Slumping car sales lead to extended layoff of Fiat Chrysler Sterling Heights workers

Shannon Jones

Workers at the Fiat Chrysler Sterling Heights Assembly Plant are continuing on layoff due to slumping sales of the Chrysler 200 and Dodge Dart.

Last week Fiat Chrysler announced that what had originally been scheduled as a six-week layoff would be extended for another three weeks. Workers are now not set to return until April 4. During the layoff period workers get a percentage of their regular earnings through a combination of state unemployment benefits and supplemental pay from the company.

The layoffs affect some 2,600 hourly workers at Sterling Heights Assembly and another 150 workers at the nearby Sterling Stamping plant. Some 400 skilled trades and maintenance workers are not affected at Sterling Heights Assembly.

The layoffs follow the announcement by Fiat Chrysler CEO Sergio Marchionne that the company will stop production of the Chrysler 200 and the Dodge Dart in the coming period. The company is reportedly in discussion with outside parties to continue small car production in order to concentrate on larger, higher profit margin vehicles like the Dodge Ram truck and its line of Jeep products.

Sales of the Chrysler 200 were down 61 percent compared to the same period one year ago, to fewer than 12,000 vehicles. The sales decline follows the decision by Fiat Chrysler management to pull back on dealer incentives last November.

According to Ward’s Automotive, FCA had 147 days of inventory in stock of the Chrysler 200, far more than the 60 to 65 days supply considered normal.

Sales of the Dodge Dart have fallen 26 percent so far this year. There has been no announcement of layoffs yet at FCA’s Belvidere, Illinois assembly plant where the Dart is made.

At one time FCA considered the Chrysler 200 a means to secure a position in the US passenger car market. The company spent $1 billion retooling the Sterling Heights facility, which had originally been scheduled to close permanently, to build the 200.

The only official reaction to the layoff extension came from United Auto Workers Local 1700 President Charles Bell, who told the Detroit Free Press, “We are confident we will go back to work in April.”

In fact, the national UAW-Fiat Chrysler contract agreement signed last fall opened the way for the current round of layoffs, containing no provisions to halt the contracting out of production.

Sterling Heights Assembly workers contacted by the WSWS said that the plant is scheduled to be shut down again later this spring for retooling. Fiat Chrysler is reportedly planning to shift production of the Dodge Ram truck from the Warren Truck plant to Sterling Heights over the next eight to 10 months.

Stacy, a veteran Sterling Heights worker, told the WSWS, “All I know is that the truck is coming, but there is no definite information about what is happening. Corporate keeps that hush-hush.

“We went through this before during the bankruptcy. It is coming full circle.”

Workers at the Warren Truck plant face an uncertain future. There are reports that FCA plans to move the Jeep Grand Wagoneer to the plant to replace the Ram. However, the Wagoneer is a slow selling vehicle and it is unlikely that FCA will need to retain its entire current workforce at the facility.

A tier-two worker at Warren Truck told the WSWS, “The union hasn’t said anything to us. All I know is what was rolled out to us prior to the [2015] contract vote – that a new vehicle is coming, but no one specifically said what it is. At this point it looks like some of us will stay here and some will go over to Sterling Heights when the change occurs.”

There are signs that the auto sales boom of the past several years may be winding down. A report Sunday in the Wall Street Journal notes that delinquency rates for so called subprime auto loans have risen. Subprime loans account for about 20 percent of the $1 trillion in auto loans made last year. Nine out of 10 new cars and more than one-half of used cars are financed.

While a majority of subprime loans are for used car purchases, the rising delinquency rates are a sign of weakness in the overall car market.

The Journal asserts that the automakers have boosted sales by extending credit to those with low credit scores. It cites one recent bond made up of subprime loans where, through February, 12 percent of the underlying loans were at least 30 days past due and one-third were 60 days past due.

The Journal writes, “The 60-plus day delinquency rate among subprime car loans that have been packaged into bonds over the past five years climbed to 5.16% in February, according to Fitch Ratings, the highest level in nearly two decades. The rate of missed payments is higher for loans made in more recent years, a reflection of more liberal credit standards and the larger number of deals from lender serving less creditworthy customers, according to Standard & Poor’s Rating Services.”

It goes on to cite a hedge fund manager who declares, “What’s driving record auto sales is not the economy, but record auto lending.” He said that lenders have systematically loosened loan-underwriting standards.

The UAW has no answer to the mounting threat to jobs except the promotion of rabid American nationalism, blaming workers in Mexico, China and other countries for stealing jobs in the US. In fact layoffs are a product of the developing global economic slump, a consequence of the anarchy of capitalist production.

South Korea imposes extra sanctions on North Korea

Ben McGrath

South Korea’s imposition of unilateral sanctions on North Korea on March 8 has further heightened tensions on the Korean peninsula following new UN Security Council sanctions adopted on March 2, under duress from the US.

Washington and Seoul have exploited Pyongyang’s fourth nuclear test in January and a rocket launch last month to impose penalties that are intended to cripple North Korea’s economy, accentuate the political crisis in Pyongyang and, in doing so, intensify the pressure on China and Russia.

While the new UN sanctions barred the export of materials such as gold, titanium ore and rare earth metals from North Korea, as well as the import of all weapons and aviation fuel, they allow trade in coal, iron ore and oil so long as it is for “livelihood purposes.”

China pressed for this last condition, fearing that the North Korean regime would be pushed to the brink of collapse if it were starved of oil and unable to earn income from its mineral exports. While Beijing opposed the North Korean nuclear tests, it is deeply concerned that a political implosion in Pyongyang could result in the unification of the Korean peninsula under a government aligned with Washington.

Lee Seok-jun, minister of the government policy coordination office, justified the unilateral South Korean sanctions by declaring: “The government will continue to sanction and press the North in close cooperation with the international community so as to create conditions where there is nothing for it but to change.” In reality, South Korea, in league with the US, is pushing for regime-change in Pyongyang.

The new South Korean sanctions go further than the UN Security Council resolution in choking the North Korean economy. Foreign ships that have visited North Korea in the previous 180 days will be banned from entering South Korean waters. Seoul hopes it will prevent third countries from doing business with Pyongyang. Last year, 66 ships that had been to North Korea made 104 stops in South Korea as well, according to the government, which also stated these vessels were loaded with steel and general merchandise. Japan imposed similar sanctions last month.

The South Korean government also intends to draw up a list of items that other countries will be required to ban if the goods are made in, or with materials originating in, North Korea.

By these measures, countries that wish to trade with South Korea will be forced to limit economic ties with Pyongyang. This is particularly aimed at China, which is North Korea’s only major trading partner. In addition, some 40 individuals and 30 business entities in North Korea have been blacklisted.

Seoul has also suspended a trilateral trade cooperation agreement with North Korea and Russia known as the Khasan-Rajin project. This deal included the construction of a railway line between the Russian border town of Khasan and the North Korean port town of Rajin. Siberian coal was to be transported to the port then loaded onto ships for delivery to South Korea. In 2014-2015, three trial runs took place with Chinese ships.

The project’s suspension is noteworthy as Russia had threatened to veto the UN sanctions resolution if the project was to be banned. Before the South Korean sanctions were formally announced, Je Seong-hun, a professor at the Hankuk University of Foreign Studies, commented: “Dropping the project will inflict a major blow on Russia’s East Asia policy. The backlash from Russia will be considerable.”

Seoul is also capitalising on the heightened tensions on the Korean peninsula to pass so-called anti-terrorism legislation under the pretext of countering the North Korean “threat.” Its spy agency, the National Intelligence Service (NIS), claimed on March 8 that North Korea had hacked into the cell phones of high-ranking government officials at the end of February and beginning of March.

None of the NIS allegations should be accepted at face value. The spy agency is notorious for fabricating pretexts for ramping up pressure on North Korea. In February, Unification Minister Hong Yong-pyo claimed North Korea had used 70 percent of the funds earned at the now-shuttered joint Kaesong complex to fund its weapon programs. The next day, Hong was forced to admit he had no evidence to substantiate the allegation, but the government has nevertheless continued to circulate it.

The hacking allegation came at an opportune time for Seoul. In February, the NIS, again without specific evidence, claimed North Korea was preparing cyber-attacks and demanded the passage of a cyber security bill along the lines of that currently being considered by the National Assembly. If passed, the legislation will allow the monitoring of online communication and create a new body under the NIS to direct this operation.

A separate “anti-terrorism” bill was passed last week following a nine-day filibuster by the main opposition Minjoo Party of Korea (MPK), the latest incarnation of the Democrats. The new law allows the NIS to tap telephone calls and access bank records, enabling the government to collect a broad range of information on South Korean citizens. The bill also establishes an office under the prime minister to ostensibly oversee the NIS. South Korea’s prime minister directly serves under the president.

The MPK is not opposed to the attack on democratic rights. Its filibuster is nothing more than a political stunt to give the impression that the party defends democracy in the lead-up to next month’s general election. In fact, the MPK previously suggested similar measures, as long as they were implemented by a separate government body.

The tensions with North Korea come as the US and South Korea conduct the largest-ever war games on the Korean peninsula. The Key Resolve and Foal Eagle exercises began on March 7 and will run through to March 18 and April 30 respectively. While these drills in the past have focused on supposedly defensive scenarios, this year the two militaries are simulating offensive maneuvers under the new Operational Plan 5015 that includes pre-emptive attacks on North Korean installations and the assassination of key North Korean officials.

In short, Seoul is preparing for war alongside the US, directed not only against North Korea, but also China. Washington is exploiting the tense situation on the Korean peninsula to justify its military build-up in North East Asia as part of its broader “pivot to Asia” and military encirclement of China. Well aware that the war drive will provoke popular opposition, the South Korean government is preparing police-state measures to suppress it.

Central banks confront unintended consequences

Nick Beams

Three of the world’s major central banks are to meet this week in the wake of last week’s decision by the European Central Bank to push the interest rate it charges on deposits further into negative territory and expand its supply of ultra-cheap money to banks and financial institutions from €60 billion to €80 billion a month.

The Bank of Japan (BoJ) meets today, followed by the US Federal Reserve on Wednesday and the Bank of England on Thursday. No major policy decision is expected to result from any of the discussions. But financial authorities will have plenty on their agenda amid growing concerns that the entire financial system is moving out of their control.

Since the Japanese bank’s decision to introduce negative rates on new deposits from February 16, central banks have been confronted with a series of problems and unforeseen consequences.

When BoJ governor Haruhiko Kuroda announced the new interest rate regime, it was intended to put downward pressure on the Japanese yen and boost the stock market. A lower yen would improve the competitive position of Japanese companies in global markets and lift their bottom line.

Moreover, Kuroda’s announcement was an admission that the policy of massive purchases of Japanese government bonds, initiated in 2013, had failed to lift the rate of inflation. The stated objective was to reach an inflation rate of 2 percent in two years. Three years on, inflation is still close to zero and the target date has been shifted to the middle of next year. No one seriously believes it will be met.

The policy has also failed to promote growth. In the fourth quarter of 2015, the Japanese economy contracted at an annual rate of 1.1 percent and further negative growth is expected in the first quarter of this year. This would mark the third technical recession—defined as two consecutive quarters of negative growth—in four years.

In a 5-4 vote on the BoJ’s governing council, Kuroda and his supporters decided to introduce negative rates with the stated purpose of lifting prices and boosting the economy and the unstated objective of lowering the value of the yen.

Given public pronouncements from the G-20 that there should be no resort to 1930s-style beggar-thy-neighbour policies, no central banker will admit to targeting the exchange rate, lest they be accused of engaging in currency wars. But the various forms of monetary easing are all carried out with that aim.

The move to negative interest rates has backfired badly, however. Instead of falling, the yen has actually risen in recent weeks, while the stock market has declined. This is because the BoJ decision had unintended consequences. First, it was seen as making less likely a decision by the US Fed to further increase interest rates, following the 0.25 percentage point increase in December. This had the effect of slowing the appreciation of the dollar relative to the yen and other currencies.

Second, the Japanese decision added to the growing perception in financial markets and more broadly that the world’s central bankers have no clear idea of where their policies are heading. Instead, they seem to be stumbling in the dark and reacting in an ad hoc manner to each development.

The increase in uncertainty, combined with fear that negative rates would have an adverse impact on the business models and profits of banks, made investors more wary and resulted in a shift to so-called safe havens. As Japan is regarded one as of these, the yen rose, rather than declined as might otherwise have been expected.

The introduction of negative rates also has had significant consequences internally in Japan. One of the aims of so-called Abenomics is to increase consumer confidence and spending in order to counter deflation. The new interest rate regime has had the opposite effect. Consumers have rightly concluded that if the BoJ has to introduce negative rates then the economic situation must be worsening, rather than improving, and so have cut back on spending.

A source cited by the Wall Street Journal as “close” to the BoJ commented: “There is a perception that we are set to further lower the negative rates, and it seems to be stoking a sense of uneasiness among the public.” The article noted that opinion polls regarded the negative rate policy as ineffective and consumer sentiment last month fell at its sharpest rate for two years.

The European Central Bank (ECB) program, based on the pledge by its president Mario Draghi in 2012 to do “whatever it takes,” has proven no more successful than that of its Japanese counterpart. The measures the ECB introduced last Thursday had an air of desperation. Draghi warned of “disastrous deflation” had nothing been done over the past four years.

However, as with the BoJ decision, the latest ECB measures seemed to have the opposite effect from what was intended. The further lowering of interest rates into negative territory could have been expected to lower the value of the euro. After an initial fall, the euro rose, swinging through a range of 4 percent in a single day, because Draghi appeared to indicate that interest rates would not be reduced further.

Two reasons have been suggested for Draghi’s comments: open opposition to further rate cuts from Germany, where the Bundesbank has expressed hostility to the entire easy money policy; and concerns that the negative interest rate regime was calling into question the business models of the major banks.

The US Federal Reserve meeting on Wednesday is not a policy event. However the comments of chairwoman Janet Yellen will be followed closely as to what they indicate about the possibility of a further interest rate increase when the Fed meets in June

When the Fed increased its base rate by 0.25 percentage points in December, the general consensus was the first rate increase in a decade had proceeded smoothly. But the apparent calm was short-lived. Since the start of the year, markets have experienced a series of gyrations, to which the central banks are responding with ever-more desperate measures, giving rise to unanticipated consequences that are contributing to further instability.

Millions join protests in Brazil demanding ouster of Workers Party government

Bill Van Auken

Crowds estimated in the millions demonstrated in cities across Brazil Sunday demanding the ouster of the Workers Party (Partido dos Trabalhadores-PT) government and the country’s President Dilma Rousseff.

The largest of the rallies took place in Sao Paulo, Brazil’s financial and industrial capital, where the city’s security office put the number of demonstrators, who filled the entire length of the central Avenida Paulista, at 1.4 million. Instituto DataFolha, a prominent polling institution, put them at 450,000, while organizers claimed an improbable 3 million.

Fueling these rallies, which were substantially larger than similar demonstrations held a year ago, was anger over the ever-widening political bribes and kickbacks scandal that has siphoned billions of dollars from the state-run energy conglomerate Petrobras, as well as growing frustration over the precipitous decline of Brazil’s economy into its worst crisis since the Great Depression of the 1930s.

They were further driven by the demand of state prosecutors in Sao Paulo to place Luiz Inacio Lula da Silva, the former president and founder of the PT, in “preventive custody” in connection with their charges that he concealed ownership of a seafront apartment built for him by a construction firm that was a major contractor with Petrobras.

Demonstrators chanted, “Down with the PT,” “Dilma out” and “Stop the corruption.” A significant minority within the rallies raised banners and signs calling for the Brazilian military to intervene, reprising the right-wing 1964 coup that plunged Latin America’s largest nation into 21 years of brutal military dictatorship.

Unlike the rallies held a year ago, Sunday’s demonstrations enjoyed the open support of the right-wing bourgeois parties opposed to Rousseff and the PT, as well as that of the leading employers and business associations such as FIESP (Federation of Industries of the State of Sao Paulo). Free metro transit fares were offered in Sao Paulo to boost participation.

Surveys indicated that, while larger than last year, the rallies were once again dominated by sections of the middle class. A survey done by a leading polling company found that 63 percent of the protesters had incomes equal to at least five times Brazil’s minimum wage.

While the predominant political orientation of the protests was right-wing, attempts by the PT’s right-wing political opponents to capitalize on them were met with angry hostility toward all politicians and parties.

Sao Paulo Governor Geraldo Alckmin and Senator Aécio Neves, who was narrowly defeated by Rousseff in the 2014 election, both of the right-wing PSDB (Brazilian Social Democracy Party), were quickly escorted out of the Sao Paulo protest by their security guards after crowds surrounded them chanting, “You’re next,” and denouncing them as “opportunists” and “crooks.” In other cities attempts to address the crowds by right-wing politicians were drowned out by boos and chants of “no parties.”

The leadership of the Workers Party called off rallies in support of Lula and Rousseff that had been called for the same day, citing fears of violent confrontation. It is also undoubtedly the case that the those who would come into the street in defense of the PT would be heavily outnumbered by the party’s opponents.

PT President Rui Falcão used his Facebook page Monday to call for rallies on Friday March 18 “in defense of democracy and presidents Lula and Dilma, against the coup and for changes in the economy.”

This last slogan is meant to cast the PT as being an opponent from the “left” of the very policies that are being pursued by the PT government itself. Rousseff has responded to Brazil’s deepening economic crisis with the attempt to push through a “fiscal adjustment” program aimed at slashing pensions, wages and workers’ benefits, while assuring that fully 20 percent of the federal budget goes to service Brazil’s debt to Wall Street and the international banks.

These economic austerity measures serve to exacerbate the crisis of Brazilian workers under conditions in which layoffs have reached 100,000 a month and the inflation rate has topped 10 percent.

In a further sign that the economic crisis is only deepening, Brazil’s Central Bank reported Monday that economic activity had fallen by another 0.6 percent in January, confounding economists’ predictions of a very slight increase for the month.

Despite the indices of economic decline, the value of Brazil’s currency has risen by 10.8 percent over the past month, while its stock and bond markets have also risen substantially over the past week. As the Financial Time snoted, the impetus to the market rally has “come from the political sphere.”

“The detention of former President Luiz Inácio Lula da Silva, and its implications for his protégé and current leader, Dilma Rousseff, have raised hopes among investors that the barriers to political change may be overcome sooner than expected,” the newspaper reported.

Jefferson Luiz Rugik, who heads the Correparti brokerage in Sao Paulo, told the paper, “Everything that is against the current government and President Dilma is favourable for the real . . . it raises the possibility that we would have another government with more credibility.”

For more than a dozen years, the PT has served as the principal party of the Brazilian bourgeoisie, serving its interests, while promoting limited social welfare programs aimed at dampening the class struggle, even as social polarization between a narrow financial elite and masses of workers and poor continued to deepen.

Now, dominant layers within the Brazilian ruling class have decided they need a new kind of government, of an openly right-wing and potentially dictatorial character, to carry out drastic attacks on the living standards of the working class. This is the driving force behind the campaign to impeach Rousseff.

The betrayals carried out by the PT, and particularly by an array of pseudo-left groups that promoted it as a substitute for the building of a revolutionary party of the working class, are responsible for the present political situation, which confronts Brazilian workers with grave dangers.

The president of the House of Deputies in the Brazilian Congress, Eduardo Cunha, of the PMDB (Brazilian Democratic Movement Party), an erstwhile ally of the Rousseff government, has called for members of the body to remain in Brasilia through Friday in anticipation of the country’s Supreme Federal Tribunal responding to questions on the rules governing impeachment, allowing the process to begin.

Cunha, a right-wing Christian fundamentalist, is charged by federal prosecutors with receiving as much as $40 million in Petrobras-linked bribes for himself and his political allies, using an evangelical mega-church to launder the money. He is accused of personally socking away $5 million in bribe money in secret Swiss bank accounts.

Second terrorist attack in a month in Turkish capital kills at least 37

Halil Celik

On Sunday March 13, at least 37 people were killed and 125 wounded in a car bomb attack in the middle of Ankara, the Turkish capital. Immediately after the attack, the Radio and Television Supreme Council (RTUK) banned broadcasting images of the scene and of victims, while an Ankara court ordered the blocking of social media, including Facebook and Twitter.

The last terrorist attack was carried out on February 17 by the Kurdistan Freedom Hawks (TAK), a splinter group from the Kurdistan Workers’ Party (PKK), near the military headquarters, parliament and other key government institutions in Ankara, killing 29, most of them soldiers. It came four months after a suicide bombing organised by the Islamic State (IS) against a peace rally near the Ankara Railway Station left at least 103 dead.

After the attack, the Turkish ruling elite seized the opportunity to further promote nationalist and military propaganda justifying its ongoing military operations in Kurdish towns of the country.

Immediately after the terrorist attack, both Turkish President Recep Tayyip Erdogan and Prime Minister Ahmet Davutoğlu repeated their resolve to escalate military operations against the PKK. “Our state will never give up using its right of self-defence in the face of all kinds of terror threats. All of our security forces, including soldiers, police and village guards, have been conducting a determined struggle against terror organisations at the cost of their lives,” Erdogan said in a written statement.

Although no organization claimed responsibility for the terrorist attack, Davutoğlu said in a written statement that they had “concrete information on the terrorist group behind the attack.”

Paving the way for a possible Turkish ground invasion of Syria, Davutoğlu accused the PKK of perpetrating the attack, adding: “Our country has been targeted by multidimensional terror attacks in a thorny and unstable region. As before, and from now on, the Republic of Turkey will conduct its struggle against terror with great determination for the sake of our nation’s unity and serenity, and it will punish in the most severe way treacherous circles that aim at our country.”

These statements, and similar remarks of pro-government media commentators, indicate that the Turkish government is ready to jump at the opportunity to pursue its aim of invading Syria.

According to the state-owned Anatolian Agency, four people were arrested in connection with Sunday’s car bomb attack in Sanliurfa, a province bordering Syria, in what was taken as a sign implicating the Democratic Union Party, the Syrian offshoot of the PKK, in the attack.

Afterwards, Turkish fighter jets hit arms depots and shelters of the PKK in the mountainous Kandil and Gara regions in northern Iraq, and Turkish police launched an operation detaining dozens of Kurdish nationalists in different cities.

Since the collapse of a fragile truce in June of last year, deadly clashes have resumed between Turkish forces and PKK militants, as Turkish security forces armed with tanks and helicopters launched campaigns in towns of the Kurdish-dominated southeast. In February, Ankara also carried out artillery bombardments on Kurdish fighters acting as US imperialist proxies in Syria.

Citing “escalating terror activity in the region” and the need to ensure the “security of citizens’ lives and property”, Turkey’s ruling AKP (Justice and Development Party) declared further curfews, as security forces prepared for new operations in the ethnic Kurdish towns of Yuksekova and Nusaybin.

A months-long, devastating anti-terror operation has recently been completed in other Kurdish-populated districts of Cizre, Silopi and Idil in Sirnak province, and Silvan and Sur in Diyarbakir, leaving over 1,000 dead and forcing some 350,000 people to flee their homes.

Ankara has also escalated its attacks on the media and the pro-Kurdish Peoples’ Democratic Party (HDP), the third-largest political party in the Turkish parliament. On Erdogan’s orders, a request for the abolition of parliamentary immunity of five deputies from the HDP, including its two co-leaders, has already been submitted to the Parliament. In addition, hundreds of HDP mayors, provincial administrators and members have been arrested on charges of being members of, or aiding and abetting “terrorist organisations”.

In written statements, three opposition parties in the Turkish parliament condemned the terror attack. The Republican People’s Party (CHP) leader Kilicdaroglu denounced it for targeting the “social peace and serenity” of the country, and reiterated his party’s determination to take “all kinds of political responsibilities” in the fight against terrorism.

Describing it as a “savage attack” against civilians, the HDP condemned the terrorist attack. The HDP’s Central Executive Board stated “that all of these attacks against our people will not be able to estrange us from feelings of fraternity and condemn the attack once more in the strongest way.”

Devlet Bahceli, the chairperson of the far-right Nationalist Movement Party (MHP), reiterated his party’s full support for the government: “The government should not allow any weakness and negligence on this issue. Turkey’s national security is signalling a red alert because our precious nation is openly under attack and is surrounded in a compact and categorical circle of enmity.”

The ruling elite is also exploiting the attack in an attempt to remove an unpopular new anti-labour bill from the agenda.

The draft “On Amending the Labour Law and Turkish Employment Organisation Law” aims to extend temp work and widen the activity of private employment agencies. The bill also includes the creation of a severance pay fund, which would exempt the employers from paying compensation to workers whose job contract is ended due to reasons listed under Turkish Labour Law.

There is also growing dissatisfaction amongst workers, especially in the automotive sector, which has been hit by a wave of layoffs. On March 1, workers at Oyak Renault, a joint venture between French Renault and the Turkish army pension fund Oyak in Bursa went on strike, organised a march and tried to block the main road. The riot police, using tear gas, attacked the workers to disperse the crowd and detained several of them.

On May 14 last year, automotive workers at Renault and Tofas, owned by Italy’s Fiat and Turkey’s Koc Holding, organised a two-week wildcat strike, which soon spread to other carmakers, including Ford Otosan, Ford’s Turkish unit, and several auto parts makers.

Economic nationalism, war and the fight for international socialism

Nick Beams

Fundamental questions of perspective and orientation for the international working class are raised by the promotion of economic nationalism, which is assuming an ever more prominent role in the political life of one country after another under conditions of deepening economic crisis, mass unemployment and worsening social conditions.

In the campaign over Brexit—the referendum on June 23 to decide whether Britain is to remain within the European Union—both the “Leave” and “Remain” camps, reflecting different sections of the British bourgeoisie, are couching their arguments in terms of what is “best” for Britain. In the United States, the presidential election campaigns of both the leading Republican contender Donald Trump and the self-styled “socialist” Democratic candidate Bernie Sanders are making appeals on the basis of an economic nationalist agenda.

Seeking to exploit the legitimate anger and hostility of workers to the destruction of jobs and living conditions as factories are closed and jobs outsourced to cheaper labour areas, Trump promises to “make America great again” and denounces “unfair” trade deals, while Sanders lashes out against trade agreements with China and Mexico as “stealing American jobs.”

Despite their differences, the two sides share a common platform. They seek to remove the question of the “export of jobs” from its foundation—the capitalist system itself and its drive for profit.

They speak not for American workers, but express the interests of sections of the ruling class who feel themselves disadvantaged by major transnational corporations and aim to exploit the working class no less ruthlessly than their rivals.

There is no question that the various so-called “free trade” deals are not aimed at advancing economic and social conditions, but rather are designed to benefit giant corporations, enabling them to site their operations so as to secure the maximum profit at the expense of the working class.

But it does not follow from this that in opposing such agreements and their reactionary provisions workers should put a nationalist minus where the dominant sections of the corporate and financial elite put a plus. They must develop their own independent perspective based on a thoroughly worked-out and scientific analysis.

Such an analysis begins by posing the question: where is the campaign of economic nationalism leading? What would be the consequences of a return to isolated national economies? The tortured and bloody history of the twentieth century provides the answer.

The resort to economic nationalism arises out of the breakdown of the global capitalist order signalled by the financial crisis of 2008. The last great breakdown of the capitalist system, which began with the outbreak of World War I and led to the Great Depression, shows where it is heading. The rise of economic nationalism during the 1930s, as each country sought to protect itself from the collapse of the world market through the erection of customs and tariff barriers, created a disaster.

From the introduction of the protectionist Smoot-Hawley Act in the US in June 1930 to the end of 1932, it has been estimated that world trade contracted by as much as one half to two-thirds, leading to the disintegration, not advancement, of entire economies. The inevitable outcome was World War II and the relapse into barbarism.

The reactionary logic of economic nationalism was demonstrated most clearly in the case of Germany. Adolf Hitler came to power on the basis of a program of economic autarchy. But within a very short space of time an economic crisis began to develop, as this policy ran up against the constrictions of the German nation-state. Further national economic development therefore required territorial expansion—Lebensraum—and from 1936 onwards the entire economic policy of the Hitler regime was based on military conquest, a program that led directly to World War II and all of its resultant horrors.

In determining its standpoint, the working class must ground itself on a broad understanding of the role of capitalism in the historical development of mankind.

Mankind’s ascent, as Marx and, following him, Trotsky continually emphasised, is grounded on the development of the social productivity of labour, which is the basis for all social and economic advancement. In smashing down the constrictions of feudal particularism and establishing nation-states, capitalism provided a mighty springboard for the development of the productive forces and laid the basis for modern civilisation.

But the growth of the productive forces did not stop at the borders of the national state. Over the last 175 years it has increasingly assumed a global character through the expansion of international trade, the extension of investment to every corner of the world and, over the past three decades, the development of globalised production based on a further development of the international division of labour.

The globalisation of economic life is in itself an enormously progressive development. It increases the social productivity of labour and thereby lays the material foundations for the development of a society in which, for the first time in history, the economic and cultural interests of the entire world’s people, rather than a privileged few, can be met and advanced.

However, this enormous potential cannot be realised within the suffocating framework of the capitalist profit and nation-state system. Rather, these constrictions lead inevitably and inexorably to war and the descent into barbarism.

The great historical task, therefore, is not to try to drag the productive forces back into the reactionary and outmoded framework of the nation-state system—as the proponents of economic nationalism whether from the right or the “left” propose—but to liberate the productive forces by abolishing the reactionary social and political framework that constricts them.

This is not some utopian ideal. The material basis for its realisation has been created by the very globalisation of production itself. It has created an immense social force, the international working class, united objectively by the process of capitalist production and opposed by its very life-situation in every country to the depredations of the profit system.

Its task is to tear down the walls and barriers of the nation-state system, overturn the profit system, and take political power into its own hands in order to establish a new and higher socio-economic order based on the harmonious development of the productive forces on a global scale through a planned, consciously regulated and democratically controlled economy.

The sceptics and apologists for capitalism scoff at such a perspective and declare it violates so-called human nature, the highest expression of which, they insist, is the market and the capitalist profit system—a veritable libel on the human race.

But just as capitalism has created its own gravedigger in the form of the international working class, so it has forged the material foundations for a planned socialist economy. There is not a single transnational corporation or international financial institution in the world today that does not plan its global operations on a minute-by-minute, or even second-by-second basis. In its drive for profit, the capitalist system has established a vast system of information and technology spanning the world.

This complex and globally-integrated system of production and its associated information and other technologies have been created and are maintained, not by the handful of ultra-wealthy individuals who at present reap its benefits, but by the collective physical and intellectual labour of billions of working people—from the worker on the production line to those who maintain and design the technologies for its regulation.

Having created this enormous productive force, the international working class must now wrest control of it and utilise it for the development of society as a whole.

The perspective of economic nationalism advanced by the Trumps and Sanders of this world represents an attempt to drag mankind back into a new dark age.

The perspective of international socialism is the next stage in mankind’s advancement. But it can be realised only if it is consciously fought for, and that requires a decision to join and build the International Committee of the Fourth International as the revolutionary leadership of the international working class.

Current Syrian Peace Process Inutile: A New Approach Needed

Ranjit Gupta


Several initiatives have been taken to try to end the war in Syria. The first was by the Arab League, then Geneva I and Geneva II by Russia and other countries, and finally, the Vienna Process, where even a calendar of steps for bringing peace to Syria was laid out. In February 2016, followed by intensive negotiations between US Secretary of State John Kerry and Russian Foreign Minister Sergey Lavrov, the US, Russia and 19 other countries met in Munich and an agreement for a ‘cessation of hostilities’ in Syria's civil war was announced. This agreement exempts the war against the Islamic State (IS/Daesh) and Jabhat al Nusra. Therefore, ostensibly, the wars against these two groups are continuing.

In many theatres of the multiple wars in Syria, Daesh and Jabhat al Nusra are present cheek by jowl with other Islamist groups and regime forces; and therefore, attacking the former two, permitted under this agreement, could and has led to attacks against other groups covered by the ceasefire agreement. This has led to charges of violations, particularly against the regime, Iran and Russia; and this combined with several other loopholes and serious shortcomings make this agreement unenforceable. Therefore, this ‘cessation of hostilities’ agreement reflects nothing more than well-intentioned desires and despite the welcome lull in the fighting, this is emphatically not a prelude to any longer term halt to fighting or any substantive step towards a settlement. 

Furthermore, this agreement does not remotely address the exceedingly complex underlying dynamics of ground realities in Syria at all.

Multiple wars have been simultaneously raging in Syria for some years now. The original war between the Syrian protestors and the Syrian President Bashar al-Assad’s regime; the war by over 1000 jihadi groups actively supported by Qatar, Saudi Arabia and Turkey against the Assad regime; the war between Daesh and the Assad regime; the war between Daesh and all the other Islamist groups, including in particular Jabhat al Nusra; the war between the Kurds and Daesh; and the aerial war between a number of countries and Daesh. In these processes, five foreign countries – Iran, Russia, Saudi Arabia, Turkey and the US – have become rather deeply involved in Syria, militarily. The only aspect all of them agree on is on defeating Daesh. However, the top priorities of each are different and in several cases mutually contradictory.

Amongst these countries, the highest military priority of the US and its Western allies is defeating Daesh. The Kurds are their strongest and most successful allies in the war on the ground against Daesh, both in Iraq and in Syria. However, Turkey’s immediate top priority is the destruction of the Syrian Kurds’ power potential and the next priority is the removal of Assad. Ankara does not allow the Kurds to be part of any peace negotiations. Turkey’s President Recep Tayyip Erdoğan has been publicly criticising the US with increasing vehemence, challenging it to choose between its NATO ally Turkey or what it calls the Kurdish ‘terrorists’. For Saudi Arabia, the highest priority is Assad’s removal – it continues to publicly insist that Assad has to stand down at the beginning of any transition process.

Riyadh also insists on determining the composition of the negotiating team of the “opposition” to Assad. There does not appear to be any let up in the Qatari, Saudi and Turkish support for different jihadist groups fighting in Syria, and supply of arms and funds to them continues. Iran is probably the most committed to Assad’s continuance in power over all of Syria. It has and continues to contribute significantly towards efforts to defeating Daeshin Iraq. Russia’s highest priority is to ensure that the jihadist groups fighting Assad, particularly those supported by Turkey, in the western third of the country are comprehensively defeated to ensure Assad’s continued control of this vital part of Syria, at least until transition agreements can be agreed to. In fact, in what should be considered an encouraging factor, Russia publicly chided Assad when he announced that he intends to regain control of the whole of Syria.

Day by day, Russia’s intervention is shifting the advantage in Assad’s favour, both diplomatically and militarily. Assad can no longer be defeated militarily and if he cannot be defeated on the battlefield, there is no way that he can be removed in a conference room.

For any peace process to have any realistic chance of success, it must be fully in accord with substantive ground realities. It is difficult enough for a peace process to be successful when there are only two antagonists. No peace process can possibly succeed when it involves the participation of such a large number of entities; more non-state than state actors, many of whom are engaged in a life and death struggle against others; and many entities imposing impossible-to-meet preconditions to even participate. Such an approach cannot possibly achieve positive results and should be abandoned.

A greatly intensified war against the IS with the US and Western countries acting in coordination with Russia should become the top priority. It is entirely possible that this could cause a temporary partition of Syria into zones under the control of different authorities. In fact, a review of the Sykes-Picot arrangements may be the only way for long-term stability in West Asia. The simultaneous holding of intense and continuous negotiations, strictly away from media attention, initially between empowered sherpas of the P5, Iran, Saudi Arabia and Turkey potentially provides the most workable hope to even attempt to get out of the Syrian quagmire. The involvement of non-state groups, who are essentially proxies of states, only complicates negotiations.

Modalities of a political transition process in Syria should also be part of these discussions. While it may be politically correct to say that any peace process must be Syrian-owned and Syrian-led, the reality is that such a process simply cannot be brought about.

Media Monsters: Militarism, Violence, And Cruelty In Children's Culture

Heidi Tilney Kramer

"10 percent of any population is cruel, no matter what, and 10 percent is merciful, no matter what, and the remaining 80 percent can be moved in either direction." - Susan Sontag

Who ever thought there would be torture scenes in G and PG rated American children's films or that a video game would allow one to feel the rush of killing? Who would have imagined in their worst nightmare that the Disney corporation would try to trademark "SEAL Team 6," especially right after this elite military group killed Osama bin Laden, so they could use it for toys, Christmas stockings, and snow globes? Or that a child would write a few loving words on her desk and be arrested in front of her classmates? Who could have believed that the U.S. would torture real children in the "war on terror" campaign?

Consider that there are now only five big media conglomerates controlling over 90% of everything seen and heard. Media in the U.S. is engaging in post-9/11 rhetoric even in the world of children. Seeing little Boo, the toddler who can barely speak in Monsters, Inc., strapped in the torture chair - equipped with holes in the seat's bottom like electric chairs have for drainage of bodily fluids - convinces us to look closer at what American kids and children the world over are watching as their purported entertainment.

As cartoon images of militarism and prison fill children's heads, the school-to-prison pipeline is active in the schools of poor neighborhoods and those of color mimicking the prison system - and these children have largely been slated for a life in prison or the military. Pushing students out of the classroom and into the criminal justice system - often for minor offenses such as getting behind in their homework! - is as disturbing as the JROTC instituting programs on the middle school level as a way of getting especially inner-city, racially targeted recruits.

This is against the U.N.'s Convention on the Rights of the Child's (C.R.C.) Article 38: "Children under 15 should not be forced or recruited to take part in a war or join the armed forces...The Convention's Optional Protocol on the Involvement of Children in Armed Conflict further develops this right, raising the age for direct participation in armed conflict to 18 and establishing a ban on compulsory recruitment for children under 18." The United States, along with Somalia and South Sudan, refuses to ratify this document under the guise of parental rights, but that decision allows the following problems: 21% of U.S. children are living in poverty; the U.S. is the only high-income country not to grant paid maternal leave; and the U.S. is the only country in the world sentencing under-18-year-olds to life without parole. These infractions are all against the C.R.C. Over twenty-five years old, the document will never be ratified by the United States because it interferes with business as usual, and Michael P. Farris, president of Parental Rights, actively fights the treaty. His group fears that, if instituted, "[a nation] would have to spend more on children's welfare than national defense." As the old saying goes, "It will be a great day when our schools get all the money they need and the Air Force has to hold a bake sale to buy a bomber." The grand total in 2013 for U.S. Homeland Security and National Defense was an astounding $931 billion, or nearly $1 trillion, and part of the funding has come from cutting the school-lunch program. China has the next largest military budget, estimated at $136 billion.

Yet the propaganda continues...The Incredibles shows the 9/11 trope of a plane bent on destruction heading toward a U.S. city while the entire family ends up on the torture rack; the film also shows Mr. Incredible blasted by viscous bubbles similar to new, real-life (theoretically) less-than-lethal incapacitant sticky foam weapons being proposed for crowd control in the U.S. and abroad. And what are the children to think when their beloved Buzz Lightyear - a friend to all for two of the three films - is tortured, his personality changed, and he becomes, in Toy Story 3, prison guard for the cruel overlord in the surveillance-laden dystopia?

Children's beliefs about others are molded from a young age - just think how characters in Aladdin contributed to persuasion for the first Gulf War as even children came to see the Arabic world as mean-spirited. Henry A. Giroux explains that Disney not only included offensive language toward the region in this (and its follow-up) film, it didn't even bother to write actual Arabic where it was called for in the film, instead choosing to scribble the substitute of nonsensical scrawl.

In addition to death language, war scenes, and general barbarism, there are other disturbing depictions in G and PG rated children's movies. Nearly all African-American characters have an inner-city vibe as we see in Turbo. Often Spanish-speaking characters are presented as poor and lazy or loud as observed in the aforementioned and in Open Season. Women are shown as either "bitchy" or subservient. If you want evidence, just watch Beauty and the Beast - it's a primer for women to learn how to endure an abusive relationship (as in, "If I'm just nice enough, he'll come around"). Or watch how Ratatouille presents a woman as psychotic. Native Americans are depicted as mysterious and speak monosyllabically, as seen in Rango. Children themselves are presented as either endangered or as monsters, sometimes both, as is the case in both Toy Story and Nanny McPhee. Guns, cruelty, and bullying are in just about every kids' film in the U.S., but the Motion Picture Association of America doesn't care that the violence component is through the roof as long as no one hears cursing or sees drugs or alternative lifestyles.

How are people affected by that last one? Ritual ridicule in a brutal gender binary system is largely responsible for the mass school shootings. Our definitions of what it means to "be a man" are injected early on. Seeing Ken - depicted as supposedly effeminate - bullied and threatened by Barbie in Toy Story 3 tells boys to be wary of having nice hand-writing or any other purportedly feminine behavior. There are many, many examples of gender policing in American kids' films - take how the minion is teased for wanting affection in Despicable Me as just one example.

Meanwhile, over 6,000 were killed from the U.S. drone assassination program in Somalia, Yemen, Iraq, Afghanistan, Pakistan and Palestine in 2015 alone - some of the victims are children and 90% of victims are innocent bystanders. You won't see this on American TV or in the country's films. The U.S. veteran homelessness rate is appalling - and suicide rates among armed services veterans and active duty personnel have sky-rocketed. You won't see this either. The world is grappling with how to handle refugees from the fashionably long-lasting wars amid - and aiming specifically for - civilians. You'll see the refugees but no coverage of why these victims are fleeing. You won't hear the name Omar Khadr, a 15-year old Canadian citizen tortured by the U.S. or that of 14-year old Chad-citizen Mohammed El-Gharani who suffered the same fate. You won't see coverage detailing that those of Arabic/Islamic origin or background rounded up in the U.S. after 9/11 were ALL found innocent. Instead, you will see over 900 mostly Hollywood films vilifying these groups over the past century so the military-industrial complex has an eternal "enemy."

U.S. children are busy at school being patted down and going into lockdown mode, learning how to kill from video games, repeating cruelties learned from their films, and watching playground fights on YouTube, while American tax dollars are hard at work being used for nationalistic ceremonies at pro sports events and censoring directors who don't promote "patriotism." That citizens shudder at fellow hijab wearing citizens shows how the U.S. public has been sucker-punched.

We are undergoing a paradigm shift of monumental proportions wherein some are awakening to possibilities on a dimming horizon. Doing so has never been more imperative because our very survival depends on seeing what is true: that we are more alike than we are different and that the "have nots" have a my-voice-matters stake in which way life proceeds. It is time for us, "the 99%," to stand against the media and political giants engaged in separating us from one another. God bless the whole world: NO EXCEPTIONS.

"Of course the people don't want war...That is understood...But, after all, it is the leaders of the country who determine the policy and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them that they are being attacked, and denounce the peacemakers for lack of patriotism and exposing the country to danger. It works the same in any country."

- Hermann Goering (at the Nuremberg trials)

UAW sanctions mass layoffs by farm equipment giant John Deere

George Gallanis

Last week, Illinois-based Deere and Co., the world’s largest agricultural machinery company, announced the layoff of approximately 125 employees. This is the third round of layoffs since last November. A total of 445 workers have lost their jobs so far.

The recent layoffs will affect two factories in Iowa, with Deere slashing 75 jobs at its Dubuque factory and approximately 50 jobs at its Ankeny factory. Layoffs at Dubuque will go into effect April 29 and the Ankeny factory will see its workforce dwindle April 15.

In February, Deere announced it was the laying off approximately 80 employees at its Davenport Works and 20 at Deere’s factory in Dubuque. Both of these cuts will go into effect April 1. In November, Deere informed approximately 220 employees at the John Deere Seeding and Cylinder factory in Moline, Illinois that they would be laid off. The workers were terminated on February 15.

The company is conducting a ruthless cost-cutting campaign to make workers pay for the impact of the global economic crisis. This is taking place only months after the United Auto Workers rammed through a sellout agreement—in the face of the mass opposition of rank-and-file workers—that facilitates the downsizing of the company and the imposition of further concessions factory by factory.

Deere stated that the actions were “taken to align the size of the manufacturing workforce at individual factories with market demand for products made at each specific location.” It is likely Deere will lay off even more in the future. Deere’s fiscal forecast for 2016 expects a 10 percent decline in sales. In a recent report, Deere saw its worldwide net sales and revenues for its first fiscal quarter decrease by 13 percent, to $5.52 billion, compared with $6.38 billion last year.

Deere’s CEO, Samuel R. Allen, stated, “John Deere’s first-quarter results reflected the continuing impact of the downturn in the global farm economy as well as weakness in construction equipment markets. At the same time, all of Deere’s businesses remained solidly profitable, benefiting from the sound execution of our business plans and the success of actions to develop a more responsive cost structure.”

In other words, Deere is counting on the collaboration of the UAW to slash as many jobs as it needs “to develop a more response cost structure,” i.e., to maintain its profits. Last October, the UAW pushed through a new six-year labor agreement, which maintains the hated two-tier wage and benefit system, increases out-of-pocket health costs and continues the erosion of living standards. The UAW claimed the contract, which covers 11,000 workers, was ratified by a margin of 180 votes; workers responded by accusing the UAW of stuffing the ballot.

The collusion of the UAW has ensured huge payouts to the company’s top executives and wealthy shareholders. In 2015, Deere CEO Samuel R. Allen made $15,770,056 in total compensation; Senior Vice President and Chief Financial Officer Rajesh Kalathur made $4,352,810; Senior Vice President Jean H. Gilles made $4,537,306; President of Agricultural Equipment Operations James M. Field made $4,539,286; and Group President Michael J. Mack Jr. made $4,875,918.

Speaking to the WSWS, a retired Deere worker who worked at the John Deere Waterloo Works in Iowa said, “Deere is a different place now. I think they’re screwing these young people.

What’s so terrible about Deere are these tiers. It was terrible back when I was there. The tier wages screwed everything up. This kid on second shift did the same exact job as me and got half the pay and he was pissed and I don’t blame him.

“Hell. I think my pension is as much as some of these people are making these days now. And look at what the CEO is making. It’s so unfair.”

Regarding the suspicious character of last year’s contract vote, he said, “I went to the union meeting when they were going to ratify the recent contract and we listened to it for half an hour and left because we couldn’t take it. You can’t trust the vote; nothing would surprise me. The UAW are a bunch of fat cats and they sold them out.”

“The UAW should have stood up and fought to end the two-tier system, but they didn’t. It’s just a continuation.”

He further added, “You used to be able to raise a family with the wages you received at Deere, but you can’t now and that’s for most wages in the US. To me, it’s symptomatic to what’s going on in the world.”

China: Thousands of coal miners protest over unpaid wages

Peter Symonds

Thousands of Chinese coal miners protested last week in the north-eastern province of Heilongjiang after provincial governor Lu Hao boasted to the National People’s Congress (NPC) in Beijing that wages at the huge state-owned Longmay Mining Group were being paid in full and on time.

The unrest follows the announcement earlier this month by employment and welfare minister Yin Weimin that 1.3 million coal miners and 500,000 steel workers will lose their jobs as the government slashes overcapacity in basic industry. The protests are a sign of the acute social tensions building up as the Chinese economy continues to slow.

The north-eastern “rust belt” provinces have been particularly hard hit. Yet Heilongjiang governor Lu told the NPC a week ago: “Longmay has 80,000 workers down mines, and today, not one has not been paid monthly wages and their income hasn’t fallen a penny.”

Lu also foreshadowed mass layoffs saying that Longmay has more than three times as many workers as the average Chinese coal mine as measured by tonnes of output per employee. The state-owned enterprise (SOE), which has 224,000 employees in all, announced plans last September to shed 100,000 jobs. It is the largest coal producer in north-eastern China with 42 mines in four cities.

The comments provoked widespread anger. From last Wednesday, mine workers and their supporters congregated in front of government and company offices in Shuangyashan, demanding Lu and other officials address their complaints over unpaid wages. In many cases, workers have not been paid for months.

According to social media accounts, up to 10,000 people took part in the demonstrations which lasted at least three days. Photographs showed workers carrying banners saying, “We want to live, we want to eat” and “Lu Hao tells lies while his eyes are wide open.” A video showed miners being dispersed by armed police.

A protesting miner told the Financial Times that Lu’s comments about wages were false. “At the time he said that, we had not gotten our salaries for four months. That’s the key,” he said.

Speaking to the Associated Press, a local resident Li said that he knew of Longmay workers who had not been paid for six months. Another eyewitness Wang told the news agency that the wages of her family members working in the mine had been cut to less than 1,000 yuan ($US154). Other workers either did not receive their full wages or were not being paid for months.

Liu Jingjua, a shop assistant whose husband worked in the mine, told theNew York Times: “We’re demanding our own money, and some of us have been arrested. Is it illegal to ask for our own wages? We workers have to eat.”

Last Saturday governor Lu was compelled to make an embarrassing public back-down, acknowledging that wages were in arrears for Longmay workers. However, he sought to shift the blame, accusing Longmay of withholding information and vowing to “severely punish” anyone who did so in the future.

In an effort to save face, Lu called a meeting of provincial officials and issued a statement declaring that the provincial government would work with Longmay to raise money and make every effort to pay workers on time.

Lu’s reaction is a telling example of a Chinese Communist Party (CCP) bureaucrat: committed to the CCP’s agenda of pro-market restructuring and contemptuous of the working class, yet fearful of the social unrest that the government’s policies could provoke.

Lu, who has been marked out as a rising star in the CCP apparatus, was clearly keen to impress at the NPC. As governor of one of the rust-belt provinces, he was determined to demonstrate his ability to deal with so-called “zombie” companies, like Longmay, that are kept afloat by state-backed loans.

President Xi Jinping last week focussed attention at the NPC on the necessity of slashing overcapacity in basic industries such as coal, steel, plate glass and cement. He asked in particular how Longmay was coping and urged the company to “face the market”—that is, make deep inroads into jobs, wages and conditions to ensure a profit.

“Facing the market” also means abolishing the remnants of the so-called iron rice bowl, which ensured that state-owned enterprises provided health care, education and welfare to their employees. Longmay still runs hospitals and schools and is responsible for the pensions of 180,000 retired workers.

Longmay has been hit by falling prices, which have fallen dramatically by 6 percent for thermal coal and 10 percent for coking coal in the first two months of this year. The company had already been struggling, with substantial losses for at least three years. Last November the provincial government, which owns Longmay, provided 3.8 billion yuan ($588 million) to ward off an imminent default on its debts.

Last week’s protests are only the latest. In April last year, thousands of miners and their supporters marched in the city of Hegang to protest over delayed wages. The organisers were arrested and jailed. In October, the company management only averted another protest by locking workers in the mines on the day of a scheduled rally.

Moreover, coal miners in other regions are facing similar difficulties. Earlier this month, hundreds of coal miners in Anyuan in south-eastern China marched through the city of Pingxiang. The local state-owned mining company has cut back production, laid off workers and told others to stay home on drastically reduced pay. As reported by the Washington Post, up to 1,000 workers from three mines protested with banners declaring: “Workers want to survive, workers need to eat.”

While no official statistics are publicly available, figures produced by the Hong Kong-based China Labour Bulletin have shown a sharp rise in the number of strikes for 2015 to 2,774, twice as many as for 2014. In January, another 504 strikes were recorded. The actual figure is likely to be far higher. Last November, the Chinese employment minister, Yin Weimin, cited 11,007 “incidents” involving unpaid wages—the most frequent cause of disputes—in the first nine months of 2015, a 34 percent increase from a year earlier.

With mounting levels of debt, the CCP regime is determined to press ahead with the first mass layoffs since the 1990s, with estimates of up to six million jobs being destroyed across basic industries. The government has promised to allocate 100 billion yuan ($15 billion) to fund retraining, which is far from adequate. Even with retraining, many miners and industrial workers will simply not find jobs in the slowing economy.

The CCP leadership is insisting that local government and companies must contribute to the retraining fund. In depressed areas such as Heilongjiang, the economy is already stagnant or in recession, the tax base of local administrations has shrunk dramatically and SOEs like Longmay are heavily indebted. At the NPC, provincial representatives called for greater central government financial support.

At every level of government, the CCP apparatus is acutely conscious of the potential for social unrest that spirals out of control. The rising number of strikes and protests is taking place prior to mass sackings. Moreover, since the 1990s, the growth of staggering social inequality has engendered deep resentment and bitterness. While workers struggle to get by on as little as 100 yuan a month, the CCP has opened the NPC to multi-billionaires whose interests it presents.

A former Longmay mine worker now a taxi driver, Cui, told the New York Times earlier this year: “In the 90s, everyone was poor. Now the rich are too rich, and the poor are too poor. Because of the layoffs, everyone is worried. No one has a way to live outside the mines.”

What is looming is a confrontation between the Beijing regime and the working class.