New Zealand economy in deepening slump

John Braddock

New Zealand’s gross domestic product (GDP) fell by 1 percent in the September quarter, a much larger decline than economists had expected. The slump came after a revised 1.1 percent drop in the June quarter, according to figures released by Stats NZ on December 19.

New Zealand Prime Minister Christopher Luxon delivering state of the nation speech in October 2024 [Photo: Christopher Luxon Facebook]

The report points to an accelerating decline in the position of New Zealand capitalism. Amid geo-strategic tensions globally including the drive to war, the ruling elite is preparing to wage an intensifying assault on the living standards and basic democratic rights of workers and youth.

The two successive negative quarters place the country in the deepest downturn since the COVID-related slump in 2020–21. The falls were the biggest since late 2021 at the height of the pandemic lockdowns. Excluding those, the six-monthly fall was the largest since mid-1991.

GDP per capita, a measure of economic output per person, fell 1.2 percent during the September quarter—the eighth consecutive fall in the series. As a measure of historic decline, New Zealand was third in the world in terms of GDP per capita in the 1950s but is now ranked 37th.

September quarter economic activity declined in 11 of the 16 industries that measure GDP. The main contributors were a 2.6 percent fall in manufacturing, 3.7 percent in electricity and gas, 2.8 percent in construction and a 1.1 percent decline in retail. The fall in manufacturing in part reflected the mid-winter energy crisis which forced some businesses to reduce or halt production. 

The recession is the second in less than 18 months. The economy had officially contracted by 0.1 percent, and 0.7 percent per capita, in the December 2023 quarter, following a 0.3 percent contraction in September. GDP figures had shrunk in four out of five quarters, with a stagnant annual growth rate of just 0.6 percent.

The weakening New Zealand dollar fell by a third of a US cent to US56.30c on the back of the worse data. Economic activity is the weakest of all the country’s major trading partners and is ranked 33rd out of 37 by the Economist. Of OECD economies, New Zealand is placed ahead of only Finland, Latvia, Turkey and Estonia.

Two days before the GDP figures were released, Finance Minister Nicola Willis delivered the Half Year Fiscal Update (HYEFU) revealing the government’s books are also worse than most economic forecasts.

Treasury now predicts sharply slowed economic growth with unemployment, currently 4.8 percent, rising to 5.4 percent next year. Far from heading towards promised budget surpluses by 2028, the government’s books will be in the red for at least the rest of this decade.

Willis told parliament; “The downturn started earlier, was deeper and persisted for longer than previously expected.” In fact, the deteriorating economic situation is a direct product of the austerity agenda pursued by successive Labour and National Party governments and intensified by the current far-right National-NZ First-ACT coalition following the October 2023 election.

While Crown expenses are $1.4 billion higher than expected due to welfare, superannuation and education costs, nearly $5 billion is going to the military this year amid the US-led drive to war. The Ministry of Foreign Affairs and Trade, which oversees these preparations, is the only department to escape major funding cuts.

The government expects to borrow an extra $57 billion over four years. The gross debt-to-GDP ratio will hit 46.1 percent in 2027/28, up from 41.8 percent forecast in the May Budget. Government debt is expected to rise to $234.1 billion by 2029, up $24.3 billion from the Budget forecast.

Tax revenue is $NZ13 billion lower due to escalating unemployment, lower Goods and Services Tax from falling retail sales and lower business taxes. The Budget handed major tax cuts to the wealthy, including residential property investors. Landlords can now deduct tax on 80 percent of their loan interest, cutting their tax obligation by a total of $2.1 billion. From April 2025, the deduction will lift to 100 percent.

Behind the dismal figures is a deepening social disaster with the costs imposed on the working class.

Like capitalist governments around the globe, National, ACT and NZ First have launched a scorched earth assault on jobs and services across the public sector with a view to privatisation. Willis imposed funding cuts of 7.5 percent on almost all ministries. Some 10,000 public sector jobs have already been axed, including more than 2,000 in the health sector.

Employers based in Wellington have shed around 19,500 jobs since January, 11.6 percent of the capital city’s workforce. Auckland has lost over 10,000 jobs. Radio NZ reported on December 2 that business insolvencies are running at more than double the rate of last year, with one economist saying the failure rate exceeds that of the 2008 Global Financial Crisis (GFC).

While official unemployment stands at 148,000, there are 204,765 people, or 6 percent of the population, receiving the Jobseeker benefit. The number of working-age people on a main benefit, including health and disability payments, is approaching a record 400,000. This represents 1 in 9 people (11.4 percent), almost the same proportion as after the GFC.

Jobless figures would be much higher if not for the exodus of people leaving the country. A record 79,700 NZ citizens permanently departed in the year to September, with half going to Australia. A net immigration gain of 44,900, mainly from Asia, was sharply down from 136,300 in 2023. The numbers going overseas could well exceed those entering next year.

Direct attacks on the working class are underway. Last week, Workplace Relations Minister Brooke van Velden announced a real-term pay cut for minimum wage workers, the second in a row. From next April the minimum wage will rise by 1.5 percent to $23.50—below the 2.2 percent inflation rate. It is the smallest rise in dollar terms since 2013, and the smallest percentage increase since the 1990s. Training wages and starting wages will increase to just $18.80, 80 percent of the adult minimum wage.

Van Velden is introducing a range of legislation to attack fundamental workers’ rights and conditions. She has vowed to “simplify and clarify” already anti-worker laws to enable pay deductions for partial strikes, which could lead to workers losing pay even for running “work-to-rule” campaigns, and to gut occupational Health and Safety regulations.

The trade unions have played a central role in enforcing the assault on jobs and wages. No unified industrial and political campaign against the government has been mounted. Nevertheless, key sections of the workforce are beginning to fight back. Some 36,000 nurses have been striking this month against a pay offer from Health NZ of 0.5 and 1.00 percent over two years.

The Treasury predicts real wage growth to fall from a paltry 1.7 percent per annum to an average of under 1 percent over four years. Workers have already suffered under the drive by the Reserve Bank, among the most aggressive central banks in the world, to engineer a recession. Beginning in March 2020 the Official Cash Rate was progressively lifted to 5.5 percent before being eased in August.

The result has been a massive increase in household costs of 5.4 percent in the 12 months to June, driven by mortgage payments, rent and other expenses.

Treasury predicts tepid growth to 1.7 percent in the year to June 2025 then picking up to average 2-3 percent over the following years. But no one is factoring in the dramatic decline in the Chinese economy, on which the ruling class depends as its largest export market, or US President-elect Donald Trump’s threats of a catastrophic global trade war.

Berlin state government adopts austerity budget

Tamino Dreisam

In the face of large protests, the Berlin Senate (state government) last week passed the supplementary budget for 2025, thereby approving cuts of three billion euros. This will result in sharp social cuts and affect many sectors.

#Unkürzbar demonstration in front of the Berlin House of Representatives, 5.12.2024

In the area of mobility, transport and the environment, €660 million [$US688 million], or almost 20 percent of the total budget, is to be “saved.” Some €150 million euros will be cut from housing subsidies, €370 million from education and €309 million from science, health and care, some 8 percent of the original budget. The cultural sector will lose 12 percent of its previous budget, or €130 million. Only the police and the judiciary have been spared from the ax.

The Berlin state government responded to the enormous anger within the population and the various protests, particularly strong among artists and cultural workers, by announcing it would partially reverse the cuts in the cultural sector. However, this was only a numbers trick.

While cuts were withdrawn or reduced for several renowned theatres, the amount to be saved in the cultural sector remains the same. This means that the savings are merely being redeployed, at the expense of the independent art scene. For example, the subsidies for the development of workspaces for artists are now being reduced from the original €21 million to €3 million. The savings of €18 million are thus almost eight times as high as previously planned.

The savings target for the Friedrichstadt-Palast, Berlin’s largest theatre, has also been increased by €250,000 to €1.85 million. The funds earmarked for the renovation of the entrance area of the Berlin Museum of Technology have been cancelled altogether, instead of halved as previously planned.

Particularly severe cuts have been made in the higher education and science sectors. The announced cuts in the areas of science, health and care have increased steadily in recent weeks: from €100 million to €280 million and now to €309 million. For the university contracts alone, the cuts have increased from €100 million to €142 million euros.

Berlin’s Senator (state minister) for Science, Health and Care, Ina Czyborra (Social Democratic Party, SPD), has already announced, “If these cuts are maintained at a critical level over the next few years, it could also mean a reduction in staff and courses of study.” In some circumstances, the number of university places could also be reduced.

In certain cases, this is already noticeable. At Berlin’s Technical University, the chair of the staff council, Stefanie Nickel, said that a hiring freeze would apply to the central administration of the TU from the beginning of the year. This is despite the fact that many positions are not being filled because the necessary personnel cannot be found under the current conditions.

In particular, mid-level academic staff, where most contracts are temporary, are affected by these cuts. Originally, the Senate passed a resolution that as of April 1, 2025, all employees with a doctorate had to be offered a permanent position after a temporary position. In view of the cuts, this decision to abolish the time limit is now to be repealed. This will further exacerbate the already precarious situation for thousands of academic staff with temporary contracts.

The cuts to the subsidy for the Studierendenwerk (Student Services) by €6.55 million, i.e., almost a third of the previous amount, will also have devastating effects for Berlin’s 170,000 students. The Studierendenwerk is responsible for advising on funding, cafeterias, cafés, dormitories, nurseries and counselling for mental health issues.

Rotes Rathaus, seat of the Berlin Senate [Photo by Olbertz / CC BY 3.0]

On its website, the Studierendenwerk has already announced the consequences of these cuts, including:

·        An increase in the social insurance contribution that students have to pay, from €63 per semester to at least €93, i.e., by 50 percent. As early as the coming summer semester, for which fees must be paid by mid-February, the social insurance contribution will be €85. Even now, many students have to think twice about every euro they spend.

·        Several dining hall locations are being closed and dining hall prices are rising overall. The dining hall at Humboldt University’s Faculty of Economics has already been closed. At least two bake shops will follow. Starting next year, the least expensive dining hall meal will become 20 percent more expensive. The price of desserts will rise by seven percent.

·        Much-needed renovations of student dormitories are being postponed indefinitely, thus leaving them to decay, and the sustained provision of living space for students is seriously endangered. At the end of the year, the waiting list for a room in the Studierendenwerk’s dormitories stood at 4,238, with a minimum waiting time of 1.5 years. The loss of even a single additional residence hall would have dramatic consequences for the students affected.

·        Cultural and support services for students will be reduced. These include, for example, training courses that support students in academic writing or in coping with stress, and other measures designed to promote mental health.

For tens of thousands of students who are already living in precarious circumstances, these cuts will have drastic consequences. The fundamental rights of students to housing, nutrition and health are being directly curtailed.

In recent weeks, there have been mass protests against the planned cuts. Thousands of public employees, artists and cultural workers, nurses and students have demonstrated against the cuts. On the day of the vote in the Senate, 3,000 people, mostly students, gathered in front of the parliament building.

But the protests remained limited in scope to the extent that the organisers themselves support the austerity measures and the pro-war policies behind them. Most of the protests were organised by the Verdi trade union. Its failure to oppose cutbacks was already evident in the 2000s. In close cooperation with the then SPD-Left Party state government, it enforced every austerity dictate, wage reduction and privatisation against the workers.

The character of the protest organisers became particularly clear at the rally on the day of the vote itself. The co-organiser and first speaker at this rally was Humboldt University president Julia von Blumenthal. Far from being an opponent of the cuts, she merely does not want them to happen on her watch.

In an interview with Tagesspiegel, she stated that she recognised “that the state of Berlin has to save money” and merely “criticises the way the cuts are being made.” In response to Tagesspiegel’s comment that “people in the cultural and social sectors will lose their jobs overnight,” she replied, “It’s not a scandal when something is decided politically. It’s just not good governance when you don’t justify your decisions and these cuts.”

Australian government cuts international student numbers by decree

Mike Head

Australia’s Labor government is so intent on slashing the numbers of international students in the country that it has now resorted to potentially unlawful means to do so via a ministerial directive.

Having failed to get its proposed student enrolment caps through parliament last month, the Albanese government last week issued a new immigration Ministerial Direction 111, despite warnings that it could be illegal.

Signed by Assistant Minister for Citizenship Julian Hill on December 18, the direction orders the slowing of the processing of visas for overseas students once their intended university or other tertiary education provider hits 80 percent of the government’s previously announced cap.

Direction 111 seeks to ensure that Labor achieves its goal of reducing enrolments by 53,000 (or 16 percent) on 2023 levels, eliminating thousands of jobs in the process in universities and private colleges.

Legally, however, the immigration department is required to process each visa. The government could try to sidestep that requirement by shifting resources to delay processing and put an effective halt on selected applications.

“Legally the government is obligated to process all offshore visa applications in a timely way… It would be illegal to deliberately engineer a backlog in order to use it as some sort of de facto cap,” former Immigration Department deputy secretary Abul Rizvi told the Australian.

Once again, Albanese’s government is seeking to outdo the openly right-wing Liberal-National Coalition in making international students, and immigrants more broadly, scapegoats for the worsening housing and cost-of-living crisis affecting millions of working-class households.

Home Affairs Minister Tony Burke speaks in parliament on November 19, 2024 [Photo by Parliament of Australia / CC BY-NC-ND 4.0]

Home Affairs Minister Tony Burke said: “[Coalition leader] Peter Dutton wants to talk tough on migration but has voted to let it rip when it comes to international students.”

The latest Australian Bureau of Statistics (ABS) data on overseas migration, released this month, showed there were 207,000 international student arrivals in 2023–2024, a decrease from 278,000 in 2022–23.

The attack on international students forms part of Labor’s plans to halve overseas migration to 235,000 annually for the next three years. The Coalition has vowed to cut annual net migration even further, to 160,000, which could reduce annual international student inflows to less than 15,000.

This offensive mirrors those by the political establishments in the US and Europe—now spearheaded by US president-elect Donald Trump’s pledge to mobilise the military to deport millions of immigrants. This agenda seeks to divide the working class and divert mounting social and political discontent in reactionary nationalist directions.

International students, who make up an estimated 4 percent of the rental market nationally, are not the cause of the lack of affordable housing for workers and their families. The soaring rents and home mortgage payments are the result of profiteering by billionaire property speculators and developers.

This has been intensified by the Reserve Bank of Australia’s hiking of interest rates to try to drive up unemployment and cut real wages further, backed by the efforts of the Labor and trade union bureaucrats to keep imposing below-inflation pay deals on workers.

The cuts are also part of the government’s anti-China agenda, in line with Labor’s commitment to the US economic and military confrontation with Beijing. The universities to be hardest hit are those, such as the University of Sydney, University of Melbourne, Australian National University (ANU) and University of New South Wales, with the highest proportions of students from China. They are set to have their 2025 international student enrolments reduced by close to 15 percent, compared to 2023 figures.

Direction 111 replaces Direction 107, which cut numbers by slowing visa processing for smaller universities and students from countries with an alleged higher risk of breaching visa rules in order to work or stay in Australia.

Under Direction 107, there already had been a 60,000 decline in the number of student visas granted in the 2023 to 2024 financial year. Regional university student commencements dropped by 30 percent from 2023 to 2024.

This year, the Labor government also more than doubled non-refundable student visa application fees from $710 to $1,600—the highest in the world—slowed visa processing and imposed harsher English language requirements and “genuine student” tests.

In this month’s Mid-Year Economic and Fiscal Outlook (MYEFO), Labor went further. It increased the application charge for temporary graduate visas by 14.75 percent from next February, estimated to increase government revenue by $1.7 billion over five years.

The country’s 39 public universities have been thrown into further chaos by the government’s latest decree, announced just weeks before the start of 2025 courses. Labor’s moves have already triggered more than 2,000 job losses at universities in recent weeks alone, especially in the humanities and arts, including at ANU, the University of Canberra, James Cook University, the University of Southern Queensland and the University of Wollongong.

While allocating hundreds of billions of dollars for nuclear-powered AUKUS submarines and other weaponry, Labor is continuing to starve the universities of adequate funding. This is exacerbating a crisis produced by their ever-greater reliance on exorbitant international students’ fees because of years of funding cuts by successive Labor and Coalition governments.

This financial squeeze is also aimed at forcing the chronically under-funded universities to integrate themselves more fully with the demands of big business and the military, as set out earlier this year in the Albanese government’s Universities Accord.

The Accord insists that universities must reshape both their teaching and research in partnership with employers, and in line with the building of a war economy, including through the AUKUS pact, in preparation for a US-led war against China.

International students have been treated as cash cows as a direct result of the “education revolution” imposed by the Rudd and Gillard Labor governments of 2007 to 2013. This “revolution” created a corporate-style market, which forced universities to fight each other for full fee-paying international enrolments.

Since barely scraping into office again in 2022, Labor’s support has disintegrated among workers and youth because of the gutting of living standards and its backing for the US-armed Israeli genocide in Gaza.

The main campus trade union, the National Tertiary Education Union (NTEU) is trying to prop up the government. Far from opposing the attack on international students, the NTEU has effectively lined up behind it, while blaming university managements, not Labor, for the job losses.

NTEU national president Alison Barnes issued a media statement, saying: “Vice-chancellors have already shown a willingness to use changes to international student arrangements as fig leaf to cover their own failures, and unfairly threaten job cuts. The scaremongering must now end once and for all.”

Previously, the NTEU urged its members to sign a petition to ask the government to “phase in” the enrolment caps, claiming this would save jobs. Months later, it is ludicrously calling for “an iron-clad commitment from universities and the federal government that this ministerial direction will not lead to a single job being cut.”

Macy’s, Big Lots join other US retailers in shutdown of thousands of stores

Jerry White

Macy’s, the largest department store chain by sales in the United States, is set to close 65 “underperforming” locations by March 23, 2025, as part of a broader strategy to shut 150 stores—or about a third of its operations—by 2026. The move will eliminate thousands of jobs and follows an ongoing trend of retail closures driven by the shift to online shopping, and more cautious consumer spending due to inflation, higher interest rates and crushing levels of household debt.

Striking Macy's workers in Washington state in November 2023 [Photo: UFCW L. 3000]

Retailers across the US, including Big Lots, 7-11, Family Dollar and Walgreen’s, announced thousands of store closures in 2024. An October 26 CNN Business article, titled, “Consumers reach their breaking point, forcing retailers to shutter stores at a worrying pace,” noted: “Major retailers have announced 6,189 store closures so far this year, already outpacing last year’s total of 5,553, according to Coresight Research. Chains are on track to close the highest number of stores in 2024 than any year since 2020, when the Covid-19 pandemic decimated the industry.”

Consumer spending accounts for nearly 70 percent of US economic activity and the Christmas holidays are a make-it-or-break-it period for retailers. Though the corporate media trumpeted the Mastercard/Spending Pulse report showing that this year’s holiday spending had risen 3.8 percent over 2023, Target, Macy’s and Kohl’s all cut their forecasts for profitability ahead of the holiday season. 

A far more accurate picture of the state of things came from the executives of Japan-based Seven & i Holdings, which is closing nearly 450 7-Eleven convenience stores in the US and Canada. In a conference call in October, they told investors that persistent inflation, high interest rates and a “deteriorating employment environment” had created “a more prudent approach to consumption, in particular among middle- and low-income earners.”

Underscoring this economic distress, consumer discount retailers like Big Lots announced it will be liquidating its 908 locations nationwide and holding “going out of business” sales after the failure of buyout bid by private equity firm Nexus Capital Management. 

Macy’s operates 459 stores under the Macy’s brand name and another 32 Bloomingdale’s luxury stores. The closures are part of the company’s “Bold New Chapter” strategy to streamline operations and boost profitability, including liquidating “non-go-forward stores.” In a December 11 conference call, Macy’s CEO Tim Spring told investors and financial analysts the company was raising the first round of store closures from the previously announced 50 to 65 and that these would “occur post-holiday.”

So-called activist investors, angered by falling share values, have pressured Macy’s to cut costs and monetize assets, including selling real estate and leveraging its Bloomingdale’s and Bluemercury beauty product brands. Share values continued to fall after Macy’s announced its third-quarter profits of $28 million, down from $41 million a year ago. Values have stabilized since Wall Street received word of the increased number of closures. 

The company’s footprint has been shrinking for many years. Under pressure from previous investors, Macy’s sold its San Francisco men’s store for $250 million, its Minneapolis flagship for $59 million, a portion of its Chicago Loop flagship for $27 million and its Pittsburgh flagship for $15 million. In December, Macy’s said it was selling its iconic building in downtown Brooklyn, New York to United American Land. Macy’s will reportedly lease the four story, 440,000 square-foot property in the Fulton Mall from the new owner but it is not clear how long the store will remain open.

The company has returned $8.7 billion to shareholders over the last decade though stock buybacks and dividends. But this has not stopped private equity firms from aggressively expanding their presence on Macy’s board of directors and pressing to liquidate more stores based on their potential real estate value. 

In July, Macy’s board of directors rejected a $6.8 billion takeover bid from Arkhouse Management and Brigade Capital Management. The Wall Street speculators were apparently planning to secure financing for the deal based on future sales of the 150 properties on the chopping block. 

In December, Joseph Sitt, Chairman of Thor, stated, “Macy’s owns valuable and well-located real estate assets—led by its flagship property at Herald Square in New York City—that we believe are worth between $5-$9 billion. In our opinion, Macy’s board should create a separate real estate subsidiary to collect market rents from Macy’s retail operations and pursue other asset sale and redevelopment opportunities. We believe doing so would greatly maximize the value of these owned assets for the benefit of stockholders.”

The closures will have a devastating impact on workers at the department store, which employed 94,000 salespeople, stock workers, managers and other employees as of January 2023. The concerns and anger of Macy’s workers were reflected in some of social media posts, including on thelayoff.com.

“I’m sick of these activist investors. They are all just bottom feeders. All they care about is the real estate. All they WANT is the real estate at the expense of everything and everyone else.”

Another read: “In a little less than 10 months, the company has announced its closing 150 stores and decided to call it a “Bold New Strategy” when every failed retailer had a similar, but maybe less presumptuous spin on similar downsizing approaches. We have moved from one activist investor distraction (Arkhouse) to the embarrassment of a delayed earnings release, to yet another activist investor fiasco (Barington). Now we learn that the company is selling assets for pennies on the dollar. What a year, can’t wait for the next survey, it will be interesting to see if we leave the question about trusting senior leadership or asking people how they feel about the future in the survey.”

“Reducing expenses means layoffs and reduced staffing. Staffing is always the biggest expense and the easiest way to cut costs,” another worker wrote, with one replying, “On top of that they want a huge stock buyback. Sure, why not…just print some money. It works for the Feds.”

In addition to Macy’s, Big Lots and 7-Eleven, the list includes: 

• Family Dollar: the discount chain announced 677 store closings in this year. 
• Walgreens: the pharmacy and convenience chain plans to close 1,200 stores over the next three years, including 500 in the fiscal year 2025.
• CVS: The pharmacy giant closed nearly 300 stores in 2024, on top of the 600 it has previously shuttered since 2022.   
• Advanced Autoparts: More than 700 locations will be closed by the middle of 2025, as the car parts supplier introduces a new three-year financial plan to revive its business, according to USA Today. 
• Party City: The company is permanently closing after 40 years, shutting 700 company-owned and franchised stores after declaring bankruptcy. 
• Foot Locker: The athletic shoe retailer announced in 2023 that it planned to close more than 400 low-performing stores in shopping malls through 2026. 
• Walmart: Earlier in 2024, the retail giant closed 23 stores in 12 states, including in the cities of Chicago, San Diego and Portland, and closed an additional 11 stores in December. 
• Office Depot: The company, which has been downsizing for years, closed 10 stores in 2024 and is planning for more in 2025. 
• Gamestop: After suffering a 20 percent decline in sales, the game console company is reviewing how many stores in smaller towns and declining malls it will close in 2025. 

In November alone, retail employment fell by 30,000, according to the Bureau of Labor Statistics. Every indication points to this trend accelerating in 2025, including major retailer’s proposals for major cost-cutting measures next year, including the introduction of AI and other technologies to slash labor costs. This will also provoke far more struggles by retail and logistics workers, a foretaste of which was seen last week in the strikes by Amazon and Starbucks workers. In the latter, 5,000 baristas walked off the job, shutting down more than 300 stores across 43 states.

Mass protests against jihadist HTS rule in Syria

Hakan Özal

Following the overthrow of the Russian- and Iranian-backed regime of President Bashar al-Assad in Syria by Islamist proxies of NATO powers, there has been a great deal of anxiety and fear, particularly among religious and sectarian minorities.

On December 8, 2024, jihadist forces led by the al-Qaeda-linked Hayat Tahrir al-Sham (HTS) seized power, creating new threats to the rights and lives of Christians, Alawites and other minorities.

According to the Artı Gerçek and the Mesopotamia Agency in Turkey on Wednesday, complaints of house raids, looting, harassment of women and executions have increased, especially in areas where Alawites live, since jihadists led by the HTS took power.

After two churches and a patriarchate were reportedly attacked, on December 18, in Hama, central Syria, masked and armed men set fire to a giant Christmas tree in the Christian-populated city of al-Suqaylabiyah on Tuesday. Those who tried to extinguish the tree and prevent the attack were reportedly threatened at gunpoint.

The circulation of a video on social media showing the burning of the Christmas tree in al-Suqaylabiyah sparked outrage among Christian and other communities across Syria.

Christians in Hama, Damascus and Homs took to the streets carrying crosses and protesting jihadist groups in solidarity with the people of Suqaylabiyah. The protesters formed long convoys of vehicles and demanded that minority-populated areas be cleared of jihadists.

Syrian Christians carry crosses and shout slogans in Damascus, Syria, Tuesday, December 24, 2024, as they march during a protest after a Christmas tree was set on fire in Hamah city on Sunday [AP Photo/Hussein Malla]

Hundreds of people took to the streets in the Bab Tuma neighborhood of Damascus, chanting “Protect the rights of Christians.”

Andrew Bahi, a priest living in Damascus, told DPA (German Press Agency) that “We have the right to be afraid. Over the years, the [Christian-dominated] neighborhoods of eastern Damascus have been hit by hundreds of shells and we endured in our homes, but now the atmosphere remains ambiguous. There is a conflict and contradiction between words and actions.”

Samer Elias said, “Everyone chanted demanding the protection of Christians in Syria.”

The leader of the new regime, Abu Muhammad al-Jolani (Ahmed al-Shara’a), claimed that those who burned the Christmas tree were foreign fighters and would be punished. But these and similar statements lack credibility in the face of increasing harassment and attacks by jihadist gangs.

A day after these demonstrations, protests took place in Tartus, Latakia, Hama and Homs after a video went viral of a December 5 attack on an Alawite shrine in Aleppo that houses the tomb of Hussein bin Himden al-Hasibi, considered an historical leader of the Arab Alawites. In a video allegedly made by jihadists, five civilians responsible for maintaining the shrine are killed and the shrine is set on fire during the attack. The jihadists then pose on the bodies of the mausoleum servants they killed.

Government officials appointed by the HTS have tried to appease the angry masses by saying that the attack on the shrine was not new, but took place during the capture of Aleppo in early December.

Euronews reported that the killing of three Alawite judges and an officer who served under the Assad regime in Hama on Tuesday also contributed to spark mass protests in Homs, Hama, Tartous and Latakia on Wednesday.

According to the London-based anti-Assad Syrian Observatory for Human Rights (SOHR), HTS forces killed an Alawite demonstrator during a protest in Homs, further escalating tensions. Following these incidents, a curfew was announced in the city.

The official SANA news agency announced that the HTS government launched an operation against pro-Assad forces in the countryside of Tartus. During the operation, 14 security officials from the new Interior Ministry were reportedly killed.

Alawite sheikh Ali Dareer, who lives in a predominantly Alawite neighborhood in Damascus, told Reuters: “Thousands of people are filled with resentment, anxiety, and their dignity is offended,” before adding that “However, we must remain committed to peace.”

He said that homes had been vandalised and people beaten because of their religious identity, despite HTS promises the sect would be treated with respect.

Dareer then described an incident that allegedly took place on Thursday, when people were reportedly taken off a bus and beaten because they were Alawites.

These remarks underscore the tense atmosphere in the community and the danger that the new al-Qaeda-linked ruling forces could exacerbate sectarian tensions.

In the face of the repressive policies of the HTS regime, the imperialist and regional powers that brought it to power have largely remained silent. Instead, they are doing their best to eliminate Iran’s influence in Syria, plunder its resources and increase their influence in the country.

Washington lifted its bounty on al-Jolani, paving the way for a rapprochement with the new regime. Representatives of France and Britain also met with HTS officials in Damascus. The NATO powers and their allies are trying to use HTS, which they still consider a terrorist group on paper, as a tool for their geostrategic interests.

While the US and Israel have severely crippled Syria’s military infrastructure through intensive air strikes and sought to create a compliant puppet regime in Damascus, the Israeli army has expanded its occupation and influence in the country.

As Turkey seeks to suppress Kurdish forces in northern Syria and increase its influence in the country, it has turned to more open relations with HTS. President Recep Tayyip Erdoğan pledged military and logistical support to the new regime, while Foreign Minister Hakan Fidan became the highest-ranking NATO official ever to visit Damascus, embracing al-Jolani. The HTS leader also pledged a “strategic relationship” with Turkey.

Peru’s crisis-ridden president launches police-state buildup

Cesar Uco

The government of Peru’s unelected President Dina Boluarte has unveiled a multi-million-dollar “strategic plan” for the buildup and rearming of the country’s armed forces, along with its militarized National Police (PNP), in anticipation of major social unrest, strikes and anti-government demonstrations in the coming year.

President Boluarte opening new National Police (PNP) station in Lima [Photo: ElPeruano]

Military spending is set to increase by roughly 12.97 billion soles ($3.422 billion). This will include the purchase of advanced fighter jets for the Air Force, along with two military transport aircraft for 222.6 million soles ($60 million). The Navy is to receive some $1.3 billion in new equipment, including an ocean patrol boat and two logistical transport units. The Army is to get new rocket launchers and other equipment.

The government’s plan for the PNP includes acquiring 56 armored 4x4 vehicles, 43 anti-riot units fitted with water cannon for breaking up demonstrations, 1,007 handguns, and other equipment, totaling over $57.6 million.

The lavish new spending on Peru’s repressive forces is being rolled out amid a series of escalating crises and scandals that have destroyed the last shred of the government’s credibility among the Peruvian population. Boluarte’s popularity rating has sunk to just 3 percent, the lowest of any head of state on the planet.

Among the latest developments are a police raid on the home of Boluarte’s official spokesman and close political ally, Fredy Hernán Hinojosa Angulo, in connection with a kick-back and bribery scandal surrounding the Qali Warma (Vigorous Child in Quechua) program providing school meals for poor children. After the poisoning of children in a district near the southern city of Puno, it was discovered that the meals included molded chicken, horsemeat and dog food. At the time when Hinojosa headed the program, Boluarte was the minister overseeing his work. Simultaneously, a prostitution ring operating inside the Peruvian Congress, a sex-for-votes operation, has also been uncovered.

The regime of Boluarte, who was installed as president in a US-backed parliamentary coup that toppled President Pedro Castillo two years ago, epitomizes the corruption, self-dealing and hatred of the masses that characterizes the Latin American bourgeoisie.

Its attitude toward the Peruvian working class was made explicit this month when a reporter asked Education Minister Morgan Quero about the failure of the government to speak on Human Rights Day about the 50 Peruvians killed by security forces in the protests against the ouster of Castillo. “Human rights are for people, not rats,” was the minister’s terse reply.

The announcement of massive new spending on the military and security forces comes amid the continuing collapse of Peru’s health and education systems and as over half the population confronts food insecurity.

There are no looming conflicts with any of the five countries bordering Peru. The buildup of the armed forces is directed against the enemy within, the working class and oppressed rural masses. At the same time, its purpose is to curry favor with the generals, who will no doubt profit handsomely from kick-backs on military contracts.

It is also part of a global shift towards dictatorial measures to manage social unrest related to the threat of war, attacks on democratic rights, unemployment, poverty, and hunger.

While Peru has no regional foes requiring a strong army to defend itself, the country does find itself increasingly drawn into the economic power struggle between China and the United States for dominion over the South American continent. The US has reacted angrily to China achieving a sizable lead in exports and foreign direct investment in a country rich in copper and rare metals. It has expressed concerns that the new Chancay mega seaport, built by a Chinese company, may be used to harbor Chinese battle ships. Chancay is expected to become the South American hub for sea exports to Asia; particularly valuable is the export of lithium from Bolivia – essential to the production of Evs.

The current global landscape, marked by the genocide in Gaza and the war in Ukraine, Trump’s election to the presidency and his vocal admiration for right-wing Latin American figures like Javier Milei in Argentina and Nayib Bukele in El Salvador, prompts a closer look at developments in Peru.

Peruvian media highlight Argentine President Milei’s budget cuts, claiming they have curbed inflation and revived the economy, with GDP growth reported in the third quarter of 2024. However, this growth coincided with 55 percent of Argentines being driven into poverty.

Meanwhile, Salvadoran President Bukele’s authoritarian measures are framed positively for their effectiveness against organized crime, even as they have destroyed democratic freedoms.

The protests that rocked Peru in the latter months of 2024, focusing on organized crime and rising violence, reveal deeper issues. The government has tried to palm off its police-state buildup as a response to the demand raised by the protests for an end to the insecurity caused by organized crime and its shakedown operations. The existence of the gangs, however, is bound up with rampant social inequality. They are politically connected, create profits for a wealthy elite and are able to recruit from a mass of impoverished youth who find no place to either work or study.

Peru’s Ministry of Economy and Finance (MEF) and the Central Reserve Bank (BCR) project economic growth to fall below the 5 percent goal needed for job creation. Without job creation, poverty and extreme poverty will continue to rise. Protests, strikes and social upheavals will inevitably grow. This is what the government is preparing for with its massive arms spending.

The Peruvian working class must prepare as well. The decisive question is that of revolutionary leadership. This year’s protests were dominated by petty-bourgeois forces precisely because of a lack of such a leadership. The betrayals carried out by the Stalinist-led union apparatus, the diversion of social struggles into bourgeois politics by the “old” United Left, and the bitter experiences with guerrilla movements have all contributed to a political disorientation that must be overcome.

Former French President Nicolas Sarkozy sentenced to three years in prison

Pierre Mabut

On Wednesday December 18, the former French President Nicolas Sarkozy (2007-2012) had his final legal appeal rejected and was definitively sentenced by the Court of Cassation to a three-year jail term. Two of those years will not be served, on condition of good behavior, and the remaining year has been reduced to the wearing of an electronic bracelet for that period. Sarkozy has been found guilty of “corruption” and “influence peddling” mainly in connection with his electoral campaign contributions.

France's former President Nicolas Sarkozy during commemorations marking the 106th anniversary of the November 11, 1918, Armistice, ending World War I, at the Arc de Triomphe in Paris, Monday, Nov. 11, 2024. [AP Photo/Ludovic Marin]

The electronic bracelet wearer is normally obliged to stay home under surveillance with his/her movements limited to a defined perimeter of one’s domicile. Sarkozy’s limits have not yet been set by the judges.

Sarkozy has announced that he intends to take his case to the European Court of Human Rights against the French State, claiming his democratic rights were infringed upon by the State’s wiretapping of his private, privileged discussions with his lawyer which led to his initial conviction.

The ruling that a former head of state of France is a criminal underscores the illegitimacy of the French capitalist regime. The bourgeois newspaper of record Le Monde admitted that it was “an earthquake in the history of the French Fifth Republic, the first time an ex-French President has been dealt such a severe punishment.”

In reality, the ruling marks the second time, after the conviction of former President Jacques Chirac on embezzlement charges in 2011, that a former French president is condemned to prison. Chirac’s prison term was however entirely suspended by the courts. Sarkozy’s was not, and in that sense the ruling against him marks a new stage in the official recognition of the criminality of the French political system.

Indeed, the undemocratic 1958 constitution of the Fifth Republic grants the president vast powers in terms of the launching of war, police repression, and dictatorship. The president can repeatedly dissolve parliament, arrange foreign policy at his own discretion, and can invoke powers to suspend parliament and the judiciary to rule unchecked, effectively as a dictator. The fact that these powers repeatedly were wielded by criminals is a warning of the enormous danger of dictatorship posed by the French capitalist regime.

The case against Sarkozy dates back to charges laid in 2014 when evidence came to light of his attempt to bribe a high-ranking judge at the Court of Cassation, Gilbert Azibert, for feeding him information about an ongoing enquiry into illegal electoral campaign contributions from Liliane Bettencourt, the multi-billionaire heiress to French cosmetics empire L’Oréal.

The now 70 year-old Sarkozy, ex-right-wing leader of the former UMP Gaullist party, now renamed the Republicans and reduced to a rump in the National Assembly, faces in total five legal cases brought against him. He is charged with falsifying invoices relating to his election campaign expenses for president in 2012: the so-called Bygmalion affair, the latter being the publicity agency charged with running his campaign.

Next January sees the opening of his trial for receiving illegal donations from Libyan leader Muammar Gaddafi to finance his 2007 election campaign. If found guilty, Sarkozy faces a heavy penalty of 10 years jail and five years of disqualification from public office.

In 2012, the Mediapart online investigative magazine published two documents purporting to show a €50 million contribution from Gaddafi in aid of Sarkozy’s 2007 election campaign. This contrasted with the €20 million officially declared for the campaign’s expenses.

Sarkozy, during his term as president he played a central role in launching the criminal 2011 NATO war of aggression which destroyed Libya, reducing it to a country beset by warlords and Islamist militias. It should be noted this was supported by all of the pseudo-left who make up today’s New Popular Front, and especially the Pabloite New Anti-Capitalist Party (NPA). After leaving office in 2012, Sarkozy called for “rapid action of the international community” to intervene in Syria for regime change; again with NPA support.

As a pillar of the French establishment, Sarkozy has played a major role in the suppression of struggles by the working class and youth. Already in 2005 as Minister of the Interior, he suggested that working class neighborhoods be cleaned out with “high pressure hoses” after mass urban riots in response to the police killing of two youth.

In 2018, when current President Emmanuel Macron was under siege from the mass mobilization of the “Yellow Vest” movement in 2018, Macron called upon Sarkozy for his advice. While demonstrators were being beaten to pulp by the riot police and dozens lost their eyesight and limbs, Sarkozy advised “respect for law and order.”

A spokesperson for Macron’s office commented on the judgment against Sarkozy, saying that “the two men have a mutual respect for each other.”

Another example of President Sarkozy’s vile attacks on oppressed workers and nations was a trip he made to the French colonial possession of Mayotte in the Indian Ocean in 2010. He said: “I have come to help Mayotte develop itself, but let’s be clear about one thing, there are rights and duties; among duties there is respect for law and the State representatives and police who have the heavy responsibility to enforce the law.”

In 2011, he incorporated Mayotte into the French State machine as a fully-fledged French department, but all the investment necessary was and has been absent. All the island’s social crises are now blamed on clandestine immigration from the Comoros. Because of his and all French governments’ failure to invest in economic development and social care, the 350,000 impoverished population has just been decimated by the cyclone Chido, leaving possibly thousands dead and over half of makeshift housing destroyed.

In the recent period, Sarkozy has sought to shore up his position by signaling his support for far-right forces.

In a BFM-TV interview he approved of Trump’s strategy of appealing to “the nation’s greatness” and “the national flame,” attributing Trump’s victory to speaking about “America to Americans.” In line with most of the rest of the French political establishment, Sarkozy defends the line that “Israel has the right to defend itself.” His son, Louis, brazenly supported the Gaza genocide, saying, “let them die, Israel is doing Humanity’s work.”

South Korean president stonewalls removal from office

Peter Symonds

A week after South Korean President Yoon Suk-yeol was impeached by the National Assembly, the country’s political crisis continues to deepen. Yoon, with the assistance of the ruling People Power Party (PPP), is seeking to block investigations into his extraordinary declaration of martial law on the evening of December 3–4 and to prevent his removal from office.

Protesters carry a caricature of impeached South Korean President Yoon Suk Yeol during a rally demanding his arrest in Seoul, South Korea, Saturday, December 21, 2024 [AP Photo/Ahn Young-joon]

After being impeached on December 14, Yoon was suspended from office pending a decision in the Constitutional Court on whether or not to remove him. Prime Minister Han Duck-soo, who was appointed by Yoon and is now acting president, used his presidential powers on Thursday to veto six bills passed by the National Assembly, where the opposition Democratic Party (DP) holds a majority.

This is only the second time since the end of the US-backed military dictatorship in the 1980s that an acting president has exercised the veto power. The bills included four providing financial assistance to the agricultural and fishery sectors, and another giving greater power to the National Assembly to summon and require information from officials. The bills have now returned to parliament, where a two-thirds majority is needed to overturn Han’s vetoes. The DP and its allies hold only 192 out of 300 seats.

Significantly, Han also has refused to date to approve National Assembly nominees to the nine-member Constitutional Court to fill three vacant positions. If the nominees are blocked, it sets a very high bar for Yoon’s removal from office. Constitutionally, all six existing judges must vote in favour of the impeachment.

The political confrontation between acting president Han and the DP-controlled National Assembly will come to a head tomorrow. The Democrats yesterday issued an ultimatum to Han, demanding that he approve bills establishing special counsel investigations into insurrection charges against Yoon and corruption allegations against Yoon’s wife, or face impeachment himself. In addition, they have suggested that Han may have been involved in the martial law decree.

Yoon is also stonewalling. In the immediate wake of his failed attempt to impose martial law and the wave of outrage that swept the country, the president publicly apologised and promised to cooperate with legal and constitutional proceedings. Since then, however, he has refused to answer summonses or hand over documents.

Yoon also failed to appear last Wednesday at the Corruption Investigation Office (CIO) for questioning over charges of insurrection and abuse of power. A CIO statement declared that his no-show would be “considered as a failure to comply with the first summons.” A second summons has been issued and the CIO is reportedly considering the possibility of Yoon’s arrest.

The fact that Yoon feels he can brazenly impede his removal from office is a result firstly of the perfidy of the Democrats and their allies in the Korean Confederation of Trade Unions (KCTU). They have wound back the mass protests and strikes that erupted over the declaration of martial law and channeled the widespread anger into the narrow confines of parliamentary manoeuvres.

Yoon’s attempt to wind back the clock to the military dictatorships of the past failed in large measure because of the immediate protests it provoked and ruling class fears of a mass outpouring of anger. Thousands of people gathered around the National Assembly in the early hours of December 4 and prevented the arrest of key political figures, including the opposition leader and parliamentary speaker.

The National Assembly was able to convene and pass a motion demanding Yoon lift the martial law decree. While constitutionally required to accede to the motion, Yoon prevaricated for several hours, no doubt consulting both domestically and internationally as to whether he should simply ignore the demand. Finally, he relented.

The KCTU immediately swung into action, declaring that it would initiate a “general strike” until Yoon was removed from office. In reality, the “general strike” proved to be nothing more than limited stoppages in several sectors, such as auto and rail, some of which had already been planned.

Following Yoon’s impeachment, the KCTU announced on December 16 that it was lifting its “general strike guidelines.” KCTU head Yang Gyeong-su claimed that Yoon’s suspension from office amounted to a victory. “In the end, democracy, workers and citizens, and the KCTU won,” he said.

Mass protests against Yoon continued last Saturday. Organisers estimated that 300,000 took part in the largest demonstration, in the capital Seoul, to demand his resignation and arrest. Farmers associated with the Korean Peasants League attempted to join the protests, driving into Seoul with tractors and cargo trucks, but were blocked by police. Other protests involving thousands were held around South Korea, including in Busan, Gwangju, Jeonju, Ulsan, Daegu and Jeju.

While large, the protests were significantly smaller than those the previous Saturday, when organisers estimated that two million gathered near the National Assembly building where lawmakers were preparing to vote on a second motion to impeach Yoon. Older participants who had experienced the brutality of military dictatorship expressed their determination to never allow a return. Young people were clearly shocked that basic democratic rights could be so easily overturned.

The fact that Yoon has not resigned and the right-wing PPP has even begun to organise pro-Yoon rallies suggests that he has powerful support in international circles. The Biden administration, in particular, welcomed Yoon’s decision to forge close military and intelligence ties with Japan in what amounts to a tripartite alliance with the US as Washington prepares for war against China. Such a pact had been previously thwarted by deep-seated animosity toward Japan stemming from its harsh colonial rule over Korea from 1910 to 1945.

While the Biden administration indicated that Yoon should withdraw the martial law decree, it has not condemned his wholesale assault on democratic rights, nor called for his removal from office. If Yoon had succeeded, South Korea would now be under martial law, all political and strike activity would be banned, and blanket censorship imposed. Yet Washington, which hypocritically exploits the banner of “democracy” to wage regime-change operations, is silent when it comes the gross abuses of political allies if its geopolitical interests are at stake.