The Inevitability of Nuclear War?

Winslow Myers

Nuclear war is coming. Our officials are currently increasing the chances of that.

I only write ominous op-ed pieces like this in the spirit of hoping I’m an inaccurate prophet. But I’m unable to avoid the difficult conclusion that nuclear war, absent an immediate, fundamental, worldwide change in attitude, is an inevitable part of our future. It could be weeks, months, or years away. But it is coming.

It could break out at any moment between India and Pakistan, the most likely scenario at present. Pakistan is deploying tactical nuclear weapons controlled by local commanders on the front lines in Kashmir, as if the near-miss of the Cuban crisis of 1962 had never happened. War could almost as likely start between NATO and Russia. It might begin with an accident, a misinterpretation of computer blips, a terrorist act, a careless or calculated overreach by a dictator, or a troubled officer with access to sequestered codes. There are too many weapons of too many sizes connected by too many complex but imperfect electronic systems to too many fallible human beings.

If it happens, all our incremental steps toward a semblance of world order will disappear in a few minutes of unimaginable destruction, to be replaced by a barbaric chaos where medical facilities are overwhelmed and water and food supplies are contaminated. Those still alive at the periphery of the blasts will envy those annihilated at the center.

The effects will be experienced around the world, even from a so-called “regional” war. As the ash and soot and radioactive particles from the detonations rise into the upper atmosphere and disperse upon the winds, we will learn just how small a planet we inhabit together—a lethal lesson with no do-over.

The political fallout will be equally grave and far-reaching. Those leaders who made lukewarm but ineffectual efforts to control the weapons, who paid lip service to non-proliferation treaties, who made high-minded speeches while convinced that disarmament initiatives would mean the end of their electability, will feel a remorse that screams within like the howling mobs that will surround their offices and palaces demanding to know why the leaders let disaster happen.

Not a day goes by that I do not ponder why it has not happened already. However ignored, this issue has hung over our lives like a gray pall. Working to prevent nuclear war has provided invaluable moments of shared hope, but feelings of foreboding have dominated. Morbid preoccupation seems less neurotic than total denial. Anyone who admits the urgency of this issue cringes and waits and wonders when, say, the radio goes temporarily dead—has it finally happened? There’s also the magical thinking that says that since it has not yet happened, there may indeed be miraculous hidden forces at work, helping us avoid the worst until we grow mature enough to realize our folly.

History suggests to us that divine intervention will not prevent the worst. It did not stop the Nazi holocaust. Nuclear weapons were conceived and created by people. People are equally capable of realizing that such weapons have not led, and cannot lead, to the global security we seek. It is this logical conclusion, sidestepped and diluted by hundreds of thousands of “experts,” but clear enough to the average 10-year-old, that can be the shared basis of universally applied, reciprocal negotiations toward absolute and total abolition. The world would rejoice in relief if it happened.

Meanwhile we remain stubbornly blind. How much more deeply could we fail our 10-year-olds than by introducing them to a world where such hideous and unmerited suffering hangs over them? The bumper-sticker question persists: do we hate our enemies more than we love our children?

We have kept these weapons at the ready as our primary way to avoid looking at our own darkness. We have projected evil motives upon a series of less-than-fully-human stereotypes, from the toothy, sadistic, slant-eyed Orientals (suddenly transformed back into agonized human beings at Hiroshima and Nagasaki), to brutal, corrupt, vodka-swilling Soviets, to bearded, misogynistic Islamic thugs. And the real people behind these crude and false stereotypes have projected the same malevolence onto us. Out of this “us-and-them” animosity has arisen the systemic evil of world-destroying weapons.

Our mutual fear can only be mastered by living the golden rule common to all major religions, of doing as you would wish to be done by. Refusal to heed this practical advice has borne a perverse shadow-version of the universal rule of interdependence: if you do harm unto me, I will destroy you utterly—even if it also destroys me in the process!

We need to see, with the same visceral fright that we respond to a poisonous snake rearing up and baring its dripping fangs, the immediacy of the danger we face.

On this earth the universe has tried an experiment in consciousness, an experiment in learning to see what causal conditions lead to life and what lead to death.

We have been gifted with the capacity to see. Instead, we are very close to doing ourselves in. We ignore the life-affirming realism of Jesus, Gandhi, the Dalai Lama and Martin Luther King in favor of the illusory “realism” of Kissinger, Cheney, Trump and Cruz. Millions on the planet continue to work their hearts out to wake people up to reasonable alternatives based in common interest and common sense.

May they prove my pessimism wrong.

Saudi King And Princes Blackmail U.S. Government

Eric Zuesse

Saudi Arabia, owned by the Saud family, are telling the U.S. Government, they’ll wreck the U.S. economy, if a bill in the U.S. Congress that would remove the unique and exclusive immunity the royal owners of that country enjoy in the United States, against their being prosecuted for their having financed the 9/11 attacks, passes in Congress, and becomes U.S. law.

As has been well documented even in sworn U.S. court testimony, and as even the pro-Saudi former U.S. Secretary of State Hillary Clinton acknowledged privately, "Donors in Saudi Arabia constitute the most significant source of funding to Sunni terrorist groups worldwide.” She didn’t name any of those “donors” names, but the former bagman for Osama bin Laden, who had personally collected all of the million-dollar+ donations (all in cash) to Al Qaeda, did, and he named all of the senior Saud princes and their major business-associates; and, he said, "without the money of the — of the Saudi you will have nothing.” So, both before 9/11, and (according to Hillary Clinton) since, those were the people who were paying virtually all of the salaries of the 19 hijackers — even of the four who weren’t Saudi citizens. Here’s that part of the bagman’s testimony about how crucial those donations were:

Q: To clarify, you’re saying that the al-Qaeda members received salaries?
A: They do, absolutely.

So: being a jihadist isn’t merely a calling; it’s also a job, as is the case for the average mercenary (for whom it doesn’t also have to be a calling). The payoff for that job, during the jihadist’s life, is the pay. The bagman explained that the Saud family’s royals pay well for this service to their fundamentalist-Sunni faith. Another lifetime-payoff to the jihadists is that, in their fundamentalist-Sunni culture, the killing of ‘infidels’ is a holy duty, and they die as martyrs. Thus, the jihadist’s payoff in the (mythological) afterlife is plenty of virgins to deflower etc. But, the payers (the people who organize it, and who make it all possible) are the Saud family princes, and their business associates — and, in the case of the other jihadist organizations, is also those other Arabic royal families (the owners of Qater, UAE, Kuwait, Bahrain, and Oman). However, 9/11 was virtually entirely a Saudi affair, according to Al Qaeda’s bagman (who ought to know).

The report of the threat by the Saud family comes in veiled form in an April 15th news-story in The New York Times, headlined, “Saudi Arabia Warns of Economic Fallout if Congress Passes 9/11 Bill.” It says that the Saud family’s Foreign Minister is “telling [U.S.] lawmakers that Saudi Arabia would be forced to sell up to $750 billion in [U.S.] treasury securities and other assets in the United States before they could be in danger of being frozen by American courts.” The NYT says that this threat is nothing to take seriously, “But the threat is another sign of the escalating tensions between Saudi Arabia and the United States.” While the carrying-out of this threat would be extremely damaging to the Saud family, the NYT ignores the size of the threat to the Sauds if their 9/11 immunity were removed — which could be far bigger. Consequently, this matter is actually quite a bit more than just “another sign of the escalating tensions between Saudi Arabia and the United States.”

Russian Television is more direct here: “Saudi Arabia appears to be blackmailing the US, saying it would sell off American assets worth a 12-digit figure sum in dollars if Congress passes a bill allowing the Saudi Government to be held responsible for the 9/11 terrorist attacks.” (The Saudi Government is owned by the Saud family; so, even that statement is actually a veiled way of referring to the possibility that members of the royal Saud family — the individuals name by the bagman — could be held responsible for 9/11.)

Even immediately in the wake of the 9/11 attacks, there had been some mentions in the U.S. press of the U.S. Government making special allowances for Saud Prince Bandar al-Saud, a close friend of the Bush family (and he was also one of the Saudi Princes mentioned specifically by the bagman), to fly out of the country to avoid being sought by prosecutors. Furthermore, Newsweek’s investigative journalist, Michael Isikoff, headlined on 12 January 2001, “The Saudi Money Trail”, and he reported statements from royal Sauds, that they didn’t really mean for their donations to be going to such a thing as this. (Perhaps those individuals didn’t, but Bandar almost certainly did, because he was the Saud Ambassador to the U.S. at the time of 9/11.) However, now that the U.S. Government is relying heavily upon Saudi money to pay for the U.S. weapons and to help to organize the operation to overthrow Bashar al-Assad in Syria and to replace him with a fundamentalist-Sunni leader, there is renewed political pressure in the United States (from the victim-families, if no one else), for the arch-criminals behind the 9/11 attacks to be brought to American justice. After fifteen years, this process might finally start. That would be a drastic change.

Clearly, the threat from the Sauds is real, and the royal response to this bill in the U.S. Congress reflects a very great fear the owners of Saudi Arabia have, regarding the possible removal of their U.S. immunity, after 15 years.

Prosecution of those people will become gradually impossible as they die off. But a lot more time will be needed in order for all of the major funders of that attack to die natural deaths and thus become immune for a natural reason — the immunity of the grave. The U.S. Government has protected them for 15 years; but, perhaps, not forever.

To say that this threat from the Sauds is just “another sign of the escalating tensions between Saudi Arabia and the United States” seems like saying that a neighbor’s threat to bomb your house would constitute just “another sign of escalating tensions” between you and your neighbor. The passing-into-law of this bill in Congress would actually constitute a change from the U.S. Government being a friend and partner of the Sauds, to becoming their enemy.

Obviously, there is little likelihood of that happening; and, on April 20th and 21st, U.S. President Barack Obama is scheduled to meet with Saudi King Salman al-Saud. Without a doubt, this topic will be on the agenda, if it won’t constitute the agenda (which is allegedly to improve U.S. relations “with Arab leaders of Persian Gulf nations” — not specifically with Saudi King Salman and with his son Prince Salman).

If President Obama represents the American public, then the Sauds will have real reason to fear: the U.S. President will not seek to block passage of that bill in Congress. However, if the U.S. President represents instead the Saud family, then a deal will be reached. Whether or not the U.S. Congress will go along with it, might be another matter, but it would be highly likely, considering that the present situation has already been going on for fifteen years, and that the high-priority U.S. Government foreign-policy objective, of overthrowing Bashar al-Assad, is also at stake here, and is also strongly shared not only by the Sauds but by the members of the U.S. Congress. Furthermore, the impunity of the Saud family is taken simply as a given in Washington. And, the U.S. Government’s siding with the Sauds in their war against Shia Muslims (not only against one Shiite: Assad) goes back at least as far as 1979. (Indeed, the CIA drew up the plan in 1957 to overthrow Syria’s Ba’athist Government, but it stood unused until President Obama came into office.)

Furthermore, the U.S. Government is far more aggressive to overthrow Russia-friendly national leaders, such as Saddam Hussein, Muammar Gaddafi, Bashar al-Assad, and Viktor Yanukovych, than it is to stop the spread of fundamentalist Sunni groups, such as Al Qaeda, ISIS, etc.; and, a strong voice for U.S. foreign policy, the Polish Government, even said, on April 15th, that as AFP headlined that day, “Russia 'more dangerous than Islamic State', warns Poland foreign minister”; and Russia itself is, along with Shiite Iran, the top competitor against the fundamentalist Sunni Arab royal families in global oil-and-gas export markets. So, clearly, the U.S. Government is tightly bound to the Saud family. Terrorism in Europe and America is only a secondary foreign-policy concern to America’s leaders; and the Saud family are crucial allies with the U.S. Government in regards to what are, jointly, the top concerns of both Governments.

Consequently, there is widespread expectation that some sort of deal will be reached between U.S. President Barack Obama and the Saudi leaders, King and Prince Salman, and that the Republican-led Congress will rubber-stamp it, rather than pass the proposed bill to strip the Saud family’s immunity.

Wave of closures and job cuts under way in New Zealand

John Braddock

The deepening global slowdown is hitting the New Zealand economy not only in the dairy industry, the country’s main export, but more broadly, triggering a wave of job losses.

The present GDP growth of 2.5 percent, down from 3.7 percent in 2014, is based principally on immigration and tourism. In a recent article in the New Zealand Herald entitled “Froth disguises the facts,” commentator Brian Fallow highlighted downturns in growth, employment and wages. Real gross national disposable income grew by just 1.5 percent last year. However, when adjusted for population growth, national income per capita contracted by 0.4 percent.

In 2015, the country ran a current account deficit of $7.7 billion, ending the year with net external liabilities of $151 billion, equivalent to 61 percent of GDP. Led by the 13 percent plunge in dairy prices, the terms of trade have become, Fallow wrote, “a lot less advantageous.”

According to the Ministry of Business, Innovation and Employment (MBIE) employment growth in the year to March slowed to 1.7 percent, from 3.4 percent the year before. MBIE forecasts for the coming period are dismal. The official unemployment rate, currently 5.3 percent, will rebound to 6 percent. Labour productivity growth, which rose 0.6 percent, will slip back to 0.4 percent. Wages have only been boosted by exceptionally low inflation. Real wage growth is forecast to average just 0.7 percent a year over the next three years.

A new round of job cuts is under way, hitting over 2,000 workers in retail, postal services, education, mining, manufacturing and the public services.

On April 5, whitegoods manufacturer Fisher & Paykel (F&P) announced the closure of its plant in Auckland, which manufactures refrigeration products, with the loss of 186 jobs. F&P has long been touted as a New Zealand manufacturing “icon.” CEO Stuart Broadhurst said the factory was “no longer sustainable,” due to its “lack of cost competitiveness in today’s global whiteware marketplace.” Upgraded models of some products will be manufactured at plants in Thailand and China.

Carpet manufacturer Cavalier Bremworth announced last week it will close its Christchurch plant and downsize operation in Whanganui as a result of a downturn in demand for woollen carpets. The moves will see more than 100 redundancies. CEO Paul Alston said the company is “consulting with the unions” about relocating some workers to its Napier plant.

Auckland-based Unitec, the country’s largest polytechnic, has begun a three-year restructuring program that involves laying off nearly 300 staff. More than 50 full-time job cuts were axed in 2014 in the design and visual arts department. Student services have been handed over to Concentrix, a private customer service organisation, resulting in 55 job losses. The next tranche of 87 redundancies, among administration and teaching staff, is due to take effect this month.

Unitec CEO Rick Eade said the cuts were due to a “shift to new teaching methods, improved ways of working, and efficiencies created by new technology.” In fact, the main driver is ongoing reductions in government funding and competition among institutions for a declining number of students, due in no small part to sharply rising study costs.

Further attacks on tertiary education are being prepared. The Productivity Commission has begun a wide-ranging inquiry into the sector that is likely to produce more “pro-market” recommendations in order to orient the country’s universities, polytechnics and private training providers more directly to the needs of business.

On March 29, NZ Post said it will cut 500 jobs by the end of July. The announcement brings the total jobs shed since 2013 to nearly 1,900. The state-owned company said the cuts were in response to an annual $20–$30 million fall in revenue as people send 60 million fewer letters every year. The unions, which have collaborated fully with NZ Post’s downsizing agenda, are expecting a further 25 percent reduction in the workforce.

The opposition Labour Party promptly accepted the sackings. Leader Andrew Little made a vague call for the National Party government to help retrain the workers and “encourage new sectors and innovative businesses to create new jobs,” that is, provide more handouts and other incentives for businesses.

The downsizing of the public sector, which has seen over 5,000 jobs eliminated since 2008, is continuing. The Inland Revenue Department (IRD) announced last month that it expects to cut 1,500 jobs between 2018 and 2021 as part of its Business Transformation plan, which aims to reap benefits of $7.65 billion from reduced tax avoidance, lower debt write-offs and cost savings. Labour’s revenue spokesman Stuart Nash said only that placing a number on the cuts was “premature.”

The Ministry of Justice has confirmed that it will axe 202 jobs by July, replacing them with 111 new fixed-term positions. The closure of fines collection units at the courts will mean officers will be forced to work from home, seek redeployment or take redundancy. This opens the way for similar cost-cutting measures across the state sector, and more public servants forced to work from home.

In retail, 62 Dick Smith electronics stores will close this month along with 300 stores in the failed company’s home base, Australia. Altogether, 3,000 jobs will disappear, of which 430 are from New Zealand.

State-owned miner Solid Energy has confirmed it will cut another 41 jobs at its Stockton mine, north of Westport. The company has already shed at least 340 jobs at Stockton and is currently reviewing whether the mine should be closed. Solid Energy last year entered voluntary administration in a bid to minimise losses to creditors and is selling off assets.

Another 25 jobs are expected to be destroyed on the West Coast after Bathurst Mine announced it is likely to close within the next few months. Bathurst has had to seek domestic buyers for its coking coal, because of the low international price. It supplies coal to the Westport Holcim cement plant, which is closing in June, at a cost of another 120 jobs.

The closures and job shedding are being executed with the full collaboration of the trade unions, which are keeping each group of workers isolated while implementing the employers’ agenda. At F&P, NZ Post and the mines, the unions have already overseen downsizing and layoffs over many years. The main union at F&P, E Tu (Maori for ‘stand up’), created last October through the merger of the Engineering, Printing and Manufacturing Union and the Service & Food Workers Union, only declared that its members there “will be entitled to redundancy compensation.”

The Public Service Association (PSA) has declared that it is “inevitable” jobs will be lost at IRD and that it will be involved with the restructuring project “at every step of the way.” The PSA will not fight to defend any jobs that are earmarked to go at IRD and the courts. PSA national secretary Erin Polaczuk has already accepted that working from home may well be “the way of the future.”

The Tertiary Education Union (TEU) held one brief protest rally at Unitec last November over the impending layoffs. Meanwhile it presented a paper to the governing council declaring it was committed to working with the council and senior managers “to undertake a change in such ways that staff are brought along with the changes; and at a pace that will allow change to bed in.”

VW hands out massive bonuses to company executives

Dietmar Henning

The granting of millions of euros in bonuses to top executives at Volkswagen illustrates how the management of the auto concern is reacting to the exhaust emissions scandal, which has resulted in massive losses and potential fines. It is not board members and big shareholders, but rather workers and their families, who are to pay for the crisis.

The same criminal energy that gave rise to the exhaust emissions fraud is now being directed against the workforce. To defend their profits and million-euro incomes, the VW bosses are preparing a massive cost-cutting program involving rationalisation measures and job cuts.

Behind the company’s aggressive defence of board members’ salaries, of which the bonuses represent only a small part, stands the determination of the entire ruling elite to defend it profits and privileges at all costs.

A glance at the facts is revealing:

Martin Winterkorn has headed VW since 2007. During this time, the incomes of board members have been systematically hiked. In 2014, he received €16 million euros as board chairman. That is €1.3 million a month. Later, it emerged that he had known about the manipulation of diesel emissions test results in spring 2014.

In September last year, Winterkorn resigned as VW chair, but demanded that his contract, set to run to the end of 2016, be honoured. Until then, the ex-head of VW, responsible for the greatest crisis in the firm’s history, continues to receive his salary plus bonuses. Since the latter are based on the results from the previous year, Winterkorn will receive a sum of several million euros, according to the Frankfurter Allgemeine Sonntagszeitung. In addition, he will receive pension entitlements amounting to €28 million.

Another example of the orgy of enrichment on the VW board is former Chief Financial Officer Hans Dieter Pötsch.

Under the headline, “The ten-million-man,” business daily Handelsblatt wrote a few days ago: “The VW diesel affair has many losers—and one winner: Hans Dieter Pötsch. The ex-CFO was handsomely rewarded for the change at the head of the supervisory board.”

In return for leaving the lucrative post of chief financial officer—annual salary in 2014 of €7 million—and taking over the chairmanship of the Supervisory Board—annual salary of “only” €1.5 million—Pötsch demanded and received a severance payment. In the press there is talk of up to €10 million as a “special bonus.”

In the past, the IG Metall union functionaries and works council representatives on the Supervisory Board invariably gave the nod to such million-euro bonuses. But now they fear that the unrestrained enrichment of top management will incite workers’ anger, and drastic cost-cutting measures will provoke resistance in the workforce.

With hypocritical hand-wringing, works council leader Bernd Osterloh is demanding that board members make at least a symbolic contribution and announce the reduction of part of their bonuses. Osterloh is backing the incumbent CEO Matthias Müller, who announced several months ago that everyone would have to “tighten their belts,” including the Board.

The Supervisory Board, IG Metall and the works council are all agreed that the VW exhaust emissions scandal and increased competition on the world market require the mass shedding of jobs and attacks on working conditions for those remaining.

It is already clear that existing special payments for the workforce will be abolished. Osterloh and Müller have agreed that there will only be a “token of appreciation” payment for 2015. How much this will be has not yet been decided.

But the planned cost-cutting measures go much further. The emissions crisis is to be used to achieve the specific objective of a significant increase in profit margins, which was set two years ago for the core VW brand.

To this end, former BMW Executive Herbert Diess was brought onto the VW board last July, where he took over responsibility for the core brand from Winterkorn. Diess, considered to be a ruthless business rationaliser, was “bought in” by Osterloh.

In an interview with Handelsblatt, works council leader Osterloh was gushing about his new man. “He is very business-like and decisive,” Osterloh said. “I am very pleased with how he assesses certain things,” he continued. “We have established much in common in the areas of complexity, keeping to processes and cost consciousness. He sees many things in the same way as the works council.”

In January, when Manager Magazin reported that more than 10,000 jobs were vulnerable, Osterloh made no protest. According to the magazine, Diess demanded a productivity hike of 10 percent for the current year in all areas, including production, administration, development and sales.

Diess and Osterloh have since ensured that over 1,000 contract workers lost their jobs, production of the Phaeton luxury brand was halted, and one in 10 administrative posts was slated to go by the end of 2017, amounting to 3,000 to 4,000 jobs.

In early March, VW announced that it was not extending the contracts of 250 contract workers at its Emden plant. On April 12, the Ostfriesen-Zeitung reported that the jobs of 300 workers on service contracts would also be cut.

On March 21, on the basis of statements by a VW executive, Handelsblatt reported that two VW production locations could be closed, one in Lower Saxony.

Notwithstanding media reports of growing conflicts between Diess and Osterloh, the two cooperate closely. The works council leader, however, is demanding that the restructuring and savings programme be based on his ideas. The VW General Works Council submitted its own savings programme to the Board in October 2014. The 400-page paper contains proposals for savings of €5 billion in the core VW brand alone.

If the works council and IG Metall are now demanding that management do without a few million, they are primarily reacting to the growing anger of workers. They are afraid of losing control. The cronyism and corrupt relations of IG Metall, the works council and management are well known. Nearly two years ago, when it was revealed that VW CEO Winterkorn was the best-paid executive in Germany, Osterloh said, “Herr Winterkorn is worth every cent.”

Earthquakes in Japan kill 42 people, injure 1,000

Peter Symonds

Two major earthquakes and hundreds of aftershocks starting last Thursday have left a trail of death and destruction through the southern Japanese island of Kyushu. The response of Prime Minister Shinzo Abe and his government has been a military one—despatching some 20,000 troops as part of rescue and relief operations.

According to the US Geological Survey, the largest of the quakes hit in the early hours of Saturday morning with a magnitude of 7.0, following an earlier earthquake measuring 6.2 on Thursday night in the same area. According to Japan’s Meteorological Agency, there had been 478 tremors up until 9 pm yesterday, of which more than 70 were strong enough to cause damage.

The death toll from the twin earthquakes rose to 42 on Sunday after the body of a 61-year-old woman was discovered in her collapsed home in Minamiaso. Many of the victims were elderly. As well as those killed in building collapses, several people died in fires and landslides. About 11 people are still missing as rescuers continue to search through rubble. More than 1,000 people were injured, including about 190 in a serious condition.

The worst affected area was the Kumamoto Prefecture, with significant damage also in neighbouring Oita Prefecture. As many as 196,000 people were evacuated in the two prefectures as of Sunday morning, but the figure dropped to 110,000 later in the day as some began returning to their homes. By Sunday evening some 250,000 homes were without water, 100,000 without gas and 39,000 without electricity in Kumamoto Prefecture.

The quakes not only destroyed homes but collapsed or damaged other buildings and structures. According to the NHK national broadcaster, a 500-bed municipal hospital was one of several buildings badly damaged in Kumamoto City, forcing the evacuation of patients. The Great Aso Bridge—a single span of more than 200 metres—collapsed into the ravine below. Sections of a stone wall surrounding the 400-year-old Kumamota Castle collapsed into the moat on Saturday afternoon.

High-speed rail services, or shinkansen, have been suspended in Kyushu and the island’s two main highways have been cut by landslides. The Kumamoto airport was shut. Meteorological Agency spokesman Gen Aoki said on Sunday that earthquake activity was continuing and warned: “There is an ongoing possibility of ground slips from more tremors or the rain since yesterday.”

Major corporations including Toyota, Honda, Nissan and Sony, have been forced to temporarily suspend operations in many parts of the country as damage to plants in Kyushu threatened to disrupt the supply of parts. A Toyota supplier Aisin Seiki was assessing the situation at its two plants in Kyushu that produce door and engine parts, but stated that it would boost production elsewhere to minimise the impact.

The Financial Times commented: “Japanese companies have learnt lessons from the 2011 Tohoku earthquake and tsunami, where car factories from Nagoya to Alabama ground to a standstill after production halted at Renesas, a supplier of microcontrollers used in vehicles worldwide.” Renesas subsequently strengthened the level of quake resistance in its plants and maintained higher levels of inventory.

The 2011 disaster killed 15,000 people and led to the partial meltdown of three nuclear reactors at the Fukushima power plant resulting in the evacuation of hundreds of thousands. The catastrophe, which will take decades to clean up, exposed the collusion of government agencies and the plant’s operator, TEPCO, in covering up safety breaches.

The Kyushu Electric Power Company was quick to issue a statement saying that its two nuclear power plants had not been affected and continued to operate normally.

While major corporations concerned about profits have taken action following the 2011 disaster, the death and destruction on Kyushu over the past week raises questions about what action has been taken by governments to protect the population. According to USA Today, the area affected by the twin quakes is a largely rural, mountainous region where some homes and structures lack modern earthquake-mitigation technology.

The Abe government has responded to the disaster by announcing that 20,000 troops would be sent to Kyushu to assist in rescue and relief efforts. The use of the military in disaster operations, which figured prominently in the response to the 2011 earthquake and tsunami, is an element of the country’s remilitarisation and the increasing intervention of the armed forces into civilian life.

The Pentagon has also been quick to send military assistance with the US-based Military Times reporting that an undisclosed number of US Marines are already on the ground in Kyushu. At least four MV-22 Osprey aircraft are also part of the relief operations—with another four on standby. The US Marines were flown from the Philippines where they have been participating in the annual joint US-Philippines Balikatan war games.

US military involvement in such operations is now so routine that it has its own acronym—HADR or Humanitarian Assistance and Disaster Relief. In the aftermath of the 2011 earthquake/tsunami, in which the US armed forces were heavily involved, the Australian Strategic Policy Institute (ASPI) produced a report entitled “More than good deeds: Disaster risk management and the Australian, Japanese and US defence forces.”

ASPI pointed out: “The primary justification for despatching defence forces to help another country experiencing a disaster is usually humanitarian. But for Australia, Japan and the US, there are several other drivers: reinforcing alliances and partnerships, advancing foreign policy agendas and providing knowledge of operational military capabilities.

The latest disaster in Kyushu offers another opportunity for the US to collaborate closely with the Japanese armed forces to test out personnel, equipment and procedures under the guise of providing humanitarian assistance. The strengthening of the US alliances with Japan, and also Australia, serves more sinister purposes—the military build-up throughout the region in preparation for conflict with China.

Ecuador earthquake kills hundreds

Tom Eley

A magnitude 7.8 earthquake struck Ecuador on Saturday evening, killing at least 246 people, injuring thousands more, and destroying infrastructure in a large swath of the South American nation. The death toll was expected to rise on Monday as collapsed buildings are excavated. It was the region’s strongest earthquake since 1979.

The epicenter of the quake was twelve miles underground near the town of Muisine, on the north-central coast not far from the Colombian border, according to the US Geological Survey. Heavy aftershocks, some as powerful as magnitude 5.6, continued after the first earthquake, which reportedly lasted for over 40 seconds.

Deaths have been reported in the provinces of Manabí, Esmeraldas and Guayas. Among Ecuador’s cities, extreme damage was reported in Pedernales, a coastal town of some 40,000. Portoviejo, the capital of Manabí province, was also devastated. Buildings collapsed in Guayaquil, Ecuador’s most populous city. Quito, the capital, lost power but reported less damage and no deaths.

“We’re trying to do the most we can, but there’s almost nothing we can do,” Pedernales Mayor Gabriel Alcivar told the media. “This wasn’t just a house that collapsed, it was an entire town.”

President Rafael Correa, who was on a state visit to Italy at the time of the quake, imposed a national state of emergency in six of the country’s 24 provinces.

There has reportedly been little organized emergency response from the government or volunteer organizations. Rescue efforts were hindered by an absence of readily available earthmoving equipment. Desperate residents dug through debris with their hands, as those trapped under rubble called out for help.

“We hear screaming all through the night,” said Luis Quito, a resident of Pedernales. “There are humans trapped below the terrace. Babies. We need rescuers. But nobody has arrived so far.”

The Correa government deployed some 13,500 security forces “to keep order around Ecuador,” while the Red Cross called on 800 volunteers to assist. Venezuela, Chile and Mexico said they would send supplies and personnel.

Correa said Ecuador would tap into $600 million from international lenders to rebuild, and currently had $300 million at its disposal for earthquake response. This is $50 million less than the production cost of one the US Air Force’s nearly 200 F-22 fighter jets. As of Sunday evening, the Obama administration had made no concrete offer of assistance, though Secretary of State John Kerry announced that the US “stands ready to assist and support.”

Earthquakes occur with regularity in Ecuador. Over 1,000 were killed by a series of powerful tremors in 1987. In 1979, an 8.2 magnitude earthquake off the coast generated a tsunami that killed over 600 and injured 20,000 more.

The consequences of yesterday’s earthquake are made worse by Ecuador’s poverty. With a population of 16 million, Ecuador’s gross domestic product of approximately $100 billion is considerably less than the combined wealth of the two richest Americans, Bill Gates and Warren Buffet. GDP per capita, at approximately $6,000, is one ninth that in the US.

In spite of the “left” pretensions of the Correa administration, which has been in office since 2007, Ecuador remains one of the world’s most unequal countries in terms of wealth distribution. Poorly built concrete houses and shantytowns that provide shelter for much of the population reportedly came down throughout the country from the force of the earthquake.

The earthquake intersects with a deep crisis in Ecuador and South America as a whole. Ecuador, which aligned itself with Venezuela, Brazil and Argentina in a “leftward” turn under the Correa government, has been hammered by falling oil prices, which previously accounted for roughly 40 percent of its export earnings, along with decreasing prices for basic agricultural and mineral commodities, which account for much of the rest. Economic growth for the coming year, even before the earthquake, was projected at near zero.

The same day the earthquake hit, Ecuadorian Hydrocarbons Minister Carlos Pareja was in Doha appealing to OPEC countries to cut oil production. “There is a need for a committee that will monitor the capping of production,” Pareja told reporters Sunday. “The negative consequences [of overproduction] will be enormous, and not only for Latin America; we are talking about the whole world.”

Declining oil and commodity prices, combined with a strengthening dollar, pose particular problems to Ecuador because it adopted the US currency as its own national currency following the country’s 1998-1999 banking crisis. Ecuador cannot devalue its currency, making its other major exports, including bananas, more expensive and less competitive on the global market. Yields on Ecuadorean government debt briefly surged to 18 percent last fall.

Value Our Children, Instead Of Money

Lionel Anet

The present is the future in its formative stage. That process is universal and is always adhered to as that’s nature. Life only thrives from the present activities, which are evaluated in the future, and that future tends to be imagined from the past. But today’s evaluation of the future is highly fragmented as a result of the reductionist method used by scientist and society. Study to do with life’s future, to be useful, must be holistic. The most important thing we need to ponder, and be as accurate as we can is the future we are creating today, so we are back to the beginning. What sort of future are we making?

We are constrained by an economy that has economic growth as its criterion of success, as it must be in a competitive capitalist world. That growth had escalated in two surges, the first by using coal as an extra energy to top up sunlight and wind, then a century later, the internal combustion engine burning oil, which took over as the primary source of energy in the middle of last century. Oil is the most practical, convenient and energy efficient fuel ever used, that is, the energy from burning that fuel is many time greater than the energy used to get and process it, and little waste to dispose. Last century economic growth surged because of cheap oil, but this century as the cost, (the energy used), of producing oil rises, that high yield margin is going to a deficit. Nevertheless economist expectation remains somewhat confident that the economy will regain its strength as they can see it in their economic system.

That economic growth is due to the concentrated energy in the fossil fuels. Not that economic growth in the last four decades has given us any tangible benefits; on the other hand, there has been a gradual environmental and social degradation. Early during that time the neocons claimed that the economy needed to keep growing to be able to manage all the environmental problems. But it’s the economic growth that has been the culprit by using the energy that gives the greatest return for the energy used to get that energy. And that is fossil fuels, particularly oil. Without oil, coal mining would be minuscule.

There are many things that we did with that cheap abundant energy that’s impossible with renewable energy, considering that we already have an over populated world, let alone the extra 2 billion people expected within 4 decades. The items we won’t be able to afford on a sustainable and compatible basis with other life are military expenditure, city car travel, jet air travel, and transport of goods over long distances, most international shipping of goods, megacities and high rise building. They are a few of the many items we must abandon just to survive, but we will be able and need to do far more than just survive. We must change from an exploitative to a collaborative economy, as that can satisfy the needs of all people in a peaceful way with the least damage to the ecosystem. Our first step can be less use of money and a lessening of its importance.

Economic growth is synonymous to capitalism and money is its life blood that forces its people to consume increasing amount of fossil fuels to maintain the energy needed to grow the economy. Fiat money is the only money that has ever existed, as gold, silver and anything of value are only part of a barter system, they suits static civilisations. On the other hand, capitalism is a dynamic system and therefore needs money, as a catalyst; it facilitates economic activities and measures it in unit, which can be stored digitally. Money is only a number; therefore we can never runout of it, hence, sovereign government can create the money that is needed to enables its people to look after themselves, if resources are available.

Money, as an abstract concept, is ideal as a facilitator to exchange private property, an essential element in capitalist economies that can stimulate economic growth. Nevertheless, its nature’s ability to provide, which’s the present obstacle to growth, and it will soon lead to a decline in economic activities. So far growth is only stunted, except for the financial sector. Unfortunately, it’s that sector that has accumulated the most money and is using it for their advantage, which is to societies’ disadvantage. It has led society further into uncontrollable state where we know we are destroying our life supporting planet in multiple ways, but money keeps us on that course because it’s at present all powerful, particularly as it’s largely used covertly.

Money gained dominance due to its etherealness, it exist because we believe it exist, thus it can disappear from view to avoid been taxed, but its practical function, in capitalist economy, is to catalyse interactions. Money must be used by everyone to be able to live and function in capitalist society. This form of control is far more efficient than any others at robbing societies and its people. For our survival, we need to know what’s going on and to do that we must remove the power that money has to rules us. That will make life much easier for nearly everyone and as well; people will gradually become more important and have more power than money. But how do we reduce the importance and power of money?

That could be achieved by supplying as many services free of charge in a gradual way, but quickly. Services such as health care, education, city transport, and information services are vital, so they should be free of any charges. Also a basic income for everyone working or not would remove a need for workers compensation and unemployment benefits etc. This would drastically reduce the cost of living and administration, which in turn would mean that wages can be very much lower but with a better and more secure life.

With a lower cost of employees, we would have more and better services by people instead of machine burning fossil fuels. Because the employer would only need to pay workers for their effort, as the community would be increasingly responsible for our wellbeing. The cost of providing services would be affordable as that labour intensive work is provided with the cheaper labour. The labour to service ourselves is only time so, the more intimately our relationships are, the less money we would need. There would be many benefits from the cheaper labour and that basic income. Cost of entertainment would be very low, as people in that industry would also have lower expenditure, therefore need less remuneration and they’ll have no worries in maintaining their families and themselves.

This would reduce the power of money it would equalise somewhat social status and would reduce crime and give opportunities to live worthwhile lives. It would decrease government’s expenditures on hospital, public transport, and education, and in any areas were people are so important. The cost of human interrelationship is nil, but it’s essential, it’s the way we live; we must interact with one another in the community and communities with others around the world, or we’re likely to be depressed. Social groups, if they are set up to give the best life for its people run at their best where people participate according to their ability and they get the satisfaction by participating in maintaining the viability of the group. Furthermore there’s no reason to be better than other groups but to exchange methods and ideas. That’s not idealistic wishful thinking it’s what happens in many voluntary organization.

Transport is a wasteful activity and therefore should be kept to a minimum to be efficient; although, it does increase the GDP. The total cost of transporting items is never fully factored in to the product’s cost. The carbon emission is considerable, especially when its air freighted, as emission at 10 thousand metres are 5 times more effective in warming the planet than at sea level. While ships have stowaways on their hull and in bilge tanks, harbouring many unwanted organism that damages the ecosystems. All those cost aren’t factored in the sale price, if they were, local produce would be more viable and our planet would have a better chance of supporting today’s children when they take over. Governments are uncaring and dishonest in the way they collectively force societies, business, and its individuals to disregard the biological state of the planet and its future just to maintain that exploitation and boost the GDP, regardless of the fret to our life.

Reduced labour cost with an increasing fuel price and a good public transport that is used by every traveller, combine with town planning to minimise travel will reduce accidents, pollution, wasted time and space. Roads would only be used by emergency vehicles, taxis, and the essential transport of goods. The benefit from that would be multifaceted with cleaner air, better health, fewer accidents, more social interactions, and a relaxed life. All of that could be acceptable within a capitalist system as the main changes are a lower labour cost and an escalating cost of non-renewable, that’s if our population was a mere 2 billion. Therefore we’ll need to do far more to survive with an expected 9 billion, but it would be a good start.

British Conservative Breaks Ranks, Opposes TTIP

Eric Zuesse

It’s as if, say, during the Republican Administration of U.S. President George Herbert Walker Bush, the person who had negotiated international trade deals for the prior President, the Republican Ronald Reagan, came out publicly against a mega-‘trade’ deal that his fellow-Party-member, President Bush, was ardently trying to get approved. That is extremely breaking ranks, and it happened recently in the UK.

Britain’s former Secretary of State for Trade & Industry (1990-92, under Margaret Thatcher and John Major), and current Conservative MP (Member of Parliament), Peter Liley, did it when he blogged on April 3rd at the Conservative Party’s website “Conservative Home”:

I believe in free trade. Always have, always will. As the only serving MP to have negotiated a successful free trade deal (the Uruguay Round – as Trade and Industry Secretary during the 1990s), I automatically supported the Transatlantic Trade and Investment Partnership (TTIP) deal currently being negotiated between the USA and EU, assuming it was a free trade agreement.

The more closely I look at it, the more parts of it worry me. Conservatives who believe in free trade should be very wary about endorsing TTIP. And both the Leave and Remain campaigns should look very carefully at its implications for our EU membership.

Let me explain why.

TTIP is not primarily about removing tariffs and quotas. The average tariff levied by the US on goods from Europe is just 2.5 per cent. Getting rid of them would be worthwhile – but no big deal.

It is mainly about harmonising product specifications and creating a special regime for investment. There is no objection to those things in principle. Insofar as product harmonisation means removing rules introduced as hidden protection of a domestic producer, that is fine. But we should not sign away Parliament’s right to protect our citizens from harmful additives, and so forth.

The very core of both Obama’s ‘trade’ deal with Europe, TTIP, and his ‘trade’ deal with Asia, TPP, is precisely that: to sign away legislators’ power to protect the electorate from harmful additives, toxic water and foods and air, unsafe cars, and a sustainable environment for themselves and future generations — and more (Lilley is especially concerned because it would abolish Britain’s vaunted public health service. Imagine: a British Conservative is determined to protect that enormously successful socialist program in his country! Flabbergasting, but true.)

The very core of it is to transfer national sovereignty to a worldwide dictatorship of international corporations(three-person corporate-accountable panels of ‘arbitrators’, whose rulings are non-appealable and aren’t required to adhere to any nation’s laws — it’s shocking, but true).

And, for any conservative — whether in Britain or any other country — to oppose that is a very big deal, especially when it’s a former Secretary of State for Trade & Industry.

He goes on to say:

My three main concerns relate to the Investor-State Dispute Settlement System (ISDS). This creates a system of tribunals – special courts – in which large foreign companies can sue governments (but not vice-versa) for pursuing policies which harm their investments.

• US companies could sue the UK government should it want to take back into the public sector privately provided services in the NHS, education, and so forth – or open fewer services to private provision. The EU and UK government have denied that this is possible. But a cogent Counsel’s Opinion argues that because these tribunals can award unlimited fines they could exert “a chilling effect” on government decision making. The Left have been particularly irate about this but Conservatives too should be worried. I and other local MPs – all Tories – lobbied successfully to reincorporate into the NHS a disastrously run private Surgicentre (set up by Tony Blair’s Government) serving our constituencies. Under TTIP, a foreign operator could have sued for massive compensation at the expense of our local NHS. Conservatives have rightly been cautious and pragmatic about the extent of private provision particularly in health. It would be electorally disastrous if we back a system which turns out to bring in privatisation by the back door.

• These tribunals give foreign multinationals their own privileged legal system, too costly for smaller foreign companies (since the average case costs $8 million), and from which UK companies are excluded. Moreover, the ‘judges’ are commercial lawyers who, when not serving on a Tribunal, work for, and are therefore sympathetic to, big companies. Cases are heard largely in secret.

• The “Stabilisation Clause” protects all investments made under the treaty for at least 20 years. Arecent legal treatise explains how this undermines parliamentary democracy by binding future parliaments. Of course, the UK enters into other long term treaties and contracts – but our government can always renegotiate or, in the last resort, resile from them. Exceptional circumstances may make that necessary: I had to nationalise without compensation all Iraqi-owned companies when Saddam Husain invaded Kuwait. A future parliament might object to letting foreign multinationals have their own courts – especially if those courts expand their remit beyond that originally envisaged. The UK might decide the protection of our common law courts is sufficient. But if we are still in the EU when TTIP and CETA are ratified, we will be bound ‘jointly and severally’. We could not renegotiate these treaties without the consent of every EU state and the Commission – even if we subsequently left the EU. So we would still be bound by the Stabilisation Clause for 20 years.
The EU and UK government respond to these criticisms by saying: the UK is party to a large number of treaties with similar tribunals; only twice have cases been brought against the UK, neither succeeded; if the tribunals did not exist, UK courts would impose similar verdicts and fines; arbitrators cannot rule on companies for whom they work; TTIP negotiators now propose a permanent judicial panel instead of using ad hoc arbitrators; also, the proceedings may in future be made public. In particular, they deny that the tribunals could affect the NHS at all – let alone force it to put out services to contract or prevent it taking back private services into the public sector.

In short, the Government argues (not entirely convincingly) that TTIP tribunals will probably do no harm. No one claims that they will actually do any good – i.e. attract more US investment to the UK or vice versa. The idea that any American companies are afraid to invest here because they do not trust the British legal system or fear expropriation is not credible. Businesses from across the globe choose to make their contracts subject to British law precisely because it is the most trusted. If, as the Government claims, these ISDS tribunals will give the same outcome as British courts they are completely unnecessary. …

In or out of the EU, we should question whether ISDS tribunals are necessary, reject the 20-year stabilisation clause and insist on excluding the NHS from the treaty (as France has excluded movies). That would be less difficult if Britain leaves the EU and negotiates a parallel treaty – though the simplest thing would be to negotiate a pure free trade agreement restricted to abolishing remaining tariffs.

He comes to this late, after millions of Europeans have already made clear in marches and in numerous public opinion polls that the only way the TTIP can become law in the EU will be if the EU is already a dictatorship — not at all by truly democratic means. But, better late than never.

Unlike Hillary Clinton in the U.S., who has always worked behind the scenes to pass trade deals that have ISDS in them, and who told Democrats in Congress to follow the lead of Nancy Pelosi, who spoke publicly against Obama’s ‘trade’ deals but was actually whipping in the U.S. House to help the President win Fast Track so they can become passed into law, Lilley doesn’t have the reputation of someone who says one thing in public and does the opposite, behind the scenes, in actual policymaking.

His statement is real — not mere slogans and words. And it will sway policymakers, and not merely the voters of his own Party (in order to win that Party’s primary election).

If Obama gets his ‘trade’ deals passed into law, he will be by far the biggest-impact U.S. President since FDR, who introduced Social Security and many other existing programs (and also the Glass-Steagall Act, which FDR’s fellow — but only fake — ‘Democrat’, Bill Clinton annihilated), and who joined with Churchill and the formerly Hitler-allied Stalin, to defeat global fascism. Obama’s impact will then be perhaps even more evil than FDR’s was good. However, if he fails to pass any of his ‘trade’ deals, then he’ll only be as bad, or nearly as bad, as George W. Bush was, even if he turns out to have been lucky enough to postpone the coming super-crash (toward which his policies are building) till the next person becomes President. Obama is the most conservative Democratic President since James Buchanan — and that’s pretty bad, even if Obama manages to hold off the crash that he has been postponing, until his successor comes in.

In contrast, the Conservative Peter Lilley is a flaming progressive, by comparison, because he certainly is that on the biggest public-policy issue since World War II, which is whether to end or instead expand ISDS. If it’s expanded, then, for example, the recent Paris accord against global warming will be effectively dead. That’s how big a deal this is: not only democracy, but even the continuation of a livable planet, are all on the line now. Obama says one thing, but what he does can be very different. 

Hottest March On Record As Earth Keeps Hurtling Past Temperature Milestones

Deirdre Fulton

(Graph: Japan Meteorological Agency)

Earth is on a roll.

Adding "yet another month to a new mountain chain of extreme global temperature peaks," March 2016 was the warmest since at least 1891, according to the Japan Meteorological Agency (JMA).

Not only that, but, as February did, March broke the previous record by the greatest margin yet seen for any month. Compared to the 20th-century average, March was 1.07°C hotter across the globe, according to the JMA figures, while February was 1.04°C higher.

If April also sets a monthly record—and there's no reason to think it won't—"the Earth will have had an astonishing 12 month string of record-shattering months," writes Andrew Freedman for Mashable.

The JMA's findings are likely to be confirmed by forthcoming reports from the UK Met Office as well as NASA and NOAA, whose satellite data indicates last month was the warmest March in records dating to 1979.

Scientists have pinned the record warmth to a combination of human-caused climate change and this year's strong El Niño event.

Responding to the news, professor Michael Mann, a climate scientist at Penn State University, told the Guardian: "Wow. I continue to be shocked by what we are seeing."

"The [new data] is a reminder of how perilously close we now are to permanently crossing into dangerous territory," Mann said. "It underscores the urgency of reducing global carbon emissions."

As Common Dreams reported, last month's NASA data showed that February 2016 was not only the hottest in recorded history, but it soared past all previous records, prompting scientists to describe the announcement as "an ominous milestone in our march toward an ever-warmer planet."

Meanwhile, NOAA said last week that March 2016 was among the warmest on record for the contiguous United States, and that Alaska had seen "its warmest start to the year on record, while 32 states across the West, Great Plains, Midwest and Northeast were much warmer than average" between January and March.

What's more, pointed out NOAA climatologist Deke Arndt in a blog post this week, "If you were alive during March 2016, and I'm betting you were, you witnessed U.S. history."

"One stunning feature from the March 2016 temperature map was just how universally warm the month was," wrote Arndt. "Every one of the 357 climate divisions across the contiguous United States and Alaska ended up—at least—in the 'warmer than normal' category."

IMF attaches harsh austerity measures to Sri Lankan bailout

Saman Gunadasa

The International Monetary Fund (IMF) announced an agreement on Monday with the Sri Lankan government on a “reform program,” in return for a bailout loan to avert a balance of payment crisis.

The IMF did not specify the amount of the loan facility but the Colombo government indicated it could be between $US1 billion and $1.5 billion. The deal will be finalised for a 36-month Extended Fund Facility (EFF) program during a further two weeks of discussion with the IMF.

An IMF team led by Todd Schneider was in Colombo for nearly two weeks from March 31 to “review” the economy and discuss the government’s loan request. Prime Minister Ranil Wickremesinghe was personally involved in the final discussions, in order to convince the IMF his government would implement the required “reforms.”

Announcing the agreement, Schneider said Sri Lanka’s “fiscal deficit expanded, public debt increased and the balance of payment position deteriorated.”

Official figures provide some indication of the precipitous fiscal crisis. Foreign loan repayments due this year total more than $4.56 billion, around 6 percent of gross domestic product (GDP). Gross foreign reserves stand at $7.3 billion.

The country’s outstanding debts rose by 12 percent to $57 billion during the first nine months of last year, with foreign debts alone increasing by 5 percent to $22 billion. By the end of 2015, the annual balance of payments deficit had reached $1.5 billion.

According to Schneider’s statement, the IMF-Sri Lankan government agenda includes “improving revenue administration and tax policy; strengthening public financial management; state enterprise reforms; and, structural reforms to enable a more outward-looking economy, deepen foreign exchange markets, and strengthen financial sector supervision.”

These so-called reforms will undoubtedly produce further attacks on the living standards of working people, by increasing prices of essentials, slashing subsidies, eliminating jobs and pension rights, and cutting public education and health.

The IMF’s main emphasis was on a drastic reduction of the budget deficit from 7.2 percent last year to 5.4 percent this year. The government has to reduce the deficit to 3.5 percent by 2020.

On March 8, Wickremesinghe unveiled a value added tax (VAT) increase from 11 to 15 percent and other tax proposals. However, at President Maithripala Sirisena’s request, the government postponed these measures until the end of this month, fearing they would provoke outrage among workers and the poor during the festival season in April.

Finance Minister Ravi Karunanayake said the government would look at privatising “non-strategic” investments and listing some state-owned bodies on the Colombo Stock Exchange within three months.

The IMF’s reference to “strengthening public financial management” means slashing subsidies and cutting expenditure on public services such as health and education. In preparation for the IMF talks, the government reduced subsidies for flour, increasing the price by 8 percent for one of the main staple foods of workers, particularly in the plantations.

From this year, the government has already stopped supplying fertiliser at subsidised rates. Thousands of farmers around the country demonstrated against these cuts.

The IMF’s insistence on an “outward looking economy” and “deepening foreign exchange markets” requires a totally market-driven local currency to make Sri Lankan exports cheaper on global markets. This will further erode workers’ real wages. During the past eight months, since it was officially floated by the Central Bank, the rupee has devalued by nearly 10 percent, going from 135 rupees to 150 to the US dollar, increasing the prices of imported goods, including essentials.

Sri Lanka’s economy is being battered by the global slump. Its export earnings decreased by 5.6 percent in 2015. Income from garments and textiles fell by 12.8 percent in December, reflecting the recessionary tendencies in the key markets of the United States and the European Union. Remittances from Sri Lankans working overseas declined by 12.8 percent—one reason being the tensions and the conflicts stoked by US imperialism in the Middle East.

The crisis is such that Central Bank Governor Arjun Mahendran told the Sunday Observer the government was waiting for the IMF loan approval in order to use it as a guarantee to seek $5 billion worth of loans from other sources. Those sources include the World Bank, Asian Development Bank, Japanese international lenders and Indian and Chinese banks.

The government has already initiated, as temporary measures, a $1.5 billion currency swap from the Reserve Bank of India and a $1 billion currency swap from Central Bank of China. It also announced $3 billion in commercial borrowing through sovereign bonds.

Wickremesinghe devoted a visit to China at the end of March to inviting new investments, while seeking measures to reduce the burden of debt from that country. Sri Lanka obtained around $8 billion in loans from China during the previous government of President Mahinda Rajapakse.

As soon as Sirisena came to office in January 2015, many projects funded by China, including the $1.4 billion Colombo Port City Project, were halted, pending “reviews.” The real reason was that the US demanded a distancing from China. Sirisena was effectively installed via a regime-change operation orchestrated by the US, assisted by India, to end Rajapakse’s close economic and political relations with Beijing.

During his visit, Wickremesinghe asked the Chinese authorities to transform some of the loans obtained from that country into equities. He also agreed to allow the Colombo Port City Project to resume, with some changes to the agreement so that the development would be leased for 99 years to the Chinese company involved, rather than be owned by it.

At a press conference last Sunday, Wickremesinghe blamed the global economic crisis for the desperate IMF loan request. He said the IMF was downgrading its global economic growth forecasts every three months. “We are like a small boat in the sea,” he said. “The sea will get rough. I cannot prevent that, but I will make sure the boat does not overturn and we will go over head.”

Like governments around the world, the Sri Lankan government is seeking to implement far-reaching attacks on living conditions and social rights. This will inevitably set the stage for sharp struggles of workers, peasants, and students.