Renewed surge in US mergers

Nick Beams

A spate of mergers announced in the US this week has underscored the growth of monopolisation and parasitism, fueled by the moves by the US Federal Reserve and the European Central Bank (ECB) to continue the supply of ultra-cheap money to global financial markets.

On Monday alone, takeover deals amounting to more than $70 billion were announced as multinational firms sought to tighten their grip on the markets in which they operate.

The deals included: the takeover by discount brokerage firm Charles Schwab of its rival TD Ameritrade; the decision by the American jewellery firm Tiffany’s to be bought by the French luxury goods firm LVMH, owner of the Louis Vuitton brand; a move by the Japanese conglomerate Mitsubishi to buy the Dutch utility firm Eneco; and the purchase by the Swiss drugmaker Novartis of a biotech firm The Medicines Company.

Reporting on the renewed burst of takeover activity, following a pause attributed to uncertainties arising from the state of the world economy and fear of a global slowdown, the Financial Times said the recent decisions of the Fed and the ECB to cut interest rates had “propped up stock markets and extended the availability of historically cheap borrowing.”

The largest deal was the Schwab takeover of TD Ameritrade in a share-swap deal valued at $26 billion. The merging of the two largest publicly traded brokerage firms will create what has been widely described as a Mammoth or Goliath in wealth management with more than $5 trillion in client assets.

Wall Street roared its approved of the deal with Schwab shares rising by 8 percent when it was announced TD Ameritrade’s stock shot up by 16 percent.

When the deal is finally completed, if it receives regulatory approval, Schwab’s current shareholders will hold 69 percent of the new firm, TD Ameritrade’s 18 percent, with the Canadian Toronto Dominion Bank, which owns 43 percent of TD Ameritrade, will hold 13 percent.

The main impetus for the merger of the two brokerage house appears to have been the rise of challengers in the brokerage industry which has forced the cutting of trading fees. The aim is to stamp out rivals. A statement by company president Charles Schwab and the firm’s CEO Walter Bettinger said the combination of the two firms “positions us to be competing and winning in the investment services business for the long run—the very long run.”

The purchase by LVMH of Tiffany’s for $16.2 billion in an all-cash deal saw its share price rise instantly increasing the wealth of Bernard Arnault, the owner of the Louis Vuitton brand, by $2.85 billion. The rise briefly made him the world’s second wealthiest man, with a total wealth of more than $107 billion, before falling back to third spot behind Bill Gates, $107.5 billion, and Amazon chief Jeff Bezos, $111.7 billion.

The deal means that Tiffany’s will now join the more than 70 luxury brands owned by LVMH, which include Bulgari, Dom Pérignon, Christian Dior and Givenchy.

The increase in merger activity, while providing fabulous gains in the wealth of corporate chiefs and rich pickings for the banks and legal firms that arrange the deals, does not indicate improved economic health—rather the opposite.

Anu Aiyengar, who heads JP Morgan Chase’s merger and acquisition business in North America, told the Financial Times: “Regulatory uncertainty, equity market volatility, elections and recession are all looming out there and could have a detrimental impact.”

Luigi De Veechi, who heads investment banking for Citigroup in Europe, also pointed to global risks in comments to the newspaper.

“Cash rich companies are once again targeting the US markets as many emerging markets represent a more dangerous equation due to increased geopolitical risk,” he said.

One of the biggest mergers involving US-based firms is that between the mobile phone and telecommunications firms T-Mobile and Sprint in a deal estimated to be worth $26 billion.

Last month the Federal Communications Commission gave its go head for the deal which will cut US wireless telecom providers from four to three—the merged firm plus AT&T and Verizon.

The decision went three to two, the split was on party lines with Republicans hailing the merger as Democrats warned it would lead to monopoly pricing.

The two companies only secured approval after they had promised a series of concessions including not raising prices for three years, improving their broadband services in rural areas and speeding up the spread of the 5G network.

But these commitments were dismissed by the dissenters to the decision saying they are unenforceable. One of the commissioners Geoffrey Stark wrote: “In the short term, this merger will result in the loss of potentially thousands of jobs. In the long term, it will establish a market of three giant wireless carriers with every incentive to divide up the markets, increase prices, and compete for only the most lucrative customers.”

Legal action has been launched by ten state attorneys general against the merger. New York attorney general Letitia James, who is heading the legal action, said the merger would cause “irreparable damage” to millions of subscribers by cutting access to affordable and reliable services and would particularly affect lower income communities in New York and in urban areas across the country.

California attorney general Xavier Becerra, who is also part of the legal challenge, said the merger would “hurt the most vulnerable Californians and result in a compressed market with fewer choices and higher prices.” The attorneys general said the companies had “yet to provide plans to build new cell sites in areas that would not otherwise be served by either T-Mobile or Sprint.”

The legal case will go to trial next month. Whatever the outcome, the grip of the giant telecommunications firms will surely tighten, underscoring the case for these necessary services to be brought into public ownership under democratic control.

Social counterrevolution and the decline in US life expectancy

Niles Niemuth

A study published this week in the Journal of the American Medical Association (JAMA) details the fall in life expectancy in the United States from 2015 to 2017, a streak unprecedented in modern times.

Virginia Commonwealth University professor Dr. Steven H. Woolf and Eastern Virginia Medical School student Heidi Schoomaker analyzed life expectancy data for the years 1959-2016 and cause-specific mortality rates for 1999-2017. The data shows that the decline in life expectancy is not a statistical anomaly, but the outcome of a decades-long assault on the working class.

The report exposes a country in the grips of a profound social crisis. The record stock prices touted by Trump are, in fact, a measure of the increased economic exploitation that has produced the fall in life expectancy among workers.

Protesters assemble a makeshift memorial to those lost to drug overdoses last year during a demonstration in support of a proposed supervised injection site, outside the federal courthouse in Philadelphia, in September [Credit: AP Photo/Matt Rourke]

The shuttering of thousands of factories and mines, countless store closures and downsizings, along with the slashing of wages, pensions and health care benefits to meet the demands of Wall Street investors have literally killed hundreds of thousands of workers across the United States.

Life expectancy increased annually from 1959 until it stopped rising in 2010, plateauing at zero growth before beginning its descent after 2014, when it peaked at 78.9 years. By 2017, life expectancy had fallen to 78.6 years.

Not coincidentally, 2010 was also the year that Obamacare was signed into law an attack on health care sold as a progressive reform. The decline in life expectancy since then exposes Obamacare’s regressive character, only one of the reactionary legacies of the Obama administration.

Obamacare was part of a deliberate drive by the ruling class to lower the life expectancy of working people. As far as the strategists of American capitalism are concerned, the longer the lifespan of elderly and retired workers, who no longer produce profits for the corporations but require government-subsidized medical care to deal with health issues, the greater the sums that are diverted from the coffers of the rich and the military machine.

A 2013 paper by Anthony H. Cordesman of the Washington think tank Center for Strategic and International Studies (CSIS) frankly presented the increasing longevity of ordinary Americans as an immense crisis for US imperialism. “The US does not face any foreign threat as serious as its failure to come to grips with… the rise in the cost of federal entitlement spending,” Cordesman wrote, saying the debt crisis was driven “almost exclusively by the rise in federal spending on major health care programs, Social Security, and the cost of net interest on the debt.”

Meanwhile, conditions for the rich have never been better. This is reflected in the growing life expectancy gap between the rich and the poor. The richest one percent of men live 14 years longer than the poorest one percent, and the richest one percent of women 10 years longer than the poorest.

Despite expending far more per capita on health care than other major capitalist countries, the United States has fallen far behind when it comes to life expectancy and mortality. The US began to lose pace with other developed countries beginning in the 1980s, and by 1998 had fallen below the average for countries in the Organization for Economic Cooperation and Development.

The first nodal point, in the early 1980s, corresponds to the initiation of the social counterrevolution by the administration of Ronald Reagan, which involved union busting, strikebreaking, wage-cutting and plant closings on a nationwide scale, combined with cuts in education, health care and other social programs. This was launched with the breaking of the PATCO air traffic controllers’ strike in 1981, carried out with the complicity of the AFL-CIO. Reagan’s social policies were rapidly adopted by the Democrats and continued by the Clinton and Obama administrations.

The second major inflection point was the Wall Street crash of 2008, which was followed by trillions in bailouts for the banks on the one hand and brutal austerity against the working class on the other. The ensuing decade has seen the explosion of the opioid crisis, which has ravaged communities across the United States.

According to the JAMA report, the decrease in life expectancy is the outcome of nearly three decades of increasing mortality among midlife working-age adults, those 25-64. This is mainly the result of a dramatic rise in drug overdoses, alcohol abuse, suicide and a series of organ system diseases.

Age-Adjusted Mortality From Unintentional Drug Overdoses, by Race/Ethnicity, US Adults Aged 25-64 Years, 1999-2017. Values in parentheses indicate relative increases in age-adjusted mortality rates by race/ethnicity between 2010 and 2017. Source: CDC WONDER.

Between 1999 and 2017, drug overdose mortality among those in their prime working years increased an astounding 386.5 percent, going from 6.7 deaths to 32.5 deaths per 100,000. The increase in mortality was greatest for the youngest of this cohort, between the ages of 25 and 34, rising 531.4 percent.

The report found that between 2010 and 2017, the overall midlife mortality rate increased from 328.5 to 348.2 per 100,000, resulting in 33,307 deaths that would not have occurred if the rate had held steady.

The rise in mortality has impacted workers across every racial and ethnic group, with the largest number of excess deaths occurring among white workers—a grim refutation of the concept of “white privilege.” By means of such racialist conceptions, the ruling class seeks to promote racial and national divisions even as the reality of social life confirms the fundamental identity of interests of workers of all races and nationalities.

Woolf and Schoomaker found that the largest relative increase in midlife mortality was concentrated in New England and the Ohio Valley, two areas that have been hit particularly hard by deindustrialization and the opioid crisis. Approximately one third of the excess deaths since 2010 occurred in just four states—Ohio, Pennsylvania, Indiana and Kentucky. Eight of the top 10 states for excess deaths are in the Midwest and Appalachia.

“What’s not lost on us is what is going on in those states,” Dr. Woolf told the New York Times. “The history of when this health trend started happens to coincide with when these economic shifts began—the loss of manufacturing jobs and closure of steel mills and auto plants.”

This JAMA analysis exposes the commission of a crime on an immense scale. “When society places hundreds of proletarians in such a position that they inevitably meet a too early and an unnatural death,” Friedrich Engels wrote in 1845 in The Condition of the Working Class in England, “yet permits these conditions to remain, its deed is murder just as surely as the deed of the single individual.”

The responsibility for driving workers to an early grave lies with the capitalist system’s insatiable demand for ever greater profits. The key accomplices in this crime have been the unions, which serve as the corporations’ industrial police force on the shop floor, ensuring the orderly closure of plants and imposing one concessions contract after another.

In this mad drive for profits, workers are being squeezed past the breaking point. The Amazonification of work and the growth of the “gig economy” in the last decade have dramatically increased the exploitation of the working class. Workers are driven to powerful painkillers including oxycontin and opioids simply to cope with the injuries and illnesses that result from overwork.

The reemergence of the class struggle across the US and internationally has shown the way forward. However, while tens of thousands of auto workers, teachers and other workers have taken strike action in the last year, their struggles have been betrayed by the unions.

What is required to meet the needs of the working class is a conscious political leadership with a socialist program on the basis of which workers can take control of the banks and corporations and run them democratically to meet human need, not private profit.

Hunger Games: Food Abundance and Twisted Truths

Colin Todhunter

The world already produces enough food to feed 10 billion people but over two billion are experiencing micronutrient deficiencies (of which 821 million were classed as chronically undernourished in 2018). However, supporters of genetic engineering (GE) crops continually push the narrative that GE technology is required if we are to feed the world and properly support farmers.

First of all, it must be stressed that there is already sufficient evidence to question the efficacy of GE crops; however, despite this, conventional options and innovations that outperform GE crops are in danger of being sidelined in a rush by powerful, publicly unaccountable private interests like the Gates Foundation to facilitate the introduction of GE into global agriculture; crops whose main ‘added value’ is the financial rewards accrued by the corporations behind them.

Secondly, even if we are to accept that at some stage GE can supplement conventional practices, we must acknowledge that from the outset of the GMO project, the sidelining of serious concerns about the technology has occurred and despite industry claims to the contrary, there is no scientific consensus on the health impacts of GE crops.

Both the Cartagena Protocol and Codex share a precautionary approach to GE crops and foods, in that they agree that GE differs from conventional breeding. There is sufficient reason to hold back on commercialising GE crops and to subject each GMO to independent, transparent environmental, social, economic and health impact evaluations.

To evaluate the pro-GMO lobby’s rhetoric that GE is needed to ‘feed the world’, we first need to understand the dynamics of a globalised food system that fuels hunger and malnutrition against a backdrop of food overproduction. As Andrew Smolski describes it: capitalism’s production of ‘hunger in abundance’.

Over the last 50 years, we have seen the consolidation of an emerging global food regime based on agro-export mono-cropping, often with non-food commodities taking up prime agricultural land), and linked to sovereign debt repayment and World Bank/IMF ‘structural adjustment’ directives. The outcomes have included a displacement of a food-producing peasantry, the consolidation of Western agri-food oligopolies and the transformation of many countries from food self-sufficiency into food deficit areas.

As long as these dynamics persist and food injustice remains an inherent feature of the global food regime, the rhetoric of GM being necessary for feeding the world is merely ideology and bluster. Furthermore, if we continue to regard food as a commodity in a globalized capitalist food system, we shall continue to see the comprehensive contamination of food with sugar, bad fats, synthetic additives, GMOs and pesticides and rising rates of diseases and serious health conditions, including surges in obesity, diabetes and cancer incidence, but no let-up in the under-nutrition of those too poor to join in the over-consumption.

Looking at India as an example, although it continues to do poorly in world hunger rankings, the country has achieved self-sufficiency in food grains and has ensured there is enough food available to feed its entire population. It is the world’s largest producer of milk, pulses and millets and the second-largest producer of rice, wheat, sugarcane, groundnuts, vegetables, fruit and cotton.

Farmers therefore produce enough food. It stands to reason that hunger and malnutrition result from other factors (such as inadequate food distribution, inequality and poverty). It is again a case of ‘scarcity’ amid abundance. The country even continues to export food while millions remain hungry.

While the pro-GMO lobby says GE will boost productivity and help secure cultivators a better income, this too is misleading as it again ignores crucial political and economic contexts; with bumper harvests, Indian farmers still find themselves in financial distress.

India’s farmers are not experiencing hardship due to low productivity. They are reeling from the effects of neoliberal policies, years of neglect and a deliberate strategy to displace smallholder agriculture at the behest of the World Bank and predatory global agri-food corporations. It’s for good reason that the calorie and essential nutrient intake of the rural poor has drastically fallen.

And yet, the pro-GMO lobby wastes no time in wrenching these issues from their political contexts to use the notions of ‘helping farmers’ and ‘feeding the world’ as lynchpins of its promotional strategy.

Agroecological principles

Many of the traditional practices of small farmers are now recognised as sophisticated and appropriate for high-productive, sustainable agriculture. These practices involve an integrated low-input systems approach to agriculture that emphasises, among other things, local food security and sovereignty, diverse nutrition production per acre, water table stability, climate resilience and good soil structure. Agroecology represents a shift away from the reductionist yield-output industrial paradigm, which results in enormous pressures on health and the environment.

A recent FAO high-level report called for agroecology and smallholder farmers to be prioritised and invested in to achieve global sustainable food security. Smallholder (non-GMO) farming using low-input methods tends to be more productive in total output than large-scale industrial farms and can be more profitable and resilient to climate change.

Despite the fact that globally industrial agriculture grabs 80 per cent of subsidies and 90 per cent of research funds, smallholder agriculture plays a major role in feeding the world. At the same time, these massive subsidies and funds support a system that is only made profitable because agri-food oligopolies externalize the massive health, social and environmental costs of their operations.

These corporations leverage their financial clout, lobby networks, funded science and political influence to cement a ‘thick legitimacy’ among policy makers for their vision of agriculture. In turn,  World Bank ‘enabling the business of agriculture’ directives, the World Trade Organization ‘agreement on agriculture’ and trade related intellectual property rights help secure their interests.

In the meantime, supporters of GMO agriculture continue to display a willful ignorance of the structure of the food system which produces the very problem it claims it can resolve. The pro-GMO scientific lobby arrogantly pushes its ideological agenda while ignoring the root causes of poverty, hunger and malnutrition and denigrating genuine solutions centred on food sovereignty.

Global Turmoil: Ethics offer a way out of the crisis

James M. Dorsey

Rarely is out-of-the-box thinking needed more than in this era of geopolitical, political and economic turmoil.

The stakes couldn’t be higher in a world in which civilizationalist leaders risk shepherding in an era of even greater political violence, disenfranchisement and marginalisation, and mass migration.

The risks are magnified by the fact that players that traditionally stood up for at least a modicum of basic economic, social, political and minority rights have either joined the civilisationalists or are too tied up in their own knots.

The United States, long a proponent of human rights, even if it was selective in determining when to adhere to its principles and when to conveniently look the other way, has abandoned all pretence under President Donald J. Trump.

Europe is too weak and fighting its own battles, whether finding its place in a world in which the future of the trans-Atlantic alliance is in doubt, Brexit or the rise of civilizationalist leaders within its own ranks.

The long and short of this is that civil society’s reliance on traditional strategies and tactics to exert political pressure serves to fly the rights flag but is unlikely to produce results.

The same is true for traditional often heavy-handed and violent government attempts to quell protests.

In some ways, this weekend’s landslide vote for pro-democracy forces in Hong Kong lays down a gauntlet for the governments of the city and China.

“Even if the current wave of protests recedes, the instability will very likely persist for some time and may even become a permanent situation… because the problems that cause the protests appear unresolvable by means of the current political and economic system,” said Israeli journalist Ofri Ilany.

Mr. Ilany put his finger on the pulse. This decade’s global breakdown in confidence in political systems and leaders not only spotlights the problem but may also create opportunities for out-of-the-box thinking.

The key lies in the fact that protesters across the globe in Santiago de Chile, La Paz, Bogota, Port-au-Prince, Quito, Paris, Barcelona, Moscow, Tbilisi, Algiers, Cairo, Khartoum, Beirut, Amman, Tehran, Jakarta, and Hong Kong as well as movements like the Extinction Rebellion essentially want the same thing: a more transparent, accountable and more economically equitable world.

The Middle East and North Africa, the one part of the world that exasperates the most, also represents the worst and the best of responses to the global clamour for change.

While Egypt under general-turned-president Abdel Fattah Al Sisi is almost a textbook example of what drives global protest, Tunisia and Kuwait, offer lessons to be learnt. So do some of the world’s longer standing success stories such as Singapore.

Tunisia has emerged as the one country that experienced a successful revolt in 2011 and was able to safeguard its achievements because its leaders, much like Singapore’s Lee Kwan Yew, saw power as a tool to secure national rather than personal interests and at a time of crisis worked with civil society to engineer a national dialogue that crafted a way forward.

Similarly, Kuwait, a constitutional semi-democratic anomaly in a region governed by secretive autocrats, recently opted for a more transparent competitive approach towards politics.

As a result, Kuwait saw this month its ruling family take its internal differences and disputes public. The differences forced the government to resign as members of the ruling family accused each other of embezzlement in advance of parliamentary elections scheduled for next year and a possible succession in which the assembly would have a say.

Achieving protesters’ goal of more equitable and accountable political and economic systems involves not only adherence to the rule of law, including the implementation of international law, and application of the principle of equality before the law of not only individuals and organizations but also states.

It further involves the need to make principles of right and wrong and of respect of human dignity the moral and ethical underpinnings of the architecture of a new world order by which all ranging from an individual to a state are judged.

That is the fundamental message of protests across the globe that denounce a world in which financial or economic benefit justifies violations of rights and civilisationalists have abandoned any pretence of adherence to international law.

Heeding the protesters’ message means ensuring that at least international law provides an effective mechanism to hold accountable security forces that use lethal force against largely peaceful protesters as well as politically responsible officials that authorize unjustified brutality in what often amounts to mass killings.

This year’s numbers speak for themselves, including some 100 on a single day in Sudan, more than 350 in a matter of weeks in Iraq, more than 100 in Iran and scores in Chile.

The need for morals and ethics is gaining momentum with hardline realist proponents of the projection of power as well as some leaders raising the alarm bell.

The rise of artificial intelligence persuaded former US secretary of state and national security advisor Henry A. Kissinger, a symbol of realpolitik and the wielding of power, to recognize the importance of morals and ethics.

Writing in The Atlantic, Mr. Kissinger warned that the consequence of artificial intelligence “may be a world relying on machines powered by data and algorithms and ungoverned by ethical or philosophical norms.”

Threats resulting from the abandonment of international law and the lack of moral and ethical yardsticks were evident in this month’s unilateral recognition by the Trump administration of the legality of Israeli settlements in occupied Palestinian territory long viewed by jurists and the international community as illegal.

The move highlighted the link between protecting individual rights and freedoms and national security.

Malaysian prime minister Mahathir Mohamad warned that the administration’s move meant that “we are no longer safe. If a country wants to enter our country and build their settlements, that is legal. We cannot do anything,”

Mr. Mahathir was projecting onto states a sentiment of vulnerability among protesters and minorities across the globe that results from the random, unrestricted employment of power by those in positions of authority.

Similarly, Singapore’s Chief Justice Sundaresh Menon warned last month that “countries increasingly adopt a zero-sum mentality in eschewing multilateral agreements as shackles on sovereignty and a burden on economic growth.”

Mr. Menon’s words must have been music in the ears of Norway’s successful US$1 trillion rainy-day oil fund that has proven that growth and profitability are achievable without abandoning norms of moral and ethical investment.

Norway’s Government Pension Fund Global (GPFG), the world’s largest sovereign wealth fund returned three percent or US$28.5 billion to the country’s pension pot during in the second quarter of 2019.

Guided by Norway’s Council of Ethics, which monitors the fund’s investments, GPFG recently blacklisted shares in British security company G4S because of the risk of human rights violations against its workforce in Qatar and the United Arab Emirates.

Said New York Times columnist David Brooks: “The world is unsteady and ready to blow… The big job ahead for leaders…is this: Write a new social contract that gives both the educated urban elites and the heartland working classes a piece of what they want most.”

To achieve the kind of social and economic justice as well as live-and-let live environment that Mr. Brooks advocates, leaders, governments and civil society will have to rediscover and readopt the moral and ethical values that are embedded in the world’s multiple cultures and common to much of mankind.

7 Billion + Population Problem

T. Vijayendra

This is meant to be an article for activist education and therefore on the one hand it starts with explaining basic concepts; on the other hand it avoids academic references. The population problem is complex and has been debated since Marx’s time. In the past leftists maintained that it is not a real problem, but a creation of capitalism. However in the last few decades resource constraints of the planet earth have been recognised and the present population of seven billion appears as a challenge. This article does not give definite ready solutions. It tries to present the problems and looks at possible solutions in a particular region.

Population growth means increase in population which is computed by subtracting total deaths from total births per year. For a specific area or country one has to add total immigration minus total outmigration.

Population grows at a ‘compound rate’ (like compound interest rate that students learn at school). The doubling of population is a function of growth rate. A simplified (but fairly accurate) formula is 70/growth rate = No. of years in which the population will double. Thus if there is 1 percent growth rate, in 70 years it will double. If there is 2 percent then in 35 years it will double and in 70 years it will be 4 times! If the growth rate is 10 percent it will double in 7 years—like the fixed deposits used to double in 7 years when the interest rates were 10 percent.

Zero Population Growth (ZPG)

Zero population growth rate (ZPG) means the rate of growth is zero or there is a stable population. There may be negative population growth which results in the decline of the population. This happens at some time both in nature and in human history.

In nature sustainable population is based on high child mortality and normal/low longevity. High child mortality occurs because almost all animals have predators, which kill the weak and the slow. Also in nature they don’t have ‘health care’ like humans have today, where the aim is to save every child and achieve as low child mortality as possible. High child mortality ensures lower growth rate and more effective genetic selection and therefore a ‘healthier’ population. Low longevity occurs because the predators kill the weak and the old because they cannot escape the predators. Animals that do not have predators (the top of the species) die due to inability to hunt or digest. For example, tigers die when they become too weak to hunt whereas elephants die due to losing their teeth.

In early human history human beings were not very different from other animals as shown in the population growth charts. But human history is different because humans can modify the environment to suit themselves to a greater degree than any other species. This ability kept on increasing and it increased by a leap due to industrialisation in the last 200 years. That is the root of the population problem.

The population growth is essentially due to humans’ ability to modify the environment to suit their needs. While the invention of fire and other similar inventions were important, a significant change occurred around 12,000 years ago due to introduction and growth of agriculture. Agriculture provided food security by increasing the shelf life of food (mainly grains), made slavery possible and in turn increased population. The figures are well known. Thus :

	World	India
Beginning of agriculture (10000 BC)	1 Million
Introduction of Iron (500 B. C.)	100 Million
Beginning of Christian Era	200 Million
1800 A. D.	1000 Million or 1 Billion	260 Million
1900 A. D.	1.6 Billion	300 Million
1950	2.5 Billion	350 Million
2000	6 Billion	1 Billion
Today	7 Billion +	1.2 Billion

(All figures and dates are approximate)

Agriculture also destroyed forests, grasslands and wetlands endangering the flora and fauna and in the final analysis it can endanger human species too. Agriculture created food security. But it is debatable because it also increased population and created slavery thus creating food insecurity for the slaves. This has happened more dramatically in the 20th century.

The 20th Century

As one sees from the data above, the 20th century was unique. It had the highest population growth rate in history. It was the only century in which the global population doubled and trebled! Several factors contributed to it. The green revolution (chemical fertilisers, pesticides, hybrid seeds, irrigation and mechanisation of agriculture), which was possible due to availability of cheap petroleum products, came only after World War I (in India it came in the 1970s). It contributed significantly to increase production of commodified food, particularly in the US, Canada and Australia and contributed to increase of population all over the world. On the other hand it also increased poverty, hunger and food insecurity for millions of people, especially in the third world.

Secondly increased longevity and decreased child mortality occurred due to dramatic changes in the health care industry. This is opposite to what happens in nature. In the era of cheap oil longevity increases due to ‘zoo conditions’ of old people – no predators, assured food supply and a high eco foot print of old people due to geriatric health care. In nature, ‘zoo conditions’ do not prevail and therefore longevity is low.

Thirdly, decrease in the number, intensity and deaths due to famines. So one gets a picture of a 7 billion population with millions of hungry people all around the world, particularly in the third world. The current UN data of hunger is around a thousand million or one billion.

Several other things happened too. A huge meat and poultry industry came up. These animals did not eat grass or insects as in the past but were fed agricultural produce (mainly corn in the US). So a greater area came under agriculture, further reducing grassland, wetland and forest. Several commercial crops like tobacco, tea, coffee and sugarcane also took up large agriculture areas. To feed this agriculture other industries and mining also increased. A huge resource drain occurred.

The 21st Century

There is a limit to growth of agriculture. It is limited by land and by input resources. The limit was artificially raised by cheap oil in the 20th century. This has ended in the 21st century. Oil production peaked (2005-2008), and it is now declining, never to rise again. This not only ushered an unending crisis of capitalism, it has also affected food production by increasing the input prices of agriculture. Today a billion people are starving the world over. About half of these starving people, that is, 500 Million are likely to die in this decade. And a full half of them, that is, some 250 Million will be Indians. It is difficult to imagine what other things will happen along with this catastrophic event. It is an end of era event —like the Black Death in Medieval Europe.

What else can happen during this period? With the arrival of Peak Oil, the curtain has closed on Act 1 of the drama Petroleum Man. What will happen in Act 2? Chekhov said, ‘If there’s a gun on the wall at the beginning of the play, by the end it must go off.’ In the world’s nuclear arsenal there are many guns on the wall. If life copies art, will there be an Act 3 in which the players, having learned their lesson the hard way, live sustainably? So if one does face a nuclear holocaust then one may have a situation when the ‘living shall envy the dead’. However as humans, people are optimistic and here are some more optimistic scenarios.

What are the possibilities?

There are two issues :
1.    How the current and growing population can feed itself and,
2.   How the world can move towards a sustainable population.

In a short term scenario there is going to be a lot of pain and starvation deaths. In the past due to cheap oil one could transport large quantities of food quickly. While it did not stop poverty or starvation, it prevented deaths. This no longer will be possible. These deaths will occur among vulnerable population, the poor and tribals. The sad thing is that these very people have many of the skills needed to sustain the society in a post-oil world. Various scholars have given different figures about reduction of population in the short term. One extreme figure is that the world population will be only two billion by 2050.

In the long term there are some possibilities. With the end of oil-economies will have to grow local because transport costs will be too high. If people do not destroy themselves social changes are bound to occur.

A viable future lies in some kind of non-capitalist social formation which is based on:
1.    Equity
2.   Scaling down of energy use
3.   Local self sufficiency
4.   Eco restoration by using Perma-culture / Agro Ecology

This may ensure enough food for the existing population. Each eco region will have to become self sufficient. Now different eco regions can support different levels of populations. Deserts and cold countries support smaller populations whereas tropical countries and riverine plains support bigger populations. So over a period the population will have to decline according to carrying capacity of the region. In the final analysis they will have to attain zero population growth and may even have shrinking of population.

Social Formation

There are two existing models which have tackled the present problems somewhat successfully: the Cuban model after the collapse of Soviet Union and the Transition Town Movement in Europe and USA. The latter has an anarchist kind of social formation.

The erstwhile socialist/communist countries (former Soviet Union, China, Vietnam etc.) may learn from Cuba and have their own version of ‘Special Period’ and come out of the crisis in 5 years.

The advanced capitalist countries may have some kind of social democracy with strong ‘Eco Socialism’ inputs and coupled with Transition Town models may also solve the problem within a relatively short period.

The so called ‘Third World ‘countries have limited experience of democracy. While they do have anarchist kind of experiments in pockets, like permacul-ture communes that are springing up everywhere, they are also facing lot of difficulties because the society at large still has an authoritarian background. So, these countries may have to go through some kind of revolution resulting in a command economy and then follow Cuba kind of ‘special period’.

This is an optimistic scenario, but in reality there will be lot of conflict, pain and misery, particularly before and during the revolution. There is also a possibility that some countries may not have revolution and may have a prolonged period of chaos destroying people and resources.

The new social formations coupled with organic farming or agro ecology can certainly feed the present population better. This is due to several factors. Due to relative equitable distribution people will have a little more food. A lot of waste due to wasteful consumption by today’s rich, waste due to storage and transport in the present capitalist economy will also be eliminated.

However as the world has seen organic farming fed only about two billion people in 1921. Can it feed 7 billion people today? It is a very difficult proposition. So there will be attempts to limit population growth and take it to zero population growth (ZPG).

The existing models of ZPG are based on urbanisation, nuclear family and increased prosperity. This model cannot be applied to the whole world because there are not enough resources for the whole world to achieve the prosperity that the western countries and some richer people in developing countries have achieved.

However one reason for the above model to work was the security that this model provided. It is possible to provide security at a lower level of consumption if the society is based on equity. So it is possible that in the new social formations ZPG may be achieved.

The sustainable population before agriculture was only one million. What is the desirable level of population that is actually sustainable over a long term? Obviously one million, the natural sustainable population before agriculture, is the lowest limit and mankind may never go down to that level. Various figures have been suggested, most of them are around two billion or less. This figure is arrived at due to the fact that in 1921 when the population was two billion, all agriculture was organic. For India this figure is 350 million (1950) when practically all agriculture was organic. However since then the soil has been degraded and without oil even this population may have difficulties to survive. Will mankind shrink to such a level? And of course the more pressing question is how the present population will face the situation when fossil fuel agriculture comes to an end. There is a possibility of large scale famine killing millions of people.

The Future

Will mankind be able to achieve this reduction of population to two billion? The question poses several issues. Mankind has developed an ethics that values life per se and it is unthinkable to allow child mortality to increase and have higher number of births. Similarly it is difficult to think of lowering longevity. At best one can think of an option—making euthanasia legal. But it will be exercised by very few. Only future generations will be able to think about it more clearly in changed circumstances. Even if there is negative growth rates, it will take a long time to achieve this kind of reduction. And what is the way to achieve this? If people voluntarily decrease birth rate, they will be saddled with an increasingly aging population, like Japan and France today. So logically nature’s way appears to be best. In organic farming one may say that-he should follow Nature’s way. Why should it not be applicable to human society? It remains a challenge to future generations as to how to achieve this in a humane way.

Think Locally, Act Locally

In the past the slogan, ‘Think Globally, Act Locally’ was very popular. This article too began looking at the problem globally. But in the future local self sufficiency will be the order of the day. So one should also be able to think locally and act locally. Below one can look at the Deccan in India as an eco region, look at its problems and try to look at the solutions that are being attempted.

Historically India has been endowed with rich natural resources and the country was self sufficient most of the time except in times of great political turmoil. Deccan too has been self sufficient. The last great famines occurred during the closing decades of the 19th century.

Every eco region has specific food practices. In Deccan it has been millets, pulses and ground nut. Agriculture is mainly rain fed with local irrigation from tanks. Some rice was grown in low lying areas with tank irrigation. Cotton was the main cash crop. Rearing of sheep and goats has been an important part of the local economy and meat has been part of the diet. Some amount of fish and poultry has also been part of the food. Some communities also eat pork.

A lot of this changed due to green revolution in other parts of the country and in the Deccan it introduced food insecurity and hunger and in some cases farmer’s suicide. How did it come about?

Increases of food production of wheat and rice are concentrated in green revolution areas. This was brought to the Deccan by the government’s public distribution system. Popular governments introduced rice at two rupees per kilo for the poor. This made the local millets expensive and people got used to eating rice and wheat. Slowly rice and wheat were introduced as food crops. As these require lot of water, tube well irrigation was introduced and tanks were neglected. Other cash crops like sugar cane, soybean and genetically modified Cotton were also introduced.

This led to a big disaster within 30 years. Water tables fell and there has been a big water scarcity in many regions. Commercial agriculture proved unviable for small and medium farmers and their burden grew to such an extent that several thousands of farmers had to commit suicide. Polished rice and white flour consumption affected the health of local people and possibly caused increased suffering due to diabetes. Hunger and water scarcity stalks the land.

The socialist solution to this situation is a combination of the old traditions and new. The old tradition consists of struggling for security of land ownership or land to the tiller or land reforms. The new is decentralisation, local food security and knowledge based restoration of ecology and agriculture that has been degraded due to the processes mentioned above. Local food security implies growing local foods as per local ecology. In the Deccan it would mean reducing rice and wheat and going back to millets, pulses and ground nut. Again the cash crop of sugar cane and soybean which are popular today will have to be abandoned or reduced drastically and organic cotton will have to be restored. Agro ecology would be the key science of the 21st century and rebuilding local communities would be the key social task.

A large number of social movements coordinated by NAPM (National Alliance of People’s Movements), NGOs like Deccan Development Society and several other organisations, small groups, permaculture farms in the region are following this path. While the scale is small and the ruling classes are very powerful, nevertheless they are showing a viable alternative. With larger political changes these policies and experiences will prove useful. It is certainly possible to visualise food self-sufficiency for the Deccan region.

Call to Arms

In the face of such imminent crises there are several people’s movements going—the Maoists, the ethnic and regional movements in Kashmir and the North East and scores of movements against large capitalist projects that take away common property resources such as land and water, existing livelihoods of poor people and endanger the environment. However there is a lack of coordination and understanding about the nature of capitalist crisis. The movements mainly oppose the exploitation and oppression and demand either immediate relief or improvement of the system. Many even think that they are fighting a losing battle. They do not realise that the time has come to fight for a win, to change the system. There does not seem to be the necessary urgency in the people’s movement. Partly it is inertia; partly it is the phenomenon of the boy crying ‘wolf’, that is, in the past, so many times, capitalism faced crisis and yet people did not have any revolutionary change in India. So this time around people are tired of responding. Then there is a divergence in various movements—in the issues handled—class, ethnicity or opposition to mega projects. So even though millions of people are actively opposing the present State and capitalism, there is no dialogue or coordination between different groups and movements. It is the need of the hour to have a dialogue, come together for concerted action and avoid the forthcoming disaster as much as possible. This time around the chances are better because the edifice of the enemy is weakened, is crumbling and imploding. Is anyone listening?

Automaker Audi slashes 9,500 jobs in Germany

Dietmar Gaisenkersting

Audi, a subsidiary of German automaker Volkswagen, will cut 9,500 jobs in Germany over the coming five years. This will leave just over 50,000 jobs at the company's operations, down from the current level of 61,000.

The job cuts are part of a global offensive against autoworkers, which experts expect to cost the jobs of at least 15 percent of the 820,000 workers in the auto and parts industries in Germany alone. Over the last year, BMW, GM, Ford, VW, Nissan and other global automakers have carried out mass layoffs of production and white-collar workers in North America and Europe, while hundreds of thousands of workers have lost their jobs in India and China.

Worldwide car sales fell in 2018 from 81.8 million to 80.6 million and are anticipated to decline by another three million this year, the largest drop since the Great Recession. The global economic decline has intensified a brutal competition between the transnational auto giants for profits and to corner the emerging market for electric and self-driving vehicles. The restructuring of the global auto industry is leading to a wave of planned mergers, consolidations and a brutal campaign of job- and cost-cutting.

In this March 24, 2018, file photo, part of the assembly line at German car producer Audi plant in Ingolstadt, Germany. The automaker said Tuesday Nov. 26, 2019 that it is cutting 9,500 jobs in Germany through 2025.(AP Photo/Matthias Schrader, File)

The Audi jobs massacre has the full backing of the IG Metall trade union and works council, which spent the past several months working out the details of the layoffs with management behind the backs of the workers.

Central works council chairman Peter Mosch had the temerity to suggest that the elimination of virtually one in every six jobs was a successful outcome. “After months of talks, we were able to avert the original cuts demanded by the company in most areas,” he asserted. Mosch also presented the avoidance of “compulsory redundancies” and a pledge to hire 2,000 “specialists” for electric vehicles as victories.

The remaining workers will face wage cuts. According to the agreement, the profit-sharing payout, which currently stands at €3,600 (US $3,996) for production workers, will be frozen or cut if the operating profit falls or remains the same. If profits rise significantly, however, the payouts will not automatically increase.

Central works council chairman Mosch belongs to a layer of trade union bureaucrats who have made lucrative careers within Germany’s corporatist system of labor-management “codetermination.” Along with the Audi central works council, which he has headed since 2006, Mosch also serves as deputy chair of Volkswagen's works council and is a presidium member of VW's global works council. He is also deputy chair of Audi's supervisory board, a member of the VW supervisory board presidium, and a member of the permanent committee to Porsche's supervisory board.

According to Volkswagen AG's business report, Mosch's activities on VW's supervisory board alone netted him €300,000 (US $330,000) per year in 2016 and 2017.

Audi is aiming to save €6 billion with the job cuts. This will be used to push up its dividend payouts from 9 percent to 11 percent, a phenomenal result for investors, given the low interest rates. Audi is also seeking to catch up with its two main competitors, the high-end manufacturers Mercedes and BMW, which both recently unveiled major job cuts and cost-cutting programmes. Part of the money saved by Audi will be invested in electric vehicles and other new technologies.

In addition to mounting competition on global auto markets and technological changes, Audi confronts further crises. The diesel scam is costing Audi billions, since the VW premium brand served as a development center for Volkswagen and was thus deeply implicated in the development of engines and the specific emissions control software that switched off when the vehicle was not in a test setting.

Over the past seven years, Audi has gone through seven heads of development. Bram Schot, who took over from former chief executive Rupert Stadler following the latter's imprisonment due to his role in the emissions scandal, will be replaced in April next year by BMW executive Markus Duismann. Schot has not moved on yet because BMW has refused to let Duismann leave sooner.

The transition to electric vehicles, which Audi and the rest of Germany's automakers long ignored, requires billions of euros in development costs. Audi intends to bring 30 electric vehicle models onto the market by 2025. At the same time, electric-powered vehicles require far fewer parts than internal combustion engine-driven cars, leading to predictions of even deeper job cuts.

At the end of October, Audi was forced to cut its sales forecast for the current year. In Audi's two main plants in the cities of Ingolstadt and Neckarsulm, production output will be reduced under the agreement now concluded with IG Metall. In Neckarsulm, which has an annual capacity of 300,000 vehicles and focuses mainly on producing the Audi A4 to A8 and R8 models, fewer than 200,000 vehicles will roll off the assembly lines this year for the third time in a row. Going forward, annual production will be 225,000 cars.

In Ingolstadt, which has capacity to build well over half a million cars, just 491,000 vehicles were produced last year. In the future, the plant will produce 450,000 cars.

Audi’s parent company VW, the world’s second largest automaker, is also engaged in a major job-cutting programme, also with the collusion of IG Metall. Three years ago, VW central works council chair Berndt Osterloh signed the notorious “future pact” with VW brand chief Herbert Diess, who now heads the Volkswagen corporation. That agreement cost 30,000 jobs around the world, including 23,000 in Germany. The works council and management at the VW brand are in the process of preparing a new edition of their pact.

Over the last two years, there have been increasing struggles by autoworkers, including in Romania, Hungary, the Czech Republic and other Eastern European countries, China, India and Mexico, along with workers in Germany, France and Great Britain. Earlier this autumn, 48,000 GM workers in the US waged the longest national auto strike in nearly half a century.

Workers are increasingly coming into a direct conflict with the pro-capitalist and nationalist trade unions, including the United Auto Workers in the United States, which is engulfed in a corruption scandal that has revealed the fact that the UAW is a bribed tool of management.

The giant corporations and the powerful financial interests behind them have an international strategy to attack workers. Autoworkers need a global strategy to respond. This requires the building of new organizations of struggle, rank-and-file action committees, which reject the nationalist poison promoted by IG Metall and other unions and fight to coordinate the struggles of autoworkers across all borders.

While modern technology presents unprecedented opportunities to raise the living standards and cultural level of all of humanity, the exact opposite is taking place under capitalism. The riches of society end up in the pockets of a tiny minority, while rotting capitalism produces mass poverty, fascism and war. That is why the emerging mass struggles by autoworkers and every section of the working class must be fused with an international socialist programme, including the transformation of the global auto industry into a public enterprise, collectively owned and democratically controlled by the working class.