of the rate of profit to fall.
Strenuous efforts were made to overcome it, including the globalisation of production to take advantage of sources of cheaper labour and the development of what is called financial engineering.
The first, however, has only resulted in the creation of ever more “gravediggers” for capitalism—the expansion of the working class around the world—unified by their participation in a truly global production process on a scale never seen in the past.
The second has resulted in the development of vast financial conglomerates to the extent that hedge funds, private equity funds, the investment arms of banks and the like now dominate over every area of the capitalist economy, extracting wealth without lifting a finger.
This week, for example, the FT reported that US private equity firms were loading debt on to their portfolio companies and using the cash to pay dividends to themselves and their investors. In the month of January alone $8.1 billion worth of junk bonds, paying higher interest rates, were issued to fund such payments.
Down the road, and not far down it at that, this money will be raised through increased exploitation of the workforce as workers are told cost cutting is necessary, not least because the company must pay off debt to remain viable.
To facilitate this kind of systematic looting vast changes were made to the legal system so that practices considered criminal in the past could be carried out.
Share buybacks are a case in point. Up until 1982 they were regarded as unlawful manipulation of the stock market, but were legalised under the Reagan administration as one of the first of many legislative changes to meet the new demands of finance capital.
Economics of course does not determine politics immediately and directly. But the impulses emanating from major changes in the economic base do find their expression in the political superstructure. And the rise and rise of financialisation has had a major impact on world politics, the significance of which can be seen when placed in its historical context.
The historic crisis of capitalism, posing the objective necessity for its overthrow and replacement by international socialism, erupted in the form of World War I and the development of barbarism on a scale hitherto unimaginable. The war was the expression of the fundamental contradiction between the development of the world economy the nation-state system.
The three decades that followed produced one horror after another, culminating in World War II. Emerging from the war as the victorious imperialist power the US, resting on the betrayals of the revolutionary struggles of the working class by Stalinism and Social Democracy, was able to use its great industrial strength to rebuild the world economy and mitigate the inter-imperialist conflicts. But it could never overcome them.
Thus, in the latter part of the 20th century the essential contradiction of global capitalism—that between world economy and the nation-state system—intensified with the development of globalised production. At the same time, the industrial strength of US capitalism—the basis of the previous stabilisation—was steadily undermined.
These processes emerged in a highly contradictory form in the liquidation of the USSR in 1991. This was not, as the bourgeoisie proclaimed, the end of socialism but the reemergence at a higher level of the contradictions that exploded in the first four decades of the 20th century. They found their initial expression in the crisis of the Stalinist regime, that had been based so directly on the nationalist dogma of “socialism in one country.”
The US, having lost its industrial hegemony, its economy hollowed out and made rotten with financial parasitism, bearing no resemblance to the powerhouse it was in what Clark termed the “old days,” unable to manufacture vital goods that do not all fall apart, seeing threats from rivals on all sides, above all China, and confronted with a truly global working class, its historical nemesis, has only one means of trying to maintain its global dominance.
That is through war in which it wields it military might with ever-greater force and on an ever-expanding scale, as is now taking place, bringing the very destruction of civilisation ever closer.
The third annual Australian Youth Barometer report reveals a further decline in financial stability, mental health and job security among young people across the country. It is a damning exposure of the harsh conditions confronting the younger generation.
Australian Youth Barometer Report 2023 [Photo: Monash University]
Conducted by Monash University’s Centre for Youth Policy and Education Practice, the 2023 report was based on data gathered in 2022 through an online survey. 571 people aged 18–24 completed the survey from around the country. The report was published in November 2023.
A key finding is that 90 percent of young people reported experiencing financial difficulties in the past 12 months, the same as in the previous year’s report. However, while in the 2022 report 26 percent of participants said they experienced financial difficulties often or very often, this jumped to 32 percent in 2023.
For this generation, social conditions are regressing compared to previous generations. Those who believed that they would be financially worse off than their parents jumped from 53 percent in 2022 to 61 percent in the latest Youth Barometer report.
Youth in Australia are bearing the brunt of a social crisis that is affecting the entire working class. Workers in Australia and internationally have been hit by an inflationary spiral which has seen the cost-of-living soar.
Since the onset of the global COVID-19 pandemic, inflation in Australia climbed, reaching a high of more than 8 percent in December 2022. It is still above 4 percent and is not expected to drop below 3 percent before 2025, even based on the government’s baselessly optimistic economic forecasts.
Meanwhile, wages are “increasing” at a rate below that of inflation, placing enormous financial strain on working-class households and young people. This has led to a fall in real wages of about 5 percent since the Labor government of Prime Minister Anthony Albanese took office in May 2022.
The effect of this inflationary spiral is stark in the increasingly unaffordable housing market.
In the 2023 Youth Barometer survey, Australian youth who thought it “likely or extremely likely” they would be able to afford a place to live in the next 12 months dropped to 35 percent from 46 percent the previous year.
A staggering 72 percent of young people aged 18–24 believe they will never be able to buy a home.
40 percent felt that they may not have a comfortable place to live in the next 12 months and 21 percent experienced food insecurity.
The report included quotes from 30 young people that were interviewed as part of the survey.
One anonymously said: “I feel like everything just rose in price, all of a sudden, quite quickly. Not just housing, even buying food and stuff. It all just rose quite quick. So I think a lot of people were taken aback by it. And I haven’t seen anything about people getting pay raises. So I guess it’s just people losing money at this point.”
Financial difficulties among youth are compounded by disproportionate job insecurity among young Australians.
While accounting for 15.7 percent of the labour market, 18–24-year-olds make up 25.2 percent of the long-term unemployed.
Those who had experienced unemployment in the past year was 44 percent, roughly steady from 45 percent the previous year.
The report shows 50 percent of young Australians earned income from working in the highly insecure gig economy at some point in the past 12 months compared to 56 percent the previous year. Underemployment also dropped from 61 percent to 57 percent. However, only 22 percent worked full time, down from 37 percent the previous year, pointing to higher, more long term, casualisation rates across the board.
A 22-year-old woman from Tasmania said in a testimonial presented in the Youth Barometer report: “You have no idea when you’re getting paid if you’re casual. Because there’s no, like you’re not on a payroll, you get forgotten very easily in, like, bureaucracy.”
Over the year, 67 percent had to turn to family members for financial support.
51 percent said that they believe employment opportunities for young people is an issue that needs immediate action.
As youth face increasingly unlivable conditions, it is no surprise that mental health is also on the decline. An alarming 97 percent of young people reported feelings of worry, anxiety or pessimism in the past 12 months—up from 85 percent the previous year.
A 2022 National Youth Mental Health Foundation survey found that 57 percent of those 12–25 felt their mental health was declining. 26 percent rated their mental health as poor or very poor, up by 2 percent from the year before.
Very little detail is given on the ongoing impacts of the COVID-19 pandemic in the 2023 Youth Barometer survey, echoing the government and media lie that the pandemic is a thing of the past.
The previous year showed the virus had infected more than 900,000 young Australians to 2021, killing 30 18–24-year-olds. Untold thousands are struggling with the debilitating effects of Long COVID. The 2022 survey found that 51 percent saw it as the most important national issue.
The 2023 report only makes a few remarks on the effect COVID-19 has had on educational difficulties and the labour market, focusing instead on the supposed negative effects of lockdowns—originally instituted as part of necessary, if limited, public health measures to stem the spread of the virus.
Young workers queuing outside an inner-western Sydney Centrelink office during the initial stages of COVID-19 pandemic in early 2020.
Since the end of 2021, both federal and state governments in Australia have dumped all basic public health measures as the ruling elite internationally have adopted the murderous “forever COVID” policy of allowing the virus to spread unchecked in the interests of corporate profits.
The most glaring omission in the report, however, is the issue of militarism.
Words like “military,” “defence” and “war” appear nowhere in the document. As the government oversees falling real wages and cuts social services like welfare, education and healthcare, it is ballooning military spending.
In its 2023 federal budget, the Labor government announced it will allocate a record $52.588 billion on the military—a year-on-year increase of 7 percent. It is the first time the defence allocation has exceeded $50 billion.
Last March, Albanese announced a $368 billion agreement to buy nuclear-powered submarines as part of the AUKUS military pact with Britain and the US aimed at preparing for a US-led war against China. Australia has also been one of the largest non-NATO supporters of the US-NATO proxy war against Russia in Ukraine.
But the omission is most stark given the Australian government’s unwavering support for the Israeli genocide against the Palestinian population of Gaza which has killed 30,000 and left 70,000 missing or injured.
The lack of any reference to militarism and war is even more significant given the widespread hostility among youth in Australia—as part of a global movement of workers and youth—against the genocide.
In a roundabout way, the hostility to the governments’ program of war and austerity is made clear in the lack of engagement in official politics reported in the Youth Barometer survey.
This does not represent a shift away from politics, but a turning away from the political establishment. A 20-year-old in New South Wales said: “The way I think of it is in more of a modern way. Politics less in the sense of governments and world leaders and everything and more about the politics of how the world’s population is running.”
Less than a third of those surveyed believe governments will act on climate change—the issue that was rated as the most concerning for youth. This expresses the sharp divide between the sentiments of young people and the interests of capitalist governments.
But the perspective offered in the 2023 Australian Youth Barometer is a dead end.
The authors argue that “the government alone cannot resolve the cost of living crisis. Rather, policymakers must work closely with the private sector… to achieve solutions that address short- and long-term issues on a local and national level.”
The fascistic president of El Salvador, Nayib Bukele was reelected for another five-year term in violation of the country’s constitution, but much else remains uncertain about Sunday’s general elections.
Two hours after the polls closed, Bukele announced that he had won and his party, New Ideas, had taken 58 of the 60 seats of Congress. But as of Wednesday, there were still no official results.
Nayib Bukele meets with the leadership of the Supreme Electoral Court of El Salvador, October 26, 2023 [Photo: Supreme Electoral Court]
On Monday, the electoral court announced that its software for preliminary counting crashed after recording 70 percent of votes for the Presidency and only 5 percent for Congress. As a result, it is manually counting 30 percent of the ballots for president and 100 percent of those for the legislature.
Then on Tuesday, the electoral authorities announced that three voting centers would be reopened on a future date in the US, where 2.5 million Salvadorans live, compared to 6.5 million in El Salvador, citing complaints that many did not get to vote. The far-right party Nationalist Republican Alliance (ARENA) has threatened to request the invalidation of the elections if this takes place.
Bukele has so far received 83 percent of the votes for the presidency, followed by Manuel Flores of the Farabundo Marti National Liberation Front (FMLN) with 6.95 percent and Joe Sánchez of ARENA with 6.15 percent. New Ideas is currently leading the congressional race with 61 percent of the votes.
The election took place under what was effectively martial law. A state of exception has been in place for 22 months, suspending the freedoms of association and assembly, due process, and other fundamental democratic rights.
Having placed loyalists in the Constitutional Court and winning a super-majority in Congress in 2021, Bukele was allowed to name his private secretary Claudia RodrÃguez as president for six months, pretending to respect the constitutional ban on consecutive terms.
Enjoying free rein, the military and police have arrested more than 75,000 people, or 1 in every 45 adults. Currently there are 110,000 people behind bars in overcrowded and inhumane conditions, including 40,000 in a new “Terrorism Confinement Center”—one of the largest prisons in the world.
At least 224 people have died in custody during the 22-month state of exception, according to the NGO Socorro JurÃdico, amid numerous legal complaints of torture.
El PaÃs reported recently on the case of Verónica Reyes, whose husband Roberto, a 38-year-old worker at a cooking oil company with no criminal record, was detained in December 2022 while buying groceries. While waiting for a hearing in 2025, Verónica sent him food and supplies every two weeks, but on January 27 she was notified that her husband had passed away.
Asked to identify him, she said, “I was looking at a body that died of starvation... When it was discovered, it was a skeleton.”
Inmates in the new Terrorism Confinement Center, March 2023 [Photo: Office of the President of El Salvador]
Governments and politicians across Latin America, from the openly right-wing Daniel Noboa in Ecuador to the pseudo-left Xiomara Castro in Honduras, have openly embraced the political formula of Bukele’s hardline on organized crime.
Bukele himself was in turn widely described as El Salvador’s Trump and was evidently inspired by the Hitler-emulating billionaire and his efforts to mobilize fascistic layers within the state apparatus and the lumpen middle class.
The Biden administration had declared in September 2021 that a reelection would undermine democracy in El Salvador, but Secretary of State Antony Blinken congratulated Bukele on Monday. Clearly, earlier criticisms had nothing to do with “democracy” or “human rights,” but were aimed against Bukele’s growing ties with China.
While his balancing act with Beijing continues, a shift away from seeking Chinese credits to requesting an IMF loan and the exclusion of Chinese companies from the development of 5G telecommunications have led to a warming of ties with Washington. Bukele has also collaborated with the US on blocking migrants heading north.
Bukele is the descendant of a Palestinian bourgeois family, which developed a textile business in the 1970s that later grew into a major conglomerate. His father became a sponsor of the FMLN following the end of the civil war in 1992, when the former Stalinist-led guerrillas handed in their weapons and took up seats in Congress as a right-wing bourgeois party.
After dropping out of college and running the family businesses, Bukele entered politics and was elected mayor of Nuevo Cuscatlán in 2012 and then of the capital San Salvador as a candidate of the FMLN.
Having decided to run for the Presidency in 2017, internal scuffles led to his fortuitous expulsion from the party. Ever since, Bukele has capitalized above all by targeting the FMLN and its rival ARENA, the far-right party founded by the infamous army torturer Maj. Roberto D’Aubuisson. The two former enemies had shared power since 1992 and become extremely discredited as a result of their policies of social austerity, deals with gangs and corruption.
Two incidents from his first term sum up his political program. In February 2020, he led troops invading Congress to demand at gunpoint a loan for the military, while his fascistic hardline supporters rallied outside demanding the heads of legislators.
Shortly after, in May 2020, he held an extraordinary meeting with El Salvador’s three richest oligarchs—Roberto Kriete, Ricardo Poma and now deceased Roberto Murray Meza—to draw up plans to let COVID-19 run rampant by “reopening” all workplaces. During the first two years of the ongoing pandemic, Bukele sacrificed the lives of 23,245 people to profits, according to excess death estimates.
While claiming to oppose the corrupt oligarchy, Bukele’s policies have all been tailored to serve its interests and those of its imperialist paymasters on Wall Street. The same handful of inbred families of the local aristocracy have long used the state for one purpose: to protect their wealth and power against the oppressed classes. The ruling elite used it to enslave the indigenous population into semi-feudal estates and armies in the early 1800s. Toward the end of the century, they expropriated peasants to exploit them in the rapidly expanding coffee plantations.
Throughout the 20th century US imperialism and its junior partners in the coffee oligarchy crushed all opposition by installing a series of military dictators and set up death squads that massacred over 100,000 workers, peasants and youth between 1932 and 1992.
In response to globalization, the oligarchy has only deepened its subordination to imperialism, after branching out as local administrators for multinational corporations and banks. The economy is heavily dependent upon the US market and remittances from migrants.
Today, Bukele seemingly enjoys unlimited popularity due to an enormous reduction in gang activity like homicides and extortion. But this is merely a byproduct—and a tenuous one at best—of the establishment of a police state and dictatorial forms of rule.
The ruling class in El Salvador and internationally support “Bukelismo” knowing they have no other answer than dictatorship to the deepening crisis of global capitalism and the emerging upsurge of the class struggle globally.
Under Bukele, employment, education and healthcare have continued to deteriorate as poverty has risen. Foreign direct investment has not increased. A majority of exports to the US, generally clothing, are produced by about 60,000 workers in extremely oppressive sweatshops that have seen thousands of layoffs in the past two years.
About three out of every 10 Salvadorans remains under the official poverty line, and seven out of 10 scrape by in the informal sector. The cost of basic goods rose 30 percent in three years, with real wages falling behind. Public spending stands at 22 percent of GDP, remaining one of the lowest rates in the region, and the IMF is demanding further cuts as a condition for a loan given a growing deficit.
Malaysia’s government of Prime Minister Anwar Ibrahim is confronting mounting debt. In response, the administration is introducing various tax increases and cost-cutting measures, which include behind-the-scenes discussions over the reintroduction of the widely despised goods and services tax (GST). This means intensifying the cost-of-living crisis facing Malaysian workers and the poor.
Malaysian Prime Minister Anwar Ibrahim at the East Asia Summit at the Association of the Southeast Asian Nations Summit in Jakarta, Indonesia, Sept. 7, 2023 [AP Photo/Yasuyoshi Chiba]
The key concern for the Pakatan Harapan coalition government, the Malaysian ruling class and global investors is the high central government debt of RM1.5 trillion ($US318 billion) and its ability to repay. This is coupled with historically high budget deficits that necessitate further government borrowing. The deficit for 2024 is forecast to be about RM85 billion ($US18 billion), which represents only a marginal reduction of the last three years of budget deficits, with each exceeding RM90 billion ($US19.1 billion).
The government plans to increase Malaysia’s service tax rate from 6 percent to 8 percent on March 1, which is expected to raise an additional RM900 million this year. This tax is a component of the sales and service tax (SST) introduced by a previous Pakatan Harapan government on September 1, 2018.
While the tax on food, beverages, and telecommunication services will remain at 6 percent, Anwar’s government has already slashed subsidies on key foodstuffs, fuel, and utilities. Chicken price subsidies, for example, were removed in October with prices rising by as much as 17 percent by November.
The working class, the poor, and even less well-off layers of the middle class rely on these subsidies to make ends meet as cost-of-living increases. However, Anwar has targeted the subsidies for drastic reduction in order to foist the government debt onto the shoulders of the most vulnerable. The subsidy program for 2023 was estimated to cost RM81 billion ($US17.2 billion). The 2024 budget has allocated only RM52.8 billion ($US11.2 billion).
In a January 22 article, the Straits Times quoted a 40-year-old middle-income earner, saying: “I am surprised that now, when I buy daily goods such as milk, eggs, bread, and vegetables, the bill is already between RM50 and RM100, which is double (what it was) six months ago. About 30 per cent of my total expenditure goes into buying groceries.”
The government also plans to introduce a targeted subsidy mechanism for petrol in the second half of 2024, Minister of Economy Rafizi Ramli announced on November 27. At present, regular petrol is subsidised and sold at RM2.05 per litre. Without subsidies, the cost could increase by 57 percent. The government estimates it could save between RM9.8 billion to RM12.2 billion ($US2.1 billion to $US2.6 billion).
In this context the Anwar administration is contemplating a new GST, which it has hinted at but then denied. The long-planned reintroduction of the GST is a political hot potato that the government needs to carefully stage manage. Rafizi indicated as much on January 9 when he noted that “we are open [about GST], but we need to consider every angle before making a decision.”
At the same time, the ruling elites both in Malaysia and abroad are pressuring Anwar to move more quickly in imposing the debt crisis on workers and the poor. In September, for example, Sim Kwang Gek, the country tax analyst at major accounting firm Deloitte Malaysia, demanded a cut in the corporate tax rate from 24 to 20 percent in line with the reintroduction of the GST.
Sim noted, “Until and unless GST is reintroduced, the corporate income tax rate may remain at 24 percent, which is not competitive with countries in the region such as Singapore (17 percent), Thailand (20 percent) and Vietnam (20 percent).” The Federation of Malaysian Manufacturers has also consistently called for such a reduction, along with the reintroduction of the GST.
In its yearly assessment of Malaysia in mid-2023, the International Monetary Fund (IMF) lists “fiscal policy consolidation,” that is major government spending cuts, as its first policy recommendation. Further into its report, the IMF notes that “with no plans to reinstate the GST this year, the preparatory work for its reintroduction should be promptly initiated to lay the ground for effectively activating this indispensable source of revenue.”
With talk of GST’s reintroduction heating up last year, Anwar provided a written parliamentary statement on November 1 to head off mounting criticism. He stated that “the government has yet to revive the GST. Any changes to tax policy will have to take into account the impact on the economy and the cost of living of the people.” Anwar’s carefully worded statement did not rule out the re-introduction of the widely hated tax.
The repeal of the GST was Pakatan Harapan’s first out of ten campaign pledges when it defeated the United Malays National Organisation (UMNO) in the May 9, 2018 election. UMNO had previously ruled Malaysia since independence in 1957. The new government repealed the GST while imposing the SST scheme.
The former UMNO government of Prime Minister Najib Razak introduced the GST on April 1, 2015, setting it at a rate of 6 percent on goods and services. Unlike the current SST, which only covers approximately 38 percent of goods and services, the GST was much broader, covering approximately 68 percent of goods and services.
In 2016 and 2017, the first and second full years of the GST, the government collected RM41 billion ($US8.7 billion) and RM44 billion ($US9.3 billion), contributing approximately RM25 billion ($US5.3 billion) more in revenue than under the previous tax system. In a tweet on X/Twitter on October 4, Apurva Sanghi, the World Bank Lead Economist for Malaysia, estimated that the reintroduction of the GST would raise approximately RM19 billion ($US4 billion) in additional revenue.
One of the key reasons for the first introduction of the GST was falling dividend revenue from the state-owned petroleum company, Petronas. Faced with another growing economic crisis, the Pakatan Harapan government and the business elite promote the idea that the regressive impact of the GST can be mitigated through cash and other transfers to poorer households. This, however, is a fraud since the aim is to increase government revenue overall by taxing everyday goods and services.
After several months of delays and uncertainty, voters in Pakistan, the world’s fifth most populous country, are to go to the polls in national and provincial assembly elections this Thursday, February 8.
The Pakistani state, above all its US-backed military, has a long history of manipulating elections through violence, intimidation and outright ballot-stuffing. However, the military has never before intervened so obtrusively to manage an election outcome.
The military’s immediate targets are defrocked Prime Minister Imran Khan and his Pakistan Tehreek-i-Insaf (PTI, Pakistan Movement for Justice)—who, it is widely believed, would top the polls were they allowed to stand.
Khan, a right-wing Islamic populist, has been in jail for the past eight months on trumped-up charges of betraying state secrets and politically manipulated corruption charges. With the approach of the polls, the vise tightened. In the past week, he has been convicted and sentenced to 14, 10 and 7-year jail terms, for respectively illegally profiting off gifts given him in his official capacity, leaking state secrets and marrying his wife before 40 days had elapsed after her divorce.
The PTI, meanwhile, has been banned from contesting the elections under its own banner. Those of its leaders who are seeking election as independents have been the target of police raids, violence and other forms of intimidation.
Under conditions where Pakistan is being roiled by intersecting economic, geopolitical and political crises, the military and the dominant factions of the bourgeoisie have decided that any expression of popular will—however limited and distorted by the right-wing character of Pakistani establishment politics—cannot be permitted.
Recent months have seen a wave of popular struggles, against spiraling food prices (inflation reached 40 percent in November) and job cuts, as well as against “disappearances” and extra-judicial killings perpetrated by the military.
Had the constitution been followed, the elections would have been held in early November. However, the caretaker administration led by interim Prime Minister Anwar ul Haq Kakar, a man trusted by the military and notorious for his contempt for the plight of the masses and their basic rights, found various pretexts to postpone them. The additional three months have been used to intensify the repression against Khan and his PTI, better prepare the political wicket for the military’s preferred prime ministerial candidate and, last but not least, press forward with the implementation of a raft of highly unpopular IMF-dictated measures. These include massive cuts to energy price subsidies, tax increases and a crash privatization program.
Pakistan's former Prime Minister, Nawaz Sharif (center) addresses an election campaign rally in Hafizabad, Pakistan, Thursday, January 18, 2024. [AP Photo/K.M. Chaudary]
Sharif, who last held the prime ministership from 2013-17, has had his share of run-ins with the military, which zealously asserts its control over the country’s military, foreign and national-security policies. However, they have apparently patched up their differences with the PML (N) leader expected to head a government charged with “reviving” Pakistan’s economy, that is boosting investment by slashing real wages, selling off public assets, and removing all regulatory restraints on capital.
In October, Sharif returned from the UK, where he had been living since 2019 to avoid jail on a corruption conviction. Within a matter of weeks, the courts overturned that conviction, threw out other charges against him and in January the Supreme Court struck down a lifetime ban on politicians convicted of corruption from standing for public office.
Sharif is campaigning as the candidate of “economic development,” while emphasizing his support for the military. He has repeatedly denounced Imran Khan for supposedly inciting opposition to the military, including his “catastrophic” role in the events of May 9, 2023, when PTI supporters outraged by Khan’s seizure by para-militaries during a courtroom appearance clashed with security forces across the country.
“What Imran Khan did and what has happened to him is his own making,” Sharif told Geo News this week. “We made Pakistan an atomic power,” he continued in a reference to the country’s 1998 nuclear-bomb tests. “We didn’t attack our own army on 9th May. We are for peace and progress.”
With the PTI effectively disbarred from the elections, the PML (N)’s principal opponent is the Pakistan People’s Party (PPP), a dynastic party of capitalists and landlords. It is now led by Bilawal Bhutto Zardari, the son of assassinated two-time Prime Minister Benazir Bhutto and the grandson of Zulfikir Ali Bhutto, who was deposed as prime minister and subsequently ordered hanged by General Zia. The PPP once promoted itself as an “Islamic socialist” party, but whenever it has held office over the past four decades it has implemented IMF austerity and pursued close relations with Washington.
The PML (N) and PPP came together in a coalition government led by Sharif’s brother, Shahbaz Sharif, after Khan’s government was toppled in April 2022 in a parliamentary non-confidence vote orchestrated by the military and egged on by Washington. During its 15 months in office, the coalition government won the approval of the IMF, by imposing brutal subsidy and other budget cuts amid the devastation caused by the 2022 floods, and succeeded in mending Islamabad’s frayed relations with Washington. Among the Pakistani people, however, its support plunged.
The IMF, with which Pakistan’s government will almost certainly have to negotiate further loans given the country’s massive foreign debts, has indicated its preference for a “broad-based” government. That way the popular opprobrium for implementing brutal measures on behalf of Pakistani and global capital can be shared among the political elite, and none of the major parties can be tempted to try to politically benefit by posing as opposed.
However, given the historic bad blood between them, it is deemed unlikely the PPP will agree to again serve as the PML (N)’s junior partner in government.
The PTI is a right-wing, anti-working class party that consorts with various Islamic fundamentalist groupings. Khan owed his election in 2018 to the behind-the-scenes support he received from the military. Once in office, he quickly ditched his populist rhetoric about establishing an “Islamic welfare state” to impose one of the most brutal IMF austerity and restructuring programs ever implemented in Pakistan. Underscoring the real relations between his party, the military and the traditional political establishment, he staffed his cabinet with ministers and officials who had served under George W. Bush’s “war on terror” ally, the dictator General Pervez Musharraf.
If the military ultimately soured on Khan and greenlighted his ouster, it was because it viewed his trip to Moscow in February 2022 and impromptu announcement of Pakistan’s “neutrality” in the US-NATO-instigated war with Russia as needlessly jeopardizing Islamabad’s already badly frayed relations with Washington. That Khan, at the IMF’s insistence announced massive cuts in energy subsidies at the beginning of 2023, then reversed them in the face of a popular outcry, also badly damaged ruling-class confidence in his government.
Since his ouster, Khan has been able to retain, even regain, a measure of popular support, particularly among the PTI’s traditional base in sections of the urban middle class. Like large swathes of the population, these layers, from small shopkeepers to recent university graduates, have been battered by the past two years of mounting economic crisis, including soaring prices, a plunging rupee and mass unemployment and underemployment.
During the many years he was a political also-ran, Khan crafted an image as an “outsider,” one he has continued to try to exploit and burnish by pointing to the conspiratorial machinations that caused his government to fall. He has also no doubt benefited from popular outrage and sympathy over the legal vendetta to which he and the PTI have been subjected, including terrorism charges; as well as from mounting popular sentiment against the military, which tramples on democratic rights, squanders vast portions of the national budget on Pakistan’s reactionary military-strategic rivalry with India, and has amassed vast wealth and power through a series of military-controlled companies.
Now scorned by much of the ruling elite as a loose cannon, Khan has at times sharply criticized the military and US bullying. Yet he has repeatedly walked back such remarks, making clear his readiness to work with both and his support for the US-Pakistani strategic alliance. Forged in the early 1950s, the pivot of that alliance has always been the partnership between the Pentagon and the Pakistani military headquartered in Rawalpindi.
Whatever the political composition of Pakistan’s next government, it will come into bitter conflict with the working class and rural masses, even as it tries to negotiate an intractable geopolitical crisis, rooted in the escalating all-rounded strategic conflict between the US and China, its two most important strategic allies.
Although officially denied, it has been widely reported that the Pakistani military is supplying Ukraine, at Washington’s behest, with weapons via back channels.
With Washington coming ever closer to the brink of launching all-out war on Iran, Pakistan’s western neighbour, Islamabad is being brought ever closer to the horn of a strategic dilemma. The US and other Pakistani allies, most notably the Gulf States, which risk being drawn into such a conflict from its very beginning, will look to Islamabad for support. Beijing, on the other hand, will seek to prevent, ultimately potentially through military means, US imperialism from reordering the energy-rich Middle East, in preparation for a showdown with China.
Pakistan has already been drawn into the maelstrom of strikes and counter-strikes. Last month, Islamabad retaliated to an Iranian attack on Balochi separatists operating against Iran from its territory by striking targets in eastern Iran allegedly associated with groups fighting for the secession of Pakistan’s Balochistan province.
In December, Pakistan Chief of Army Staff General Asim Munir met with high-placed Biden administration and Pentagon officials, including Secretary of State Antony Blinken, during a week-long visit to Washington, about which virtually nothing has been said publicly.
