Nearly 10 million US jobs lost one year after start of the pandemic

Shannon Jones

With the one-year anniversary since the start of the economic crisis triggered by the coronavirus pandemic fast approaching, new claims for unemployment benefits continued for yet another week at the historically unprecedented level of over 700,000.

Meanwhile, new infections and deaths remain at alarming levels while uncoordinated and incompetent vaccine rollouts leave the vast majority of populations unprotected even as governments absurdly talk of a return to “normalcy.”

People wait in line for help with unemployment benefits at the One-Stop Career Center in Las Vegas in May 2020. (AP)

The US economy has recovered only a little over one-half of the 22 million jobs lost during the pandemic. The official unemployment rate is 6.2 percent, but the real rate is closer to 10 percent when the 4 million people who have dropped out of the labor force, so-called discouraged workers, are counted. There are still over 20 million workers receiving jobless relief of some kind, including 4 million receiving traditional state unemployment benefits and others on emergency pandemic aid authorized by Congress.

New claims for unemployment benefits fell to 712,000 for the week ending March 6, a drop of 42,000 from the previous week, but still a very high number compared to a typical week in 2019 when between 200,000 and 300,000 would apply.

For the past year new weekly unemployment claims have exceeded the high point of the Great Recession of 2008–2009. In addition, there were also 478,000 new claims for Pandemic Unemployment Assistance for the week, a increase of 42,000 over the previous week. PUA was an emergency program enacted by Congress to help the self-employed and others not covered by regular state unemployment benefits.

While 379,000 new jobs were added in February, most of these were in the low-wage leisure and hospitality sector, reflecting the reckless reopening policy of the ruling class. Other sectors such as education and construction showed continued declines.

The weekly unemployment claims report came just as President Biden signed into law the coronavirus relief bill, which calls for an additional $300 per person weekly supplement to unemployment benefits and a one-time $1,400 payment to most US residents.

The weekly supplement is only one-half the amount enacted under the Trump administration in March of last year and $100 less than the $400 initially proposed by the Democrats. The much-heralded gradual rise of the federal minimum wage to $15 an hour got stripped out of the relief bill when Democrats capitulated to a procedural challenge.

Even when one figures in the exemption Congress gave to tax payments on the first $10,200 of unemployment benefits and an expanded child tax credit, the COVID relief provided by Congress is far from adequate to make good the devastating impact of the COVID-19 pandemic.

While the stimulus is being presented as a social reform of grand and unprecedented scope, most provisions are limited to less than one year. The pandemic relief package is aimed primarily at preventing a complete collapse in consumer spending and bankruptcy of state and local governments while the Biden administration pursues its deadly reopening agenda. This involves forcing workers back into unsafe factories with the help of the unions while forcing the reopening of schools, a measure that will facilitate the spread of the virus under conditions where new, more deadly variants are emerging.

Eventually the stimulus money will have to be repaid to Wall Street through an assault on the working class of unprecedented savagery, of which the Trump administration was only a foretaste. Indeed there are clear indications that the pandemic is already being used by corporations to restructure, continuing the elimination of relatively well-paid jobs and their replacement with low-wage and contingent employment.

The inadequacy of the stimulus package becomes evident when it is seen in the context of the raging social crisis that has been intensified by the pandemic.

In Nevada, one of the states hit hardest by the economic collapse, which devastated the state’s casino gambling industry, 45 percent of residents are behind on basic bills. The statewide unemployment rate hit 30.1 percent last April, the highest for any state on record for at least the last 44 years. It still stands at 9.2 percent.

A 32-year-old waitress from Las Vegas quoted by the New York Times reported, “I feel pretty scared every day, right now, whenever I think about my bills,” adding, “Basically every morning I wake up thinking about where my help is going to come from—is it here? Is it the government? I don’t really know who is looking out for people like me.”

Another woman told the Times, “Every morning I wake up thinking about where my help is going to come from.”

Larry Scott, the chief operating officer for Three Square Food Bank, the largest in Southern Nevada, told the Times, “Stimulus money shortens the line for food from a food pantry and when it evaporates, the lines get longer again.

“We’re going to have a protracted, long, long recovery here. What the politicians should be concentrating on is more than a short-term solution. Rather than a lot of money at a short time, we should have more money over a longer period of time.”

On March 9, hunger relief organization Feeding America released its initial projections for food insecurity in 2021. Despite various inadequate federal relief programs, the situation for tens of millions of US citizens, including children, remains dire. The organization projects that 42 million people, including 13 million children, that is one out of every six, will experience food insecurity in 2021. Included in that number are 15 million people and 4 million children who could experience reduced food intake and the disruption of eating patterns.

Pointing to the extended nature of the economic crisis, the report noted, “After the Great Recession of 2007, it took 10 years for food insecurity levels to recover to pre-Recession levels. It is likely to take time for food insecurity levels to recover from this recession as well.”

According to US Census Bureau data some 10 million people in the US were behind in their rent and at risk of eviction in the middle of January. An estimated 16 million renters had little to no confidence they could pay rent in February. According to Moody’s Analytics, nearly 12 million renters would have owed an average of $5,850 in back rent as of this past January, over 4 times the $1,400 one-time stimulus payment being issued by the government.

Approximately 1 in 5 renters said they were behind in their rent in January, according to an analysis by the Center on Budget Policies and Priorities, and some 36 percent of black renters say they are behind. However, the recently signed stimulus bill does not extend the federal ban on evictions, which is set to expire at the end of March.

While the stimulus package contained another $25 billion in rental assistance, it is not enough. According to the National Low Income Housing Coalition, renters owed as much as $70 billion in back rent through the end of December.

Businessman launches Hindu-supremacist Bharatiya Janata Party in Sri Lanka

V. Gnana

A press conference held in the Jaffna Media Center on Saturday, March 6, announced the formation of the “Sri Lanka Bharatiya Janata Party” (SLBJP), a party aiming to work with India’s violently anti-communist and anti-Muslim, Hindu-supremacist Bharatiya Janata Party (BJP).

Video still from SLBJP press conference (source: SLBJP)

This party was formed amid growing class tensions as the bourgeoisie pursues a herd immunity policy on the COVID-19 pandemic and geopolitical tensions in the Indian Ocean region between China and Washington’s main regional ally, India. India and China are waging a fierce struggle for economic and strategic influence in Sri Lanka. The formation of this party is a warning that factions within the Sri Lankan bourgeoisie are preparing an escalation of communal and political violence aimed at the working class.

The SLBJP was formed after the Indian government called for the formation of precisely such a party. In February, Tripura Chief Minister, Biplab Deb said Indian Home Minister Amit Shah would form BJP governments not only in India but also in neighboring countries like Sri Lanka and Nepal. He also said that the BJP would back attempts by its Sri Lankan supporters to found a BJP in Sri Lanka. His remarks drew condemnation from ruling circles in Nepal and Sri Lanka.

This weekend, there was no founding conference or founding statements issued, but the March 6 press conference announced that the SLBJP is led by Colombo-based businessman V. Muthusamy. Its secretary is M. Indrajith and its treasurer V. Dilan. Until yesterday, they were politically little known to the public.

At the 27-minute press conference announcing the formation of the party, not a word was said about the Indian or Sri Lankan governments’ malign neglect of the spread of the coronavirus or about the military regime that Sri Lankan President Gotabhaya Rajapakse is building. Rather, Muthusamy pointed to the explosive political crisis emerging in Sri Lanka. Tamil nationalist parties that have closely worked with the Sri Lankan regime in Colombo have been discredited by their complicity in supporting herd immunity, austerity and police-state policies.

Muthusamy demagogically asserted that his party aims to fill the political void left by the crisis of the Tamil nationalist parties. He said, “There are many parties representing the Tamil people in Sri Lanka. However, they deny the fundamental rights of the Tamil people. At the same time, they act with their personal interests in mind. That is why among the Tamil people, these parties are unable to survive. We are launching this for the educational development of Tamil students and to promote the sports sector. I think we can start in Jaffna.”

He added that “a political party is needed” to speak directly with the Sri Lankan government about issues in the SLBJP’s program. “I can meet with anyone on behalf of that party,” he said.

Several journalists at the conference asked why Muthusamy would use the name of a party already established in a neighboring country.

These questions followed warnings from Sri Lankan officials against founding the BJP in Sri Lanka. Before the SLBJP’s launch, Nimal Punchihewa, chairman of the Sri Lanka Electoral Commission, had already responded to Deb’s comments on founding the BJP in Sri Lanka by warning that such a party would be illegal, “Any Sri Lankan political party or group is allowed to have external relations with any party or group abroad. But our electoral laws do not allow foreign political parties to operate here.”

Muthusamy and Indrajith responded to reporters’ questions at the interview by trying to maintain the ludicrous pretense that Sri Lanka’s BJP has nothing to do with India’s BJP. However, they also signaled that they have and will maintain close political ties with the Indian government.

They declared that “Indian parties are not new in Sri Lanka. The Congress Party and the Communist Party are also present here.” They added, “We will not betray the nation; we will not fight against the Sri Lankan government on behalf of India. … Service is our goal, not a struggle, and we will not participate in any struggle.”

Muthusamy denied that his initiative to found the SLBJP was in response to Deb’s statement, with the chief minister of Tripura saying, “The report just arrived. We launched this initiative six months ago.”

At the same time, the SLBJP’s founders made clear their acceptance of the BJP’s Hindu-supremacist, anti-working class program, hailing India’s BJP Prime Minister Narendra Modi and refusing to rule out Indian state involvement in their party. Asked what he would do if evidence emerged of future Indian involvement in his party, Muthusamy cynically responded, “Let’s just change the name.”

Asked about his party’s political activities, Indrajith commented, “Initially, I had no intention of getting involved in politics.” While declaring that education and sports were the SLBJP’s priorities, he also hailed Modi and stressed that the SLBJP enjoys the political support of the BJP in India. “Modi’s name is on everyone’s mind,” he said. “The BJP has in no way opposed the creation of a party in the name of the BJP.”

The SLBJP’s founding combines bitter hostility to the working class with close alignment on the intrigues and war threats of Washington and New Delhi against China. It comes after years of mounting class struggles across Sri Lanka, in which Sinhalese, Tamil and Muslim workers joined hands in strikes and protests. Now, as the SLBJP is founded, a strike wave is developing across tea plantation areas in Sri Lanka.

Sri Lankan Tamil nationalists, including Tamil National Party leader K. Shivajilingam and several members of the Tamil National Alliance, previously indicated their support for the founding of the BJP in Sri Lanka. Shivajilingam went so far as to suggest, as he endorsed calls to found a Sri Lankan BJP, that US and Indian troops could then invade and occupy northern Sri Lanka. This points to the close connection between anti-Chinese agitation by the Sri Lankan ruling establishment and its hostility to the working class.

Speaking about the Indian government, Maruthapandi Rameswaran, member of Parliament of the Ceylon Workers’ Congress, recently said, “It is good for you when the government [of India] builds 14,000 houses for you, vaccinates, builds hospitals, gives people gardens. Two or three years ago, they said, ‘we are going to give everything to China.’ Now no such thing will happen.”

In India, at the Tamil Nadu BJP youth conference in Salem, Indian Defense Minister Rajnath Singh warned China, “We will not give up an inch of this land as long as my body is alive.” He also boasted that India built 27,000 new houses for war-affected people and that Modi was the first Indian prime minister to visit Jaffna since 2015. “Prime Minister Narendra Modi will work with dedication to ensure that Tamils in Sri Lanka live in peace, equality and dignity.”

In fact, the BJP has responded to mounting strikes, farmers protests and protests against its anti-Muslim laws with brutal and bloody repression.

US prosecutors declare Honduras a “narco-state”

Andrea Lobo

On Thursday, the former leader of the Honduran drug cartel Los Cachiros, Devis Leonel Rivera Maradiaga, testified before the US District Court for the Southern District of New York that he had bribed three successive Honduran presidents in exchange for protection and government contracts to launder drug proceeds.

Juan Orlando Hernández (Credit: Alan SantosPR)

According to his testimony, the bribes include hundreds of thousands of dollars paid to the current President Juan Orlando Hernández (2015-today) through his siblings, and to his Vice-President Ricardo Álvarez, when he was mayor of Tegucigalpa. He said he paid half a million dollars to President Manuel Zelaya (2006-2009) and carried out several deals with President Porfirio Lobo (2010-2014) during their tenures.

Hernández, Álvarez, Zelaya and Lobo have all published tweets denying any wrongdoing.

Maradiaga had been summoned by US prosecutors to testify in the trial of Geovanny Fuentes, whose partnership with the Cachiros turned into a bloody rivalry around 2013.

Throughout the trial, the prosecution insisted that an alliance with the Hernández administration helped Fuentes’s business to “flourish.”

In his opening statement, prosecutor Jacob Gutwilling said Fuentes “was untouchable, a key part of the Honduran narco-state … who worked with police, military, politicians, including the president, who made millions helping the president traffic cocaine.”

Evidence includes contact information for the current president as well as for Manuel Zelaya and several high-ranking military and police officials on Fuentes’ electronic devices.

The US indictment against Fuentes names Hernández as a “co-conspirator” who received “tens of thousands of dollars” in 2013, when Hernández was president of the Congress and a presidential candidate, in exchange for promises to provide military protection and other assistance.

Hernández allegedly told Fuentes that he wanted to shove drugs “right up the noses of the gringos” and to end the extradition agreement with the United States, the indictment says.

The document also indicates that Fuentes used the president’s brother, “Tony” Hernández, as an intermediary. In 2019, a New York jury found “Tony” Hernández guilty of trafficking cocaine “in large scale” between 2004 and 2016.

The current trial has received major coverage by Honduran and international media outlets, whose reports have often mentioned that, during the 2019 trial, a witness testified that “Tony” Hernández received $1 million from the Sinaloa Cartel leader, Joaquín “Chapo” Guzmán.

While formal charges have not been made public, the open admission by the US Department of Justice that Juan Orlando Hernández leads a “narco-state” not only incriminates the entire government and security forces but constitutes an indictment of the Trump and Obama administrations, which propped up his rule with hundreds of millions of dollars.

Amid the impact of the COVID-19 pandemic and hurricanes Eta and Iota last November, such allegations threaten to light the fuse of mass opposition to the Hernández regime. At the same time, it has been a staple policy of US imperialism to scapegoat selected officials in the region when facing mass social opposition to their right-wing policies.

Last year, unemployment nearly doubled to 11 percent, and official poverty jumped to almost 60 percent. The pandemic is surging, and a streak of drought years is expected to continue. On the other hand, Wall Street and the local oligarchy demand social austerity and a regressive economic adjustment, including to pay back the $3.35 billion in loans requested last year.

A BNAmericas report this week cites Ismael Zepeda of the think-tank Fosdeh, who suggests “the government offer fiscal adjustment, including taxation, rate reforms, and lower education and health spending in the negotiations for an IMF loan in November.” The oligarch Luis Larach cried to the business website, “we have the highest taxes in Central America. The solution is to streamline/slim down the government and stop stealing.”

Presidential elections are scheduled for November 28, and Hernández is not running for re-election. Sitting on a social powder keg, Wall Street and the handful of Honduran multimillionaires and billionaires hope to keep plundering the country by placing corruption and drug allegations at the center of the electoral campaign to cover over social questions. While neck-deep in corruption, Hernández is being thrown to the wolves for this purpose.

This is also the context of Joe Biden administration’s $4 billion plan for the Northern Triangle—Honduras, Guatemala, and El Salvador— supposedly to deal with the roots of mass migration.

The presentation of the plan on the Biden campaign website indicates that its first pillar is “attracting greater private investment—both from international sources and from their citizens being willing to invest at home.” The second pillar is “improving security and the rule of law,” which is followed by “addressing endemic corruption” and “prioritizing poverty reduction and economic development.”

However, the Northern Triangle’s place in global capitalism is as a source of cheap labor and cheap natural resources for US imperialism. Massive poverty to keep wages low, tax incentives, the resulting extreme social inequality, police-state regimes and endemic corruption constitute the basis for attracting greater investments. The social catastrophe today that hundreds of thousands are desperately seeking to escape is the result of more than a century of this imperialist oppression.

Regarding the Maradiaga revelations, it is worth noting that Gen. Julián Pacheco Tinoco (ret.), the country’s security minister since 2015 and the official with the closest ties to Washington, has not been mentioned. During trials in 2017 and 2019, the Cachiros leader had testified that he bribed Pacheco. This can only be interpreted as the US government’s assurance of impunity to the Honduran security forces.

According to The Intercept, Pacheco graduated from courses on counterinsurgency tactics in 1979 and psychological operations in 1986 at the School of the Americas at Fort Benning, Georgia.

Throughout the 1980s, Honduras provided the main base for the Pentagon’s training and arming of the Guatemalan and Salvadoran militaries to repress left-wing guerrillas, and the CIA’s organizing of the terrorist “Contra” forces to overthrow the Sandinista government. As part of these activities, the Reagan administration consistently protected and financed local officials and Contra leaders who were known drug traffickers.

After the dissolution of the USSR in 1991 and the transformation of the guerrillas and Sandinistas into bourgeois parties subordinate to US interests, Washington switched its banner from the “war on Communism” to the “war on drugs” to continue its military presence. Honduras has been key in this campaign, which has been escalated as US imperialism seeks to counter Russian and Chinese influence in the hemisphere.

When Honduran President Manuel Zelaya began to establish closer relations with Hugo Chávez in Venezuela, a close partner of Russia and China, the Honduran military overthrew him in 2009 with the support of the Obama administration. Pacheco, as reported by The Intercept, was the envoy of the Honduran military to Washington D.C. to defend the coup and re-stabilize collaboration.

The coup regime launched a wave of privatizations and social austerity that plunged millions into poverty. It has remained in power through murderous repression and fraudulent elections, while the Obama and Trump administrations have backed it with hundreds of millions of dollars in aid—at least $500 million since 2016, going largely to the military.

This support for a dictatorial regime that speaks for such a venal elite entirely subordinated to Wall Street exposes as ludicrous any claim that the Democratic Party administration has the slightest concern over corruption, democratic rights or the “development” of Honduras or any other country.

Canada’s universities and colleges announce reopenings despite threat of COVID-19 third wave

Talia Brown

Amid the ongoing COVID-19 pandemic and the growing threat of a deadlier third wave, provincial governments across Canada have given the greenlight for the gradual reopening of universities and colleges. This premature and reckless step will contribute to spreading the lethal virus among students and staff on campuses and in the broader community.

At the urging of Quebec’s right-wing CAQ government, which has been at the forefront of the Canadian ruling class’s back-to-work/back-to-school drive, some universities and colleges (CEGEPS) in Canada’s second most populous province began offering in-person learning as early as February 8.

Across Canada, universities are planning to offer “bimodal” learning this fall, which could see up to one hundred students gathered in one classroom, with a hundred more online.

University administrations have seized on the recent decline in daily new COVID-19 cases to around 3,000 per day—a level equal to the peak of the first wave last spring—to make their announcements about a return to in-class learning.

The reopenings represent a serious threat to students and staff members, as underscored by the repeated warnings of scientists and public health officials about the three more contagious and potentially deadlier new COVID-19 variants rapidly spreading across the country. As of March 4, 1649 cases of the variants had been reported in Canada, according to the country’s Public Health Agency. The mingling of hundreds of students and workers on university campuses in the coming weeks, in classes, libraries, cafeterias, fitness centers, and campus residencies will inevitably increase the spread of the virus.

Several outbreaks at privately owned student residence complexes have already occurred over recent weeks and months. For instance, at least 34 cases have recently been identified nearby Fleming College and Trent University, in Peterborough, Ontario. According to University Affairs Canada, there have been outbreaks in three residences at London, Ontario’s Western University since last fall. The university was forced to delay residence move-in for the Winter 2021 term until after reading week, with students returning on a staggered schedule as of February.

Reopening university and college campuses has nothing to do with offering students a better educational experience and learning environment. This hasty and negligent decision is part of a concerted drive to reopen the economy that is aimed at enabling the financial elite and big businesses to churn out more profits at the expense of the working class.

In the case of elementary and secondary schools, which have been open since last summer and have been shown to be a major vector in spreading COVID-19, big business governments were determined to get children back in schools so their parents could be pushed back to their jobs in unsafe working conditions.

A major reason university and college administrations are eager to restart on-campus learning is that this will ensure they can continue to charge students all sorts of fees and make money from residences and ancillary campus services.

The ruling class is only capable of going forward with the reopening of schools and non-essential production thanks to the trade union bureaucracy. The unions have been actively involved in closed door discussions with the federal and provincial governments and big business representatives to orchestrate the schools’ reopening. One of their main functions from the beginning has been to suppress workers’ opposition to the ruling class’s disastrous pandemic response and subordinate them to the very capitalist parties responsible for this catastrophe.

A university professor in Ontario contacted the WSWS and shared their observations of what is happening on campus: “As I was walking around the campus, I was shocked and appalled to see so many students gathered at the cafeteria with no masks, walking worry-free in their residence,” he remarked. “It was strange to see maintenance workers, security employees and the cleaning crew in several buildings. Also, electrician staff members were already starting to install the video equipment for the new teaching delivery, as if nothing was happening with the pandemic. Some workers already contracted the virus in the past months and the campus was completely empty. Imagine once it will fully reopen. Our lives and safety are at stake.”

The professor added: “I feel betrayed by my union for which I paid my dues but does not represent me at all. On the contrary nowadays, university unions only represent the interests of the administration. A grand betrayal.”

The pandemic has intensified the capitalist crisis, increasing social inequality, and impacting mostly working class people, many of whom are forced to work in unsafe workplaces. Teachers and workers on university campuses have not been spared from the ravaging impact of the COVID-19 pandemic.

The university and college administrations view the reopening of campuses as a means of offsetting past and current revenue losses, which are the outcome of decades of austerity and underfunding. Canadian universities are also anticipating huge losses of revenue in coming years due to the pandemic, including a significant drop in student registration, especially among international students.

In an attempt to offset these pressures, universities got the greenlight from governments to receive international students as early as last October, even as experts warned of the dangers related to international travel. In Canada, international students pay approximately five times higher tuition than domestic students and represent a major source of revenue for universities. Tuition fees from international students accounted for over one-third of the tuition fees received by Canadian universities in 2018-2019.

The professor who contacted the WSWS also explained that poorly paid, overworked contract teachers are particularly risking their health. He stressed that the pandemic may be exploited to increase their workload. “There is an abusive instrumentalization of PhD part-time professors teaching undergraduate courses composed of more than 100 students,” he said. “We have,” he added, “an entire cohort of PhD’s struggling to pay their student debt with contracts at universities refusing them social benefits. This situation perpetuates the social determinants of health issues which arise in relation to precarious employment.”

The situation facing teachers and lecturers in Canada is similar to that in the United States and in Australia, where educators are being forced to go back to their classrooms with few safety measures and under increasing stress.

To justify the reopening of schools and universities, governments such as that of Emmanuel Macron in France invoke the pretext of mental health. Macron and the corporate media recently seized on the tragic suicide of one student to justify campuses reopening. In Canada, there is an increasing number of media reports about the isolation and depression felt by students.

While many students may well be experiencing stress and depression, what is required above all is ending the pandemic and the murderous herd immunity policy advocated by all the political parties of the establishment. Students’ mental health will be improved only if the spread of the virus is halted, the economic situation improves and good jobs are available. But in direct opposition to these goals, all measures have been taken to prioritize the profit interests of businesses over workers’ health and lives. Governments have imposed fruitless measures such as short and totally inadequate lockdowns, and systematically disregarded scientific evidence and the warnings of health experts.

The reopening of the economy amid delays in the vaccination campaign is leading to unnecessary and preventable deaths and threatens us with a third wave of the pandemic, even larger and more the lethal than the previous two.

Court ruling in Brazil promotes political rehabilitation of Lula

Miguel Andrade

In a surprise decision Monday, Brazilian Supreme Court (STF) Justice Edson Fachin annulled the two criminal sentences for corruption of former president Luiz Inácio Lula da Silva, popularly known as Lula, which barred him from running for office. Justice Fachin ruled that both cases had to be tried again by the district court based in the capital Brasília, because the 13th district that sentenced him, based in the southern capital of Curitiba, had no jurisdiction over the case.

Former Brazilian President Luiz Inacio Lula da Silva speaks at the Metalworkers Union headquarters in Sao Bernardo do Campo, Sao Paulo state, Brazil, Wednesday, March 10, 2021, after a judge threw out both of his corruption convictions. (AP Photo/Andre Penner)

The corruption cases against Lula stemmed from the famed Carwash (lava jato) corruption probe, which uncovered a massive bribes scheme centered at the state-run oil giant Petrobras. The corruption schemes, involving virtually every Brazilian political party, had been overseen by Lula’s Workers Party (PT) during the period when the PT became the preferred instrument of rule of the Brazilian ruling class. Between 2003 and 2016, the PT won four straight presidential victories, first with Lula’s two terms (2003-2010), and then with the two victories of his handpicked successor, Dilma Rousseff.

This period ended in 2016 with the ouster of the PT’s Rousseff in a fraudulent impeachment carried out by the party’s former accomplices in corruption, then-House member Jair Bolsonaro among them. Exploiting the discrediting of the PT by the pervasive scandals and its austerity drive in face of the country’s economic crisis, they imposed a massive bottom-up redistribution of wealth, imposing a 20-year freeze on public spending and enacting a labor reform provoking massive wage reductions.

Lula was sentenced twice in 2017 and 2018 in interrelated cases of receiving undercover bribes from two key defendants in the investigation, the OAS and Odebrecht construction giants. These bribes allegedly took the form of improvements to a beachfront penthouse and a country estate owned by a political associate and the OAS itself.

In addition to appeals denying wrongdoing, Lula’s defense had filed a habeas petition claiming the charges had no direct connection to the Petrobras scandal being investigated in the Curitiba district, and should be tried elsewhere. This argument was ultimately accepted by Justice Fachin on Monday, clearing the way for Lula’s political comeback.

Doubts remain as to whether Lula can be barred again if new trials in Brasília move quickly enough, or if Fachin’s decision is struck down by the full STF. Those doubts didn’t stop Lula’s rehabilitation making front-page news around the globe and unleashing a torrent of speculation in the international corporate press—enthusiastically exaggerated by the international pseudo-left—that Lula could “save Brazil from Bolsonaro,” who has shocked the world with his sociopathic handling of the COVID-19 pandemic.

From the standpoint of millions of workers confronting the horrors of the pandemic, news of a political alternative to confront Brazil’s social disaster is no doubt anxiously awaited. Bolsonaro now presides over the world epicenter of the pandemic, with an unprecedented catastrophe of over 2,300 deaths a day on top of more than 270,000 deaths thus far in the year-long pandemic. Hospitals are filled to capacity all over the country of 210 million inhabitants. Faced with what scientists and medical experts are describing as a war-like scenario even in the country’s richest state, São Paulo, Bolsonaro has railed against even the mildest and least effective restraints on economic activity decreed by governors and mayors, including the use of masks.

Nonetheless, the attempt to package the tried and tested stooge of finance capital, Lula, leader of a party which, while in government, allied itself with the most reactionary forces in Brazil, including Bolsonaro himself, is, to put it bluntly, politically criminal.

Leading the charge promoting Lula was the foremost voice of “democratic” imperialism, the New York Times, which lionized Lula as a “fiery leftist leader” and proclaimed that Justice Fachin’s decision had “the potential to reshape Brazil’s political future.” But it was the mouthpiece of the pseudo-left imperialist apologists in the US, Jacobin magazine, which offered the most overblown and self-exposing account of Lula’s prospective political return.

The Jacobin report, titled “Lula Is Back — And He Can Save Brazil From Bolsonaro,” did not even stand up to the first public address by Lula himself. The speech delivered Wednesday at the headquarters of the ABC Metalworkers Union, was a pro-business, pro-military profession of faith peppered with platitudes about Bolsonaro’s handling of the pandemic, the need for vaccines, masks and social distancing, along with moral preaching about the need to “look after the poor.” In the most critical moment of the speech, he told his audience, “Do not follow a single one of the president’s or health minister’s moronic decisions. Get vaccinated.”

The Jacobin article doesn’t bother to present any reason why the PT would reverse the policies it carried out in office, which paved the way to the rise of Brazil’s most right-wing government since the 1964-1985 US-backed military dictatorship. Instead, the piece is based entirely on one assumption, that the fall of the Brazilian stock markets on the day of Fachin’s decision was an indication that Lula would carry out anti-capitalist policies. Jacobin states: “It’s telling, though, that Brazil’s stock market fell by 4 percent, and the real slipped to record lows against the dollar following the news of the verdict. Investors apparently were not too worried about the apocalyptic COVID-19 death numbers coming out of Brazil—but the return of Lula led to full-on panic.”

This assumption is entirely false. As Reuters noted in a Tuesday analysis of the market’s reaction to the decision, before Justice Fachin’s ruling, the Brazilian real had registered the third worst performance in the world against the dollar. The São Paulo stock exchange has plunged 20 percent in 2021. The latest shock came with Bolsonaro’s attempts to defuse accelerating inflation by sacking the Petrobras CEO, blaming him for high fuel prices—a move enthusiastically welcomed by the PT and the PT-controlled oil workers union, the FUP.

A more sober and realistic assessment was given by the Financial Times, which quoted Monica de Bolle, a senior fellow at the Peterson Institute in Washington. “What I see happening is a reckoning with the fact that Bolsonaro is a massive threat to institutional stability,” she said. “The calculation thus is: ‘What is least destabilizing?’” That was also the analysis made by Foreign Policy, whose Latin America correspondent Catherine Osborn told the Morning Brief that, after Bolsonaro sacked the Petrobras CEO, “a Lula presidency may be an improvement,” concluding, “I think it’s possible a Lula administration could be more of a ‘rational’ economic actor as far as markets are concerned.”

The Jacobin piece is unable to evade a central issue, that of the push towards dictatorship by the country’s ruling elite, spearheaded by the Rousseff-appointed army commander, Gen. Eduardo Villas Bôas, an enthusiast of Lula’s rearmament program. Jacobin states: “the elephant in the room is how the Brazilian military will respond.” While recalling that Villas Bôas threatened a coup in April 2018 if the STF granted another habeas petition, Jacobin never asks about Lula’s response to such threats. Asking that question would mean debunking the argument in favor of Lula’s potential to “save Brazil” from the current disaster, since the PT is dedicated to chloroforming the working class to the threat of dictatorship.

Lula’s entire three-hour speech and press conference Wednesday was an exercise in deception and lobbying of big business, the armed forces and the police.

Lula began in one of his self-aggrandizing hyperboles, downplayed by his supporters as colorful idiosyncrasies, claiming to be the victim of the “biggest judicial lie in 500 years of history”, i.e., the entire history of Brazil.

He then turned to an overture to the army and police. Lula criticized Bolsonaro’s gun deregulation legislation, stating that the president “is not elected to encourage gun ownership” and that those “who need guns are our Armed Forces, our police, which go into the streets to fight crime with a rusty .38 revolver.”

This ominous declaration in support of a police apparatus that kills 6,000 Brazilians a year was given against the backdrop of a strike threat by police forces against Bolsonaro for his austerity measures, to which the PT congressional caucus responded by claiming Bolsonaro had “betrayed” the police.

Lula proceeded to the national chauvinism that became PT’s stock-in-trade after its poverty relief programs hit a brick wall and social unrest began to grow in 2013 “Brazil was born to be big,” he said adding that, on the PT’s watch, Brazil was “respected by China, Russia, India, Germany, France, England, the United States.”

In criticizing the Petrobras privatization drive, designed to reduce by a third the company’s workforce and to cut costs, Lula ignored the resistance of the oil workers and rambled on in an even more reactionary promotion of national chauvinism, saying that “Germany lost the war [World War II] because it could not get to Baku to get gasoline.” Due to military needs, “every rich country must have a high fuel stockpile,” he continued, charging that Brazil, “a f*ing big country,” is giving away its oil.

In his conclusion, Lula directed himself to big business, telling them: “do not fear me.” He criticized free-market orthodoxy and all but promised generous bailouts for criminal financial interests. Citing the 2008 crisis, he said: “When they go bankrupt, who puts up money to save them? The state! The state they repudiate, the state they destroy.”

In the question-and-answer period, there was an even greater stress on the PT’s chauvinist line. When asked by Al Jazeera about the international impact of his comeback, he rambled on again with delusional arrogance, claiming the Iran nuclear deal brokered by himself and Turkey’s Erdogan in 2010 had been torpedoed to hit Brazil’s prestige, concluding that he would restore Brazil’s international credibility in order to attract back former investors.

As many pundits noted, Lula avoided at all cost mentioning Rousseff or her impeachment, which the PT classifies as a coup whenever it feels the need to shrug off questions about its alliances with those who ousted them, first and foremost Rousseff’s vice-president Michel Temer.

The PT’s policies in relation to the COVID-19 pandemic are just as criminal as those of Bolsonaro, except for the president’s incendiary rhetoric. This has been undeniably substantiated by the collective resignation of the scientific committee serving the PT-run state governments in the opposition strongholds of the country’s Northeast. Led by the world-renowned Brazilian neuroscientist Miguel Nicolelis of Duke University, a decades-old public PT supporter, the scientists resigned in protest on February 19 in the face of the inaction of opposition governors as it became clear that Brazil was heading towards the current pandemic catastrophe.

The PT’s aim is not to save the Brazilian working class, but to rescue Brazilian capitalism from Bolsonaro, whose policies are seen by growing sections of the ruling class as a threat to their interests.

Lula’s political rehabilitation poses immense dangers to Brazilian workers, including the threat of a military coup, which the PT is dedicated to covering up and has no intention of stopping.

The Brazilian working class is growing ever more restive, with more and more spontaneous strikes and demonstrations against the murderous herd immunity policy being pursued by the entire ruling class. The timing of Justice Fachin’s decision, whatever its judicial motivations, serves clear political needs to channel growing opposition back behind the institutions of the capitalist state.

It is of utmost significance that Lula chose the ABC Metalworkers Union’s headquarters as the site for his press conference. While the PT claims that it is a movement that is “returning to its foundations,” the integration of the unions into the state apparatus to discipline the workforce is emerging as a crucial requirement for propping up the rotting capitalist setup. The same tendency has been demonstrated in the US by the unprecedented intervention of President Joe Biden, the foremost official of world imperialism, in favor of the unionization of Amazon.

As the ruling class attempts to rehabilitate Lula and spread political disorientation, it is ever more urgent that the pro-capitalist nature of the Workers Party, its affiliated unions and the pseudo-left groups that orbit the PT be understood by Brazilian workers.

ECB to accelerate supply of ultra-cheap money

Nick Beams

It seems that whatever the state of the economy, the response of central banks is the same: pour more money into the financial system, so that investors and speculators can continue to make vast profits on the basis of ultra-low interest rates.

When the economy is down, more money is needed to stimulate it. If it starts to grow, more money must be supplied to stop interest rates going up and damaging the recovery.

An example of this modus operandi was seen on Thursday, with the decision of the European Central Bank to significantly increase its rate of purchasing bonds, under its €1.85 trillion pandemic emergency program (PEPP).

Christine Lagarde, President of the European Central Bank [Credit: Bernd Hartung/European Central Bank]

In its latest policy statement, delivered by President Christine Lagarde at a press conference, the ECB said “the governing council expects purchases under the PEPP over the next quarter to be conducted at a significantly higher pace than during the first months of the year.”

Lagarde repeated the phrase a number of times when questioned by journalists, and said the decision had been reached “by total consensus,” seeking to dampen any speculation that the easier monetary policy may have been opposed by Germany or other critics.

Lagarde would not be drawn on the actual amount involved in the accelerated purchasing program, but made clear it would be undertaken. “When I tell you that we are moving into action as early as tomorrow, I think that fits the bill,” she said, in response to a question about whether the ECB should be doing more.

Lagarde also made it clear that what she called the ECB’s €1.85 trillion envelope, of which there is around €1 trillion remaining, would be expanded if this were considered necessary. She said it was “very clear” from the ECB statement that if less than the whole envelope was not needed it would be used, but “if, equally, to preserve favourable financing conditions we need to recalibrate the whole envelope, we will do so.”

As in the US, where there is concern about the impact of inflation and rising interest rates in the bond market, the ECB decision was motivated by rising yields in European bond markets.

The ECB statement said “preserving favourable financing conditions” was essential, and noted that “market interest rates have increased since the start of the year, which poses a risk to wider financing conditions.”

Banks used the risk-free rate on bonds as the baseline for setting rates, and “sizable and persistent increases in these market rates,” if left unchecked, “could translate into premature tightening of financial conditions for all sectors of the economy,” it said.

The same issue has arisen in the US, where last month the failure of Fed chair Jerome Powell to specifically address the Fed’s response to a spike in yields, led to a market sell-off. Wall Street has since resumed its upward trajectory after the turbulence in the bond market— resulting from a $68 billion seven-year Treasury bond auction being 40 percent undersubscribed—subsided over the past week.

The impact of the bond market yields on the stock market and, flowing from that, the monetary policy of the major central banks, underscores the way in which economic policy has been completely transformed.

In the past a rise in the bond yield was taken as an indication of economic growth and inflation. Given that the stated policy of both the ECB and the Fed is to encourage growth and lift inflation, to above 2 percent, one might think that such a movement would be welcomed.

But the previous conditions in which that scenario might apply no longer exist. The inflow of money into financial markets from central banks, starting in the wake of the global financial crisis of 2008, and then accelerated in response to the pandemic, has created a mountain of fictitious capital, such that a rapid increase in market rates has the potential to set off a financial crisis.

Hence, there have been calls that even as economic conditions improve, the central banks must intervene and buy up still more bonds to keep yields and interest rates down.

In a speech delivered in the lead up to the ECB meeting, reported by the Financial Times, a member of its executive board, Fabio Panetta, warned that “we are already seeing undesirable contagion from rising US yields … that is inconsistent with our domestic outlook and inimical to our recovery.” Market rates had effectively tightened since December, and this was “unwelcome and must be resisted,” he said.

Panetta’s remarks were widely interpreted as a call for the ECB to engage in so-called yield-curve targeting, in which the central bank intervenes with purchases in the bond market to keep rates on specified bonds at a designated level. This practice, already being carried out in Japan and, to a limited extent, by the Reserve Bank of Australia, is being discussed by the Fed, which has said it is studying the Australian experience.

However, Lagarde, realising it would provoke opposition from Germany and probably other northern European members of the ECB, ruled it out in her press conference.

Asked if the goal of the ECB was to go back to the market rates that had prevailed in December, she responded: “There is no reference to any kind of yield curve control if it is the question you are angling at. We are not doing yield curve control.”

Lagarde insisted that the ECB was preserving favourable conditions with regard to “the inflation outlook that we have.”

The reference to inflation is one of the fictions that surround the ECB’s justification of its policies. They are always presented as if they were directed to achieving the official objective of inflation consistently at or around 2 percent.

In fact, as is widely known both in financial and media circles, its policies have little or nothing to do with targeting inflation, but are directed to maintaining the supply of ultra-cheap money to financial markets.

A question by a Le Monde journalist sought to puncture this fiction. “The problem of course,” he said, “is that you justify your intervention by saying that you needed to increase inflation in the past. If the headline inflation gets to 2 percent what arguments are you going to use to justify your intervention?”

Lagarde’s reply was revealing. “It is quite possible this year, in particular at the end of 2021, inflation actually hits 2 percent. But I will tell you something: we will see through that for a very clear reason, and that is that inflation will most likely go up possibly to 2 percent because of some technical and temporary reasons.”

In other words, if inflation were to reach the ECB’s stated target, it would completely ignore that, in line with its real objective of continuing to shovel money into the hands of the financial oligarchs, which, together with other central banks, it serves.

Australian government promises “cheap flights” to deflect social unrest over mass unemployment and vaccine debacles

Mike Head

Amid a mounting political crisis over its cutting off of wage subsidy and welfare payments, plus its slow and disorganised COVID-19 vaccine program, along with the danger of fresh infection breakouts, the Liberal-National government this week promoted another $1.2 billion handout to the airline companies, supposedly to provide half-price flights to tourism destinations.

An air of desperation hung over Prime Minister Scott Morrison’s announcement on Thursday. It came as he repudiated his previous promises that the entire population of 25 million people would be vaccinated by October, thus throwing into doubt his claims that this would allow a return to “more normal” business, including the lifting of international border restrictions.

Every element of the airline package is misleading. Only an estimated $72 million of the $1.2 billion package will go to subsidising the promised 800,000 lower-priced tickets. The rest will boost the coffers of the airlines, in the hope of preventing them immediately laying off 6,800 more workers, on top of the thousands they have retrenched over the past year.

As well as being placed under pressure by the corporate media over a series of sexual assault allegations, the government is facing increasing popular hostility over the reality that the scrapping of its JobKeeper wage subsidy scheme on March 28, accompanied by the abolition of a meagre Coronavirus Supplement on dole and welfare benefits, will leave millions of workers jobless or under-employed, and living in dire poverty.

The risk of further COVID-19 outbreaks was highlighted yesterday by the announcement of a still-unexplained infection of a doctor at Brisbane’s Princess Alexandra (PA) Hospital. The PA, one of the city’s biggest hospitals, is on the frontline of treating infections from the quarantine hotels for arriving international travelers.

The developments at the more than 1,000-bed PA again show how quickly the pandemic can erupt, under conditions in which basic safety precautions—even as elementary as mask-wearing in public hospitals—are brushed aside by governments and health authorities.

The PA was placed on lockdown yesterday, and mask-wearing reinstated, after it was reported that the infected doctor had contact with two COVID-positive patients at the hospital in the early hours of Wednesday. She was infectious while in the community the following day. The identified “high-risk” locations include a café, gym and hotel, as well as the hospital itself.

Heightening the dangers, the two infected patients have contracted the more transmissible and potentially deadly UK variant of the coronavirus. They are among 42 COVID-19 cases currently in quarantine in the state of Queensland.

At a media conference this morning, the state Labor government announced limits on visits to hospitals, aged care facilities, disability services and prisons in the Brisbane region, but took no further safety measures to protect the population. Premier Annastacia Palaszczuk even declared there was no need for people to weak masks.

Instead of any precautionary lockdown of the city, Palaszczuk said the next 72 hours would be “critical” to see if the infections spread further. She said contact tracing was underway to try to identify and contact all patients, staff and families who may have been exposed. She claimed that because the doctor had been infectious in the community for only a “short period,” this breakout was different to one involving the UK variant in January, which led to a three-day Brisbane lockdown.

Long lines of cars last December at inner-west Sydney COVID-19 testing station [Credit: WSWS Media]

State Health Minister Yvette D’Ath implored Brisbane residents to get tested for COVID-19 if they experienced symptoms, but said they would need to expect “long lines” at testing sites.

Increasing the risk to the public, the PA hospital has also been administering first-round vaccine doses—reportedly 3,477 jabs since the rollout began three weeks ago. However, the doctor was not one of the recipients. In fact, only half the hospital’s 3,800 frontline staff have received their first doses so far.

The latest airline bailout—Qantas and Virgin received $715 million from the Morrison government last year—will do nothing to stop the expected broader elimination of tens of thousands more workers’ jobs across the tourism industry, as well as throughout the rest of the economy, when JobKeeper ends on March 28.

Far beyond the touted benefit to the 13 tourism destinations hand-picked for the cut-price tickets, the “cheap flights” are intended to bolster big business demands for an end to all pandemic lockdowns, border closures and other safety measures.

The government, airline chiefs and corporate media proprietors are hoping that people will rush to buy discounted tickets, assisting the profit-driven push to insist that no more measures be taken by state and territory governments that could obstruct the full “reopening” of the economy.

Morrison told a media conference yesterday: “Now, of course, of course, we want to see the domestic borders remain open and … we would expect premiers to want the flow of this benefit into their states.”

As the Australian Financial Review political editor Phillip Coorey wrote today, the scheme amounts to a “border bribe:” “The tacit message in the great air ticket cash splash is that state premiers will now close borders at their own peril.”

Coorey drew the connection to this week’s business summit hosted by the newspaper, where Morrison “backed by others, argued a change of mindset from the states was crucial to the economic recovery… Put bluntly, as the vaccines are rolled out and the most vulnerable are protected, the health risk abates.”

But the vaccine “rollout” is fast becoming a disaster. In January, the Morrison government said it would have 4 million vulnerable people vaccinated by early April. So far, however, only around 150,000 people have been vaccinated.

While portrayed as motivated by the need to protect lives, the government’s vaccine pledges are the spearhead of a corporate “reopening” drive. At Thursday’s airline bailout announcement, Morrison again claimed that the vaccine rollout would meet the October target, allowing the reopening of the country’s international borders by then. “That’s our hope and that’s our expectation,” he said.

Yesterday, journalists challenged Morrison on his broken pledges. The prime minister had just told a media scrum that the government’s October target only referred to the first dose of vaccines. This effectively postponed the deadline by at least 12 weeks, until 2022.

One reporter asked: “Yesterday, you said everyone would be vaccinated by October and you said that on television. Today you are now saying that they’re not?” Morrison claimed he had been “misunderstood” because “the first doses will be administered by the end of October—that’s what I meant.”

Morrison blamed the delay on a decision by Italy and the European Union to block 250,000 AstraZeneca doses from being exported to Australia. At the same time, he said he had no concerns whatsoever about using the AstraZeneca coronavirus vaccine, after some European and other countries paused their rollouts, amid reports of people developing potentially fatal blood clots after their injections.

Echoing the financial elite, the opposition Labor Party has criticised the delay from the standpoint of private profit. Shadow cabinet minister Jason Clare complained yesterday: “We’re not going to get the economy revving at full speed again. We’re not going to be able to open up international borders, and get tourists in from around the world, until we get everybody vaccinated.”

Labor’s pro-business response continues its essential unity—along with the trade unions, the corporate elite and Morrison’s Coalition government—throughout the pandemic. This has included backing the cutting of jobs and conditions to help employers restructure their operations at the direct expense of the working class.