Without an Economic Recovery, Argentina Cannot Repay Its Debt

Lara Merling

For those following Argentina’s debt saga, the current situation might seem eerily familiar: after the implosion of an IMF program, Argentina finds itself at the brink of default, with a debt burden, denominated in foreign currencies, that it simply cannot pay. In contrast with Argentina’s default in 2001, when it reached agreements with most of its creditors years later,  this time Argentina’s government is doing its best to avoid default by attempting to find agreement with its lenders for an orderly restructuring.

Argentina made its creditors an offer based on a sound framework that aims to restore debt sustainability. The offer proposed a three-year stay on all payments, followed by a gradual resumption in interest repayments as the economy recovers, along with a 0.4 percent write-off of the capital value of the bonds. Creditors now have a choice between accepting this offer or letting Argentina default as negotiations drag on.

To understand why this offer is the best Argentina can do, one needs to understand the dire situation its economy is in. Until Argentina can revive its economy, it truly does not have enough revenue to service its dollar-denominated debt. Negotiations or costly litigation might drag on. And even if creditors get a better deal on paper, it does not matter if Argentina cannot honor it.

Between 2017 and 2019, the ratio of external debt-to-GDP exploded: from 38.8 percent in 2017, to 69 percent in 2019. This was caused by a sharp depreciation of the peso, along with a contraction of the economy. These numbers will only get much worse this year as Argentina battles COVID-19. This additional shock is not only hurting Argentina’s domestic economy but has also caused a collapse in commodity prices, Argentina’s main source of exports.

It is clear that Argentina’s debt is unpayable and needs to be restructured. The IMF released its own debt sustainability analysis, which reached the same conclusion as the Argentine government: the debt is unsustainable and there is no scope for any foreign currency payments for at least the next three years. The most important implication of this assessment is that the IMF will no longer lend any funds to Argentina before a debt restructuring occurs, as its own rules forbid it from lending to countries with unsustainable debt.

Argentina’s private creditors need to accept that they will not receive their agreed-upon returns as there is currently no one left to bail them out. A restructuring could have taken place at more favorable terms if it had occurred before the IMF started its record $56 billion program in the summer of 2018. To most observers, it was already clear then that Argentina’s debt was unsustainable. Yet, the IMF bent its own rules and officially assessed Argentina’s debt to be “sustainable but not with a high probability.” This decision was made on political grounds, as the Trump administration was committed to the IMF supporting then president Mauricio Macri.

The roots of this crisis can be traced back to mistakes made by the Macri administration, in office from 2015 to 2019. Before Macri, Argentina was locked out of international credit markets due to a legal dispute with holdouts from its previous debt restructuring. The vulture funds — hedge funds that buy distressed debt and then take legal action to recover the full face value of the bonds — managed to hold Argentina hostage due to a 2014 ruling by a US court that Argentina could not repay any creditors until it paid the holdouts. Macri, who was elected on a “market-friendly” platform, was quick to settle the dispute and pay the vulture funds, with some making profits as high as 1200 percent.

Another step Macri took that would later prove disastrous was his immediate removal of all capital control measures. At first, markets cheered this, and Argentina issued over $40 billion in dollar-denominated bonds, mostly under US law. While markets lent him more dollars, Argentina continued to have limited sources of dollar revenue, and there were no significant investments in growing Argentina’s export base. Argentina’s macroeconomic imbalances were revealed when a brief rise in US interest rates precipitated capital outflows from emerging markets.

The large and sudden reversal in capital flows from Argentina caused a collapse of the peso, as the Central Bank stumbled to defend its currency, spending billions of dollars to no avail. It is then that the Macri administration approached the IMF, which ignored the debt sustainability issues and proceeded to sign an agreement of $56 billion, out of which about $44 billion was eventually disbursed. Most of the funds disbursed immediately left the country, enabling many investors to cash out of Argentina at little or no loss.

Meanwhile, Argentina was stuck with additional foreign exchange debt and an economic collapse exacerbated by IMF-imposed austerity. The cuts dictated by the IMF worsened the recession and failed to reduce Argentina’s deficit, as revenues collapsed along with the economy. The program also had enormous social costs, as poverty jumped from 27.3 percent in 2018 to over 35 percent at the end of 2019.

Argentina is entering its third year of recession as it now also battles the crisis triggered by COVID-19. In the last four years, Argentina reduced its primary expenditures by over 5 percent, negatively impacting its economy and thus failing to  allow room to  reduce the budget deficit. There is no more space for additional fiscal consolidation without deepening the economic crisis, and in the current context of a health emergency, without putting more lives at risk. For Argentina to generate revenue to repay its debt, it first needs the space for an economic recovery.

Given this national context, along with the unfavorable global economic situation, it is easy to conclude that Argentina is doing the best it can to do right by its people and by its creditors.

Rich Corporations Get $500 Billion, No Strings Attached

Eve Ottenberg

It is beyond obscene that the U.S. government used the Covid-19 panic to ram through a $500 billion loan giveaway to rich corporations. Loans with no strings attached. How did the geniuses in Washington conclude that stuffing cash into the pockets of oligarchs would help the 30 million dumped out of work? Those plutocrats have proved time and again, since Ronald Reagan first started throwing money to them, that when you give them dollars it does not trickle down to ordinary people. It goes to stock buybacks and multimillion-dollar ceo bonuses and raises. It is money flushed down the toilet.

A government that burns money like this can afford Medicare for All. Especially during a lethal pandemic. But our senators, congressmen and white house officials clearly prefer to let people die of plague while they make inequality great again. Their motto is the haves get it all, the have-nots get crumbs. A government that can squander $500 billion on the super rich can afford a universal basic income for its citizens. But our political elites prefer to loot the country and pass the cash to people already swimming in it. No lifeline for the millions who just lost their income. Nothing besides a one-time check for $1200 and unemployment. Which they get from their states. Which are going bankrupt and can’t expect money from Trump, Mnuchin or Mitch McConnell, because no – that trio is too busy bashing Democratic governors and passing out the plunder like candy to corporate cronies and donors.

Adding insult to injury, the political elite who rigged this pillage didn’t even bother to conceal it, cover it up, make excuses or lie about it. Nope. The stock market sank, so without further ado Trump et alia pushed through a bailout for the people who need it least. They didn’t conceal it, because they just assume everybody who matters agrees – when there’s stock-market trouble, the U.S. opens its coffers to corporations, because this is the United States of Corporations not of Citizens, especially not citizens without substantial portfolios. Those people don’t matter. The 30 million who lost their jobs don’t count. And in case they were deluded enough to think they did, Trump, Mnuchin and McConnell just gave a fortune to plutocrats to make it crystal clear: in the U.S. the rich have all the rights – especially the right to government money.

But, you may ask, what about the small business loan program? Well, the first time around that didn’t go so well, with lots of money grabbed by publicly traded corporations. We’ll see how the re-do fares. But even that cannot conceal the brazenness of the $500 billion corporate loan giveaway, which requires no job hirings or worker retentions. At least the small business Paycheck Protection Program (PPP) does that. The $500 billion corporate gift should be redirected, tout de suite, to the states or to the PPP – where at least it could do some good for ordinary people. But Washington doesn’t think much of ordinary people.

What our rulers really do think of us is best demonstrated by how Republicans treat meat packers, who do hard, dirty, disgusting, dangerous work. Many meat packing plants have become Covid-19 hothouses, with workers dying. On May 1, the CDC announced that almost 5000 meat packers are infected. So some plants temporarily shut down. Trump freaked out over this and designated slaughterhouses an essential industry. Workers evinced reluctance to return to work, since for many the pestilence could be a death sentence. But governors in states with slaughterhouses threatened to stop these workers’ unemployment checks if they did not clock in. So meat packers have a choice: starve or get the plague. Either way, Washington and their governors clearly regard them as expendable.

One irony is that many meat packers are undocumented workers – you know, the people Trump loves to vilify. Suddenly he says they’re essential to ongoing American life. But many of them, presumably, could not get unemployment funds anyway, due to their immigration status. We’ll see if they risk infection and possibly death for a president who routinely belittles and insults them and whose only concern for them thus far has been to kick them out of the U.S. as fast as possible.

So $500 billion for plutocrats, peanuts for everyone else, forced labor and forced exposure to a deadly virus for “essential” workers. If that sounds like a democracy to you, check the dictionary definition. It spells oligarchy, maybe even tyranny.

Australian governments pushing tracing app despite unanswered privacy-functionality questions

Oscar Grenfell

Australian governments are aggressively promoting COVIDSafe, a mobile phone application that will supposedly assist contact tracers in monitoring and containing the spread of the coronavirus, despite a raft of unanswered questions about its effectiveness and the privacy of those who download it.

The app is a central component of the “back to work” campaign being conducted by federal, state and territory leaders on behalf of the corporate and financial elite. Over the past weeks, they have claimed that the country has succeeded in “flattening the curve” of infections and that this justifies the rapid elimination of social distancing and lockdown measures.

At a meeting of the national cabinet today, governments are mapping a “road out of the crisis.” It will involve the easing of restrictions over the coming weeks, aimed above all at forcing workers back onto the job to ensure the resumed flow of corporate profits.

This campaign is unfolding amid ongoing community transmission of COVID-19 and indications that infections could rapidly spiral out of control. A cluster at a meatworks facility in Melbourne, for instance, has been linked to 71 cases, demonstrating the perils of compelling employees to work in factories and businesses where social distancing is impossible.

Prime Minister Scott Morrison has already acknowledged that the removal of lockdowns will result in a spike in infections. Governments have claimed, however, that they will be able to “manage the spread” of the coronavirus, with the assistance of COVIDSafe along with expanded testing. To underline the importance of the app, Morrison recently declared that his vision was for a “COVIDSafe economy.”

The application is premised on ongoing community transmission of the virus. It supposedly works by logging the details of all individuals who are in close proximity to someone who has downloaded the app for more than 15 minutes. Once testing reveals an infection, contact tracers will then scour the data captured by the application and seek to identify those who have also contracted the virus.

In other words, the application will only be of use after community transmission of the virus between people who do not live together.

Commentators have noted, however, that even if it works as it has been outlined, the app will not be able to identify infections of the highly contagious virus caused by fleeting contacts in public areas. Virologists, moreover, have documented the fact that COVID-19 can be spread through inanimate objects and have stated that it remains in the air longer than first thought.

An article by technology researchers at the prestigious Brookings Institution in the US last month was bluntly headlined: “Contact-tracing apps are not a solution to the COVID-19 crisis.” The researchers warned that such applications, which are being rolled-out in a number of countries, would likely be ineffective at best and “disastrous” at worst.

The researchers noted the likelihood of both false negatives, stemming from contacts with infected individuals that are not logged by the program, and false positives. As an example of the latter, they commented that automated technologies are incapable of making contextual assessments. A Bluetooth signal may be established between two phones that are separated by a porous wall, for instance, which would log a contact despite the impossibility of transmission.

The researchers wrote: “The lure of automating the painstaking process of contact tracing is apparent. But to date, no one has demonstrated that it’s possible to do so reliably despite numerous concurrent attempts.”

Hinting at the political calculations underlying the turn by governments to such programs, they perceptively stated: “We worry that contact tracing apps will serve as vehicles for abuse and disinformation, while providing a false sense of security to justify reopening local and national economies well before it is safe to do so.”

The functioning of the COVIDSafe app is shrouded in secrecy. Australian government ministers have given wildly conflicting estimates of the take-up rate required for it to be effective.

Some have provided a figure of 20 percent, while others have cited 40 percent. It has not been clear whether the officials have been referring to a proportion of the total population, the adult population or registered smartphone users. Other government representatives have called for people to “upload” COVIDSafe, apparently ignorant that mobile phone applications are, in fact, downloaded.

Despite it being hurriedly launched almost a fortnight ago, state health officials still do not have access to the data collected. Already, federal authorities have been compelled to admit that the app does not work effectively on iPhones, which account for an estimated 45 percent of the Australian smartphone market. The Bluetooth “handshake” that will result in a contact being logged will only work reliably on iPhones if users have the app open and in the foreground, something they are unlikely to do.

While it is entirely unclear that the app will do anything to assist contact tracing, there are legitimate grounds for suspecting that it will collect vast amounts of data on the population, amid a broader assault on privacy and democratic rights.

The federal government claimed when it launched the app that it would publicly-reveal those aspects of its source code that did not jeopardise the security of the program. It has failed to do so, meaning that the population is being encouraged to download an app without any opportunity of scrutinising how it functions.

The government has also claimed that the data will be stored encrypted and will only be accessible to state health officials.

Technology researchers have questioned the claims that the app will protect users’ privacy. Jim Mussared and other developers who have sought to reverse-engineer its source code have warned that the app does not work as has been claimed.

Mussared and the groups’ findings, as summarised by Gizmondo, included: “Two flaws that lead to potential long-term (many day) tracking of devices; An additional flaw, which leads to limited long-term tracking as well as sharing information not stipulated in the app’s privacy policy; Another flaw provides long-term tracking as well as exposure of the user’s name, in some cases; One issue allows for permanent tracking of an iPhone even when the app is uninstalled.”

An article by two University of New South Wales academics in the Conversation on Wednesday documented the ways in which draft legislation that will govern the app contradicts the claims of the authorities.

Professor Graham Greenleaf and senior lecturer Katharine Kemp noted that ministers have claimed that COVIDSafe will only store the details of individuals who come within 1.5 metres of a user and are in proximity for more than 15 minutes. The legislation, however, indicates that “the app collects and—with consent of a user who tests positive—uploads to the central data store, data about all other users who came within Bluetooth signal range even for a minute within the preceding 21 days.”

The privacy concerns have been compounded by the government’s decision to provide the contract for storage and management of the data to the giant US technology corporation Amazon. This week it was revealed that the company is being paid $700,000 for its services.

As some commentators have warned, under American legislation, the US government and its agencies can subpoena data from any US-registered company, regardless of where the information originates. The federal government response to the warnings about Amazon, which has close ties to the US intelligence agencies, has been a combination of intimidation and obfuscation.

On Monday, the government filed a formal complaint to the Australian Broadcasting Corporation over a story by Dylan Welch noting that the COVIDSafe data could be accessible to US law enforcement. The government branded the article as “unnecessarily alarmist.”

Its representatives, however, have taken contradictory positions on the key issue in Welch’s story at Senate committee hearings into the app this week. Attorney-General’s Department deputy secretary Sarah Chidgey declared it was “inconceivable” that the data would be provided to a US government agency, but would not give a “100 percent guarantee” that this would not take place.

In a cynical deflection, she stated: “I can give a guarantee that it is a criminal offence under Australian law” for the data to be provided to a third party. The US intelligence agencies, however, explicitly do not operate under the domestic laws of foreign countries.

Attempting to contain growing popular concern over the privacy provisions of the app, Labor Party representatives have called upon the government to be more “transparent” and to ensure that “safeguards” are built into it. Labor, though, has played a central role in the passage of many pieces of legislation directed against encryption, targeting whistleblowers and journalists and increasing the powers of the police and the intelligence agencies.

At the state and federal level, moreover, Labor, no less than the Liberal-National Party, is spearheading the dangerous back to work campaign that the app serves to legitimise.

Representatives of the Victorian state Labor government have told the media that the Melbourne meatworks cluster may not have spread as rapidly, if COVIDSafe had been operational and all workers had it on their phones. In reality, it was the government that covered up the infections for almost three weeks in a bid to ensure that businesses remained open.

The comments, however, are a warning that workers who do not download the app will be scapegoated for the spike in infections that will result from the pro-business policies of governments.

Deemed essential, US farmworkers face wage reductions, zero protections from COVID-19

Norissa Santa Cruz

From the apple, cherry, and pear orchards in Washington to the vineyards and strawberry fields in California’s Central Valley, to the Midwest Corn Belt, the tobacco farms in North Carolina and the Florida citrus groves, the 3 million farmworkers who produce the lion’s share of the nation’s food exist on the edge of society, the majority of whom are undocumented migrants.

It is of no surprise these agricultural laborers have been officially declared “essential workers,” however the COVID-19 pandemic is yet another great burden thrown onto the shoulders of the most vulnerable and poorest workers in the United States.

Employed by agricultural and dairy farms they perform backbreaking labor in hazardous conditions for poverty wages—an average of just $12.59 per hour—or make their wage by the barbaric piece rate system that discourages even the most basic health precautions such as regular handwashing, assuming such stations even exist.

Migrant workers harvest corn on Uesugi Farms in Gilroy, CA (U.S. Department of Agriculture)

Farmworkers lack access to basic medical care and suffer from significantly higher rates of diabetes, hypertension and health conditions such as heart disease and environmental cancers due to long exposure to pesticides. Hundreds die annually from sun and heat exposure, the leading cause of death in the industry.

Migrant and seasonal farmworkers in the United States are subject daily to extreme heat and often lack access to clean drinking water. There are approximately 500,000 child farmworkers in the US who forgo education to work alongside their parents in the fields helping them to boost their piece rate.

While real numbers do not exist, the advocacy group Farmworker Justice estimates that 70 percent or more of the workforce are undocumented and just ten percent fall under the H-2A seasonal guest-worker program. An agricultural worker with no documentation earns an average of 15 percent less than his H-2A or documented counterpart.

Large farms rely on new immigrants from Mexico, Central America, and South East Asia to work for extremely low wages. They live in cramped, unsanitary and inhuman conditions, including sleeping on bare bunks, or moldy mattresses on floors. Their quarters have poor ventilation, leaky roofs, hazardous wiring, ill maintained plumbing and showers, infestations of rodents, flies, mosquitoes and inadequate facilities for washing. They live in isolated areas far away from health clinics, grocery stores, and public transportation, and are often forced to pay exorbitant rates for rent.

The average life expectancy of a farm worker is a mere forty-nine years, equivalent to the average life expectancy in the US in the year 1900. For the year 2017, the fatality rate due to work related injury was 20.4 deaths per 100,000 farmworkers.

Farm work is an industry of abject poverty and debt, racism and sexual harassment, long hours of stoop labor in the fields, abuse from bosses, and the denial of basic labor and human rights protections.

In such cruel conditions, it is impossible to imagine that any genuine care could be provided to prevent the spread of the coronavirus from a ruling state that has carved out such an inhuman existence for this underclass of laborers and is doing little to protect the working class as whole as it pushed to reopen the US economy.

Earlier this month, California governor Gavin Newsom signed an executive order to provide an additional 80-hours of sick pay for farmworkers, stating “I want you to know you’re not disposable, you are essential, and you’re valued...And I want from the bottom of my heart to extend my deep admiration and appreciation to you.”

Newsom’s words could not ring hollower as there have been no emergency rules put in place to protect agricultural workers from potential outbreaks of COVID-19 in labor camps this harvest season.

Crowded truck beds and buses carry them to the fields. While some farmworkers are able to spread out in fields, social distancing is difficult or impossible to maintain with farm equipment for planting or harvesting that requires large groups to labor in close proximity. The advocacy group Farmworker Justice estimates that one-third of farmworkers live in houses and apartments where multiple families share the same household.

The Trump administration’s recent plan to spend $19 billion to address the impacts of COVID-19 on agriculture will do nothing to help farmworkers. Analysis of United States Department of Agriculture (USDA) data by the Environmental Working Group (EWG) shows that in the 100 counties with the most farmworkers, more than $590 million in recent trade bailout payments were sent, with no requirement that any of those funds be used to improve the conditions of farmworkers.

Thousands of cases and deaths from COVID-19 are reported in counties with large populations of farmworkers, according to EWG. Yet, farmworkers still face a gross lack of personal protection equipment from their employers such as masks and gloves let alone any real measures for supporting housing and transportation options that will reduce the spread of the virus.

Oneida, New York has become a hotspot of the virus in recent days. Oneida County officials say that 64 of the new positive cases in the county are related to workers at Green Hills Farm. In total, of the 300 employees at the farm, 139 have tested positive for COVID-19.

Monterey County in Salinas, California, a major lettuce producer is referred to as the “Salad Bowl of the World.” The county had 185 confirmed cases as of April 28, many of which were connected to the local farms. An employee at Tanimura & Antle, one of the largest lettuce companies, reported testing COVID-19 positive on April 22.

On top of the immediate threat to their lives exacerbated by their poor health and living conditions, the White House is working to reduce wage rates for foreign guest workers on American farms. This cruel attack on farmworkers is being touted as a measure to help struggling farmers in the US amid disruptions in the agricultural supply chain compounded by the outbreak.

In Florida, tractors are driving through bean and cabbage fields, plowing ripe vegetables back into the soil as Idaho farmers are burying millions of pounds of onions in ditches. Farmers in Wisconsin and Ohio are dumping thousands of gallons of fresh milk into lagoons and manure pits.

Lowering the minimum wage laws for workers with migrant visas will cut wages by about $2-$5 dollars an hour. In North Carolina, for example, this change would result in an hourly wage of $4 an hour for farmworkers.

The loss of income affects not only these workers and their immediate families but also their family members who receive billions of dollars in remittances every year. Some 1.6 million households in Mexico depend on remittances from migrants in the United States as their most important source of income. The World Bank reported that migrant workers around the world sent some $689 billion in global remittances in 2018.

Washington is touting the effort to slash farmworker pay as “wage relief” to US farm owners but the real aim is drive down wages for the entire working class, and where better to start than among the undocumented. Prior to the pandemic thousands of farms across the country were struggling to keep from going bankrupt, with a growing number of small family farms going out of business every month. The US Department of Agriculture had stated in February, prior to the onset of the pandemic, that it expected farm debt to rise to a record $425 billion by the end of 2020.

The US State Department has also announced that it will begin processing more H-2A temporary guest worker visas to ensure US farmers have foreign workers in time for spring planting. These “guest workers” hold a limited, “nonimmigrant,” temporary work visa and in order to remain in the US they must keep their jobs and employers satisfied to return the following season.

Guest workers are also legally prevented from ever demanding a pay increase. H-2A program allows employers to reject any job applicant who demands a wage rate higher than the rate approved by the government also known as the “adverse effect wage rates” which are based on a USDA survey of what agricultural workers are paid in each state. This rate is $11.71 per hour in Florida, $12.67 in North Carolina and $14.77 in California. A citizen or legal resident who demands a higher wage rate can be rejected or fired as “unavailable” for the job and replaced by a guest worker.

Every aspect of the industry and punishing visa laws are constructed to keep wages as low as possible and hold the threat of deportation over the heads of both the documented and undocumented.

The United Farm Workers (UFW) President Teresa Romero stated her support for the sick leave temporarily mandated by Newsom, stating that “Farm worker families and the families of farmers work, play, shop and worship together.”

“Protecting these small, tight knit communities is vital to the protection of our food supply,” Romero declared. However, the UFW takes zero responsibility for the inhumane conditions farmworkers must endure and in its sixty years of existence has been complicit in allowing the abject squalor of farmworkers to endure unchanged.

The Trump administration is now using the very desperate situation faced by farmers as a battering ram to slash wages and working conditions even further. Trump’s executive order utilizing the Defense Production Act forcing meat processing plants with outbreaks of COVID-19 to remain open is also by design aimed at compelling a workforce which is at least 30 percent immigrant to labor under inhuman conditions.

Farming, dairy and meat processing plants which have large numbers of immigrant and undocumented workforces have been at the center of the largest mass immigration raids by Immigration, Customs, and Enforcement (ICE) in recent years.

Immigrants continue to be at the forefront of the attacks on democratic rights in the United States. US citizens married to undocumented immigrants have punitively been denied stimulus checks that they would otherwise be entitled to under the CARES package to support themselves and their children. Forcing the meatpacking industry back to work amid major outbreaks while doing nothing to prevent the spread of the disease among agricultural industries are only glimpses of what is in store for the working class more generally.

New Iraq government faces economy in freefall amid COVID-19 pandemic

Jean Shaoul

Former head of intelligence Mustafa al-Kadhimi has taken office as Iraq’s new prime minister.

He comes to power six months after mass protests against appalling social conditions, government corruption and the entire political setup forced the resignation of Prime Minister Adil Abdul Mahdi. This was the first time since the 2003 US-led war that a government had been forced to resign due to popular pressure.

Al-Khadimi is Iraq’s third prime minister-designate assigned by President Barham Salih since Mahdi’s resignation. His two predecessors, Muhammad Tawfiq Allawi and Adnan al-Surf, both failed to win parliamentary support for their cabinets. Mahdi quit his post as caretaker prime minister at the beginning of March, the day after Allawi admitted defeat, leaving Iraq without a functioning interim government.

Prime minister Mustafa al-Kadhimi (Wikimedia Commons)

Al-Khadimi, who spent 25 years in exile in the UK and US, is on good terms with Saudi Crown Prince Mohammed bin Salman and is viewed as a US spy. He appeared initially to have the support of some of the Shia parties after Iran, which in practice controls parliament and can therefore neuter him, gave the nod.

However, Kataeb Hezbollah, one of militias within the Popular Mobilization Units (PMU) close to Iran and part of Iraq’s armed forces, accused him of complicity in the January 3 assassination of Iran’s General Qassem Suleimani and Abu Mahdi al-Muhandis, a prominent member of the Iraqi government and PMU leader, aimed at undermining Iran’s political influence in Iraq. Their killings have spawned major disagreements among the various Shia factions, with four PMU units loyal to Ayatollah Ali al-Sistani breaking from the PMU, which Washington is seeking to exploit.

Al-Khadimi has still to fill several posts in his cabinet after parliament refused to endorse some of his nominees, including the key oil and foreign affairs ministries. But his line is clear: he said he will uphold the political sectarian system known as muhasasa and work with Washington in the “strategic dialogue” over relations between the two countries scheduled for June.

In January, after the US assassination of Suleimani and al-Muhandis, parliament called for the immediate withdrawal of all US troops in the country. However, US-led forces have every intention of remaining in Iraq despite the overwhelming hostility they face. President Donald Trump threatened Iraq with sanctions if it ordered American troops out of the country. In March, Washington set up at least four new batteries of Patriot air defence systems in Iraq as a preparatory move to strike against Iran, consolidating its position in its most important bases as it withdrew its smaller bases.

Iraq has for decades been caught in the crosshairs of US imperialism’s militaristic confrontation with Iran, which is bound up with Washington’s build up for “great power” confrontation with China—attempting to use military force to establish a chokehold over the energy resources upon which the Chinese economy depends.

Al-Khadimi is under huge popular pressure to bring the killers of peaceful protesters to justice. Around 700 protesters were killed, and thousands injured during the mass protests that started in October, with government taking no action to identify those in the security forces responsible. He has also to try and get agreement on holding new elections based on new legislation that would overturn Iraq’s sectarian political system as demanded by the protest movement.

The COVID-19 pandemic has plunged Iraq deeper into a maelstrom. The country is in no position to treat millions of potential victims. With its healthcare system, once the best in the Arab world, gutted by the 1991 Gulf War, a decade of US sanctions, the 2003 US-led war and occupation of Iraq and the wretched political sectarian system Washington imposed, what remained of Iraq’s medical staff left the country in their thousands or were fired by US officials. With only 0.8 doctors and 1.4 beds per thousand people, hospitals became a place to die as healthcare budgets were turned into a mechanism for doling out patronage.

Just two weeks after Iraq confirmed its first case of COVID-19, the government ordered a complete lockdown that has deprived millions of day workers of their means of subsistence and temporarily closed down the protest camps in Baghdad’s Tahrir Square and other cities.

Iraq has around 2,500 confirmed cases and over 100 deaths. But these figures are widely believed to be a cover up of the real scale of the crisis, with the Iraqi government even issuing a fine and temporary ban on a Reuters journalist who reported the sceptical views of Iraqi doctors about the official number of COVID-19 victims.

The collapse in oil prices due to the coronavirus-led recession—60 percent on February prices—and the OPEC-agreed production cuts of 1.1 million barrels per day is a disaster. The government was depending for 90 percent of its revenues for the 2020 budget on oil based on a price of $56 a barrel, double the current figure. Along with the lockdown to stem the spread of the pandemic, the economy has plunged into the abyss.

The resulting deficit could require $40 billion of external financing—provided the government implements the usual free market “reforms,” privatisations and above all the slashing of public sector wages and benefits.

The closing of Iraq’s borders and curbs on internal travel have also stopped the flow of religious tourists to the holy Shi’ite cities of Najaf, Karbala and Samarra, leading to the loss of 4,000 jobs in the hospitality sector in Najaf alone.

Some 60 percent of regular fulltime jobs are in the public sector and allocated on the basis of Iraq’s sectarian political system. Just 10 percent of private sector jobs provide regular employment, while the remaining 90 percent are casual day work that require two such “jobs” to put food on the table.

Iraq’s population is young—more than 60 percent of the population are under 24—and most young people are without regular work as jobs depend on family connections and the ability to bribe officials. Seventeen years after the US war to topple Saddam Hussein, Iraqis are worse off than they have ever been.

The government has been forced to announce a paltry one-off grant of $25 to those who have lost their income as a result of the lockdown. It eased the lockdown restrictions for the holy month of Ramadan, even though the rate of new infections has grown and the risks of asymptomatic cases and untested infected persons spreading the disease remain.

Last week, the federal government in Baghdad stopped all payments to the Kurdistan Regional Government (KRG) in Erbil, which depends on central government for about 42 percent of its income. The KRG is already in arrears in paying its public sector workers, prompting a walk out by doctors and health care workers. Compounding the KRG’s problems is the sanctioning of Rosneft Trading (RTSA), one of its main oil shippers, by the US Treasury due to its dealings with Venezuela.

While the protests may have subsided, the economic repercussions of the pandemic threaten to ignite a far broader political upheaval.

There has also been an increase in the number of attacks by Islamic State in Iraq and Syria (ISIS) in Diyala province, which borders Iran, and in the KRG. Pro-Washington sources have tried to imply that Iran is helping ISIS, saying that weaponry of Iranian origin—most likely left behind by PMU units fleeing the area—had been found. On Wednesday, three rockets hit Baghdad near the airport, assumed to be targeted at the counter-terrorism service’s headquarters where US troops are based.

American commanders openly acknowledge that they now see the Shia militias that defeated ISIS with assistance from Iran as their principal enemy. Just as Washington is backing al-Qaeda-linked militias in Syria, it may well begin lending support to ISIS in Iraq in order to better divide and rule the country, while preparing for a direct military confrontation with Iran.

Modi eases lockdown restrictions even as COVID-19 cases surge across India

Wasantha Rupasinghe

Egged on by big business, India’s far-right Bharatiya Janata Party (BJP) government is pressing to “reopen” the economy so that sweatshop exploitation of the working class can resume at full throttle, even as the number of COVID-19 cases is surging.

Prime Minister Narendra Modi announced May 1 that India’s 40-day lockdown, which was set to end May 3, would be extended a further two weeks till May 17. However, he also vowed that there would be a further “easing of restrictions” across much of the country, so as to allow the resumption of much of commerce and industry. Modi justified his promised “gradual easing” by cynically invoking the plight of India’s workers and toilers—tens of millions of whom have lost their jobs and all income—and by touting the claim that the lockdown has proven largely successful in checking the spread of the virus.

In reality, the situation remains perilous. COVID-19 cases and deaths are surging overall, and there are a number of major local outbreaks, including in the slums of Mumbai, any of which could rapidly lead to a catastrophic loss of life, due to the comprised health of India’s malnourished poor, the country’s densely populated slums, and its ramshackle public health system.

Stranded students from various districts wait for transport to travel to their hometowns in Prayagraj, India, Tuesday, April 28, 2020. (AP Photo/Rajesh Kumar Singh)

Between May 1 and 6, confirmed COVID-19 cases rose by more than 15,000, from 37,257 to 52,987, while deaths jumped from 1,223 to 1,785 an increase of 45 percent.

These figures, it need be emphasized, gravely underestimate the true spread of the highly contagious virus, since India from the beginning of the pandemic has severely rationed COVID-19 tests. In a country of 1.37 billion people, India has conducted little more than 1 million tests. In per capita terms, India, according to statista.com, had performed as of yesterday, just 984 tests per million inhabitants, only a tiny fraction of the per capita tests administered by all other countries with more than 50,000 confirmed coronavirus cases. On a per capita basis, Turkey has performed 14 times more tests than India, the US more than 24 times and Germany 32 times.

The government’s push to reopen the economy, coupled with its failure to mobilize society’s resources, beginning with the assets of the tiny strata of rich and super-rich who monopolize India’s wealth, to provide essentials to working people during the lockdown and strengthen the country’s health system, all but ensure that the current upswing in COVID-19 infections and deaths will tragically prove to be only the proverbial tip of the iceberg.

Under the new phase in India’s lockdown, travel by air, rail, bus, and urban subway systems, and between states is to resume. Educational institutions are to remain closed.

As part of its preparations to “reopen” the economy, the government has divided the country’s 733 districts into three zones, depending on their supposed exposure to the virus.

130 districts have been labelled “hotspots” or part of the “Red Zone,” because they have high rates of COVID-19 infections.

The Orange Zone is currently comprised of 284 districts where the government claims “no cases have been detected for a fortnight.” However, the accuracy of such claims is in serious doubt, given the low-level of testing.

319 districts with “no fresh COVID-19 cases for 21 days” comprise the “Green Zone.”

The movement of taxis and rickshaws at 50 percent capacity is to be allowed in the orange and green zones, but prohibited in red zone districts

However, even in the so-called red zone, much of industry, especially important exporters, are already allowed to operate. Those exempt from the lockdown include companies in Special Economic Zones, industrial estates/townships, IT hardware manufacturers, the jute industry, and manufacturers of packaging materials.

Government propaganda claims that only employers that follow strict social distancing and other “safety guidelines” will be allowed to operate. But India’s employers, with the full complicity of the central and states government, are notorious for their wanton disregard for occupational health and safety regulations.

Underscoring how the corporate elite prioritizes profits over workers’ lives, India records a high number of industrial accidents and workplace fatalities in “normal times.” According to a study by the Indian Institute of Technology (IIT), around 48,000 people die at work in India every year.

Yesterday, eleven people were killed and 350 hospitalized as the result of a chemical-plant gas leak in Visakhapatnam, an industrial center in Andhra Pradesh. The plant was in the process of resuming production after the lockdown.

On Sunday, Modi congratulated and saluted frontline healthcare workers, who he dubbed the “corona-warriors”. While hundreds of doctors and other medical personnel have gotten sick as a result of the lack of personal protective equipment (PPE) and hospitals are crippled by the lack of equipment and personnel, Modi sent Indian Air Force combat jets and transport aircraft over various state capitals to drop flower petals on hospitals treating COVID-19 patients.

The government’s attitude to the country’s workers and toilers is exemplified by its callous treatment of tens of millions of migrant workers and other day-labourers who have been provided, at most, with starvation-ration relief during the lockdown.

Before being herded into crowded, makeshift internal refugee camps by the police, millions of migrant workers, rendered jobless and often homeless by the government’s ill-prepared and sudden March 24 lockdown announcement, attempted to return to their native villages on foot walking hundreds of kilometers.

On April 2, police found fourteen migrant laborers travelling over 1,200 km from Nashik to Lucknow in the belly of a cement-mixer truck. A shocking video that quickly went viral showed several workers emerging from inside the mixer, clutching bags and small bundles of their belongings to their chests, after police stopped the vehicle on suspicion.

Less than two weeks into lockdown, the Right to Food Campaign reported that at least 270 people had already died due to hunger, exhaustion, state violence, suicide prompted by the loss of all income, and inability to access healthcare.

Millions of migrant workers are now stuck in crowded camps, hundreds of kilometers away from their homes, without money or resources to purchase the most basic of necessities.

The filthy and cramped camps resemble India's notorious jails, with security officials harassing the migrant workers, while state authorities largely leave it to NGOs and other charities to provide them with food.

Facing increasingly vocal opposition from the migrant workers, the BJP government announced on May 1 that trains would be arranged to send the workers home. However, it soon emerged that the workers will have to pay their own fare, which for many is an impossibility. The state government in Kerala, which is led by the Stalinist Communist Party of India (Marxist), has, for example, asked poor workers to pay the base fare of 875 rupees for being ferried to Jharkhand, India Today reported.

Going home will not end their misery. A report published last week by volunteer group Stranded Workers Action Network (Swan) based on distress calls from 16,863 migrant workers, said that 64 percent had less than 100 rupees (about US $1.30). 99 percent of those who were self-employed said they had no earnings during the lockdown period, while 78 percent of those who worked for wages had not received any pay.

Russian COVID-19 cases rise, as 750,000 join unemployment rolls

Andrea Peters

As coronavirus infections continue to rise in Russia and the country’s economic crisis deepens, political disaffection with the government of President Vladimir Putin is growing. On Thursday, the country witnessed its largest one-day increase in diagnosed cases—more than 11,000—bringing the total number of infected to well over 177,000. Recently released data show that joblessness is surging, as popular support for the Kremlin falls to new lows.

Three top government officials—the prime minister, the minister of culture, and the minister of construction—have contracted COVID-19. Outbreaks have also taken hold in Russian orthodox churches and monasteries, where religious leaders falsely claimed that clergymen and parishioners were safe from the disease. On Thursday, Russian mining tycoon Dmitri Bosov, who had a net worth of $1.1 billion, killed himself with a gunshot wound to the head. While his motives remain unclear, an associate close to the oligarch said that recently he began selling off assets, possibly gripped by anxieties over the pandemic and its consequences even as he faced a series of legal challenges to his business operations.

At the Chayanda oil field in Yakutia, over one-third of the 10,500 workers on site have now tested positive for COVID-19, according to the federal Russian Health Ministry. Last week, protests erupted at the Gazprom-run facility, with employees charging management with transforming the workplace into a hotspot by quarantining ill and healthy workers together. The company failed to provide adequate food, masks, protective gear or medical care. Some 8,500 workers have now been evacuated from the oil field, with those remaining required to continue production.

A woman wearing a face mask to protect against coronavirus walks past a graffiti dedicated to the victory of the Soviet Union in the World War II, in St.Petersburg, Russia, Monday, May 4, 2020. (AP Photo/Dmitri Lovetsky)

The head of Russia’s atomic energy corporation, Aleksei Likhachev, has also warned that the country’s “nuclear cities,” centers of the industry that were once closed to outsiders, are unable to secure the health of their workforces. The situation in Sarov, Elektrostal, and Desnogorsk is “particularly alarming,” he warned, due to a lack of personal protective equipment (PPE) and ventilators.

In Moscow, the epicenter of Russia’s outbreak, Mayor Sergei Sobyanin reported that there are more than 92,000 official cases, but the real number is likely close to 300,000. Nonetheless, on May 12, the city will reopen industry, manufacturing, and construction, with thousands of workers sent back to their jobs, even as the Sobyanin’s administration tightens other restrictions for the general population.

Medical workers continue to suffer high infection and death rates in Russia, as in other parts of the world. The head physician of one of Moscow’s main clinics died this week due to the virus. Entire hospitals in Saint Petersburg, Moscow, and other cities have been sealed off because of COVID-19 outbreaks among staff and patients. Three doctors involved in fighting the pandemic fell from windows over the last two weeks. Social media posts reveal that health care personnel who complain about the dearth of PPE and other basic resources are threatened with firing.

Despite the unrelenting toll of the disease, the government has unveiled a multi-phased reopening plan for the country as a whole, with the process initiating in some areas this coming Tuesday. It is based on the same profit-driven calculations behind similar moves in countries around the world.

The Bank of Russia estimated late this week that due to the six-week-long shutdown of the economy, Russian gross domestic product has contracted by 1.5 to 2 percent.

Joblessness in Russia has risen to 1.234 million, with an additional 735,000 joining the unemployment rolls just during the period from March to April 2020. Minister of Labor and Social Welfare Anton Kotyakov said Thursday that the real number is likely 3.7 million. It is expected to rise to somewhere between 5 and 6 million by the end of the year. Just 1.8 billion rubles ($24.3 million) has been allocated to fund the additional demand for unemployment benefits. Recipients receive less than $150 a month in support.

In an interview with the online press Gazeta.ru, the pro-rector of the Academy of Finance of the Russian State, Aleksandr Safonov, said that the prediction of 5 million unemployed by the end of 2020 is the “optimistic” scenario. He further stated that the unfolding collapse in earnings will exceed that experienced by ordinary Russians in the 1990s, when capitalism was restored, or the 2008-2009 global economic crisis. Safonov further pointed out that while in the immediate aftermath of the dissolution of the USSR some free social services remained for a period of time—such as day care, for instance—these have since been privatized or monetized. The fall in incomes will have an even more devastating impact than previously experienced.

Echoing the position taken previously by other government officials, Russian Finance Minister Anton Siluanov said this week that the government could not make direct payments to the population. If the Russian ruble served as a world reserve currency, Siluanov said the state could shower money as if from a “helicopter,” but without this it could only help a limited number of particularly needy people. And while the finance minister insisted that the government’s “social obligations, of course, will be completely fulfilled,” he stated that the time frame for moving forward with a whole series of “national projects,” much-vaunted by the Kremlin as a sign of Russian economic prowess and commitment to social wellbeing, will be extended.

Support for the Putin government is eroding, as the coronavirus pandemic exposes the rot in every sector of Russian economic and political life. The Russian president’s approval rating, according to the Levada Center, has fallen to 59 percent, a historic low. The polling agency reports that 33 percent of the population actively disapprove of Putin’s administration. Kremlin spokesman Dmitri Peskov was quick to reject the accuracy of the data and insisted that popular support for Putin remains high. However, the release of Levada Center’s numbers follows on the heels of data put out by the official polling agency VTsIOM, which show that only 28 percent of people have trust in the government.

Trump vetoes war powers resolution on Iran

Bill Van Auken

The United States Senate Thursday fell well short of the two-thirds majority needed to override President Donald Trump’s veto of a war powers resolution that purported to limit his authority to wage aggressive war against Iran.

Forty-nine senators voted against the veto and 44 to sustain it. Seven Republicans joined Democrats in voting to override the president’s actions. This was similar to the lineup in the February Senate vote to pass the resolution, when eight Republicans joined Democrats in supporting it.

While the legislation was passed by the Senate in February and the House in March, it took nearly two months to get to the White House because of the coronavirus pandemic.

President Donald Trump addresses the nation from the White House. (AP Photo/Evan Vucci)

The legislation was introduced in the wake of the criminal January 3 drone missile assassination of Gen. Qassem Suleimani, one of Iran’s most senior leaders, shortly after he arrived at Baghdad international airport on a diplomatic mission to meet with then Iraqi Prime Minister Adel Abdul Mahdi. A top leader of Iraq’s Shia militia movement, part of the country’s armed forces, was also killed in the attack, along with several other Iranians and Iraqis.

Senate Majority Leader Mitch McConnell defended Trump’s veto in remarks delivered on the Senate floor Thursday, calling the war powers resolution “misguided” and defending the assassination of the Iranian leader, “We must maintain the measure of deterrence we restored with the decisive strike on Suleimani.”

Democratic Senator Tim Kaine of Virginia, one of the principal sponsors of the legislation, used his own remarks to insist that the measure was “not part of a strategy to hurt President Trump.” He added, “I’ve advocated these same positions as have other members of this body under presidents who were both Democratic and Republican.”

For his part, Trump issued two statements, one a formal presidential veto message and the other a crudely political statement issued from the Pentagon in which he described the bill as a “very insulting resolution, introduced by Democrats as part of a strategy to win an election on November 3 by dividing the Republican Party.” He accused the eight Republicans who voted in favor of the measure of having “played right into their hands.”

He continued by insisting that the resolution was unnecessary, declaring that the US “not engaged in the use of force against Iran.” He indicated that the assassination of Suleimani in Iraq followed by Iranian missile strikes on US bases in Iraq, in which no American personnel were killed, had ended the matter. As for the assassination, he claimed it “was fully authorized by law, including by the Authorization for Use of Military Force Against Iraq Resolution of 2002 and Article II of the Constitution.”

He criticized the war powers resolution for implying that the US president’s right to launch a war without congressional approval was limited to the defense of the United States and its military against “imminent attack.”

“That is incorrect,” he wrote. “We live in a hostile world of evolving threats, and the Constitution recognizes that the President must be able to anticipate our adversaries’ next moves and take swift and decisive action in response.”

In other words, he claimed that the US Constitution recognized the right of an American president to wage preventive, i.e., aggressive war, a war crime under international law. What precise language in the US Constitution authorizes such criminal actions, Trump did not say.

In the separate formal statement addressed to the Senate, Trump said that the resolution was “unnecessary and dangerous,” adding that its apparent aim was to prevent an escalation of conflict with Iran. “Yet no such escalation has occurred over the past 4 months, contrary to the often dire and confident predictions of many,” the statement said.

Trump’s assertion of the essentially unrestricted right of the president to wage war when and how he pleases, regardless of constitutional limitations or popular sentiment, is hardly an innovation. His predecessor, Democrat Barack Obama, asserted the same right in relation to the US-NATO war for regime change in Libya in 2011.

The latest resolution on Iran, which is founded upon the War Powers Resolution passed by Congress in 1973 after the US withdrawal from Vietnam and over the veto of then-President Richard Nixon, was largely toothless in terms of restraining presidential power.

It called for the US president to end armed conflict with Iran absent a declaration of war or authorization for the use of military force approved by Congress. It included a provision, however, ensuring the president the power to carry out military action in the face of an “imminent attack” without such approval.

Given that the initial defense of the US assassination of Suleimani was based on the phony claim that it was designed to forestall just such an “imminent attack,” the resolution provided a deliberately designed escape clause to assure that unlimited power to launch military aggression would remain in the hands of the White House.

The Trump administration later backed off of the claim that the murder of Suleimani was aimed at preempting any imminent attack on US forces, acknowledging that the killing had been designed to curb Iran’s “malign activity” in the Middle East, i.e., its interference in Washington’s imposition of undisputed hegemony in the region. Suleimani was killed as he was attempting to negotiate an easing of tensions between Iran and the Saudi monarchy, thereby threatening the anti-Iranian axis built up around the Saudis and other Gulf oil sheikdoms along with Israel.

Just two days before Trump’s veto of the Iran war powers resolution, an overwhelming bipartisan majority of 387 members of the House of Representatives issued a letter to the US State Department calling for the use of “robust diplomacy” to force an extension of an arms embargo against Iran that is supposed to expire in October as part of the 2015 Joint Comprehensive Plan of Action (JCPOA), the nuclear deal concluded between Tehran and the major powers.

The lifting of sanctions against Iran was offered under the agreement in exchange for Tehran drastically curtailing its nuclear program. The Trump administration abrogated the agreement in May 2018 imposing a series of increasingly punishing unilateral sanctions under a “maximum pressure” campaign that is tantamount to a state of war.

While Washington’s thuggish secretary of state, Michael Pompeo, has threatened to invoke the “snapback” of previously existing UN sanctions in order to maintain the embargo, Washington has no standing to do so having broken the nuclear deal. It may pressure its erstwhile European allies to pursue a continued embargo, but it is virtually certain that China and Russia, both signatories to the agreement, would veto such a maneuver.

The bipartisan congressional group calling for increased US pressure against Iran is led by House Foreign Affairs Committee Chairman Eliot Engel of New York. Its action underscores the support of both the Democratic and Republican parties for the campaign of US aggression against Iran.

Washington has steadily tightened US economic sanctions against Iran under conditions in which the country has faced one of the highest mortality rates in the world from the coronavirus pandemic, with over 103,000 confirmed cases as of Thursday and nearly 6,500 deaths. The sanctions regime has prevented Tehran from importing essential medicine and medical supplies needed to fight the pandemic and provide adequate health care, leading to thousands of unnecessary and preventable deaths.

The deadly pandemic is seen by Washington as another useful weapon of war in its protracted campaign to force the Iranian people into submission and effect regime change in the oil-rich and geostrategically important country.

German government ends lockdown, putting hundreds of thousands of lives at risk

Johannes Stern

Three weeks after the decision of the federal and state governments to gradually withdraw the coronavirus restrictions imposed in March, the end of the lockdown in Germany has largely been completed. This was announced by Chancellor Angela Merkel (Christian Democratic Union, CDU), Bavarian Prime Minister Markus Söder (Christian Social Union, CSU) and Hamburg Mayor Peter Tschentscher (Social Democratic Party, SPD) at a press conference on Wednesday.

“The current situation makes it possible to make further openings,” Merkel began her remarks. “We have passed the first phase of the pandemic.” Then, together with the representatives of the different states of Germany, she announced a veritable orgy of business reopenings, which will provoke a massive spread of COVID-19 and puts the health and lives of hundreds of thousands at risk.

First of all, the social contact restrictions that have been in place until now will be softened. From now on, members of two households will again be allowed to meet—for example, two couples, two families or members of two shared flats. The restrictions for hospitals, nursing homes and institutions for the disabled will also be relaxed. According to this, each patient or resident will be allowed to be visited by a particular person on a recurring basis.

Merkel and Söder at the press conference on 6 May (AP Photo/Michael Sohn, pool)

“Shops can now open without restriction,” Merkel announced further. Previously existing restrictions, such as the limitation of the sales area to 800 square meters, will thus be dropped. The soccer Bundesliga is also to “resume playing in the second half of May” and training operations in popular and recreational sports in the open air are to be permitted again.

Relaxation is also planned in numerous other areas. The federal states have already “prepared concepts for which this is increasingly possible,” Merkel said. She mentioned the “expansion of emergency care for children,” i.e., the gradual opening of day care centres, and concepts being developed for “theatres, concert halls and cinemas.” All in all, she said, there had been a “very constructive discussion” with the prime ministers of the federal states.

There is now a real competition between the federal states as to who opens up which areas first and goes the furthest. Already on Tuesday, Bavaria, Mecklenburg-Western Pomerania and Hesse announced comprehensive plans for “a return to normal operation” in schools and day care centres. Yesterday, Söder announced that Bavarian beer gardens would open soon. In Berlin, the SPD-Left Party-Green Senate (“red-red-green”) wants restaurants and cafés to reopen as early as next week. And in Hesse, too, the CDU/Green state government plans to reopen restaurants, hotels and campsites this month.

A key objective of the measures is to boost the economy and revitalise industry. “We have not imposed any bans in large parts of the economy,” Merkel stressed. In other countries, large parts of production have been shut down. Germany is following a “very open and courageous path.” Merkel did not explain what this “courageous path” meant for the health of workers and their families. Over the past few weeks, hundreds have become infected with COVID-19 in individual factories.

As in previous weeks, Merkel combined her announcements with appeals to the population to continue to exercise “caution” and not to endanger the “successes.” “We want to prevent infections from spreading quickly,” the chancellor explained at the press conference. In view of the federal government’s policy, this can only be described as cynical and criminal. It is already becoming apparent that the loosening of the containment measures that have been adopted will lead to a renewed spread of the virus.

According to official figures from the Robert Koch Institute, there were 679 new infections on May 4; May 5, 685; May 6, 947; May 7, 1,284. The number of deaths is also increasing. There were 43 deaths on May 4; May 5, 139; May 6, 165. According to Johns Hopkins University in the US, the number of deaths even rose by 282 on Wednesday, to a total of 7,275. The number of infected persons reached 168,162, of which 23,191 cases are active. In the clinics the situation remains dramatic despite the official propaganda. At present, 1,937 COVID-19 patients are being treated in intensive care, 69 percent of whom are on ventilators.

The pandemic is also spreading internationally. On Wednesday, the number of infections in the US rose again by more than 25,000 to over 1.26 million, of which more than 975,000 cases are active. In Europe there are over 794,000 active cases, out of a total of over 1.5 million infected persons. Almost 31,000 new cases were added on Wednesday alone, most of them in Russia (10,559), the UK (6,111) and France (3,640). Across Europe, over 2,500 people again succumbed to the corona virus, bringing the total number of deaths to 146,631.

The government’s assertion that it can control the occurrence of infections in Germany under these conditions and intervene “if regional centres of infection occur” (Merkel) is absurd. Its main purpose is to divert attention from the deadly logic of the course taken. With its policy of loosening up, it risks provoking a situation like that in Italy and the US, where the health systems are collapsing due to rapidly increasing numbers of cases and tens of thousands have already died under terrible conditions.

Like President Trump in the US, the ruling class in Germany is waging a downright war against society and is prepared, if necessary, to sacrifice hundreds of thousands of lives for its interests. From the very beginning it has seen the coronavirus crisis as an opportunity to intensify its class war agenda and to transfer hundreds of billions into the pockets of the big corporations and their shareholders. For social and medical care and protection of the population, meanwhile, there is almost nothing.

The gigantic sums of money that were mainly given to the financial elite in the corona emergency package in Germany are now to be squeezed out of the working class again. Hence the aggressive “back to work” offensive, which is being organised by all parties in the Bundestag (German federal parliament) and the trade unions. Another factor is the geostrategic and economic interests of German imperialism, which is seeking to outdo its international rivals and is massively arming itself and looking for new markets and cheap labour.

“Several staffs in the Ministry of Economics, supported by a hundred consultants, are devoting themselves to the period after the crisis: Initial scenarios are being developed as to how Germany could lead the way in a global race to catch up,” Der Spiegel had already reported at the beginning of April. “In public,” government officials “don’t want to talk about it yet … but internally they see the chance to finally get rid of all the paralysing factors.” What this means is now becoming fully visible: the “paralysing factor” is not only the social rights of workers, but also their very existence.

The working class can only counter the existential threat posed by the pandemic and the ruling class policies through its own independent programme. The assets of the super-rich must be confiscated and used to fight the pandemic and overcome the social and economic consequences of the lockdown. The big companies and banks must be placed under the democratic control of the workers. Capitalism, which means social impoverishment and death for the majority of the population, must be replaced by a socialist society.