Rich and poor in Germany: The gulf continues to widen

Marianne Arens

Queue in front of a food bank in Frankfurt-Höchst

Prior to the new German government taking office, the social divide in Germany was already wide. The former federal coalition of the Social Democratic Party (SPD), Greens and Free Democratic Party (FDP), which liked to describe itself as a “centre-left government,” pursued the redistribution of income and wealth just as brutally as its predecessors under Angela Merkel (Christian Democratic Union, CDU) and Gerhard Schröder (SPD). The latest Paritätische Armutsbericht (Paritätische Poverty Report) paints a devastating picture of the result.

According to the report, 13 million people in Germany live below the poverty line. The proportion of poor people in the population rose again last year by 1.1 percent to 15.5 percent. Taking into account constantly rising rents, more than one in five people in Germany is now at risk of poverty.

At the same time, the number of billionaires and super-rich is increasing. According to a new Oxfam report, CEO salaries worldwide have risen by 50 percent in five years, 56 times more than the average wages of employees. In Germany, the median salary of top managers has risen to 4.4 million euros—30 times higher than the average wages of all employees.

A tiny minority of around 0.6 percent of the population now owns 45 percent of total wealth in Germany. More and more, the situation is reminiscent of the conditions before the French Revolution, when Jean-Jacques Rousseau wrote 270 years ago:

Are not all the advantages of society in favour of the powerful and rich? Are not all lucrative professions occupied by them alone? Are not all favours and tax exemptions reserved for them? ... How different is the picture of the poor! The more humanity owes them, the more society denies them: all doors are closed to them. (Jean-Jacques Rousseau, “Discourse on the Origin and Basis of Inequality,” 1755)

Although society has immense resources to eliminate poverty, the opposite is happening: 13 million people no longer have enough income to properly participate in society.

Many withdraw because they cannot afford to go out to eat with friends and family once a month, go to the cinema or take part in paid leisure activities. They are unable to pay their rent, bills and loan instalments on time and cannot afford holidays or a car. The elderly often lack the money for glasses or hearing aids, while younger people have to do without basic necessities such as the internet or a mobile phone. Any unexpected expense throws people completely off track. Faster than they think, they can end up at the food bank or, even worse, homeless on the streets.

The unemployed are particularly affected by poverty, with over 60 percent considered poor according to the poverty report. The following groups are also at high risk of poverty:

• 18 to 25-year-olds: In this age group, almost one in four people (24.8 percent) are considered poor, with girls and women (26.9 percent) particularly affected. This means that young people, the most important group in any society for determining the future, are being deprived of many opportunities that they need for their lives and development.
• Many pensioners are also poor: almost one in five (19.4 percent) aged 65 and over are affected by poverty. Pensioners account for more than a quarter of all poor people in Germany. Here, too, women are particularly affected with over 21 percent of all women over the age of 65 considered poor.
• Regarding households, single people (29 percent) and single parents (27 percent) stand out in particular.
• In addition, people without German citizenship are also severely affected, with around 30 percent considered poor.
• People with disabilities and chronic illnesses are also very often poor. Their numbers are not listed separately, as they are included in the 44 percent of people who are not in employment.
• Looking at the country’s individual federal states, Bremen (25.9 percent) and Saxony-Anhalt (22.3 percent) are particularly affected by poverty, with around one in four considered poor. However, the report does not list the actual hotspots of poverty individually. For example, North Rhine-Westphalia has a poverty rate of 17.4 percent, while some cities in the Ruhr area—Duisburg (28.5 percent), Essen (29.4 percent), Dortmund (28.2 percent) and Gelsenkirchen (as high as 37.9 percent)—are well above this figure.

The figures clearly show that the protective benefit of social assistance has been declining recently with the poverty report providing clear evidence. In 2021, the poverty rate was reduced by 27.7 percentage points to 16 percent through state redistribution. Without social benefits, it would have been 43.7 percent. In 2024, the poverty rate fell to 40.6 percent due to the increase in the statutory minimum wage, but social benefits only reduced it by 25.1 percentage points to 15.5 percent. The statutory minimum wage has therefore hardly reduced poverty, but only relieved the burden on the state coffers.

One factor that has significantly exacerbated poverty is inflation since the outbreak of the coronavirus pandemic. The consumer price index rose by almost 20 percent (to 119) between 2020 (=100) and 2024. And real wages are actually declining. In 2020, they fell by 1.2 percent and in 2022 by as much as 4 percent! The latter is the result of the policies of Germany’s trade unions, which, out of consideration for the “German economy,” have been sabotaging all wage struggles for years, thereby contributing significantly to the development of poverty.

The poverty line is currently set at €1,381 per month for single people; for a family of four with two children (under 14), it is €2,900. However, this is only the upper threshold at which people are considered poor. A great many poor people live well below this threshold. The poverty report states: “5.2 million people have to live in considerable material deprivation. This includes around 1.1 million minors and young people and 1.2 million full-time workers.”

In relation to the total number of poor people in Germany, the proportion of those in employment is 19.9 percent. In other words, one in five poor persons is in regular employment but earns too little to live on. More than two and a half million people belong to this category of working poor.

And their situation is getting worse: if you compare the development of the median income of the poor with price developments, it becomes clear that the poor have become even poorer in real terms since 2020. In 2020, the poor had an average monthly income of 981 euros. In 2024, the average was 1,099 euros, which, adjusted for inflation, corresponds to a median income of 921 euros, significantly less than four years ago.

In contrast to this misery, the Oxfam report, published punctually on the eve of 1 May, paints a completely different picture. It focuses on the salaries, bonuses and incomes of top managers. As it shows, CEO salaries have risen 56 times as much as the real wages of dependent employees over the last five years. Worldwide, the median average salary of CEOs has risen by 50 percent and amounted to no less than 4.3 million US dollars in 2024.

For its analysis, Oxfam looked at the remuneration packages of almost two thousand CEOs in 35 countries. These included 56 CEOs from Germany who received more than one million US dollars last year, including basic salary, bonuses and stock options. Their median salary in 2024 was 4.4 million euros, 21 percent higher than in 2019. In contrast, the real wages of workers and employees rose by only 0.7 percent over the same period, 30 times less. Oxfam writes:

The fault lies in the system: while corporations are geared towards increasing profits for CEOs and shareholders, workers are struggling with stagnating wages and have to ask themselves every day how they can still afford rising rents and food prices.

Both Oxfam and Paritätische offer recipes in their reports for how the unprecedented and ever-accelerating redistribution of income from the bottom to the top could be stopped. However, these “proposed solutions” are completely inadequate.

Oxfam calls for taxation of the super-rich, the introduction of higher top tax rates and fairer wages—but says nothing about how today’s extreme polarisation came about. The Paritätische report points to the protective effect of the minimum wage, rent controls and the welfare state and naively proclaims: “The Federal Republic of Germany has committed itself at the international level to actively combat poverty.”

While these organisations vividly illustrate the increasingly dire reality of the rich and poor, they turn a blind eye to what is really happening: following the Trump administration’s arrival in power in the United States, a government committed to the capitalist oligarchy is also coming to power in Germany led by former BlackRock banker Friedrich Merz.

In the interests of businessmen, shareholders and the super-rich, this government is preparing Germany for the next major war and massive attacks on the working class. It consists not only of CDU/CSU (Christian Democratic Union/Christian Social Union) ministers but also of SPD ministers and is supported by the trade unions, the Left Party and the pseudo-left.

The coalition agreement already contains social cuts and attacks on the poorest in society, welfare recipients and refugees. In addition, all social projects are subject to “financial constraints,” meaning they will inevitably fall victim to budget cuts as soon as the crisis deepens or a coming war supposedly requires it.

Iberian blackout exposes financial oligarchy’s looting of European energy infrastructure

Alejandro López

People wait outside a closed metro station, during a major power outage in Barcelona, Spain, Monday, April 28, 2025 [AP Photo/Emilio Morenatti]

On April 28, a massive blackout plunged nearly the entire Iberian Peninsula, including mainland Spain, Portugal, Andorra and parts of southern France, into darkness. It was the most extensive power outage in the history of the European Union, affecting more than 60 million people.

Public life came to a standstill: trains stopped, communication networks failed, hospitals switched to emergency power and entire cities were paralysed as traffic lights stopped working. At least five people are known to have died.

Three family members perished in Ourense from fumes from a generator powering a fan. A woman in Valencia, reliant on an oxygen machine, suffocated. Another died in a fire in Madrid.

Power was not fully restored for 10 hours. Although initial speculation pointed to a cyberattack or sabotage, government cybersecurity agencies have now ruled these out.

A fairly clear picture has emerged of what caused the blackout. At exactly 12:33 p.m., 15 gigawatts of generation, over 60 percent of the peninsula’s load, detached from the grid in five seconds, causing a total system collapse. Voltage surged past 470,000 volts, and frequency hit 50.2 hertz, triggering automatic disconnections and disabling the grid’s balancing mechanisms.

Experts have pointed to a critical shortage of synchronous generation, particularly hydraulic and gas-fired turbines, which could have stabilised the grid in seconds. Of the 26 gigawatts scheduled for that day, only 5 gigawatts were synchronous. Three of Spain’s five major hydroelectric plants were offline for maintenance, and all nuclear reactors except one were shut down.

These decisions were authorised by Red Eléctrica Española (REE), the utility responsible for operating Spain’s national electricity transmission system. Although the Spanish state owns 20 percent of REE through the public investment agency SEPI, the remaining 80 percent is held by private shareholders and global investment funds, including BlackRock and the holding company of billionaire Amancio Ortega.

In practice, this structure ensures that REE operates according to private profit imperatives, not public need. Despite the state’s minority stake, oversight is negligible. REE functions as a nominally public utility managed in the interests of private capital.

According to comments made in El País by Jorge Sanz, former Director of Energy and former President of the Commission for the Energy Transition, “the theory that explains 99% of what happened is that there was an overvoltage and the system suddenly disconnected because REE had not scheduled enough hydroelectric and gas (synchronous) generation, which would have allowed the supply to be reduced—since these plants can cut production in just one second.” This is what the energy sector refers to as “spinning reserves.”

The result was a preventable overvoltage, which disconnected all generation and plunged the entire grid to zero. The French grid briefly decoupled, averting a wider European failure. Portugal, more deeply interconnected with Spain, went down entirely.

Spain’s energy sector is controlled by a handful of conglomerates—Endesa, Iberdrola, Naturgy, Repsol and Acciona—that dominate both generation and distribution. Behind them stand financial giants like BlackRock, Norges Bank, Vanguard and the Qatar Investment Authority, alongside Pontegadea, the asset management firm of billionaire Amancio Ortega. In 2024 alone, they earned over €11 billion in profits.

These firms have repeatedly blocked grid modernisation, delayed investment in battery storage and refused to maintain reserve capacity in combined cycle gas plants—all to maximise shareholder returns.

Warnings about the risks of inadequate infrastructure to support renewable energy have been voiced for years. Engineers, grid operators and researchers have warned that Spain’s rapid growth in solar and wind generation, while essential, has not been matched by investment in battery storage, grid reinforcement, or system inertia solutions.

In California, battery storage has increased from 500 megawatts to over 13,000 megawatts between 2018 and 2024. Spain, in contrast, has allowed its energy system to become “a giant with feet of clay,” as CSIC expert Fernando Valladares aptly described it in an interview with Público. “Security has a cost that companies don’t want to pay,” he explained, warning that “we are doing an energy transition in a capitalist system that has not socially or economically transformed.”

Antonio Turiel of the CSIC accused the energy companies Iberdrola, Endesa and Naturgy of “criminal responsibility,” stating that “if the combined-cycle gas plants had been ready to take over, the blackout would have been much smaller. But they had them shut down.”

Political responsibility lies with successive governments, led not only by right-wing parties, but also by social democratic, pseudo-left and Stalinist parties. This includes the current PSOE–Sumar coalition, and its predecessor the PSOE–Podemos government (2019–2023). These forces have administered years of energy liberalisation, refused to reverse privatization, protected corporate profiteering, and systematically dismantled public oversight, leaving the electricity system exposed to collapse.

After initially praising the recovery effort, Prime Minister Pedro Sánchez abruptly blamed “private operators” and called for accountability, claiming he only learned of REE’s internal investigation “through the media.” He then announced the formation of an independent commission to investigate the blackout. This is little more than an attempt to deflect public anger from his own government’s complicity in decades of privatisation and deregulation.

Tensions have exploded between the government, REE and private firms. Government sources have criticised REE’s president, former PSOE minister Beatriz Corredor, for “failing to lead” during the crisis and evading public explanation. REE and the operators are accused of stonewalling the government’s demand for detailed telemetry and legal accountability.

While the government now insists on “transparency,” its priority remains political damage control. This farce extends to Sumar, PSOE’s pseudo-left coalition partner. Sumar’s leader and Deputy Prime Minister Yolanda Díaz first urged the public “not to get tangled up in partisan disputes,” then, amid mass outrage, she demanded, “The electrical grid must be in public hands. It is a strategic sector and today it is privatised and operates not as an oligopoly, but as a monopoly.” But neither the social democrats nor its “Left Populist” allies oppose the system that enabled the blackout. They have acted as its administrators for years.

Without a doubt, private operators are not being transparent, shielding themselves from billion-euro lawsuits. Corredor, president of Redeia (REE’s parent company) insisted in interviews that “our grid did not fail” and blamed an unknown disruption beyond REE’s control. She rejected any responsibility for the failure to schedule sufficient stabilising capacity, refused to resign and dismissed the idea that greater use of nuclear power would have helped.

While some media outlets have suggested solar plants in Extremadura triggered the cascade, REE itself admitted that the Spanish grid “depends heavily on variable renewables, which disconnect under instability and lack physical inertia reserves.” The day after the blackout, under identical conditions of supply and temperature, no failure occurred. This confirmed the blackout was not caused by renewables, but by how the grid was configured, which directly points to disinvestment in critical infrastructure.

To avoid further disruption, REE has since programmed massive activation of combined cycle gas plants, causing electricity prices to soar by 500 percent, from €35 per megawatt-hour on April 29 to €117 on April 30. The blackout occurred during a period of negative electricity prices, when producers lost money on every megawatt-hour generated. Under Spain’s market design, they are compensated through subsidies and backup contracts. Now, with REE’s programme, energy companies are now making a killing of profits.

The blackout has also exposed the grotesque priorities of Sánchez’s government. While enabling private energy monopolies to loot the national grid and refusing to invest in critical infrastructure, the PSOE-Sumar government is diverting more than €10 billion to military spending.

The debate over this vast increase in the defence budget was already scheduled for his May 7 congressional appearance, now to be shared with an explanation of the blackout. Rather than being subjected to a vote, the military budget is being pushed through by decree to avoid defeat in parliament, laying bare the government’s contempt for democratic oversight.

The convergence of the blackout and the weapons spending debate has laid bare the character of the PSOE-Sumar regime: a government of imperialist rearmament for war abroad while attacking workers at home with blackouts, price shocks and corporate impunity.

Australian election highlights mass opposition to Trump globally

Oscar Grenfell

Saturday’s Australian federal election was another indication of mass hostility on a global scale to the fascistic US President Donald Trump, and the agenda with which he is associated of trade war, militarism, an onslaught on democratic rights and the open rule of an oligarchy.

Australian Prime Minister Anthony Albanese after his re-election on May 3, 2025. [AP Photo/Rick Rycroft]

The election resulted in a victory for the incumbent Labor Party and a wipeout of the opposition Liberal-National Coalition to a near rump. Vote counting is still underway, but Labor will hold more than 86 positions in the 150-seat lower house of parliament, giving it a majority government, while the Coalition is likely to secure fewer than 45 seats. Coalition leader Peter Dutton was among as many as 14 Liberal-National MPs to lose their seat.

With support from the Greens, Labor will also probably control the Senate, the upper house of parliament.

The outcome defied the predictions of most media commentators, as well as the opinion polls, both of which had been forecasting a hung parliament and a minority Labor or Coalition government. 

It did, however, follow a similar result to the Canadian election where the Liberal Party retained office despite poor polling, because of opposition to the Conservative Party’s identification with Trump.

Similarly, the fundamental change that occurred in Australia was a growing popular anxiety and hostility to Trump. When he won the US election in November, polling indicated that around 40 percent of the population was fearful of Trump. 

By mid-way through the Australian election campaign that figure approached 70 percent, with respondents expressing fear that the global trade war unleashed by Trump would result in economic crisis, as well as concerns that his militarist policies heightened the threat of geopolitical conflict and war.

Already an attempt is underway by Labor and the corporate media to present the result as the outcome of a masterful campaign led by Prime Minister Anthony Albanese. 

The reality is that Labor ran a “small target” campaign, outlining hardly any new policies. Those that it did unveil, such as a $5 a week tax cut, were pitiful amid the deepest cost-of-living crisis in decades.

Together with the Coalition, Labor sought to exclude the global upheavals from the official campaign, absurdly claiming that Australia was “uniquely placed” to deal with their fallout.

But Labor did nod to popular anti-Trump sentiment, depicting Dutton as an “aggressive” and “unreliable” figure, who would seek to “Americanise” the already crisis-ridden public health system with cuts and who would be erratic on foreign policy. This was despite Albanese’s public declarations that he would not comment on anything Trump did or said.

The Coalition campaign was shambolic. Trump loomed large, with some commentators noting that there were three candidates in the race, Albanese, Dutton and Trump, with the latter’s “shadow” damaging the Coalition.

In the lead-up to the election, Dutton had hailed Trump as a “a big thinker and deal maker.” He had declared that he would be better placed to work with Trump due to shared ideological affinities. 

But Coalition policies that smelt of Trumpism were widely unpopular and were either openly shelved or tacitly abandoned. The Coalition withdrew a promise to slash over 40,000 federal jobs, which was modelled on Trump and Elon Musk’s Department of Government Efficiency. It scuttled threats to force public servants to end working-from-home arrangements.

Media reports indicated the Coalition was planning to unveil a Trumpian referendum on stripping the citizenship of dual citizens convicted of criminal offences, but no announcement was made. Dutton sought to avoid mention of his program to build an Australian nuclear power sector, which was associated with an attack on renewable energies and raised the spectre of eventual domestic nuclear weapons production.

The backflips meant that the Coalition campaign was incoherent. Even as Dutton sought to distance himself from Trump, leading National MP Jacinta Price declared at a campaign event standing alongside Dutton that together they would “make Australia great again.”

Popular antipathy to Trump intersected with and deepened an existential crisis of the Coalition that was evident in its 2022 federal election defeat. The Coalition 2025 election vote was even lower than in that historic loss. At around 32 percent of primary votes, it is the worst result in the Coalition’s history extending back to the 1940s.

The Liberals, the urban contingent of the Coalition and the traditional conservative party of the ruling elite, now have virtually no presence in the capital cities. They are set to secure only four, possibly five seats in Sydney, the most populous city in the country, as few as three in Melbourne and no seats in Tasmania or Adelaide, the capital of South Australia.

The Teal independents appear to have consolidated their hold over “blue-ribbon” seats in Sydney and Melbourne, which the Liberals had historically dominated prior to 2022. The Teals combine genuflections to environmental concerns and identity politics, with vehement support for pro-business free market policies.

The result underscores the collapse of the Coalition as a “broad church” conservative party. Due to the Liberal wipeout, the regional Nationals, who often tend towards right-wing populism, will have a greater preponderance. What were once the “moderate” Liberals are essentially outside the Coalition in the form of the Teals.

The strengthening of the right-wing in the Coalition occurs under conditions of a massive rejection of its program. Not only the Coalition, but far-right parties, such as One Nation, either received negligible gains in the election or went backwards.

The Coalition debacle has been used to cover up the fact that Labor’s primary vote remains near historic lows. 

The Labor primary vote was only 2 percent higher than in 2022, its lowest result since the 1930s. In this election, the combined vote of Labor and the Coalition was the lowest ever. The dominant tendency has not been a mass shift to Labor, but the disintegration of the Coalition.

In addition to the Coalition crisis, Labor was the beneficiary of support from the official “left.” The Greens campaigned for a coalition government with Labor, which they absurdly claimed would begin a “golden era” of “progressive reforms.”

The Greens have lost at least two of their four lower house seats, with that of party leader Adam Bandt still in jeopardy. The party has blamed Liberal-Labor preferencing arrangements. But, to the extent that the Greens were almost exclusively campaigning for a Labor government, there was little appeal for people to vote for them rather than directly for Labor. Their decline also reflected their rightward lurch which saw them promote a war policy and drop almost all criticism of the Labor government for its support for the genocide in Gaza. 

The pseudo-left groups trailed behind, calling for a Labor vote on the bogus grounds that it was a lesser evil. The corporatised union bureaucracy sought to cover up Labor’s imposition of the biggest reversal to working-class living standards in decades over the past three years, calling for its re-election.

Much of the corporate media joined this lineup. Speaking for the ruling class, they increasingly swung behind Labor as the party most likely to avoid the instability of a minority government.

That was combined with a continuous discussion in the financial press, of the need for the next government to implement sweeping cuts to social services, to pay for the budget deficit and for a massive increase in military spending. The necessity for Labor to proceed with this onslaught on the working class is already the dominant theme of the official coverage.

Labor has signaled its intent to deliver. Treasurer Jim Chalmers has declared that “productivity,” a codeword for intensified exploitation of the working class, will be the administration’s overwhelming policy. Albanese is predicted to meet with Trump in the coming weeks, where he will deepen Australia’s commitment to the US war drive against China, which was a central focus of Labor’s first term.

Despite the confected media hype, this is a government on a collision course with the working class. To the extent that broad sections of the population had illusions that repudiating Dutton and the Coalition might spare them major attacks on social conditions and stepped-up militarism, they are in for a sharp shock.

Fascist candidate wins first round of Romanian presidential election

Andrei Tudora

Presidential candidate George Simion addresses supporters via video link after polls closed for the first round of the country's presidential election redo in Bucharest, Romania, Sunday, May 4, 2025. [AP Photo/Andreea Alexandru]

Fascist candidate George Simion won the first round of the Romanian presidential election, with more than 40 percent of the vote. In the May 18 runoff, he will face Bucharest major Nicusor Dan, who ran as an independent candidate.

The result was a massive rejection of the PSD-PNL-UDMR (Social Democrats, National Liberal and the Democratic Alliance of Hungarians in Romania) coalition government and the policies it has pursued since coming to power in 2021. Its candidate came in third place—despite the mobilization of the important electoral party machines of the three parties, who together control almost all the local authorities in the country.

The 38-year-old Simion leads the fascist AUR party, a continuator of the Iron Guard, a Nazi collaborationist organization in the Second World War. He is closely aligned to fascist Italian Prime Minister Georgia Meloni, as well as the far-right Polish PiS. A supporter of US President Donald Trump, Simion’s campaign included a US tour designed to win sections of the Republican Party for his candidacy, and away from the other Trump-aligned candidate, former social democrat Victor Ponta. Ponta received 13 percent of the vote.

Simion’s party sits at the centre of a network of neo-Nazi and paramilitary groups, whose parliamentarians do not shy away from Holocaust denial and glorifying Nazi mass murderers. It also maintains a relationship with Israel’s Likud party.

The elections are unfolding amid an intense crisis of Romania’s political establishment, driven by the Trump administration’s global trade war as well as the growing inter-imperialist rivalry between the United States and the major European powers. In the course of the crisis, Romanian authorities have repeatedly trampled on basic democratic rights, including the right to vote.

The election is the result of the Constitutional Court’s annulment of the December presidential election, after the first-round victory of Calin Georgescu, a far-right candidate who had expressed misgivings about NATO’s war with Russia in Ukraine. The annulment of the December election was one of a series of undemocratic actions by Romanian authorities, including barring Georgescu from running in the election re-run.

The pretext for the extraordinary measures taken against Georgescu was unsubstantiated allegations that a “Russian cyber-war” was supposedly waged in favor of his campaign. Not only has no evidence been presented to substantiate this, but Georgescu’s campaign has since been found to have been partly bankrolled by the National Liberal party, a member of the ruling coalition.

Bitter conflicts are erupting within the Romanian ruling elite. These stem from its anxieties over the debacle in Ukraine, in which Romania has been heavily invested as a junior partner of the imperialist powers, and over whether the emerging geopolitical landscape will be favorable to the pursuit of its predatory regional interests.

Romania’s ruling elite has exploited its geographical position to become an important supplier and transit hub for the NATO war against Russia. After the 2014 Maidan coup, former Romanian President Klaus Iohannis, who was forced to resign amid the current crisis, and Polish President Andrzej Duda developed a close collaboration directed against Russia, under the Bucharest 9 format and the Three Seas Initiative. Both countries embarked on massive rearmament campaigns.

Romania’s Black Sea shoreline has become a key dock for NATO ships and spy planes. The Kogalniceanu airbase is set to be upgraded and become the largest US base in Europe.

Romanian “volunteers” are fighting on the Ukrainian front lines, with the so-called “battle group Getica” featured prominently in Romanian media and funding campaigns. The group joined other far-right brigades in incursions into Russian territory, including during Ukraine’s partial occupation of Russia’s Kursk region.

Romania has recently adopted legislation allowing for the shooting down of Russian aircraft entering its airspace, in an intensification of tensions over the Danube ports, a vital transit area for Ukrainian grain exports. The Romanian government has been instrumental in assuring the flow of Ukrainian grains towards its Black Sea ports, also negotiating with Moldova and Transnistria (PMR).

In the wake of the geopolitical upheaval produced by the Trump administration, tensions inside the Romanian ruling elite have sharpened, and various factions of the ruling class—including within the ruling Government Coalition—have been engaged in open contacts with the imperialist powers.

While Interim President Bolojan has worked with French President Emmanuel Macron and has pledged Romania to the EU “Coalition of the willing” for continuing the war in Ukraine, PSD Prime Minister Ciolacu created a public scandal by appointing his own “emissaries” to Trump’s personal residence at Mar-a-Lago.

Chief among the concerns of the Romanian ruling class is its historical ambition to exert influence over the territories in its eastern vicinity, especially the Republic of Moldova. Frontrunner Simion’s career is tied to efforts by sections of the Romanian bourgeoisie to take over this former Soviet Republic.

As founder and coordinator of so-called “unionist” movements, Simion helped organize numerous provocations, protests and marches calling for the “union” of Moldova and Romania. This earned him several entry bans in Moldova, the last one still ongoing until 2028.

Simion’s activities in Moldova paralleled those of former president Basescu (in office 2004-2014) and his PMP party. During Basescu’s tenure, Romanian authorities used the country’s EU membership and the prospect of working within the EU, to offer Romanian citizenship to impoverished Moldovan workers. Basescu remains an influential political operative today, and has supported Nicusor Dan’s candidacy.

It is in fact his desire for a diminished role of the EU that is the most often cited criticism of the fascist Simion from part of the establishment parties and media. This is seen as potentially weakening Romania’s regional standing, which has benefited greatly from EU support.

Through the Moldovan Partnership Platform, European imperialist powers—particularly France and Germany—along with Romania have poured hundreds of millions of dollars into Moldova. These funds serve to increase Moldova’s energy and infrastructure dependance on Romania, and broader Romanian influence in the country. A glowing report from Radio Free Europe from October last year, for instance, promoted the construction and renovation of schools and kindergartens teaching in the Romanian language in the Russian-speaking region of Gagauzia.

Simion, copying the brutish style of Trump, has threatened to make such programs dependent on taking over “majority packages in Moldovan state companies.”

His attitude towards Ukraine, where he is also barred from entering, has also come under fire. The AUR and other fascistic organizations have criticized the war in Ukraine from the point of view of Romania’s territorial ambitions towards Ukraine, in northern Bukovina, the Danube Delta and Black Sea deposits.

Nicusor Dan, the current mayor of Bucharest, ran as an independent but was supported by key sections of the country’s establishment, including liberal opposition parties. Dan ran as a pro-EU candidate and his campaign seeks to frame the run-off as a “pro-Western” vs. a “pro-Russian” choice. As well as fanning the flames of Russophobia, this serves to obscure both the source of the fascist danger, which is everywhere raising its head due to the policies of the ruling class, and the agreement between the two factions on the fundamental questions.

Before the election, Dan declared in an interview on Moldova 1 that he “would like union with Moldova to happen today,” while also mentioning a 2018 declaration by the Romanian parliament that it is ready to “remake the 1918 union.” These territorial ambitions, expressed by the official pro-EU candidate, expose the lie that the “European road” of countries like Moldova is about defending “the rule of law” and that it is only Russia that seeks to “redraw the borders by force.”

Both Simion and Dan also agree on making the Romanian working class pay the cost of the rearming drive. Both have expressed the need for severe cuts in public spending and mass layoffs after the elections in order to balance the country’s budget.

The election testifies to the bankruptcy of the political and social system that has emerged 35 years since the Stalinist regime’s restoration of capitalism in Eastern Europe. Official Romanian life is dominated by political descendents of Hitler’s allies in the Iron Guard, the working class is impoverished and war is spreading across the region.

Trump administration seeking to exile immigrants to Ukraine, Libya and Rwanda

Jacob Crosse

Restraints lie on the tarmac as personal belongings of immigrants who entered the United States are loaded onto a plane for a deportation flight to El Salvador by U.S. Immigration and Customs Enforcement. [AP Photo/David J. Phillip]

Multiple reports in recent days indicate that the Trump administration is attempting to deport immigrants and refugees in the United States to distant countries where they are not citizens—some of which are currently embroiled in active armed conflicts.

Over the past week, the Wall Street Journal, CBS News, New York Times and the Washington Post have reported that the Trump administration has been engaged in ongoing talks, some dating back to January, with multiple governments about accepting deportees from the United States.

Under the proposed agreements, the US government would offer cash payments or political concessions to governments in exchange for accepting deported immigrants. These individuals would be expelled to distant countries with which they or their families have no prior connection and to which they never intended to immigrate.

One of the central grievances that led to the American Revolution was the British Crown’s practice of transporting colonists to England or other colonies for trial and punishment, thereby denying them the right to be tried by local juries and courts.

This denial of basic due process was cited in the Declaration of Independence as one of the formal charges against King George III: “For transporting us beyond Seas to be tried for pretended offences. “

In his speech and practice, Trump has made clear he considers himself unbound by the Constitution and that all basic democratic rights are null and void.

Some deportations have already taken place. Last month, independent journalist Marisa Kabas reported on a series of US State Department cables from the American Embassy in Kigali, Rwanda, which confirmed that the US government had deported Omar Abdulsattar Ameen, an Iraqi national, to Rwanda after Ameen stated that he feared persecution if returned to Iraq.

Ameen and his family fled Iraq for Turkey in 2012. In 2014, they were granted refugee status in the United States. Four years later, in 2018, the Trump administration initiated deportation proceedings against Ameen, falsely accusing him of being a high-ranking member of ISIS.

Ameen was arrested, incarcerated and faced deportation until a judge ruled in 2021 that the allegations against him “were simply not plausible.” However, after his release, the Biden administration re-arrested him and renewed deportation proceedings under the false pretense that he had lied about being a terrorist.

On April 4, Ameen, against his will, was forcibly deported to Rwanda. According to journalist Marisa Kabas, a US State Department cable dated April 22 revealed that the Rwandan government had requested policy concessions and a one-time payment of $100,000 to cover social services, residency documents and work permits. The payment was made, and the cable indicated that Rwanda was willing to “accept another ten TCNs [third-country nationals] of various nationalities.”

According to the cable, Rwanda’s “primary motivation” for accepting Ameen and others was “to improve U.S. relations and show it can advance the America First agenda.”

On Tuesday, the New York Times reported that the Trump administration is implementing plans this week to deport migrants to Libya. A flight “could leave as soon as Wednesday,” the newspaper reported, citing unnamed US officials.

Libya has descended into war and sectarian conflict since the 2011 NATO war destroyed the country’s government and society. The most horrific conditions of torture and abuse prevail. The Times cites the State Department’s own report, which refers to “harsh and life-threatening” conditions detention centers, where migrants have “no access to immigration courts or due process.”

Earlier, the Washington Post reported that following the inauguration, the Trump administration “urged” the Zelensky regime to accept deportees from the United States. The lawless and criminal Ukrainian government, backed by the US-NATO alliance, has canceled elections, imposed martial law and banned all left-wing and socialist organizations, including the World Socialist Web Site.

For over one year, the Zelensky regime has imprisoned Bogdan Syrotiuk, a 26-year-old Trotskyist, on bogus charges of “treason” for his public opposition to the ongoing proxy war.

The Trump administration is already illegally kidnapping and deporting immigrants, legal residents and even US citizens to nearby countries in Latin America, including Costa Rica, Panama and Honduras.

In March, nearly 300 men, including Kilmar Abrego Garcia and Andry Hernandez Romero, were banished to the Terrorism Confinement Center, a notorious mega-prison and torture complex in El Salvador. Nearly two months after their deportation—many under the pretext of the Alien Enemies Act—the US government has yet to release a full list of those who were removed.

On Sunday, CBS News reported that the US government is in negotiations with Angola and Equatorial Guinea. The Wall Street Journal and other outlets previously reported that the administration had also contacted Benin, Eswatini, Libya, Moldova and Rwanda.

While an Angolan government spokesperson issued a statement on Monday denying that the country is “accepting deported individuals of other nationalities,” Rwanda’s Foreign Minister Olivier Nduhungirehe confirmed to the Associated Press that his government is in discussions with the US about hosting exiled immigrants and refugees.

Nduhungirehe told the Associated Press that discussions between the US and Rwanda were underway, after previously telling state media that the plans were still in the “early stage.”

This is not the first time Rwanda has been proposed by a major imperialist power as a penal colony for immigrants and refugees fleeing their home countries. In 2022, then–British Prime Minister Boris Johnson unveiled the “Rwanda asylum plan,” under which asylum seekers would be deported to the African nation. The policy was continued by his successor, Rishi Sunak.

However, upon taking office in July 2024, Prime Minister Keir Starmer scrapped the plan, arguing that the funds would be better spent deporting asylum seekers directly to their “home” countries.

However, in November, the Labour government announced a similar “Rwanda plan” proposal, under which immigrants arriving in the Chagos Islands would be deported to the remote island of St. Helena in the South Atlantic.

Warning that Japan could play debt “card” in tariff war

Nick Beams

The decision by US President Trump for a 90-day pause, set to expire in July, on “reciprocal tariffs” imposed on a wide range of countries has calmed financial markets, at least for the time being.

But the negotiations—more akin to a series of diktats being issued by the US—are revealing deep conflicts and tensions that could rapidly erupt to the surface.

Apart from China, which has combined tariffs imposed against it of 145 percent, one of the significant targets of the Trump administration is Japan, which was hit with a 24 percent reciprocal tariff, as well as being subject to a 25 percent tariff on autos and auto parts.

Ryosei Akazawa in Tokyo on October 1, 2024. [AP Photo/Hiro Komae]

Last week, as he departed for Washington for talks, Japan’s top trade negotiator, Ryosei Akazawa, pointed to the extent of the crisis starting to engulf the auto industry, which accounts for 3 percent of the country’s GDP.

“The head of an automaker we spoke to told us that his company is suffering a $1 million loss every hour,” he told reporters.

The International Trade Centre, a combined agency of the United Nations and the World Trade Organization, has estimated that Japan could lose as much as $17 billion from US markets as a result of the tariffs. Other estimates are even higher—up to $24 billion—with Toyota alone hit by a loss of revenue of $12 billion.

So far, Japan has come up empty-handed from the talks. Returning to Tokyo on Saturday, Akazawa said Japan had no intention of striking a deal with the US unless all its new tariffs were reviewed.

“We have pressed the United States to reconsider all of the series of tariff measures as we cannot reach an agreement if that is not properly addressed in a package,” he told reporters.

As the talks were taking place, the Japanese finance minister, Katsunobu Kato, publicly upped the ante in a television interview on Friday when he said the country’s holdings of more than $1 trillion in US Treasury bonds could be a “card” in trade negotiations.

Asked whether Japan would maintain its long-term stance as a non-seller of US assets, Kato said: “It does exist as a card; whether or not we use that card is a different decision.”

Underscoring the significance of the remarks, the Financial Times (FT) described it as a “rare baring of the teeth by America’s closest ally in Asia.”

Speaking on Sunday in Milan, Kato said Japan was not thinking of using its Treasury holdings as a bargaining chip. But despite the apparent walk back, the cat is very much out of the bag.

One of the factors behind Trump’s announcement of the pause on the reciprocal tariffs was the selloff in the US debt market and the decline in the US dollar in marked contrast to what usually takes place when there is a move into US assets in times of turbulence.

Trump pulled back after he was warned by Treasury Secretary Scott Bessent and other officials that if the selloff continued, it could lead to a crisis, a US weakness which Japan has clearly noted.

Any significant withdrawal by it from the US debt market or even indications that it could withdraw would have major consequences.

The imposition of tariffs against Japan has been characterized by Japan’s prime minister, Shigeru Ishiba, as a “national crisis.”

Commenting on the initial Kato remarks, Nicolas Smith, chief Japan strategist at the Hong Kong-based financial firm CLSA, told the FT: “This is a street fight: promising not to use one of your strongest weapons would be both naïve and reckless. You don’t need to use the weapon; just brandish it.”

Trump has insisted that he is operating from a position of strength because of the importance of the US market to all the major economies of the world. But at the same time, the US is dependent on the rest of the world to finance its growing public debt—now at $36 trillion and rising.

Long-time economic analyst of Japan, Jesper Koll, told the FT: “The fact that the usually guarded and diplomatic finance minister spoke up on national TV about what is arguably Japan’s biggest asset in dealing with America confirms the growing confidence of Japan’s elite in their dealings with the US.”

As the conflict intensifies, the effect of the US tariff hikes is ripping through some of the Asian economies.

In Vietnam, which is the subject of a possible 46 percent reciprocal tariff, one of the highest, textile and garment manufacturers are waiting with trepidation for what happens after the pause expires in July. Operating with narrow profit margins, some have started to cut jobs or have stopped hiring.

If the tariffs go ahead, thousands of Vietnamese firms that supply the US market could go under. Even if the pause is extended, this may not alleviate the situation because in conditions of great uncertainty, outlets in the US could decide to reorganize their supply chains.

The character of the negotiations with the US is illustrated by the case of Taiwan, which is the subject of a 32 percent reciprocal tariff.

This week, the Taiwan dollar continued its rise against the US dollar, taking its total rise to 10 percent since the start of April when the tariff war began.

It is widely believed that one of the reasons for the rise is that upward movement in the currency is a demand of the US Treasury Department in its negotiations on a trade deal.

Taiwan’s central bank issued a statement last Friday that this was not taking place. This only increased the belief it has, given the position of the Trump administration that a lower dollar is needed to improve the competitive position of the US in world markets.

Taiwan is also an illustration of how the tariff wars can set off a financial crisis.

Life insurance companies hold a considerable portion of Taiwan’s overseas assets of $1.7 trillion, much of it in the form of US Treasury debt.

The value of these holdings is falling because of the decline in the value of the dollar, leaving them exposed to losses because they have not hedged their dollar holdings sufficiently. Taiwan’s market regulator has held talks with some of Taiwan’s largest insurers to check on their position.

Ju Wang, a strategist at BNP Paribas in Hong Kong, told the FT: “Local exporters are panicking, and local lifers are under-hedged while equity-related outflows have ceased.”

The Taiwan situation, the “national crisis” in Japan, the threatened layoffs and closures in Vietnam are just three expressions, among many, of the economic and financial mayhem triggered by the Trump tariff war and the underlying crisis of the global capitalist economy.

False start for the Merz government

Peter Schwarz

Christian Democratic Union (CDU) leader Friedrich Merz was only elected German chancellor in the second round of voting on Tuesday—and only thanks to the help of the Left Party and the Greens. Merz had failed in the first round of voting because only 310 of the 328 members of the Bundestag from the governing coalition of the CDU/Christian Social Union (CSU) and Social Democrats (SPD) voted for him. To be elected chancellor, Merz required at least 316 votes, the majority of all parliamentary deputies.

This was unprecedented in the history of the Federal Republic of Germany. So far, all chancellors have been elected in the first round of voting. But although the CDU, CSU and SPD agreed after weeks of negotiations on a 144-page coalition agreement, which was passed by the relevant party committees, Merz did not manage to unite the necessary number of deputies behind him.

In order for the second round of voting to take place on the same day, Merz had to rely on the support of the Left Party and the Greens. Both were determined to help him into office as quickly as possible so that he could stabilise the situation and implement the right-wing coalition programme.

In front of a photo of the former German Chancellor Konrad Adenauer, CDU Chairman Friedrich Merz addresses the media in Berlin, Germany after the state elections in the German state of North Rhine-Westphalia. [AP Photo/AP]

The Bundestag’s (Federal Parliament) procedural rules stipulate a deadline of three days for the second round of voting, which can only be shortened by a two-thirds majority. The Left Party and the Greens, together with the governing parties, tabled a motion to this effect, which the far-right Alternative for Germany (AfD) also agreed to in the end. In the second round of voting, 325 deputies voted for Merz, who was sworn in as federal chancellor in the evening.

The Merz government’s false start provides an unsparing exposure of the real political situation in Germany. His government is not only the most right-wing but also the most unpopular since the Second World War.

At the heart of the coalition agreement is the most comprehensive rearmament program since Hitler, a “fundamental turnaround” in migration policy in the spirit of the AfD, the establishment of a police state and massive social spending cuts that will shift the costs of war and trade war onto the working population. 

This program has no support among the population. In the Bundestag elections, the CDU/CSU achieved the second worst result in its history and the SPD the worst. Together they only received 45 percent of the vote and have since lost a further 7 percent in the polls. According to a survey by the Forschungsgruppe Wahlen, only 38 percent welcome the election of Merz as chancellor, while 56 percent oppose it.  

However, this opposition is not reflected in official politics. At every opportunity, the AfD offers Merz the chance to implement his right-wing program together with them instead of the SPD. The parliamentary secretary of the AfD, Bernd Baumann, justified its approval of the early second round of voting with the words: “Germany needs a government.”

The nominally “left-wing” opposition parties made their support for Merz and his reactionary program even clearer. As soon as the election debacle became apparent—and share prices began to fall—they forgot their occasional criticisms of Merz and rushed to his aid.

A commentary that appeared on Zeit Online shortly after the first round of voting summed up the attitude of this milieu:

The world order is tottering, and Germany is still without a government. That is quite simply fatal.

Green politician Renate Künast described the weakening of Merz as a “thunderbolt for the whole country.” Katrin Göring-Eckardt wrote: “This is not good.” Even though she does not support the chancellor, she could “only warn everyone against being happy about chaos.”

Britta Hasselmann, parliamentary group leader of the Greens, regretted that “trust in Merz and Klingbeil has been shaken.” The worst thing that could happen to this country now would be new elections, she commented. Her colleague Katharina Dröge added: “Germany needs a stable government.”

Nothing else could have been expected from the Greens. In Olaf Scholz’s government, they were the strongest supporters of military armament, the war against Russia and the genocide against the Palestinians. The only reason they are not part of the new government is because they are not needed for a majority. Outgoing Foreign Minister Annalena Baerbock had a visibly good-humoured chat in the Bundestag with her successor, CDU politician Johann Wadephul. She herself will represent the new government at the UN in New York, where she will chair the General Assembly for a year.

The Left Party, which voted for the CDU and SPD’s war credits in the Bundesrat (Federal Council, the upper house) in March, also reacted with visible concern to Merz’s election defeat. Party leader Jan van Aken gave him helpful advice. If Merz does not even get the trust of his own people, van Aken said:

[H]ow is he supposed to win the trust of people who are struggling with the real problems of everyday life?

Co-chair Ines Schwerdtner explained: “It is now up to the CDU whether they dare to talk to us.”

The former Minister President of Thuringia, Bodo Ramelow, now Vice President of the Bundestag, was “quite angry” about the election debacle. The party leaders of the planned coalition should have ensured that such a scandal did not occur, he criticised. Ramelow was one of the first to suggest an immediate second round of voting to help Merz out of his predicament. “As the Left Party, we will also help to ensure that the two-thirds majority is achieved,” he said.

The important role played by the Left Party in Merz’s election as chancellor was also recognised by Der Spiegel. One of six lessons that the news magazine draws “from Merz’s stumbling start” is:

It won’t be the last time that the CDU/SPD coalition will have to rely on the approval of Heidi Reichinnek’s party. Merz now has reason to seriously consider overturning the ban on cooperation with the Left Party. It is no longer in keeping with the times.

The new, ultra-right Interior Minister Alexander Dobrindt (CSU) took a similar view. He said:

Today it was relatively clear that if we want a two-thirds majority, we have to give the Left Party a call. ... Where two-thirds majorities are needed, we will have to do so again in the future, regardless of whether the political colouration suits us in any given case.

It is not known which 18 deputies from the governing parties refused to vote for Merz in the first round of voting and what their reasons were. The vote is secret. However, it is clear that the Merz government is extremely weak and internally divided.

Broad sections of the working class and youth will inevitably come into conflict with it when it militarizes society, reintroduces compulsory military service, suppresses political opponents, cuts social spending and wages and cuts tens of thousands of jobs in the escalating trade war.