Closure of Australian retail chain Rivers points to a deepening economic crisis

Vicki Mylonas

Longstanding Australian clothing and footwear brand Rivers is set to close all 136 of its stores, making more than 600 staff redundant. Amid a cost-of-living crisis and continuing inflation, this follows a horror year for many Australian retailers.

Rivers store at Canberra Outlet during its closing down sale January 2025 [Photo by Nick-D via Wikimedia Commons / CC BY-SA 4.0]

Rivers was owned by Mosaic Brands Limited, which collapsed in October, owing creditors $249 million. The demise of Australia’s largest fashion retailer group, which also included Rockmans, Crossroads, W. Lane and Katies, among others, will see some 700 retail shops close and destroy almost 3,000 jobs throughout the country.

Many of the Mosaic workers who have already been let go have not been paid since October, according to the Sydney Morning Herald.

Last month, Wesfarmers announced it was shutting down online outlet Catch, slashing around 190 jobs, with a further 100 employees to be moved to the Kmart Group. The company’s managing director attributed Catch’s failure to “the entry and expansion of international competitors.”

This is expressed particularly in the rise of Chinese-owned online retailers Shein and Temu, which together are expected to record sales of more than $2 billion in Australia this financial year, according to a Roy Morgan report. Meanwhile, Goldman Sachs anticipates a 40 percent year-over-year rise in Amazon’s Australian sales to $6.5 billion in 2025. In an era of globalisation, Australian retail faces competition that transcends national borders.

The collapse of these major retailers is part of a broader trend of business failures and job cuts across multiple industry sectors, including construction and hospitality.

Credit reporting agency CreditorWatch warned in its Business Risk Index that a fall in monthly business collapses in January was “likely to be short lived.” In the year to November 2024, insolvencies were up 57 percent year-over-year, and business closures were at the highest rate since August 2020. Across all sectors, an average of 5.1 percent of businesses failed, with the rate expected to climb to 5.6 percent this year.

Liquidator Jarvis Archer told the Australian that, after a record high in 2023–24 of 11,053, “total insolvencies for the 2025 financial year could reach as high as 16,000… almost double the pre-pandemic average of around 8,000 per year.”

CreditorWatch noted that, like consumers, businesses have been hit by soaring electricity, insurance and property rental costs.

For the working class, the rising cost of living, coupled with high mortgage stress and falling real wages, has forced many to cut back on discretionary spending, including retail shopping and dining out, exacerbating business shutdowns and unemployment rates.

CreditorWatch noted that the food and beverage sector in particular is “bearing the brunt of cost-of-living pressures.” A record-high 9.2 percent of businesses in the sector became insolvent in the 12 months to January 31.

Spending at cafes, restaurants and takeaway food services has remained flat since early 2023, while operating costs, including for utilities and ingredients, have soared. Restaurant and Catering Australia (RCA), a hospitality industry peak body, has warned that 1 in 11 businesses in the sector will collapse in 2025.

One of Australia’s biggest casino operators, Star Entertainment, is set to become the largest corporate collapse in Australia since Virgin Australia in 2020. Around 9,000 directly employed workers face the prospect of unemployment, and the collapse would likely have a ripple effect on food and beverage suppliers, as well as nearby hospitality businesses.

The construction industry has the second-highest business failure rate, with the number of new homes built dropping significantly since mid-2021. Around 2,832 construction companies became insolvent during the 2023–2024 financial year. The rising cost of materials, supply chain issues and 13 interest rate hikes have played a role in this.

The collapse of Quasar Constructions last year left major projects in New South Wales unfinished and workers owed tens of thousands of dollars. Already this year, another building company, Clarke Homes, has announced it will enter administration, again leaving workers out of pocket. Veteran builder Scott Challen told Yahoo!Finance the construction industry is “heading into the abyss.”

The crisis confronting so many industries will further push the increase of unemployment rates in the country. The unemployment rate, according to the Australian Bureau of Statistics (ABS), is 4.1 percent. But these official figures are a massive underestimate, excluding those who did not actively look for work in the survey period.

Market research firm Roy Morgan calculates that “real unemployment” is at 10.1 percent, meaning more than 1.6 million Australian workers are unemployed. A further 1.81 million, or 11.3 percent, are under-employed, the analysts said: “In total 3.43 million Australians (21.4 percent of the workforce) were either unemployed or under-employed in January—the highest combined figure since June 2020.”

Among those having the most difficulty finding work are those that are already economically vulnerable. According to the ABS, the official youth unemployment rate is 9 percent, more than double the overall figure and the data also show a striking discrepancy in unemployment figures between socioeconomic regions. Unemployment rates are higher, on average, in working-class areas. In southwest Sydney, for example, official unemployment is at 4.7 percent, compared with 3.8 percent across NSW. Youth unemployment in the region is at 10.7 percent.

Business closures and unemployment are only set to increase in 2025, across a wide array of industries, including steel and mining, as well as tertiary education and the public sector.

The rapidly unfolding collapse of steel magnate Sanjeev Gupta’s GFG Alliance means 6,000 workers across Whyalla Steelworks, Tahmoor Coal and InfraBuild face the prospect that jobs, wages and conditions will be slashed.

Mining corporation Rio Tinto last week flagged the likelihood of further job cuts in Western Australia, on top of 500 destroyed last year, 3 percent of its full-time workforce.

Financial consulting firm EY advised staff on Tuesday of a redundancy round, reportedly targeting the company’s technology and legal divisions. According to the Australian, as many as 100 jobs are set to be cut.

Major supermarket chain Woolworths, the largest private sector employer in the country, announced Wednesday it was aiming to cut costs by $400 million, including the elimination of an unspecified number of office roles.

Liberal opposition leader Peter Dutton has vowed to slash as many as 36,000 public service jobs, which he describes as “waste,” if his party wins the upcoming federal election, which must be held in the next three months.

In fact, the assault on jobs, wages and conditions is already well underway. Labor governments at state and federal level, with the collaboration of the Australian Council of Trade Unions (ACTU), have overseen drastic cuts to wages, especially in the public sector, resulting in real wages that are lower than they were in 2016.

The Victorian Labor government last week announced plans to eliminate up to 3,000 jobs in the state’s public services, around 5–6 percent of the current workforce.

Data from the Organization for Economic Co-operation and Development (OECD) reveals that, in the two years to June 2024, disposable incomes in Australia saw among the sharpest falls across OECD countries. In fact, the fall in real incomes has taken household purchasing power back to 2017 levels.

Recent analysis conducted by the University of New South Wales and consulting firm Digital Finance Analytics showed that 82 percent of electorates in the country have a majority of households suffering financial stress. This is more than 10 times the level recorded in 2021.

Europe rearms amid crisis in NATO alliance

Peter Schwarz

German Leopard 2 main battle tanks on their way to Ukraine. [Photo: Bundeswehr]

Since Donald Trump’s return to the White House, the conflict between the US and Europe—and Germany in particular—has intensified day by day. Even the end of NATO, the world’s most powerful imperialist military alliance, which has dominated transatlantic relations since the Second World War, can no longer be ruled out. The European powers are reacting to this with frenetic rearmament.

There were already sharp political and economic conflicts during Trump’s first term in office. In 2017, following a tense G7 summit with Trump, then German Chancellor Angela Merkel declared that the times were over “when we could completely rely on others.” The Europeans would have to take their fate into their own hands, she continued. However, there was no complete break at the time.

Under President Joe Biden, the US and Europe worked closely together again to escalate the war against Russia in Ukraine. Germany, which had initially been reluctant to end its gas supplies from Russia, became Ukraine’s most important donor after the US. Both pursued the goal of defeating Russia militarily.

However, after Trump took office it quickly became clear that his “Make America Great Again” policy was not only directed against China and other rivals, but also against his erstwhile European allies. He has announced punitive tariffs of 25 percent against imports from Europe and declared war on the European Union (EU). At a cabinet meeting on Wednesday, he complained, “The European Union was formed in order to screw the United States. That’s the purpose of it, and they’ve done a good job of it.”

At the Munich Security Conference, Vice President JD Vance backed far-right parties that reject the EU in a provocative, incendiary speech. Trump confidant and multi-billionaire Elon Musk openly supported the fascist Alternative for Germany (AfD) during the German election campaign.

When Trump then contacted Russian President Vladimir Putin over the heads of the European and Ukrainian governments and agreed negotiations to settle the Ukraine conflict, panic spread in European capitals that Trump and Putin would come to an agreement at the expense of Europe. There was talk of a new Yalta, where Stalin and President Roosevelt divided Europe up into zones of influence in February 1945.

The probable next German Chancellor Friedrich Merz (Christian Democratic Union, CDU) warned in the “Morgenmagazin” programme on German public television: “We must prepare ourselves for the fact that Donald Trump will no longer accept NATO’s  collective defence obligations without restrictions.” He demanded that Europe must now “pull out all the stops to at least be able to defend the European continent on its own.” Among other things, he proposed a joint nuclear defence shield with France and the UK: “We need to talk about what this could look like.”

Merz already declared on election night that his absolute priority was to strengthen Europe “so that we can achieve independence from the United States step by step.” He added, “I would never have believed that I would have to say something like that in a television programme.”

Merz’s CDU has been the most pro-American of the German parties since the time of Konrad Adenauer, the first post-war German chancellor. Merz himself was chairman of the Atlantik-Brücke think tank and German head of the US investment fund BlackRock. The fact that he is now so clearly opposed to Washington shows how deep the conflict runs.

French President Emmanuel Macron responded to Trump’s unilateral action by inviting government heads to two European crisis summits in Paris and then flying to Washington himself to try to change Trump’s mind. But he returned empty-handed.

Trump and Macron publicly celebrated their man-to-man friendship and showered each other with compliments. But Trump did not give ground on anything of substance. He was not prepared to provide American security guarantees for Ukraine and insisted that this was the task of the Europeans. He also only agreed to European and Ukrainian participation in the negotiations in the most general terms.

Trump will receive Ukrainian President Volodymyr Zelensky, whom he previously insulted, in Washington Friday, but only to sign a treaty that will make the country economically dependent on the US for decades. Kiev will undertake to pay 50 percent of all future revenues from raw materials and associated logistics into a fund that will be co-administered by the US.

The agreement is very general; the details will be worked out later. Zelensky rejected an original agreement under which Ukraine was to transfer $500 billion in raw material revenues to the US.

The Europeans are extremely angry about this deal because they feel they have been cheated out of their share of the spoils. Berlin has long been organising conferences on the “reconstruction” of Ukraine, from which German companies expect to make huge profits. And France has been negotiating with Ukraine since October 2024 about the use of valuable raw materials for the French defence industry, according to Defence Minister Sébastien Lecornu.

While Trump met with Macron, the US voted in the UN General Assembly together with Russia, Belarus and North Korea against a resolution tabled by Ukraine, which describes Russia as the aggressor in the Ukraine war and calls for the restoration of Ukraine’s territorial integrity. In the Security Council, the five European members abstained from voting on a resolution on Ukraine, which was supported by the US, Russia and China. It advocated peace in Ukraine without condemning Russia and demanding the restoration of the old borders.

Although such resolutions have no practical significance, their symbolic value is all the greater. Never before has the US joined forces with Russia, China and North Korea against Europe on such important geostrategic issues.

The European powers are reacting to the division in NATO by rearming as never before since the end of the Second World War and endeavouring to continue the war in Ukraine under their own steam. Having already significantly increased military spending in recent years, they are now set to increase it by hundreds of billions of euros in a very short space of time, convert industry to arms production, reintroduce compulsory military service and militarise society as a whole.

This requires massive cuts in spending on social welfare, education and health, and a fierce attack on the working class, which will have to bear the consequences of rearmament and serve as cannon fodder for future wars.  

The transformation of Germany into a major military power will be the central axis of the next German government, a coalition of the CDU/Christian Social Union (CSU) and Social Democrats (SPD), which, if all goes according to plan, will be sworn in by mid-April. There are increasing calls in the media and politics to dispense with lengthy coalition negotiations and a detailed coalition agreement in order to avoid wasting time.

CDU foreign policy expert Norbert Röttgen described the seriousness of the situation as “historic” on Deutschlandfunk radio. According to Röttgen, this shocking reality must be recognised. Only if Germany was able to act quickly would Europe also be able to act. It is now a matter of fate, he continued, stating that if Ukraine disintegrated, the EU and NATO would no longer exist in their current form.

Acting Defence Minister Boris Pistorius (SPD), who is also expected to be a member of the next government, told the Bild newspaper that the military budget would have to be at least doubled to over €100 billion in the coming years: “We are talking about more than three percent of gross domestic product.”

Green Party European affairs politician Anton Hofreiter called for “a major investment offensive to provide Ukraine with even more support and to improve the EU’s defence capabilities quickly and efficiently.” This would require “a 500 billion defence fund to support Ukraine and for joint arms procurement in the EU.”

In mid-February, the CSU, the Bavarian sister party of the CDU, presented a “master plan to strengthen the Bundeswehr [Armed Forces] and Germany’s defence,” which calls for the Bundeswehr to be increased from its current 182,000 uniformed personnel to “500,000 combat-ready soldiers and reservists” as well as the reintroduction of compulsory military service.

In addition, it called for the procurement of 1,000 new Taurus cruise missiles and the development of new cruise missiles with a range of 2,500 kilometres. An “Iron Dome” is to be erected as a protective shield against missile and air attacks. To finance the entire plan, military spending should rise to 3 percent of GDP. 

In the meantime, Merz is trying to create a fait accompli with the old parliamentary majority before the newly elected Bundestag is constituted, which must take place March 25 at the latest, by making hundreds of billions available for armaments. A further special fund totaling €200 billion is being discussed, for which a two-thirds majority in parliament is required. In the new Bundestag, the CDU/CSU, SPD and Greens together do not have enough votes and would have to rely on support from the Left Party or the far-right AfD.

Merz also flew to Paris on Wednesday for a three-hour confidential meeting with President Macron, although he has not yet been elected chancellor and cannot expect to be until April at the earliest. Afterwards, he thanked Macron on X for his “trust in Franco-German relations” and wrote, “Together, our countries can achieve great things for Europe.” Macron has long pursued the goal of strengthening Europe against the US and building a European army.

However, the conflict with the US will also exacerbate the differences within Europe. Many EU members are not prepared to subordinate themselves to German and French supremacy.

Alarm grows as “mystery illness” in Congo has now killed 60 people and infected over 1,000

Benjamin Mateus

[Photo: World Health Organization African Region]

On Thursday, the World Health Organization (WHO) released their latest report on the worsening outbreak of unknown disease in two separate locations in the Democratic Republic of the Congo (DRC), noting that 1,096 people have now officially been infected and 60 have died.

The first outbreak occurred in a remote Northwest village of Bikoro in the Bolomba health zone on January 21, 2025, after three children ate a bat and died shortly afterwards, prompting concerns given that bats are well-known to harbor various pathogens capable of causing spillover events. Samples from those affected were sent to Kinshasa, ruling out both Ebola and Marburg, deadly viral hemorrhagic pathogens. 

The next outbreak was first reported on February 9 in Bomate village in the Basankusu health zone, located about 186 kilometers (115 miles) to the Northeast of Bikoro. By February 13, the WHO confirmed at least 419 cases with 45 deaths, placing the initial case fatality rate at over 10 percent. WHO stated that “[the] outbreaks, which have seen cases rise rapidly within days, pose a significant public health threat. The exact cause remains unknown.” In the most recent in-depth report, covering data up until February 23, the WHO estimates that the case fatality rate now stands at roughly 5.5 percent.

In addition to the unidentified pathogen causing the outbreak, health authorities are deeply concerned about the short interval between the onset of symptoms (fever, vomiting and internal bleeding) and ensuing death 48 hours later. Delays in reporting relate to near non-existent infrastructure conditions and poorly resourced facilities.

The WHO Bulletin underscores the concerns raised by these developments, noting:

Key challenges include the rapid progression of the disease, with nearly half of the deaths occurring within 48 hours of symptom onset in one of the affected health zones, and an exceptionally high case fatality rate in another. Urgent action is needed to accelerate laboratory investigations, improve case management and isolation capacities, and strengthen surveillance and risk communication. The remote location and weak healthcare infrastructure increase the risk of further spread, requiring immediate high-level intervention to contain the outbreak.

WHO spokesperson Margaret Harris provided important details in a recent interview with DW News, stating:

[On] February 13, health authorities in the Democratic Republic of Congo reported clusters [of infections] in two different villages. Even though both villages are in Équateur province which are both in northwest of Congo, the remoteness and poor infrastructure means they are actually very separated, and it could be completely different things.

Harris added that although the identity of the pathogen remains to be determined, it is most likely something already known rather than being a novel virus. Furthermore, she confirmed that rapid diagnostics of cases in Bomonte were positive for malaria. She speculated that it could be a combination of winter viruses on top of malaria, which gives a mixed picture and may predispose patients to more serious and rapidly fatal infections, especially among people who are malnourished and living in squalid conditions. She added, “At the moment we have a range of differential diagnoses, but the most important thing is to do the full epidemiological investigation and do the testing.”

Although the known hemorrhagic pathogens have seemed to be ruled out, malaria remains a likely contributor as was the case of the outbreak in Kwango Province that erupted in October 2024, several hundred miles south of the current outbreak in the DRC. In that outbreak in the Panzi health zone, WHO estimated there were 406 cases between October 24 and December 5, with a death toll ranging from 67 to 143 individuals.

As health authorities noted at the time, lack of access to healthcare, malnutrition, and poor living conditions contributed greatly to the high case fatality rate in that region. Malaria, a mosquito-borne illness, can lead to severe disease and death in a matter of hours to just a few days. Initial symptoms can include high fevers and chills, vomiting, jaundice, and low blood pressure and high heart rates. Major complications can lead to brain swelling, fluid build-up in the lungs, kidney failure, severe anemia and bleeding complications.

Meanwhile, the growing armed conflict and social crisis on the eastern part of the country has led to mass displacement of the population and violence, creating difficult conditions for the country as a whole and hampering efforts by international organizations whose resources are spread thin. The collapse of the health and public works infrastructure with lack of electricity and potable water in that region is raising the risk of cholera outbreaks, malnutrition, and disease transmission. Children and the elderly are most predisposed to these manifestations.

The WHO noted:

Medical facilities are overwhelmed, having treated over 4,260 injured people, while the Red Cross has buried 2,000 bodies, and morgues remain overcrowded. Urgent actions include securing humanitarian access, restoring critical infrastructure, ensuring the supply of medical and food aid, and enhancing public health surveillance. Without immediate intervention, these crises will further destabilize the region, heighten public health risks, and worsen human suffering.

To date, the US has not provided any financial or material support, or personnel to assist the WHO, due to the Trump administration’s immediate severing of ties upon taking power. Public health officials in the US are barred from communicating with the WHO, while the fascist billionaire Elon Musk has orchestrated the destruction of the limited aid provide by USAID, upon which millions of Africans rely for their very survival.

The sudden disruption of foreign aid to these regions and the stalled work that had been taking place between the US and the WHO underscore the growing threat of future pandemics from numerous pathogens. Last year, the US provided the DRC with almost 70 percent of all aid to the country, including support for the response to Mpox. But now, “[from] one day to another, everything just collapsed,” said Paulin Nkwosseu, chief of field operations for UNICEF in the DRC.

Trump/Musk rampage could leave up to 1 million workers jobless, major investment firm warns

Jacob Crosse

Elon Musk holds up a chainsaw he received from Argentina's President Javier Milei, right, as they arrive to speak at the Conservative Political Action Conference, CPAC, at the Gaylord National Resort & Convention Center, Thursday, Feb. 20, 2025, in Oxon Hill, Maryland. [AP Photo/Jose Luis Magana]

President Donald Trump and billionaire Elon Musk’s purge of the federal workforce—intended to fund tax cuts for the wealthy, mass deportations and war—could leave up to 1 million people jobless in the coming weeks, according to a recent report from a major investment firm.

On February 22, Apollo Global Management chief economist Torsten Sløk, in a report titled Downside Risks Intensifying, wrote that the “consensus expects total DOGE-related job cuts to be 300,000.” He noted that unemployment claims were already rising in Washington, D.C., and stated that any further layoffs “will push jobless claims higher over the coming weeks.”

Citing a 2020 Brookings Institution report, Sløk observed “that for every federal employee, there are two contractors. As a result, layoffs could potentially be closer to 1 million.”

On Thursday, Federal Judge William Alsup temporarily blocked some of the mass firings, ruling that the Office of Personnel Management (OPM) exceeded its authority by ordering agencies such as the Department of Education and the Environmental Protection Agency (EPA) to fire workers.

Earlier this month, OPM issued a memo instructing federal agencies to “separate probationary employees that you have not identified as mission-critical no later than the end of the day Monday, 2/17.”

To make the job and spending cuts permanent and bypass legal challenges like Alsup’s ruling, Politico reported Thursday, Trump and top Republicans are considering “codifying DOGE actions” into the upcoming spending bill. The current proposal includes $880 billion in cuts to Medicaid, Medicare and other healthcare programs over 10 years.

In order to pressure Democrats into voting for the bill, Politico reported, Republicans would include alleged “egregious” examples of spending largess discovered by DOGE and “dare” Democrats to vote against it. Despite constant claims of “waste, fraud and abuse” being discovered by Musk and his DOGE cronies, no one has been charged with fraud.

Without a spending bill or continuing resolution by March 14, the federal government will shut down. On Thursday, Trump posted on social media that Congress was working to “pass a clean, temporary government funding Bill (‘CR’). Let’s get it done!”

With a shutdown looming, the Washington Post reported Wednesday that additional federal layoffs are imminent, with some departments facing cuts of up to 90 percent. Two Social Security Administration workers said agency leadership has been instructed to cut staff “by half.”

An internal Department of Labor memorandum viewed by the Post calls for slashing the Office of Federal Contract Compliance Program from 50 offices and nearly 500 workers to just four offices and 50 people.

Wired reported on February 25 that Musk’s Department of Government Deficiency (DOGE) is updating software previously developed by the Department of Defense to cull federal workers. Sources told Wired that the software, called AutoRIF, or “Automated Reduction in Force,” has been accessed by DOGE operatives, who “appear to be editing its code,” according to “screenshots of internal databases” provided by sources.

During his first full cabinet meeting on Wednesday, Trump said he spoke with Environmental Protection Agency (EPA) Secretary Lee Zeldin, “and [Zeldin] thinks he’s going to be cutting 65 percent or so of the people from environmental, and we’re going to speed up the process too.” The White House later attempted to walk back the statement, claiming that Trump was committed to “eliminating 65 percent of the EPA’s wasteful spending.”

Of course, for the financial oligarchy, “wasteful spending” is anything that benefits the lives, health and safety of the working class at the expense of Wall Street profits. A currently employed lawyer with the EPA told reporters for the World Socialist Web Site:

The folks with the most experience at the EPA are currently leaving (many during this exact pay period), and the first wave of probationary firings has already left the agency understaffed.

We are unable to continue past the projects we have entered on currently; to cull any more would leave us categorically unable to finish the tasks currently set. When they attack grants, people here suffer today; when they attack USAID, people abroad die today; when they attack Medicaid, people die tomorrow; when they attack EPA, children die decades from now.

He concluded that “the loss is incalculable and the message is clear: They would kill you for a red cent, and they will pay no price unless working people actually take a stand on every one of these issues.”

In devastating cuts that climate scientists and meteorologists warn will lead to deaths, hundreds of workers—including new-hires and recently promoted staff—were fired at the National Oceanic and Atmospheric Administration (NOAA), which is part of the Department of Commerce, on Thursday. The Guardian reported that roughly 10 percent of the agency’s workforce was classified as “probationary” and subject to layoffs.

In a thread on X, Dr. Daniel Swain, a climate scientist at UCLA, called the firings of “new-hires and recently promoted senior staff… profoundly alarming.” He noted that those dismissed appeared to include “meteorologists, data scientists responsible for maintaining weather predictive models, and technicians responsible for maintaining the nation’s weather instrumentation network (among many others).”

Swain emphasized that the National Weather Service (NWS) “saves countless lives by issuing high-quality weather forecasts and extreme weather warnings.” He added:

Despite widespread discussion to the contrary, the fact of the matter is that the private sector, as it presently exists, simply cannot quickly spin up to fill any void left by substantial dismantling of NOAA and/or the NWS.

“In fact,” Swain wrote, “though this is not widely known, most or all private weather companies in the US (including the forecasts you see on TV or your favorite app) are built directly atop the backbone of taxpayer-funded instrumentation, data, predictive modeling, and forecasts provided by NOAA.”

He concluded that the large staffing reductions underway, with more cuts on the horizon, will result in “people who die in extreme weather events and related disasters who would not have otherwise.”

Trump tariffs against Mexico and Canada to go ahead

Nick Beams

US President Trump has announced that 25 percent tariffs on goods from Mexico and Canada, America’s two major trading partners, will go ahead next week after being delayed for a month.

President Donald Trump speaks in the Roosevelt Room of the White House, Tuesday, Jan. 21, 2025, in Washington. (AP Photo/Julia Demaree Nikhinson) [AP Photo/Julia Demaree Nikhinson]

He also announced that the 10 percent tariff imposed on Chinese goods would be lifted by an additional 10 percent. “It’s 10 plus 10,” Trump said in a statement from the Oval Office yesterday.

The tariffs on Mexico and Canada were initially threatened shortly after Trump’s inauguration on January 20 but were delayed after the Canadian and Mexican governments agreed to take action over the flow of the drug fentanyl into the US.

In a post on his Truth Social platform yesterday, Trump said: “The proposed tariffs scheduled to go into effect on March fourth will, indeed, go into effect as scheduled.”

Speaking in the Oval Office, Trump said Mexico and Canada had not done enough to halt the flow of fentanyl for them to win another reprieve.

Trump also said that his plan for sweeping so-called “reciprocal” tariffs will go ahead after the delivery of a report from his officials on April 2.

The term “reciprocal” tariffs is something of a misnomer. It goes far beyond the imposition of tariffs equivalent to those imposed on US goods, but sets out retaliation for measures including taxes, regulations, and other internal policies of a country that are considered to adversely impact American corporations.

Earlier this week, at the first meeting of his cabinet, Trump repeated his threat to impose a 25 percent tariff on imports from the European Union, saying the bloc “was formed to screw the United States.”

The branding of the EU as an economic enemy is an indication of the total disintegration of all the arrangements—economic and political—set in place after World War II to stabilize world capitalism following the disasters of the first half of the 20th century.

The formation of the EU was the outcome of plans initiated by the US under the Marshall Plan for the post-war reconstruction of the European economy.

Trump said a decision had been made on the EU tariffs and “we’ll be announcing it very soon. It’ll be 25 percent generally speaking and that will be on cars and all other things.”

The imposition of tariffs on Mexican and Canadian goods—assuming it goes ahead—threatens chaos in large sections of US industry because the manufacture of industrial goods, particularly cars and trucks, often involves the passage of components several times across the border.

Wall Street fell again on the announcement that the Mexico and Canada tariffs were to go ahead. The tech-heavy NASDAQ index dropped by 2.8 percent and the S&P fell by 1.6 percent, taking it into negative territory for the year.

Following the latest Trump announcements, the focus will turn to the retaliatory response under conditions where, as the Financial Times commented, the latest salvo in aggressive trade policy increases “the danger of a wider trade war that risks inflicting significant damage on the global economy.”

The response of Mexican President Claudia Sheinbaum at a news conference following the Trump announcement was to hold out the prospect for a deal.

Referring to Trump’s comments, she said: “As you know, he has his way of communicating, but as usual, we have a cool head and optimism that we can reach an agreement.”

Canadian Prime Minister Justin Trudeau said his government would respond to any “unjustified tariffs” with a “strong and immediate answer.” Canada is set to immediately impose tariffs on $30 billion worth of imports coming from the US.

Whether by accident or design, the March 4 date for the further 10 percent hike in the tariff on Chinese goods comes on the eve of the National People’s Congress in Beijing, the rubber-stamp parliament which will meet to hear the measures proposed by the Xi Jinping regime to deal with the slowdown in the Chinese economy and the economic war measures of the US.

At this stage, the response appears to be fairly muted, with the Chinese embassy in Washington simply issuing repeats of what it has said before.

It said there were “no winners” in a trade war and the unilateral tariffs “imposed by the US will not solve its own problems, nor will it benefit the two sides of the world.”

But while it has avoided making bellicose statements and presented itself as the upholder of the international trading order, Beijing has been developing retaliatory measures, including export controls on rare earths and critical minerals imported by the US.

It has been reported that over the past month, China has been seeking to ascertain whether the tariff measures against it are aimed at trying to secure a narrow trade deal or a more comprehensive agreement.

Chinese government officials are said to have informally conveyed that Beijing is prepared to buy more US goods and that companies are willing to invest in the US. But Xi has yet to give his imprimatur to any offers.

There is a view in Beijing and in economic circles more broadly that Trump’s tariff measures may not be as effective as he had considered because, after years of tariff hikes, starting under the first Trump administration, Chinese companies have become adept at rerouting their exports to the US via third countries. However, this situation contains within it the possibility of further escalation of tariffs against a range of other countries to counter it.

A further expression of the breakdown of the global order was manifested in Cape Town yesterday when a three-day meeting of G20 finance ministers concluded without being able to issue a joint communique because of differences on trade, climate change financing, and US tariffs. Several countries, including the US, China, India, Japan, and Mexico effectively opted out from the meeting and replaced their senior representatives with deputies.

The G20, which had been set up in response to the Asian financial crisis of 1997–98, was elevated in 2009, in the wake of the global financial crisis, to be the world’s major economic council.

It was accompanied by hand-on-heart declarations by world leaders at the time that never again would there be a resort to the disastrous tariff measures of the 1930s. Just a decade and a half on, those declarations, like the G20 itself, which was hailed as a new foundation for stabilizing world capitalism, have turned to dust.

US House adopts budget plan to spearhead social counterrevolution

Patrick Martin

Speaker of the House Mike Johnson, R-La., talks to reporters after a closed-door meeting with fellow Republicans to find agreement on a spending bill, at the Capitol in Washington. [AP Photo/J. Scott Applewhite]

The US House of Representatives on Tuesday night took the first step in the Trump administration’s plans for devastating cuts in social spending, particularly on healthcare, adopting an initial budget plan by a 217-215 vote. The measure begins the so-called reconciliation process, in which Congress passes a single annual budget and tax bill that cannot be filibustered in the Senate.

With only a three-vote majority in the House and a 53-47 majority in the Senate, reconciliation is the preferred mechanism for the Trump White House to enact its core program unilaterally, without negotiating with the Democrats. The final bill is expected to incorporate far more than just budgetary items, providing a vehicle for major changes in policies ranging from immigration to the environment.

The House bill did not include such provisions, which will be worked out in future talks with Senate Republicans and the White House. But the budgetary provisions alone demonstrate the colossal social counterrevolution that the second Trump administration is seeking to carry out.

The bill provides the initial framework for House committees that will actually draft the provisions of the reconciliation legislation. This includes increased spending of up to $300 billion for the military and immigration and border enforcement and up to $2 trillion in spending cuts for all other government functions, primarily healthcare, education, food stamps, transportation and the environment.

The legislation would provide up to $4.5 trillion in tax cuts over 10 years, a figure already rejected by some Senate Republicans because it falls short of the full 10-year cost of extending the tax cuts for the wealthy that was enacted in 2017, during Trump’s first term. Many of these tax cuts expire this year, and both corporations and billionaires are clamoring for their bonanza to be made permanent.

The House bill is a further demonstration of the utter indifference to legal and constitutional constraints on the part of the Trump White House and the Republican Party as a whole. A reconciliation bill is required to be deficit-neutral. The requirement is “met” by assuming that extension of the tax cuts, combined with the scrapping of business regulations, will unleash massive economic growth that will raise tax revenues by $2.6 trillion. When that fails to materialize, the resulting deficit blowout will prompt demands for even more cuts in social spending.

Amid nonstop lying by Trump and his aides, who claim that there will be no benefit cuts in Social Security, Medicare and Medicaid, the House bill instructs the House Energy and Commerce Committee, which oversees Medicaid, Medicare and other health programs, to cut at least $880 billion in spending over a 10-year period.

An analysis of the underlying budget figures by the New York Times pointed out that all other government programs under the jurisdiction of this committee, beyond Medicaid and Medicare, account for only $200 billion combined. This means that the vast bulk of the cuts must come out of healthcare programs, the largest of which, in terms of people served, is Medicaid, which provides healthcare coverage for the poorest sections of the working class, as well as disability payments and nursing home care for millions of elderly people. All told, the joint state and federal program provides benefits for 72 million people, more than 20 percent of the US population.

Among the measures being considered to implement the cuts are imposing work requirements, allowing more frequent eligibility checks on beneficiaries (likely to disqualify millions of eligible recipients because they fail to meet paperwork requirements), and capping the federal contribution to the program, while leaving the actual benefit cuts to be made by the states, which administer the joint program.

The biggest single cut would involve effectively rescinding a major portion of the Affordable Care Act (Obamacare) by cutting off the subsidies to the 41 states that have expanded Medicaid coverage to 20 million Americans with incomes slightly above the poverty line. These states would either have to eliminate the Medicaid expansion, cutting off health insurance, or make offsetting cuts in other state programs, such as public education. The Times estimated this would save the federal government as much as $560 billion.

Another major social regression would be carried out by the House Agriculture Committee, which has jurisdiction over the food stamp program. This committee is instructed to cut $230 billion over the next 10 years, and there is little likelihood that this will come out of support payments for giant agribusiness interests.

House Republican leaders issued a statement celebrating their action as “delivering on President Trump’s full America First agenda—not just parts of it,” after which Trump held his first full cabinet meeting Wednesday at the White House. Trump gave the spotlight to billionaire Elon Musk, whom he has designated as his chief budget-cutter. He asked the assembled cabinet members to give their assessment of Musk’s efforts, and they responded with a predictable ovation.

Trump gave his backing to Musk’s provocative email messages to the entire federal workforce demanding that every worker provide a five-point summary of their job accomplishments from last week, or be fired. One million workers, nearly half the workforce, have not responded to Musk’s messages, and Trump said that all of them should be considered at risk.

Also on Wednesday, Trump issued an executive order requiring every federal agency and department to develop plans for mass layoffs, called “reductions in force” (RIFs), by March 13. This would extend the jobs bloodbath beyond the probationary and temporary employees who have already been laid off en masse, and include more senior workers who have civil service protection and supposedly cannot be fired arbitrarily. Trump mentioned the order at the cabinet meeting, praising Lee Zeldin, head of the Environmental Protection Agency, for preparing plans to eliminate 65 percent of the EPA’s work force.

The March 13 deadline is significant, because on March 14 the current continuing resolution (CR), which authorizes spending by federal agencies, is set to expire. The CR was adopted in December after Congress failed to pass a budget for the current fiscal year, which began October 1, 2024. Unless a budget is adopted or a new continuing resolution is passed, a partial shutdown of the federal government would begin March 14.

This could well be the occasion for the layoff of hundreds of thousands of workers, not just as a temporary measure, as during previous shutdowns, but permanently. Even those workers ultimately called back to their jobs would likely lose pay for the period of the furlough, meaning countless evictions, foreclosures and other hardships.

In the face of these impending calamities, the Democratic Party and the trade unions that supposedly represent these workers are engaged in nothing more than impotent hand-wringing. House Democratic leader Hakeem Jeffries, while acknowledging that the budget bill would mean “the largest Medicaid cut in American history,” proposed no action to stop it.

His position remains, as it has been since Trump took office with his tiny majorities in the House and Senate, “What leverage do we have?” It goes without saying that when the positions are reversed, Republican minorities have engaged in full-scale war against Democratic administrations and blocked their proposed actions. But that only demonstrates the difference between the two parties of corporate America, one pretending to defend working people and the other brazenly doing the bidding of the super-rich—in this case, with the richest man in the world wielding the chainsaw.

UK special forces rejected 2,000 Afghan asylum claims to conceal war crimes

Harvey Thompson

British special forces used a veto to reject over 2,000 asylum claims from Afghan elite units, whom they fought alongside during the US-led occupation of Afghanistan.

The Ministry of Defence (MoD) confirmed that UK special forces officers blocked every single application from former Afghan commandos referred to them for sponsorship under a resettlement scheme put in place after the Taliban came to power. This followed the ignominious withdrawal of US and NATO troops from Afghanistan after two decades of occupation in August 2021.

British soldiers storm a building in Afghanistan, 2007 [Photo by Defence Imagery / Flickr / CC BY-NC 4.0]

The former Afghan commandos were referred to as the “Triples”, due to their unit designations as CF 333 and ATF 444. The units were established, trained, and paid for by UK Special Forces (UKSF) to support the main special forces units—the SAS (Special Air Services) and the SBS (Special Boat Services) on operations in Afghanistan.

Under the rule of the Taliban some are already feared beaten, tortured or killed in reprisals for collaboration with foreign imperialist forces, while many more are believed to be in hiding.

The MoD had always previously denied any suggestion that there was a blanket policy to reject members of the Triples. However, the BBC confirmed that it had “not been able to find any evidence that UK Special Forces (UKSF) supported any resettlement applications.”

The mass rejection of the resettlement applications coincides with the convening of the Independent Inquiry relating to Afghanistan in London, which is investigating allegations that UK special forces had committed war crimes on operations in Afghanistan where the Triples were present.

The inquiry has the power to compel witnesses to appear who are in the UK, but not non-UK nationals who are overseas. If resettled, former members of the Triples could be compelled by the inquiry to provide evidence that could be highly damaging for the special forces and other armed forces of the UK.

In January, a trove of testimony was released from the ongoing inquiry revealing war crimes, the deletion of evidence relating to these crimes and their whitewashing through internal inquiries. It also showed how dramatically relations had deteriorated and repeatedly broken down between Afghan forces and UK special forces following some of the bloodiest fighting of the occupation.

Inquiry testimony detailed one meeting held in February 2011, following a growing rift between the SAS and the Afghan special forces over alleged war crimes committed by UK special forces. This episode almost ended in an armed clash and Afghan special forces temporarily withdrew their support.

Afghan units—who would often suffer blowback for the conduct of UK and other foreign forces, not being separated by garrison walls from the general population—have said that they were treated “like dogs” by their imperial masters.

It was first revealed last year by the BBC’s Panorama documentary series that UK Special Forces command had been given veto power over the resettlement applications of Afghan commandos and exercised it to deny them asylum in Britain.

The MoD initially denied the existence of the special forces’ veto, until denial became untenable. After first suggesting that the BBC’s reporting had been inaccurate, the then Conservative government Defence Minister Andrew Murrison was later forced to inform Parliament that they had misled parliament in their denials.

The confirmation of 2,022 specific rejected asylum applications emerged in court hearings this month, during a legal challenge brought by a former member of the Triples.

According to a February 17 BBC News, “Lawyers for the MoD applied for a restriction order which temporarily prevented the BBC from reporting on the relevant parts of the proceedings, before withdrawing their application last week under challenge.”

Documents since disclosed in court revealed that during the time the MoD was denying the existence of the veto, it already knew that every blocking decision made by UK special forces was potentially unsound and would have to be independently reviewed.

Mike Martin MP, a Liberal Democrat member of the Defence Select-Committee and former British Army officer who served in Afghanistan, told the BBC last week, “There is the appearance that UK Special Forces blocked the Afghan special forces applications because they were witnesses to the alleged UK war crimes currently being investigated in the Afghan inquiry. If the MoD is unable to offer any explanation, then the matter should be included in the inquiry.”

Johnny Mercer, the former Conservative MP who served alongside the SBS in Afghanistan, was last year threatened with imprisonment if he didn’t reveal what his sources told him about alleged war crimes by UK special forces in Afghanistan. He said after testifying to the ongoing inquiry that it was “very clear to me that there is a pool of evidence that exists within the Afghan [special forces] community that are now in the United Kingdom that should contribute to this Inquiry.”

According to the BBC, the MoD began a review last year of all 2,022 resettlement applications referred to and rejected by UK special forces. All apparently contained what MoD caseworkers regarded as “credible” evidence of service with the Triples units.

A government announcement at the outset stated that the review would take 12 weeks, but more than a year later it has yet to be completed.

An anonymous former Triples officer said, “Although decisions have been overturned, it’s too late for some people. The delays have caused a lot of problems. People have been captured by the Taliban or lost their lives.” The officer said the Afghan commandos worked alongside UK special forces “like brothers” and felt “betrayed” by the widespread rejections.

The MoD is facing a legal challenge to aspects of the review being brought by a former senior member of the Triples who is now in the UK, on behalf of commandos still in Afghanistan. It includes challenging the decision not to inform applicants whether their case is actually being reviewed or not.

Dan Carey, a partner at the law firm Deighton Pierce Glynn, said, “Our client’s focus is on his soldiers left behind in Afghanistan, some of whom have been killed while they wait for these heavily delayed protection decisions.

“As things stand they have a right to request a reassessment of a decision they haven’t even been told about. And there are others who think they are part of the Triples Review when the secret criteria would tell them that their cases aren’t even being looked at.”

Lawyers also criticised the level of disclosure in the case by the MoD. No documentation has yet been handed over from within UK Special Forces or government records about the process that led to the blocked applications.

Last week, sacked Foreign Office whistleblower Josie Stewart won a case for unfair dismissal over her disclosures to the media about the UK’s role in the evacuation from Afghanistan. Stewart was sacked by the Foreign, Commonwealth and Development Office (FCDO) in 2022 after being apparently accidentally identified as a confidential source by a BBC journalist.

Stewart’s lawyers said the case was “without precedent” and “raised numerous important issues about civil servants’ rights to whistleblower protection under existing law.”

The tribunal found there was a “clear public interest” in the evacuation and whether it was being carried out effectively and fairly, as the lives of individuals who had assisted NATO forces in Afghanistan were “potentially at stake.”

It also considered that it was “reasonable” for Stewart to go to the BBC’s flagship Newsnight programme when allegations had already been put into the public domain by former FCDO employee Raphael Marshall and “government ministers were publicly disputing them.”

In a statement upon receiving the judgment, Stewart said, “By calling this out, I lost my career. The outcome of this case doesn’t change any of this, but it has achieved what I set out to achieve: it has established that civil servants have the right not to stay silent when systemic failures put lives at risk, as happened during the Afghan evacuation.”