LIVING BEYOND THE WORLD'S IMAGINATION

8 Apr 2016

US provocations against China threaten world war

Andre Damon

Behind the backs of the American people and excluded from discussion in the ongoing election campaign, the United States has in recent weeks sharply escalated its military standoff with China.

On Thursday, the New York Times reported in an editorial that the United States will shortly conduct a third “freedom of navigation” exercise in the South China Sea, sailing warships within 12 nautical miles of territory claimed by China.

In the first two such incidents, which took place in October 2015 and January 2016, the US Navy sent guided missile destroyers into Chinese territorial waters in nominal adherence to the rules of “innocent passage,” which prohibit “any exercise or practice with weapons of any kind.”

According to a report in the Navy Times, Admiral Harry Harris, commander of US Pacific forces, is pushing for more aggressive action within 12-mile exclusion zone around Chinese-held territory.

Bryan Clark, a former senior aide to retired Admiral Hon Greenert, the recently retired chief of naval operations, told the Navy Times that Harris “wants to do real [freedom of navigation] operations. He wants to drive through an area and do military operations”—such as launching aircraft and firing weapons’ systems.

As a result of escalating tensions, the New York Times editorial concluded, menacingly, that “some sort of confrontation seems increasingly likely.”

In advancing its anti-China strategy, the US has recruited the leading powers in the Asia-Pacific, Japan and Australia, as well as countries such as the Philippines, Singapore, Vietnam, Malaysia and Indonesia, who are rapidly developing their naval forces and are themselves carrying out increasingly provocative operations against China.

A report published this week by the Stockholm International Peace Research Institute revealed a vast increase in military spending by US allies in the Asia-Pacific region. The Philippines increased spending by 25.5 percent in a single year, followed by Indonesia with 16.5 percent, while Thailand, Singapore, Malaysia, and Vietnam each increased spending by more than five percent.

This anti-China alliance has been increasingly assertive in its maritime claims. The Times noted: “Last week, Vietnam seized a Chinese ship for illegally entering its territorial waters, and Indonesia threatened to defend its own claims with F-16 fighter jets.”

This week, the US Navy and Marines deployed 5,000 troops for an ongoing major military exercise with the Philippines. Foreign Affairs magazine noted: “The drills, which got underway this week, include an amphibious landing on the Philippines coast and a mock assault on an oil rig, with a small contingent of Australian forces also participating.” On Tuesday, Japan announced that it would send a helicopter destroyer through the South China Sea to take part in the exercises.

Japan, which carried out some of the greatest war crimes in modern history against the people of China, is rapidly remilitarizing. Earlier this month, a reinterpretation of Japan’s pacifist constitution went into force, legitimizing the Japanese government to fight alongside the US on the pretext of “collective self defense.” Going even further, Prime Minister Shinzo Abe said earlier this week that the country’s constitution allows Japan, a quarter of a million of whose people died in the bombing of Hiroshima and Nagasaki by the United States in 1945, to possess and use nuclear weapons.

The Chinese regime, meanwhile, is under increasing pressure to respond more strongly to US aggression. Hu Bo, a Research Fellow at the Institute of Ocean Research of Peking University, urged in an article published this month by the Diplomat: “In the face of U.S. military operations in the South China Sea, China naturally should be prepared militarily.” He added: “China should adopt and apply all options to counter and expose the traps set by the U.S. through such military operations.”

With tensions escalating on both sides, a US freedom of navigation operation, or even one of the daily, and mostly unreported, conflicts between military and fishing vessels in the South China Sea, or even an “accident” such as a recent fly-over by a US nuclear-capable B-52 bomber over Chinese territory, could rapidly lead to a full-scale military exchange, possibly including nuclear weapons.

The potential of military conflict between “great powers” has rapidly become the central preoccupation of the US military. In an extraordinary statement, Army Chief of Staff Gen. Mark Milley told a Senate Armed Services Committee hearing Thursday that the US is at “high risk” from the “potential for great power conflict... and the cost in terms of casualties.”

Despite these frank statements by leading military personnel and the New York Times of the danger of a “great power” military conflict—that is, world war—these issues have been totally excluded from the 2016 presidential elections. Based on what the candidates are saying, one would never know that the United States and China are coming ever-closer to an open military clash.

There is a history in America of major military escalations immediately following elections. Woodrow Wilson, who won reelection in 1916 on the slogan that “He kept us out of war,” took the United States into World War I on April 2, 1917. Lyndon B. Johnson, who ran as the peace candidate in the 1964 election, carried out a vast escalation of the war in Vietnam within months of taking office.

Regardless of whether a Democrat or Republican becomes president next year, there is a very real danger that in the immediate aftermath of the election, if not before, the US will be engaged in a major military confrontation with China, Russia, or in the Middle East.

The Socialist Equality Party, in solidarity with the International Committee of the Fourth International, is determined to alert the working class and youth to the immense danger of war and place this issue at the center of the 2016 elections.

7 Apr 2016

Anarchy, Thy Name Is “Kashmir”!

Mohammad Ashraf

(There is hardly any section of Kashmir society where rules and laws are obeyed. It is a virtual free for all everywhere)

The Webster dictionary defines “Anarchy” as, “a situation of confusion and wild behavior in which the people in a country, group, organization, etc., are not controlled by rules or laws”. The definition fits Kashmir in every way! Let us begin with the traffic. Not only people violate the rules and laws but in the first instance they do not know at all what the rules are. They get driving licenses without knowing any traffic rules. The worst violators are mini-bus drivers who stop in the middle of the road or even at turns blocking all traffic. The passengers too are guilty as they want to be picked up and dropped wherever they will. They do not have the patience to walk few steps to a bus stop. The auto-rickshaws have the entire road to themselves. They move through the traffic like racers turning and twisting everywhere. The knowledge of fast lane, slow lane, and heavy vehicle lane does not exist here. Anybody can be in any lane. Overtaking has no rules. People overtake you from all sides. Pedestrians are not counted at all. Most of the foot paths are with street vendors or the shopkeepers exhibit their wares on the foot paths leaving pedestrians no choice but to walk on the road itself. Next comes parking. There are not enough parking places so people park cars on both sides of the road. Shopkeepers park their vehicles in front of their shops and the customers have no place to park theirs. One can go on endlessly about the anarchist traffic system. In fact, there is no system. Each for himself!

In forties, Srinagar was a city of a hundred thousand people or so. Now, its population is more than a million and a half. The roads have virtually remained same with some new ones added and earlier ones expanded but the number of vehicles has grown from 45 or so in 1947 to almost a quarter million! The Kashmir valley has over a million vehicles. In spite of a number of studies conducted by experts and detailed plans given, the government has been sticking to ad hoc decisions of the rulers from time to time. Fly overs are made for convenience of rulers to reach the secretariat and airport rather than to ensure smooth flow of traffic. In every place before starting construction of fly overs, alternate routes for ensuring smooth flow traffic are made. Not in Kashmir. Everything is done on the spur of the moment causing extreme inconvenience to citizens. One can judge the capability of our agencies from the ramshackle contraptions of barbed wire, metal pieces, and plastic road dividers etc. put at various places to contain traffic in a particular direction.

Moving away from traffic to Municipal and Civic facilities, the less said the better. Kashmir is fast becoming a “Garbage Paradise” for the unchecked population of stray dogs. It is in fact, “Dog’s Own Country” in contrast to famous Kerala Tourism slogan of “God’s Own Country”! The condition of roads and drainsis a separate story in itself. Roads macadamized with 80 mm thick layers develop pot holes in less than couple of months. The electric wires running all over especially in the down town area tell their own story. It is a wonder that we do not have dozens of people electrocuted every day. One of the Russian engineers while touring through the city and knowing that no one gets electrocuted here, remarked that he had started believing in GOD!

Regarding land use, building permissions and building bye laws, the less said the better. Each in itself is a separate story!

A question arises, what is the cause of this anarchy? The answer is simple, lack of enforcement of umpteen laws and rules and total absence of accountability of the supposed enforcers. Often the blame is put on our character. In fact, many historians have given worst surnames and epithets to us. However, some have after deep analyses absolved the common Kashmiri and put the blame on our rulers. Sir Walter Lawrence in the “Valley of Kashmir”, says, “Finally, though the character of Kashmiris leaves much to be desired, I think that it is to their credit that it is not worse, considering the few chances they have had for becoming truthful, manly, and self-respecting. A man who can be beaten and robbed by anyone with a vestige of authority soon ceases to respect himself and his fellow-men, and it is useless to look for the virtues of a free people among the Kashmiris, and unfair to twit them with the absence of such virtues. The Kashmiri is what his rulers have made him, but I believe and hope that two generations of a just and strong rule will transform him into a useful, intelligent, and fairly honest man”. Unfortunately, we have yet to see that just and strong rule!

Austria rejects all refugees

Markus Salzmann

The Austrian government has announced it will turn away refugees at the border after conducting summary hearings. A determination will be made as quickly as possible on whether they can be deported to third countries. In this way, the grand coalition of the conservative Austrian People’s Party (ÖVP) and Social Democrats (SPÖ) under Chancellor Werner Feymann is attempting to permanently reduce the number of refugees coming into the country, the DPA news agency reported.

Beginning in mid-May, all asylum applications will be decided at the border within an hour, including the possibility of an appeal. The only reason allowed for granting a residency permit will be the presence of close family members in Austria. This could be “determined within a few minutes through the registration system,” a senior interior ministry official said. All other refugees would be rejected on the basis that they came from “safe third countries” into the Schengen zone, which surrounds Austria.

At the beginning of the year, the government in Vienna introduced a cap on asylum seekers. But now, a legal report has established that “a strict limit based on numbers” could possibly “be difficult under international law,” as defence minister Hans Peter Doscozil admitted in Vienna last Wednesday.

The upper limit was to have been 37,500 people per year. In addition, Austria decided to implement a daily limit of 80 asylum applications at its southern border. According to the interior ministry, 15,000 applications have already been filed. A radical policy of deportations and the sealing off of the border will prevent refugees from entering. The military will be permanently deployed to enforce the policy.

Notorious right-wing interior minister Johanna Mikl-Leitner (ÖVP) announced a strengthening of border controls. “There is no reason for complacency”, he said, warning that after the closure of the Balkan route, refugees would try to reach Austria through Italy.

At the initiative of Defence Minister Doscozil, soldiers will take over securing the Austrian border, above all on the Brenner-Pass, the main traffic route from Italy to Austria. After a meeting of the Central European Defence Cooperation (CEDC), Doscozil declared that cooperation with the military in the refugee crisis was the supreme goal. The conference brought together defence ministers from Austria, Croatia, Slovenia, Poland, Czech Republic, Slovakia, Hungary, Serbia, Macedonia and Montenegro.

Doscozil also announced plans to send Austrian soldiers to the European Union’s external borders, e.g. Greece or Bulgaria. He was thereby explicitly supporting the brutal treatment of refugees by Macedonia, which has utilised tear gas and water cannon to prevent women and children from crossing the border. “A state like Macedonia cannot be left isolated a second time”, the defence minister stated.

Doscozil told Bavarian state radio (BR): “We notice that there is a significant development of the Mediterranean Sea/Italy/Brenner route. We have to focus on this, we have to pool our forces and expand them if the situation requires it.”

After the closure of the Balkan route, so-called alternative routes should not emerge under any circumstances, through which refugees could reach the EU, he said. To achieve this, the EU border protection agency Frontex should be supported by soldiers and the police.

Austria, together with the Eastern European states, is taking the most brutal measures against refugees. Even the small number living in Austria are subject to attacks and the deterioration of their living conditions so as to persuade them to leave. According to the plan of the ÖVP-Freedom Party state government in Upper Austria, asylum seekers will receive just €520 instead of €914 for basic necessities.

The hardline stance towards refugees is shared by the Greens and trade unions in Austria. Within the Greens, a leadership crisis has developed. A number of parliamentary deputies have, according to the Kronen Zeitung, called for a “palace coup” against party leader Eva Glawischnig. Glawischnig is considered a supporter of German Chancellor Angela Merkel’s policy. On the issue of refugees, she has demanded a “European solution.”

The trade unions, which are closely tied to the SPÖ, also support the government’s line. Presidential candidate and long-standing chairman of the Austrian trade union association Rudolf Hundstorfer has repeatedly stated that he backs the government’s approach, according to which the upper limit of 37,500 refugees is the biggest contribution to the refugee crisis that Austria can afford.

This policy is strengthening the far right. Based on the latest monthly poll by research firm Unique Research, the ultra-right Freedom Party (FPÖ) would come in first place in elections to the national parliament. According to this survey, the FPÖ would obtain 32 percent of the vote, the ÖVP 24 percent, and the SPÖ would come in third with 22 percent.

FPÖ candidate for federal president Norbert Hofer began his campaign on Saturday in the Upper Styrian town of Kapfenberg. Together with FPÖ leader Heinz-Christian Strache, he agitated against the “asylum chaos.” He called upon the government to stop the “invasion of Muslims.” Strache blamed the Muslims’ “crusade” for the attacks in Paris and Brussels. There could only be one upper limit for refugees, according to Strache, “zero.”

He praised Hungary’s Prime Minister Victor Orban for his brutal anti-refugee policies. Hungary showed the way forward. “Thanks to Orban,” Strache proclaimed, adding, “That’s what I would do as a future Chancellor, but first comes President Hofer.”

The FPÖ has been organising rallies and protests against refugee accommodation throughout Austria. The result has been 25 attacks against refugee centres across the country over the past year. This figure was provided by the interior ministry in response to a question tabled by Green deputy Albert Steinhauser.

Facilities were affected in all states apart from Burgenland. Attacks were particularly high in Carinthia. The most serious incident occurred in Lower Austria, which along with Vorarlberg reported five attacks. Refugees were shot at with an air gun in Wiener Neustadt. At institutions in Hohenems and Wolfurt in Vorarlberg, Nazi propaganda was distributed.

It is significant that, according to the reports, the perpetrators were not investigated in the majority of cases. There have already been several attacks on facilities this year.

Amnesty report: Executions worldwide at highest level in 25 years

Thomas Gaist

Governments worldwide executed at least 1,634 prisoners in 2015, an increase of more than 50 percent above official figures for 2014, Amnesty International reported Wednesday.

After bottoming out during the 1990s and early 2000s, the number of executions registered by Amnesty has steadily risen since the mid-2000s.

In a trend described as “profoundly disturbing” by Amnesty secretary general Salil Shetty, the number of executions has spiked in the past few years, including a sharp increase in 2015.

“Not for the last 25 years have so many people been put to death by states around the world,” Shetty said. “In 2015 governments continued relentlessly to deprive people of their lives on the false premise that the death penalty would make us safer.”

China executed the highest number, killing more than 1,000 prisoners, followed by Iran, Pakistan, and Saudi Arabia.

The United States ranked fifth worldwide, with 28 executions in 2015. American prisons “continued to use the death penalty in ways that contravene international law and standards, including on people with mental and intellectual disabilities,” Amnesty found.

Egypt’s US-backed military dictatorship also sharply increased its execution rate, joining Iraq, Somalia, Indonesia, and Chad to round out the top 10 executioner states.

The most common methods of execution were hanging, lethal injection, shooting and beheading.

In the United States, all of the death sentences were by lethal injection, a method whose reputation as being more humane has been increasingly discredited amidst a growing number of high-profile botched executions resulting in extreme suffering, easily comparable to medieval forms of torture.

Many US states are considering revival of the firing squad (Oklahoma and Mississippi), electric chair (Virginia) and gas chamber (Wyoming) in response to costs and other difficulties associated with obtaining the “cocktail” of deadly chemicals used for the procedure.

At least nine of the victims documented by Amnesty worldwide were under the age of 18 at the time of their execution.

Leading US client states, including Saudi Arabia, Pakistan, Bahrain and Iraq, continue to execute prisoners for a range of non-capital offenses and pre-modern “crimes,” including drug offenses, adultery, petty crimes, and religious blasphemy, and frequently carry out executions based on “confessions” given under torture and after unfair trials.

More than 20,000 prisoners are currently awaiting execution globally. The Pakistani state, whose military and intelligence services have maintained close ties to Washington for decades, is currently engaged in a “state-sanctioned killing spree,” Amnesty finds.

Despite the rising number of executions, the report noted a countervailing trend of governments abandoning the barbaric practice. The report noted that a growing list of countries have abolished the death penalty including Congo-Brazzaville, Fiji, Madagascar, and Suriname. Altogether more than 100 states have formally abolished capital punishment.

Another subset of states maintain death penalty laws but have not carried out any killings within 10 years, termed by Amnesty “abolitionist in practice,” including Russia, Mongolia, Algeria, Myanmar, Laos, Papua New Guinea, Tajikistan, Kenya, and Tanzania.

The Amnesty data makes clear that the escalated pace of official state killings has been spearheaded by US imperialism, its ultra-reactionary regional allies in Riyadh and Islamabad, and the Stalinist ruling elite in Beijing.

Taken as a whole, the growth of state killing is ultimately an expression of the immense social antagonisms building up within world society. All major governments are implementing increasingly violent domestic and foreign policies in response to the crisis and breakdown of world capitalism and the reemergence of mass struggles in the international working class.

The widespread application of the death penalty by the Chinese government, typically presented in pro-imperialist propaganda as evidence of Beijing’s exceptional status as a “human rights abuser,” is, in reality, a product of capitalist social relations in China. It is an outgrowth of the determination of the billionaire capitalists running the Chinese “Communist” Party to maintain their grip over an increasingly restive labor force of hundreds of millions of Chinese workers.

Fiat Chrysler axing 1,400 jobs at Sterling Heights, Michigan plant

Shannon Jones

Fiat Chrysler said Wednesday that it will eliminate a full shift, about 1,300 workers, at its Sterling Heights Assembly Plant (SHAP) north of Detroit on July 5. Another 120 workers at the nearby Sterling Stamping plant are also slated to be idled. The job reductions would the first layoffs by the company since it emerged from bankruptcy in 2009. About 1,900 will remain at SHAP after the cuts.

The layoffs follow the announcement earlier this year by Fiat Chrysler CEO Sergio Marchionne that the company plans to phase out production of its smaller cars, the Chrysler 200 and the Dodge Dart. The Sterling Heights facility builds the 200. Marchionne has indicated the company in the future plans to outsource the building of smaller vehicles to a third party supplier.

Sales of the Chrysler 200 have plummeted since the company dropped sales incentives on the vehicle in December. Sales of the 200 dropped 63 percent in 2016 through the month of March. As of last Friday the company reported 34,268 unsold cars in its inventory. That represents a 150-day supply at current sales levels. Workers at SHAP have been on layoff already for 12 weeks this year due to the sales slump.

Across the United States passenger car sales were down 5.3 percent this year while sales of light trucks increased 11 percent. Meanwhile, major automakers continue to experience sales declines in China.

Fiat Chrysler said it would place laid off Sterling Heights workers into open full-time positions at other Detroit-area plants as they became available based on seniority.

In response to the layoff announcement Norwood Jewell, UAW vice president for Fiat Chrysler, offered a statement brimming with mealy-mouthed complacency, declaring, “While today’s announcement of a shift reduction at Sterling Heights Assembly is unfortunate, it is not unexpected. FCA is not the only company experiencing a slow market for small cars.”

Jewell, who rammed through a concession contract on FCA workers last fall after they rejected the first UAW-backed agreement, continued, “The company has been planning to increase its capacity to build more trucks and SUV’s. I believe in the long term this move will be a positive one for our members and the company.”

The layoffs at SHAP come as Fiat Chrysler sits on a reported cash hoard of some $13 billion. The company recently gained access to the money after buying back bonds that had restricted the funds from being transferred outside the company’s US unit.

Several workers told the WSWS they first learned of the layoffs from news reports.

A tier two worker at SHAP told the World Socialist Web Site that he had just heard Wednesday that Fiat Chrysler planned to eliminate a full shift. “They didn’t give us all the details. I still need to get a clear understanding of what is going on. You hear different things from different people and rumors spread fast. They are saying it might be for six months.

“We go back to work from the current layoff on Monday and will work through until July 5, which is the time for our normal summer shutdown.”

A veteran SHAP worker said, “I didn’t hear the news until my son called me about it, but we had already heard rumors. We have only worked two weeks this year. They have sent the new hires who have a little seniority over to work at other plants like Jefferson North Assembly. We were supposed to go back to work three weeks ago, then they called us and said don’t come in until Monday.”

She expressed concern over the future of jobs at the facility. “They could just shut the plant down, because we don’t have a union. The UAW lets them do what they want.”

A second-tier worker at the Jefferson North plant added, “My best friend works at SHAP. She’s raising two kids on her own and is living on unemployment benefits and sub pay. To tell you the truth even if you had two incomes in a family it would not be enough.

“We heard about the poor sales of the 200 since last year. How long is it going to before they eliminate the first shift? Obama’s claims that the economy is doing great are BS.

“We are worried about our jobs at Jefferson. They just did an audit and said our quality was down and we will find out in the summer whether they are going to eliminate the third shift at my plant. They’ve made threats like this before but this time we’re concerned. Sure the quality is down; it’s because they won’t shut down the line to do needed repairs on the equipment or make corrections on the cars. All they want to do is keep the line moving, to get quantity, not quality.”

She said things had gotten worse since the UAW pushed through the new four-year agreements. “Management is doing what they want because of the contract. No one is fighting for the autoworkers.”

Under terms of the 2015 UAW-FCA agreement there are no job guarantees and outsourcing of work is permitted. The UAW agreements also sanctioned the plans by FCA, GM and Ford to shift small car production to Mexico to exploit lower wages, while retaining production of highly profitable pickups and SUVs in the US.

The job cutting by Fiat Chrysler followed Ford’s announcement that it would build a new small car plant in Mexico. The facility will employ 2,800 and start production in 2018. Ford said labor costs were a consideration in the move. Ford had earlier announced that it would discontinue production of the Focus and C-Max hybrid at its Wayne, Michigan assembly plant.

Hostile to any fight to unite US, Mexican and Canadian workers, the UAW is promoting economic nationalism while slashing wages and conditions of US workers in the name of “in-sourcing” jobs from lower paying countries.

In an April 4 letter to the New York Times denouncing the Trans-Pacific Partnership trade deal, UAW President Dennis Williams wrote “Company unions there [Mexico] are more aligned with employers than with workers.” As every autoworker knows the UAW has long been “aligned” with the employers and has suppressed any resistance of workers to its corporatist “partnership” with the auto bosses.

It has been 40 years since the UAW called a nationwide strike in the auto industry. Since then real wages have plummeted and hundreds of thousands of jobs have been eliminated. The fact noted by Williams that one quarter of US manufacturing workers earn less than the poverty wage of $11.91 an hour is a devastating indictment of the so- called labor movement in the United States. It is the inevitable product of the systematic drive by the UAW and all the US unions to force down real wages in order to help US companies to compete on the world market.

Chrysler earlier indicated that it is planning to shift production of the Dodge Ram from the nearby Warren Truck Assembly Plant to SHAP. No official timetable for the move has been laid out, but it is thought it will take place over the next eight to ten months.

As a consequence, workers at the Warren Truck plant face uncertainty over their jobs. There have been suggestions that the Jeep Wagoneer will be produced at Warren Truck, but that is a slower selling vehicle than the Ram.

According to a report in thestreet.com there are signs that the boom in car sales is slowing. Sales of vehicles in March did not meet estimates and there are indications that carmakers are struggling to meet sales goals through such measures as increasing fleet sales, boosting incentives and using extended terms to keep lease payments low.

The seasonally adjusted sales rate fell to 16.56 million in March, well below forecasts of 17.3 million. The pace of sales was the lowest since February 2015.

SHAP had been slated to close in 2009, but Fiat Chrysler retooled the plant for the production of the Chrysler 200.

Workers at the Belvidere, Illinois Assembly Plant that builds the Dodge Dart, which also has seen sharp sales declines, have not as yet faced layoff. The facility also builds the Jeep Patriot and Jeep Compass.

Panama Papers revelation triggers political crises around the globe

Jordan Shilton

The global fallout from the Panama Papers continued to expand Wednesday, as new revelations about the tax arrangements of British Prime Minister David Cameron increased pressure on his government and other world leaders came under scrutiny.

The release of reports based on 11.5 million documents from Panamanian law firm Mossack Fonseca by 100 media outlets around the world in alliance with the International Consortium of Investigative Journalists (ICIJ) has exposed once again the criminal practices at the heart of global capitalism. High profile figures from around the world have been affected, with a total of 72 current and former heads of state cited as having offshore accounts.

A full-scale political crisis continued to deepen in Iceland Wednesday in the wake of the resignation of Prime Minister Sigmundur David Gunnlaugsson the previous day. The government stated later Tuesday that Gunnlaugsson had only stepped aside temporarily, and would resume his duties at some unspecified time. The revelations implicate broader sections of the ruling elite, including the leader of Gunnlaugsson’s coalition partner, the Independence Party.

Criticism of UK Prime Minister Cameron grew after the Daily Telegraphreported that Blairmore, his father’s offshore firm, moved its office from Panama to Ireland in 2010 to evade examination of its tax affairs. Ireland has notoriously low corporation tax rates, which are rarely paid in full by companies.

Blairmore managed tens of millions of pounds on behalf of wealthy families. According to the Guardian, it has never paid a penny in income tax in the UK during its over 30 years of operations.

The Prime Minister’s office initially responded by declaring the matter a “private affair.” Apparently contradicting earlier statements that Cameron owned no shares in offshore companies, Downing Street issued a carefully worded statement yesterday claiming that the Prime Minister would not enjoy any future benefits from such entities. “There are no offshore funds/trusts which the Prime Minister, Mrs. Cameron or their children will benefit from in future,” a spokesman said.

The Guardian reported that the reference to “offshore firms” may have been chosen because it does not apply to Ireland, even though its tax rates are almost as low as offshore tax havens.

The Panama Papers are merely the tip of the iceberg. As the Wall Street Journal acknowledged yesterday, the offshore industry has “thrived” over recent years. According to the Boston Consulting Group, private wealth directed into tax havens grew by 7 percent in 2014, reaching the remarkable sum of $11 trillion. Between 2009 and 2014, the number of companies registered in the seven largest tax havens, which include the British Virgin Islands and crown dependency of Jersey, rose by 7 percent to 672,500.

This coincides with the period during which governments of all stripes around the world launched an unprecedented assault on the wages and living standards of the working class to pay for the billions made available to bail out the banks in the wake of the global economic meltdown of 2008. While millions of workers around the globe paid for the speculative activities of the financial elite by being plunged into poverty and unemployment, the global financial oligarchy enriched itself still further by stashing additional billions in tax havens.

Some estimates go even higher. The Tax Justice Network, a research and advocacy organization, estimated that between 8 and 13 percent of total global wealth is stored in tax havens, equating to between $21 and $32 trillion. This does not even include onshore domestic tax shelters, such as the states of Delaware and Wyoming in the United States.

Last October, Blackstone Group LP, the world’s largest private equity firm, valued Intertrust NV, a company that sets up and services companies, trusts and investment funds in tax havens, at $1.5 billion in an IPO. Intertrust’s revenue rose by 17 percent last year.

Britain is a major player in the global offshore industry, being second only to Hong Kong in the number of entities engaged in such activities.

The pressure building on the British government was demonstrated when Chancellor George Osbourne broke off a television interview after a reporter repeatedly asked him to clarify whether he had any interests in offshore firms. The Treasury later sought to claim the interview had not been cut short, but that the agreed upon number of questions had been posed.

The revelations have revived a scandal that first broke last July over Osbourne’s involvement in a property deal with a developer based in a tax haven, which netted his family business £6 million.

The first reported police action resulting from the Panama Papers occurred Wednesday afternoon when Swiss authorities raided the offices of the European Football federation UEFA in Nyon. Swiss daily Neue Zürcher Zeitung reported that UEFA sold the rights to some of its competitions to offshore firm Cross Trading in 2006, which subsequently resold the rights for a much higher price. The story implicates current FIFA head Gianni Infantino, who was chief legal officer for UEFA at the time. Infantino recently replaced FIFA President Sep Blatter and was portrayed as a clean pair of hands.

UEFA denied selling the broadcast rights below the market price.

The revelations have also hit political leaders in other countries. Investigations linked to the Panama Papers have been launched in Britain, France, Australia, New Zealand, Austria, Sweden and the Netherlands.

Argentinian President Mauricio Macri is accused of involvement in two firms based in the Bahamas and Panama. Macri did not list his involvement with either company when he became mayor of Buenos Aires in 2007 or president last year.

Ukrainian President Petro Poroshenko, a close ally of Washington and the NATO powers in their geostrategic offensive against Russia in Eastern Europe, set up a firm in the British Virgin Islands upon becoming president in 2014 to manage his chocolate business. According to opposition politicians, this move deprived the country of millions in unpaid taxes.

Major US figures have been conspicuous by their absence from the lists of clients of Mossack Fonseca. This is primarily due to the fact that many tax havens exist domestically, such as in the state of Delaware, where one office building is home to 285,000 companies.

US President Barack Obama seized on the Panama Papers to portray his administration as an opponent of tax evasion. In a press conference Tuesday, he applauded new regulations put forward by the Treasury Department with the aim of preventing corporate inversions by companies active in the US, a process whereby a firm’s headquarters is moved overseas for tax purposes so as to benefit from tax havens.

“We’ve had another reminder in this big dump of data coming out of Panama that tax avoidance is a big, global problem,” Obama declared. “It’s not unique to other countries. A lot of it is legal, but that’s exactly the problem. It’s not that they’re breaking the laws, it’s that the laws are so poorly designed.”

Obama’s hand-wringing comes from the head of a government that has done all it can to shield the criminal practices of the financial elite in the wake of the 2008 global financial meltdown, in which US-based firms played the leading role with speculative and outright criminal practices.

The impunity enjoyed by the financial elite allowed them to return to business as usual. As the Wall Street Journal noted yesterday, many local service providers in tax havens were bought up by banks in the wake of 2008, helping consolidate the offshore financial industry.

One of the privately-controlled firms engaged in this highly secretive industry, Citco Group, was compelled to pay $125 million in compensation to investors last year after it emerged it had administered funds for Bernard L. Madoff, who was convicted for running one of the largest Ponzi schemes in history.

Questions have been raised about the involvement of US authorities in prominently featured information targeting Russian oligarchs with close ties to President Vladimir Putin. WikiLeaks alleged yesterday that USAID funded a news story accusing members of Putin’s inner circle for running an offshore tax operation.

Kristinn Hrafnsson, a spokesman for WikiLeaks, also criticized the decision by the ICIJ not to release all of the information, citing “responsible journalism.” “I totally disagree with the overall tone of that,” he told Russia Today. He urged all of the information to be made publicly available.

Politics of Promise: Between Sirisena and Rajapaksa

Asanga Abeyagoonasekera

“Those that are most slow in making a promise are the most faithful in the performance of it.”

Jean-Jacques Rousseau

On Easter Day, a day of rejoicing and celebration for Christians, shrapnel and ball bearings pierced through innocent civilians in a children's park in Lahore, where a majority of the victims were children. This disgraceful suicide attack, which killed 69 and injured nearly 400, was a sad day for Pakistan and the region. Days before, another terrorist attack, in Brussels, targeted innocent civilians. The world has become unstable due to terrorism across the globe and the highest priority on the global agenda should be towards combatting it. Without a safe environment, it is difficult to talk economic prosperity, a lesson Sri Lanka learned from its brutal three-decade war. The physical and mental scars that terrorism causes are deep. They are not easy to forget as victims.

For this, consensus at the highest political level is important. The daunting task of bring the two different political parties with different values - United National Party (UNP) and the Sri Lanka Freedom Party (SLFP) - together, was established a year ago in Sri Lanka. The recent developments within the political party of President Sirisena have not been so positive, with some members being questioned for supporting the former President Rajapaksa at a rally organised in Colombo's Hyde Park. With the recurring electricity failures, the advantage has moved to the former President, with the creation of the slogan, “Rajapaksa is the President of the street and Sirisena President of the country… give it to me if you can’t.” Sri Lankan civilian engagement with social media on this has been negative, especially given the billions of losses incurred by Sri Lankan Airlines being exposed by a Government Minister. The sentiment is, 'we have given you the power, so fix it'.

High expectations and promises were set at the beginning, and the delivery has been slow but steady. From 8 January 2015, beginning with the 100-day reforms, until now, demonstrates 16 months of the new Government. The Right to Information (RTI) Act was tabled in Parliament last week - a considerable achievement - but this needs further amendment as it prevents access to some important areas that de-feat its main purpose. The RTI act could take a considerable amount of time to take the proper shape, as it did in India, with many amendments and public debate. This exercise would have been impossible un-der the former regime with its control and censorship of the media, and attacks on media outfits and individuals.

Some people are now looking at change that could bring back the former regime. They tend to forget the environment of the past where power revolved around one individual who took over the independent commissions, including the bribery commission, under his control, further extending Rajapaksa's political term by more than two terms. His once powerful family member has now taken a back seat at the Hyde Park rally, giving front seats to other SLFP seniors, which was not the practice in the past as all the senior party members had to get the blessings from the family member. One senior Minister and a party leader, now a supporter of Rajapaksa, who had a small Ministry office and a nominal budget, showed his displeasure during the Rajapaksa period but is now a front runner in the campaign to bring Rajapaksa back to power. Another senior politician from SLFP who got many more votes than several other candidates elected from the national list spoke to this author of his displeasure at the giving of positions to the rejected lot by the people.

Despite all obstacles, the triple power centres of the Government - President Sirisena, PM Wickrama-singhe and former President Kumaratunga - have found a working order for some crucial subjects de-spite their differences and public disagreements with one another, which is a great achievement. Even within the Government, a Sirisena faction Minister recently made some harsh comments against the Prime Minister, calling him an enemy of the SLFP, which angered the UNP Ministers.

Internationally, there has been much praise for the Government’s efforts to move towards introducing good governance, minimising massive spending, and working towards a more citizen-centric government. The colossal spending included expenditure for state events foreign visits filling entire flights, establishing overseas missions at places that have no direct benefit for Sri Lanka. Now, restructuring in all these areas can be seen, and they cannot be fixed overnight. The case Rajapaksa is trying to create is weak and does not have much support, especially from the youth who believe in creating a society with less corruption - the central theme that toppled Rajapaksa's regime. If the delivery of the central theme, anti corruption, is as equal or worse than the past regime, things could go against the present regime. Still there is much positivity in the present regime, with attempts to correct the economic downturn created by the former regime, with massive loans and financial misappropriation at all levels.

A perfect balance in Sri Lanka's foreign policy will be sought after the PM’s visit next week to China, “a time-tested friend” that has assisted the country during many difficult times. Geo-strategically well posi-tioned with its centrality in the Maritime Silk Road, Sri Lanka will thrive economically if this perfect foreign policy balance is achieved.

6 Apr 2016

Viva la Producción! Urban Farming In Cuba

Josh Gabbatiss

Urban farming has gained momentum in recent years as a result of increased awareness of environmental issues and the desire to feed people living in cities sustainably. For Cuba in the 1990s, however,the shift to an urban agricultural economy was a matter of life or death.

The Plaza de la Revolución is supposed to embody the spirit of revolutionary Cuba. Dominated by a large mural of Che Guevara and a monument to Cuban national hero José Martí, this site is dedicated to the ideals upon which this communist state was founded.

But strolling through the Plaza – a long stretch of grey concrete scattered with hordes of tourists taking selfies – the principles of these iconic men seemed absent in the rather bleak town square, empty of the hundreds of thousands of Cubans that used to fill it in the days of the revolution. It took a short walk around the corner from the Plaza into one of Havana’s typical residential areas to find a better representation of contemporary Cuban values in action. Among the dull tower blocks and pastel-coloured houses, explosions of green infiltrate these neighbourhoods, marking another revolution that has quietly taken place over the past three decades.

Urban agriculture is a big deal in Cuba. Food gardens – termed organopónicos – make up 8% of land in Havana, and 3.4% of urban land across the island. The country enjoys unprecedented levels of self-sufficiency, with small, local operations producing 90% of all its fruit and vegetables.

Cuba’s relationship with urban farming mirrors its changing fortunes over the past six decades. When the Soviet Union collapsed in 1991, its ripples were felt strongly in this Caribbean nation, whose economy had been propped up by imports from its powerful ally.Everything from machinery to cattle was brought in, and in return the Cubans geared their agricultural system towards producing sugar for the Soviets.

All this meant that when the supply tap was suddenly turned off, Cuba’s agriculture was completely unfit for purpose. Farmers were left with tractors without fuel, cows that died without special food mixtures and a severe shortage of chemical pesticides and fertilisers. In a matter of years, the UN Food and Agriculture Organisation estimated that the daily calorie intake for the average Cuban had halved.

A solution was required to prevent starvation, and that solution turned out to be urban farming.

In desperation, the people of Cuba began turning gardens, empty parking lots and the spaces between buildings into farms. A network of urban agriculture sprang into existence, with people learning to incorporate biological pest control strategies, crop rotations,intercropping and soil conservation into their practices to increase yield without reliance on chemical inputs. These farms were organic not as a result of ideology, but out of necessity.

In the true spirit of the revolution, such operations were initially citizen-led, but once the state got wind of what was going on, it got involved wholeheartedly. Now, the Ministry of Agriculture provides not only land and water, but also training in organic techniques and additional requirements such as insects and oils as biological pest control agents. In return,organopónicos must contribute a certain amount of their output towards the government’s controversial rationing system.

However, unusually for Cuba, the farmers do retain significant control over their own ventures. In 1992, the state controlled 75% of the country’s farmland, whereas now, as a result of the piecemeal development of the new urban farming network outside of state management, nearly all of it is run locally by co-ops. Not only do these co-ops decide what they want to grow, they are able to negotiate with the government about how much they contribute to the state. Moreover, co-op members have first claim on their own output, and after contributing their quota for rationing they are able to sell the excess themselves. In fact, many farmers who exceed their quotas are able to earn up to double the national wage. In a nation that has only recently begun relaxing its restrictions on private ventures, such freedom is remarkable.

In many ways, the urban agriculture of Cuba provides a model system for how to sustainably and nutritiously feed a population. The calorie consumption of the average Cuban is comparable with that of someone in the UK, but their diet – heavy on rice, beans, potatoes and other vegetables – is low in fat, and because so much of their production is organic, fuel costs have been significantly reduced.

For these reasons, Cuba has been lauded by many as a trendsetter in sustainable farming, but its success is somewhat misleading. The island nation still needs to import significant quantities of produce including meat and wheat, and the government’s brief flirtation with genetically modified (GM) crops might not sit well with everyone, considering the overlap between those who support organic agriculture and those who are opposed to GM crops.

Cuba is a land of contradictions. Its urban farms are an unusual avenue by which farmers can accrue personal wealth in an otherwise avowed communist state; they are also a demonstration of the kind of communal values that such a state is supposed to represent. In addition, the farms illustrate the capacity the nation has to provide for its people, though in meat and dairy they are sorely lacking. Fruit and vegetables may be plentiful, but milk, eggs and beef have been in short supply for years due, in part, to lack of sufficient feed for livestock.

While in some ways Cuba is still pretty dysfunctional – largely lacking reliable internet connections, modern transport and, crucially, freedom of speech – but there does seem to be change on the horizon. Raúl Castro is beginning to loosen the reins on some of his brother’s long-standing policies, and relations have thawed with the US.

The fact that Cuba’s urban farming culture arose out of desperate need rather than environmental principles may mean that if that need disappears, so might the organopónicos.

From providing free healthcare to virtually universal literacy rates, communism has done a lot of good for the people of Cuba, but it has also left many desiring change. Cubans are tired of the food shortages and reliance on the black market for both luxury goods and staple items. Ultimately, to get access to a more varied selection of commodities, trade with the US could be the answer. Some observers have predicted that if the US embargo is relaxed, sales of goods to Cuba could rise to as much as $6 billion a year.

An influx of cheap, subsidised US produce would bring some much-desired variety to Cuban larders, but it could also harm their home-grown sector by out-competing urban farmers.

With Cuban Economy and Planning Minister Marino Murillo setting aside $22.6 million for agriculture in 2016, on top of the $340 million earmarked the previous year, in part, to boost food production, it’s clear that leaders are keen not to lose the gains they have made in this sector. Even so, as Cuba faces an uncertain future that might well feature significantly increased foreign food imports, it’s going to have to work hard to hold onto the successes of its urban farming revolution.

Nuclear Insecurity

Mel Gurtov

The fourth Nuclear Security Summit, hosted by President Obama, has just ended. The focus was on terrorism, a perfectly reasonable topic. But the larger question, not taken up by the conference, is why the US, Russia (which did not attend), and seven other countries still regard nuclear weapons as central to their national-security strategies, especially when they have no role in deterring or fighting terrorists.

Obama did comment on his administration’s achievements toward creating a nuclear-free world, he said:

The United States and Russia remain on track to meet our New Start Treaty obligations so that by 2018 the number of deployed American and Russian nuclear warheads will be at their lowest levels since the 1950s. Even as the United States maintains a safe, secure and effective nuclear arsenal to deter any adversary and ensure the security of our allies, I’ve reduced the number and role of nuclear weapons in our national security strategy. I also have ruled out developing new nuclear warheads and narrowed the contingencies under which the United States would ever use or threaten to use nuclear weapons.

At best, this claim distorts the reality of nuclear weapons in our time and probably in our children’s time. The truth is that the US and other nuclear-weapon states have failed to reduce nuclear arsenals to a bare minimum, reach agreement to confine and reduce the roughly 2,000 pounds of fissile materials now held worldwide, or find meaningful common ground on nuclear security issues. There remain more than 15,000 nuclear weapons in the world, more than 14,000 of them under US and Russian control. Just when we thought otherwise, nuclear winter is back in the news. Two specialists who were among the first to identify the nuclear winter phenomenon recently pointed out that if war were to break out between India and Pakistan, use of just 100 of their combined 250 nuclear bombs would have catastrophic effects on global temperatures, the global food supply, and the ozone layer. In other words, a US-Russia nuclear war is not needed to produce nuclear winter worldwide.

Instead of working toward nuclear abolition, as these two writers propose, we have the United States investing (contrary to Obama’s statement) in a new nuclear weapon, the B-61-12, that will, according to its supporters, result in less radiation and fewer lives lost than existing nuclear weapons. At nearly $29 million apiece, and $11.5 billion in total program spending, it’s the most expensive weapon in the US arsenal—part of a $19 billion modernization of nuclear weapons in Obama’s 2017 defense budget that also includes funding of two more nuclear submarines. To the president, this is a matter of “striking the proper balance” between arms reductions and a “safe and reliable” nuclear stockpile. Some balance!

The B-61 is being presented as a more responsible force for deterrence. Where? In Europe, of all places, where the B-61 would upgrade some 200 nuclear weapons still stationed in Germany and elsewhere. The weapons will be available to theater commanders for use “as a last resort.” Such thinking takes us all the way back to the Eisenhower years, when nuclear weapons were considered to represent “more bang for the buck” and usable in warfare. I’m also reminded of the rationale behind another “economical” weapon, the neutron bomb, which was supposed to leave buildings alone and merely “take out” people.

The Obama administration has also missed opportunities to reduce the proliferation danger presented by highly enriched uranium. To be sure, since 2009 several countries have entirely given up their civilian HEU, starting with Ukraine; and the nuclear deal with Iran is praiseworthy indeed. Moreover, the number of countries with bomb-capable nuclear fuel has dropped from 52 in 1991 to 25 in 2014. But even as some countries have upgraded their nuclear security, the possibility of theft by a terror group remains strong—witness Belgium, which was praised in the above report for improving nuclear security, only to have a few nuclear plant workers defect to ISIS, raising the risk of vulnerability.

In keeping with the double standard that often appears in discussion of nuclear weapons, the US is reportedly disturbed about Pakistan’s development of small nuclear weapons—as though US weapons such as the B-61 are under perfect control. US safeguards are in fact suspect, as reports come in throughout the year of loose surveillance at power plants. A “60 Minutes” program that aired on July 13, 2014 found several deficiencies on nuclear safety following a reporter’s visit to an underground missile site. Even the telephones don’t work properly, the soldiers said; it’s hard to hear commands. Alcoholism, cheating on tests, and psychological problems among military personnel have been uncovered at several US nuclear bases. The Associated Press documented these since 2013; the incidents, which probably represent only a portion of the actual number, have led to the removal of officers and men—the most recent just last month at a base in Wyoming where fourteen airmen came under investigation for drug abuse.

There are many dimensions of the nuclear danger: the possibility of accidents, the potential for miscalculation in “the fog of war,” the reliance on hair-trigger alert status, the excessive numbers, and the ongoing refinements of the weapons to make them ever more accurate, reliable, and invulnerable. In July 1961, just several months into his presidency, John F. Kennedy received his first briefing on nuclear weapons. It described the likely consequences of a Soviet preemptive strike on the US, followed by a US retaliatory strike. Tens of millions of people would be killed instantly and then by radiation, Kennedy was told. He turned to his secretary of state, Dean Rusk, andsaid: “And we call ourselves the human race.”

Every US president in the nuclear era has found, on assuming office, that a nuclear-weapon exchange would be inconceivably horrific. Yet all of them wound up adding to the weapon arsenal, if not in numbers then in refinements of targeting, weapons capabilities, and deployment.

Nothing quite explains as well as the concept of the military-industrial complex why presidents have been unable to reverse these trends. The B-61 has actually been around since the 1960s, and has survived by being constantly adapted to replace retired nuclear weapons. Since 2002 the Pentagon has argued the need for revitalizing the US nuclear weapons program, and now, as Joe Cirincione of the Ploughshares Fund reports, “The Obama administration is planning to spend over $1 trillion in the next 30 years on an entire new generation of nuclear bombs, bombers, missiles and submarines to replace those built during the Reagan years.” Not only does this planning give new life to the B-61; it also provides for a new generation of strategic bombers, cruise missiles, and submarines, all armed with nuclear weapons. The Russians, of course, are not standing still either: among the new nuclear weapons in their plans is a hydrogen bomb torpedo! So much for the end of the Cold War.

The President spoke in 2009 of the country’s “moral responsibility” to work for a nuclear-free world, but evidently that is no match for the military-industrial complex’s bureaucratic mission to keep developing new nuclear weapons, even if they meet no plausible strategic need.