Why was the New Zealand stabbing attack not prevented?

Tom Peters

Over the past week, New Zealand’s Labour Party-led government has released more information regarding the perpetrator of the September 3 stabbing attack in the Countdown supermarket in New Lynn, Auckland. The material raises questions about why the attack was not prevented.

LynnMall in Auckland. (Source: Google Maps Streetview)

Seven people were injured when 32-year-old Ahamed Aathill Mohamed Samsudeen picked up a knife in the supermarket and began stabbing people indiscriminately. The horrific attack sparked panic among shoppers, who fled for safety. Within about two minutes, armed police who had been tailing Samsudeen and monitoring his movements, arrived on the scene and shot him dead.

On Wednesday, three victims remained in hospital in a stable condition.

Like many terrorists in Europe and the United States, Samsudeen, who was inspired by Islamic State (ISIS) propaganda, was well-known to police and the intelligence agencies. He first came to the attention of authorities in 2016 after posting extremist statements on social media. Prime Minister Jacinda Ardern and other politicians had been briefed on the risk he posed.

Ardern told the media immediately after the attack that everything possible had been done to try and keep Samsudeen in prison, and when this proved impossible he was put under “constant” police surveillance. The government was also in the process of trying to revoke his refugee status and deport him.

Samsudeen came to New Zealand in 2011 as a Tamil refugee from Sri Lanka. His family, who are still in Sri Lanka, issued a statement saying, “We are heartbroken by this terrible event… We are thinking of the injured, both mentally and physically.” They said Samsudeen’s “mental health got worse and worse during the last 10 years or so” and was not helped by spending time in prison. “The prisons and the situation was hard on him and he did not have any support. He told us he was assaulted there.”

The government has characterised Samsudeen as a “lone wolf” attacker, radicalised online, but his mother told a Sri Lankan TV station she believed he was “brainwashed” by neighbours in New Zealand, who were from Syria and Iraq. Deputy Prime Minister Grant Robertson told TVNZ there was no evidence to support this claim.

Samsudeen spent a total of four years on remand in prison, on various charges. In 2017 he was arrested and jailed after seeking to leave the country, apparently to fight for ISIS in Syria. The United States and its allies had fuelled the growth of ISIS by pouring weapons and funding into Syria in support of militias fighting to topple the Assad regime.

In June 2018 he pled guilty to several charges, including the distribution of objectionable ISIS material. He was later charged with possession of a hunting knife, with intent to use it in a violent attack.

In mid-2020 the Crown sought to charge Samsudeen with planning a terrorist attack, but a judge rejected this because there is currently no such offence in the law. The government is now seeking to rush an amendment to the Terrorism Suppression Act through parliament to make it a crime to plan a terror attack.

Media reports mention that Samsudeen spent his final year in prison in the same maximum security unit as the fascist terrorist Brenton Tarrant, who massacred 51 people at two Christchurch mosques on March 15, 2019. They do not say that the two had any contact with each other, but being in close proximity to the violent white supremacist may well have fuelled Samsudeen’s own extremist views.

Robertson said authorities had tried to address Samsudeen’s mental health issues but “none of those attempts have been able to change the state of mind.” In fact, reports indicate that authorities rejected offers to help with his rehabilitation.

At the time of the supermarket attack, Samsudeen was on bail for another charge of allegedly assaulting a prison guard. He had been released just seven weeks earlier to live in a flat next to Masjid-e-Bilal, a small Auckland mosque. Corrections department spokesperson Rachel Leota described him to Radio NZ (RNZ) as “a very, very difficult person to manage” who “was increasingly openly hostile and abusive toward probation staff.”

New Zealand Muslim Association (NZMA) president Ikhlaq Kashkari told RNZ on September 6 that the mosque, run by volunteers, was “not equipped to deal with someone like that.” He questioned whether the department had provided appropriate resources and assistance.

Kashkari said he was “baffled” that Corrections had turned down the NZMA’s offer to help rehabilitate Samsudeen. “I feel that they did not want to have formal accountability once he was out because what I was asking for was for formal accountability and responsibility,” he said.

Criminologist Dr Clarke Jones wrote in the Guardian that during Samsudeen’s trial in 2018, “his legal team and I offered to run a bespoke, community-led intervention program to support Samsudeen in his transition out of prison, with one of its aims to alter his extreme views.” The crown acknowledged that the program had been successful with Muslim youth in the past, but “the police opted for a different approach… choosing surveillance and monitoring over rehabilitation.”

Jones wrote that in 2018 “Samsudeen showed clear signs of depression and post-traumatic stress.” He had suffered “persecution, kidnapping and torture in Sri Lanka, being labelled a terrorist and held in solitary confinement with no professional support.” The problems were made worse by his isolation from his family. Jones had advised the courts at the time “that addressing his mental issues would be a critical factor for successful reintegration back into the community.”

Police have said that Samsudeen was extremely “paranoid” about being followed, indicating that he was aware of the state’s surveillance and this worsened his mental state.

The government has given no clear explanation for why multiple offers to help rehabilitate Samsudeen were rejected, and instead he was housed next to a mosque that could not deal with his extremely challenging issues. Ardern repeated to the media on September 6: “I’m confident that agencies did everything within their power to keep the community safe.”

Meanwhile, the government is responding to the attack, as it did with the Christchurch massacre, by increasing the state’s powers.

Ardern said the amendment to the Terrorism Suppression Act will be passed by the end of the month to make planning a terror attack a crime. Deputy PM Robertson has said the government will also review immigration laws to determine whether the process of deporting someone with refugee status can be made easier, and potentially increase the state’s power to detain someone while it seeks to deport them. The government is also seeking to pass “hate speech” laws, which could easily be used against left-wing and socialist criticism.

Major Chinese property developer on the brink of default

Nick Beams

The Chinese bond market and its financial system more broadly is coming under increasing pressure because of the crisis at Evergrande, one of the country’s largest property developers, with potential flow-on effects for international markets.

Residential buildings developed by Evergrande in Yuanyang. (Photo: Wikimedia Commons)

The company, which has more than $300 billion in debts, came under scrutiny in August when the government ordered it to take action to resolve its debt problems.

The company said that with the “coordination and support of the government” it was working with suppliers and construction companies to resume work on its property developments. It has 778 projects across 233 cities in China.

In its earnings report, issued at the end of last month, it reported a fall in net profits for the year and warned that if work did not resume there was a risk of “impairment” on the projects and problems for its liquidity.

Since then, the situation has gone from bad to worse. The company is engaged in a desperate scramble to sell off assets and raise cash while warning it faces the risk of default on bonds that are about to fall due.

In its report on the crisis the Financial Times warned that a default, exposing the perilous state of China’s property market, would be a “debacle that could cascade across global markets.”

This week shares in the company fell below their 2009 initial public offering, following downgrades by the major credit rating agencies and warnings of a debt default. Shares in the company have dropped by 76 percent this year and the price of many of its bonds has fallen to around 30 cents on the dollar.

Fitch Ratings has again cut the rating on Evergrande bonds to CC, warning of a default.

“The downgrade reflects our view that a default of some kind appears probable,” the Fitch statement said. “We believe credit risk is high given tight liquidity, declining contracted sales, pressure to address payments to suppliers and contractors, and limited progress on asset disposals.”

The day before the Fitch move, Moody’s cut Evergrande’s credit rating by three notches, its third downgrade of the property giant since June. It said its current rating implied that Evergrande was “likely in or very near default.”

The property developer, one of China’s biggest borrowers on international markets, has been one of the most prominent of the giant real estate firms that have emerged in the past two decades. It was founded in 1996 by Hui Ka Yan, who built a financial empire on massive borrowing and land acquisitions, with support from high officials in the government, and at one point became the richest man in the country.

But it has been heavily affected by moves initiated by Beijing to rein in speculation, particularly in real estate and property development, because of the dangers it poses to the financial system as a whole.

Financial authorities imposed new regulations, known as the three red lines that determined whether companies could take on additional debt, with stipulations covering cash reserves, equity and assets.

Evergrande is not the only property developer experiencing major problems. This week the bonds of Guangzhou fell by more than 20 percent in a single day and are now trading at 60 percent of their face value. The plunge came after Moody’s downgraded its credit rating and warned about the company’s ability to refinance itself.

Fantasia, another property developer, is also in financial difficulty and told the Hong Kong stock exchange earlier this week it had made purchases of $6 million of its own bonds.

The impact of the new regulations is widespread. According to a report in Bloomberg, Morgan Stanley has calculated that property firms defaulted on $6.2 billion worth of risky debt in the year to mid-August, about $1.3 billion more than the previous 12 years combined.

Economists at the Japanese financial giant, Nomura, have warned that the restrictions on property developers are going too far and are “unnecessarily aggressive.” They have even called it a “Volcker moment”––a reference to the high-interest rate regime introduced at the beginning of the 1980s by Fed chair Paul Volker that devastated the US economy and led to the highest unemployment rates since the 1930s.

The implications of the crackdown on property development borrowing for the Chinese economy were pointed to in an article by Wall Street Journal writer Jacky Wong published earlier this week.

Characterising property development as “arguably the most crucial industry in China,” he noted that when related businesses like construction material and housing appliances are included, “the sector accounted for 16.4 percent of China’s economy last year, according to Nomura.”

The tightening of restrictions by the Xi Jinping regime is being conducted under the banner “housing is for living, not for speculation.” This is part of efforts by the regime to be seen to be tackling the rise of inequality in China. But having promoted the very speculation that it is now seeking to curb the government is caught in a trap of its own making.

Its efforts to reduce speculation threaten to stifle one of key engines of Chinese economic growth over the past period. Developers are reported to have sold 21 percent fewer homes in August compared to a year before. The extent of the housing boom is reflected in the rise of household borrowing which is now 62 percent of gross domestic product compared to 44 percent just five years ago.

The problem for the government, as Wong’s article noted, is that “property is already so entwined with China’s economy that a sudden stop could be extremely dangerous” and if the regulatory “on” button were pressed for too long this could have “very serious consequences for financial stability and growth.”

Similar views are being voiced elsewhere. A note by two Bank of America economists on Tuesday warned that a rapid slowdown in the property market could have “significant spillover effects. While the motivation such credit tightening was to stabilise leverage and rebalance the economy, the risk is rising for growth instability amid fast deleveraging.”

A comment by Australian Financial Review columnist Karen Maley drew attention to the international ramifications of the Evergrande crisis. Foreign investors were becoming “fretful” that Beijing was preparing to separate out Evergrande’s real estate arm from any rescue operation, leaving the holding company, in which they are heavily invested, with the debt. This would mean they would incur substantial losses.

Consequently, they are “stampeding towards the exits” and seeking to sell off their bonds. As she noted, the problem for Beijing is that “while it may be able to limit the damage that an Evergrande default inflicts on the local economy, it is powerless to limit the impact of the country’s $12 billion bond market.”

UK: Planned cut to Universal Credit heralds savage assault on workers’ living standards

Thomas Scripps

Yesterday, Britain’s Conservative government pulled a vote planned by the Labour Party on scrapping the £20-a-week increase to Universal Credit brought in last year. The uplift is due to end on October 6, on the final day of the Tory Party’s annual conference. Cabinet Minister Jacob Rees-Mogg will give an update on the decision to pull the vote today.

Universal Credit is a social security payment rolled out since 2013 as a combination and replacement of several different welfare benefits. It is set at such a pitifully low level that ending the £20 increase will plunge millions of people, including millions of children, into desperate financial circumstances overnight. The withdrawal is the largest one-off welfare spending cut in British history, outstripping the Tories’ 1988 slashing of housing benefits and even the 1931 cut to unemployment benefit during the Great Depression—carried out by the National Government under former Labour leader Ramsay MacDonald.

Ramsay MacDonald

Roughly six million people receive Universal Credit payments, in households containing 3.4 million children. The benefit is a punitive system, offering minimal support, often delayed, and reduced by a host of possible sanctions, reductions and caps. The standard monthly amount for a couple over 25 is £509.91, with an additional £237.08 for a first child. Someone with a disability or health condition which limits their capacity to work, a definition policed with abysmal cruelty, can claim an additional £342.63 a month.

The Joseph Rowntree Federation (JRF) estimates that the government’s £1,040 a year cut will immediately throw half a million people into poverty, including 300,000 children. In fact, families with children—especially single-parents—will be disproportionately impacted. The majority of those affected are working families.

In its statement, the JRF used the example of a typical family of five receiving Universal Credit—with three children, one parent in full-time work and one in part-time, living in a medium-cost area—to show the devastating effect of benefit cuts in recent years. In 2013/14, the family would have scraped through at £271 a month above the poverty line. Today, even with the £20 increase, they are below the poverty line. After the cut, they will be £150 a month below.

Action for Children has carried out a similar analysis and reports that the typical low to middle-income sole-earner family two children will be £1,800 a year poorer come October 6 than they were in 2010.

According to the Citizens Advice Bureau, 2.3 million people will be pushed into debt after October 6 in order to afford essential bills. Save the Children report that 47 percent of people are concerned they won’t be able to live on the money they have left, and another 18 percent were unsure.

One hundred different organisations, including charities, children’s doctors and public health experts, have written to the government opposing the cut, warning it will cause “immense, immediate and avoidable hardship”. Not only are the Tories proceeding, they have refused to publish the analysis of its impact, demanded in a Freedom of Information request by the Poverty Alliance, claiming it would not be in the public interest.

For huge numbers of people, the sudden withdrawal of vital support will come as a painful shock. Surveys have found that between 18 and 36 percent of recipients are not aware of the planned cut, rising to over 40 percent in Greater London and over half among young people.

The axe will fall just six days after the scrapping of the furlough job support scheme at the end of the September. The Resolution Foundation estimates than some 900,000 people will still be on the scheme when it ends and, if they do not find a job or leave the labour market altogether, will be moved onto Jobseeker’s Allowance at £74.70 a week for the over-25s and £59.20 a week for under-25s.

UK Jobcentre

The effect of these attacks could be far worse than predicted, coming amid a sharp rise in the cost of living. Rents outside London grew 5 percent in the year to the end of July, according to property website Zoopla, an increase of more than £450 a year for the average bill—the largest the site has seen. In areas like Wigan, Greater Manchester, Mansfield, Nottinghamshire, Hastings, East Sussex and Norwich, the figure is closer to 10 percent. Falls in already sky-high rents in London, as a result of the pandemic, have bottomed out and are expected to begin climbing again later this year.

More than 1.5 million households receiving Universal Credit in February 2021 were private renters, 55 percent of whom already did not receive enough housing support to make the rent.

Last month, the UK’s energy regulator Ofgem lifted the price cap on energy tariffs to its highest-ever level, leading to the biggest rise in energy bills in a decade for as many as 15 million customers and their families. Eon UK, Scottish Power, Ovo Energy, EDF Energy and British Gas all announced increases of 12 percent—roughly £139 a year.

Petrol prices reached their highest level since 2013 and diesel their highest since 2014 in July. RAC fuel spokesman Simon Williams commented, “Right now it’s hard to see what it will take for prices to start falling again.”

The cost of food is also expected to increase, with the Financial Times reporting, “UK retail trade signals prospect of higher food prices”, and Nestle, Procter and Gamble and Unilever all warning of hikes. Prior to the £20 increase, 43 percent of Universal Credit recipients were food insecure.

At the end of August, co-coordinator of the Independent Food Aid Network Sabine Goodwin wrote in the BMJ (formerly, British Medical Journal ) to warn “a perfect storm is brewing”. Food banks, she said, were preparing for “the busiest and most difficult winter on record” as result of the Universal Credit cut and price rises. “The scale of the disaster about to unfold cannot be overestimated.”

The Tories are pushing workers and their families over a financial cliff edge as a whip to enforce their herd immunity inspired return to work agenda and to create as exploitable a labour force as possible as the economy is fully reopened. Confronted with a manifold economic crisis due to COVID and Brexit, the ruling class is seeking to resolve it through a brutal assault on the working class.

Not a peep of opposition has been heard from the Labour Party. The party is a trusted pillar of British capitalism, but the degree to which it categorically refuses to associate itself, even rhetorically, with the slightest suggestion of a redistributive policy is remarkable. Through its efforts, political debate is kept wholly within the bounds set by Johnson’s Tory government—the most right-wing in British history.

While pledging to vote against the Universal Credit cut, Labour has done absolutely nothing to mobilise opposition. It’s alternative policy, set out by shadow work and pensions secretary Jonathan Reynolds last month, is to rename the benefit and tinker with the taper rate at which it is withdrawn as people earn more income. In Reynolds’s words, “We think the way the system operates, it interacts with people who are in low-paid work, does not work sufficiently well for them.”

Asked by how much Labour would reduce the taper rate, Reynolds did not answer, saying he would need to “cost that properly”. Asked whether Labour would reintroduce the paltry £20-a-week increase, he replied, “I can’t give a specific commitment on that at this stage.”

It should be remembered that this is the same party touted by pseudo-left groups like the Socialist Workers Party just a few years ago as having undergone a radical social democratic rebirth under former leader Jeremy Corbyn, whose manifesto offered “a glimpse of jobs, homes and public services for the 99%, protection for our environment—and making the capitalist class pay,” according to the Socialist Party.

The truth is that Corbyn did not change a spot on the Labour Party. His departure as leader has revealed what he, the SP and the SWP did their utmost to conceal—that he spent his tenure in close political collaboration with a party of Thatcherite monsters who cannot distinguish themselves from the likes of Boris Johnson.

Disease and death from COVID-19 accelerate throughout US as schools continue to reopen

Bryan Dyne

The spread of disease and death from the COVID-19 pandemic has accelerated as schools continue to reopen. Daily new cases in the United States are above 150,000, and daily new deaths remain above 1,100, both despite the drop-off in reporting over the Labor Day weekend. More than 41 million cases have been confirmed in the country, alongside more than 670,000 deaths since the pandemic began, including more than 240,000 dead since Biden took office in January.

New cases are particularly surging among children. The American Academy of Pediatrics reports that, as of the week ending September 2, an estimated one-quarter of new cases, a record of nearly 36,000 a day, are among those aged 0-17. The Coronavirus in Kids (COVKID) Project notes that this is up 28 percent from the previous week.

Students returning to school in Baltimore, Maryland on Monday Aug. 30, 2021. (AP Photo/David McFadden)

Data compiled by the Washington Post shows that over that same week, 2,400 children were hospitalized with COVID-19, with numerous states reporting high or record child hospitalizations. The Department of Health and Human Services reports that California is now at about 125 pediatric hospitalizations per day, approaching last winter’s peak of 200 per day. In South Carolina, Texas and Florida, states with governors openly pursuing the homicidal policy of herd immunity, pediatric hospitalizations have risen well above their winter peaks, at an estimated 35 per day, 350 per day and 250 per day, respectively.

Children also continue to die. Among the most recent of these tragedies are a 9-year-old boy and a 15-year-old girl, who both died on September 1 and were students in the Aiken County School District in South Carolina. In Mississippi, health officials have reported seven deaths among children since August 1, as well as the deaths of eight pregnant women. State Epidemiologist Paul Byers recently stated to the Mississippi State Medical Association that the current COVID-19 wave is “worse than anytime we’ve experienced in this pandemic.”

According to the cynical pundits in the corporate media, the rise in infections and deaths is the fault of those who failed to get their shots. It is, as the Democrats and President Biden endlessly claim, a “pandemic of the unvaccinated.” But there is no vaccine at all for children under 12, and only 37 percent of those aged 12-15 are fully vaccinated, rising to 46 percent for those aged 16-17. Are these children and teenagers to blame for contracting a deadly disease? No, it is a result of the ongoing drive by Biden and Democratic and Republican governors to reopen schools at any cost so they can force parents back into the workplace.

There are, moreover, no guarantees that the coronavirus cannot further mutate to fully evade the vaccine. In a press conference Tuesday by University of Florida (UF) health officials with local politicians in Jacksonville, Florida stated that the percentage of patients vaccinated against COVID-19 in the hospital has risen from 10 to 17 percent, a possible sign of growing vaccine resistance of the virus.

During the press conference, Dr. Mobeen Rathore, a pediatrician at UF Health and Wolfson Children’s Hospital, further warned, “Kids do get sick. Kids do get hospitalized. Kids do get sick and go to the ICU to get intubated, be on a ventilator and even be on (Extracorporeal Membrane Oxygenation) ECMO, which is a heart-lung machine, sort of a last-ditch effort to support these children. Unfortunately children do die.” Rathore continued, confirming that a recent reported death of a 17-year-old was caused by COVID-19.

The spread throughout schools has been sharply reflected in the number of students, teachers and staff that have had to be quarantined after possible exposure to the coronavirus. In Mississippi, more than 2,800 K-12 students tested positive last week, forcing nearly 16,000 students, teachers and staff into isolation. COVID-19 outbreaks last week also forced the closure of nearly four dozen school districts in Texas, which 42,000 students attend, according to the Texas Education Agency.

Despite the vast amount of community spread, school and state officials continue to push for schools to remain open. In Texas, the majority of schools that closed last week have reopened. In Mississippi and Florida, schools have remained open through their recent coronavirus outbreaks.

Deaths among teachers and staff continue to remain high. The Twitter account School Personnel Lost To Covid (@LostToCovid) has found that 1,661 educators have died since the pandemic began, including 200 since July 1, some as young as 24 years old. Those dying are not only teachers; they include numerous administrative staff, bus drivers, sports coaches, crossing guards and cafeteria workers. All of them leave devastated co-workers, friends and families in their wake.

Chief responsibility for the ongoing waves of death among teachers, staff and students lies with the Democratic Party. Since taking office, the Biden administration has promoted the lie that children do not get sick from the coronavirus and that schools are safe. Biden himself infamously lied in February to a second grader, who was concerned that she might catch the deadly virus and spread it to her parents, stating, “You’re not likely to be able to be exposed to something and spread it to mommy or daddy.”

Teachers unions have played an equally wretched role. At a town hall meeting hosted last week by the Philadelphia Federation of Teachers, union bureaucrats asserted that vaccinations were enough to keep children safe, despite the fact that those under 12 are unable to get the vaccine. At the national level, American Federation of Teachers President Randi Weingarten has spent the past month on a 20-state “Back to School for All” tour, promoting the false idea that schools can be made “safe, healthy and welcoming for all” amid a surge of the deadly pandemic.

Given how many teachers and students have died during her tour as a result of the pandemic, one might be forgiven for wondering if Weingarten is in fact the president of the American Federation of Gravediggers.

The Democrats and unions are continuing the school reopening policy first pushed by former President Donald Trump. This makes clear that there is no constituency among the American ruling elite for a genuine plan to halt the pandemic. Under both parties, workers have died in their thousands day by day as a result of a preventable disease.

The only real solution is an eradication strategy to fight against COVID-19. This requires the immediate closure of schools, as well as nonessential businesses, to stop the spread of the disease, combined with travel restrictions, testing, contact tracing, isolation and the full extent of public health measures, combined with mass vaccination.

Chinese president presses corporate giants to be philanthropic

Peter Symonds

In a speech to the Central Committee for Financial and Economic Affairs last month, Chinese President Xi Jinping called for greater emphasis on “common prosperity” and the need to “regulate excessively high incomes” and “encourage high-income people and enterprises to return more to society.”

The remarks came in the wake of moves by the Chinese Communist Party (CCP) regime to rein in huge privately-owned corporations, including the tech giants Tencent and Alibaba, food delivery company Meituan, internet ride-hailing company Didi and online education companies TAL Education, New Oriental and Gaotu Techedu.

China's President Xi Jinping speaks during the BRICS Business Council prior the 11th edition of the BRICS Summit, in Brasilia, Brazil, Wednesday, Nov. 13, 2019. (AP Photo/Eraldo Peres)

Individuals such as Tencent’s Tony Ma and Alibaba’s Jack Ma have amassed huge personal fortunes—$US53.1 billion and $45.3 billion respectively—as their business empires have expanded. Their obscene levels of wealth stand in stark contrast to the 600 million Chinese earning just 1,000 yuan or $154 a month, who according to Chinese Premier Li Keqiang could not afford the rent, let alone other necessities, in a mid-sized Chinese city.

In response to Xi’s speech, Tencent Holdings has pledged $15 billion for various initiatives related to the environment, education and rural reform, saying the announcement was a response to “China’s wealth redistribution campaign.” It said half would be used for “sustainable social value innovation” and the rest for social charity programs to contribute to “common prosperity.”

Last week Alibaba promised to provide a similar amount by 2025 to “common prosperity” in China. Its statement said the money would be used to support micro, small- and medium-sized enterprises, help “the digitalisation of underdeveloped areas” and expand healthcare capability in less developed areas.

Bloomberg has reported that 73 of China’s listed firms, both private and state-run, have told their shareholders they will be making contributions to “common prosperity.”

The corporate announcements are clearly motivated by concerns of further state intervention in their businesses as well as being directed to areas that assist in their further expansion, rather than seriously addressing social inequality. The processes of capitalist restoration presided over by the CCP have opened up a huge and widening gulf between rich and poor in China.

According to the Credit Suisse Research Institute, China’s richest 1 percent own nearly 31 percent of the country’s wealth, up from 21 percent in 2000. An HSBC report put size of China’s middle classes, earning between $15,000 and $75,000, at 340 million people. While $15,000 is relatively modest income by Western standards, it is at least eight times the amount earnt by the 600 million people referred to last year by Premier Li.

President Xi’s call for “common prosperity”—a term he has increasingly used over the past year—reflects the deep fear in the CCP apparatus of the enormous social tensions being generated by the entrenched inequality. He told officials in January that “common prosperity” was not just an economic issue but “a major political matter bearing on the party’s foundation for rule,” adding: “We cannot let an unbridgeable gulf appear between the rich and the poor.”

As the figures show, however, the gulf is already unbridgeable. The hundreds of millions of people struggling to survive on less than 1,000 yuan a month live in a world far apart from the multi-billionaires. The very fact that Xi is compelled to call on the country’s super-wealthy oligarchs to sacrifice makes a mockery of the CCP’s threadbare but continuing claims to be socialist or communist.

Yao Yang, an economics professor at Peking University, indicated in an email to the New York Times that he supported Xi’s new orientation, saying China had to be “fair and just.” He admitted: “China is one of the worst countries in terms of redistribution, despite being a socialist country. Public spending is overly concentrated in cities, elite schools and so on.”

The pressures bearing down on working people have been heightened with China’s economic slowdown. The years of 10 percent GDP growth are no longer. Previously, the CCP regarded 8 percent annual growth as necessary to provide sufficient employment to ward off social tensions. Now, however, the growth rate has fallen to 6 percent and shows no sign of recovering.

Xi has no intention of reversing the processes of capitalist restoration initiated in 1978 with Deng Xiaoping’s pro-market agenda. Deng, who notoriously declared “to get rich is glorious,” argued that China had to let some get rich first to lift the economy.

According to the state-run Xinhua newsagency, last month’s meeting of Central Committee for Financial and Economic Affairs discussed “creating conditions that are more inclusive and fair for people to get better education and improve their development capabilities” and providing “chances for more people to become wealthy.”

Han Wenxiu, deputy director of the Central Financial and Economic Affairs Commission Office, reassured the wealthy that the government would not “rob the rich to help the poor.” He said the idea was not “egalitarianism” but “reducing the wealth distribution gap between the urban and rural areas and firmly preventing polarisation.”

Han’s comments were clearly aimed at heading off any panic among the corporate elite and foreign investors by signaling that the shift is largely cosmetic and no significant inroads will be made into their profits.

Pro-market political commentators have nevertheless hit back. The Hong Kong-based South China Morning Post, which is owned by Alibaba, last Friday featured Peking University economics professor Zhang Weiying who argued: “If we lose faith in market forces and rely on frequent government intervention, it will lead to common poverty.”

Xi has nominated the eastern coastal province of Zhejiang as a demonstration zone for his “common prosperity” program. Its recently released plan sets 2025 as the target for average disposable income per person to reach $11,500—up 40 percent from current levels. Economics professor Li Shi who advised provincial officials on the plan suggested in a newspaper article that the province could promote collective bargaining to give employees a stronger voice in wage negotiations.

Pandemic and disrupted supply chains bring major problems for Australian economy

Nick Beams

In line with the government’s “reopening” agenda, even as COVID-19 infections, hospitalisations and deaths surge out of control, the Reserve Bank of Australia (RBA) has delivered an upbeat assessment of the direction of the Australian economy.

It was contained in the statement on monetary policy issued by RBA governor Philip Lowe following a meeting of the central bank’s board on Tuesday.

Reserve Bank of Australia Governor Philip Lowe (Credit: Wikimedia)

Notwithstanding the June quarter data already showed a slowing of growth, Lowe said that, prior to the Delta outbreak, the Australian economy had “considerable momentum,” but this recovery was being “interrupted” by Delta. Gross domestic product was expected to “decline materially in the September quarter and the unemployment rate will move higher in coming months.”

However, the optimistic assessment continued, the “setback to the economy” was expected to be only temporary. The economy would grow again in the December quarter and was “expected to be around its pre-Delta path in the second half of next year.”

The only change the bank made in its monetary policy was to slow its reduction of purchases of government bonds. It will go ahead with an earlier decision to cut its weekly purchases of bonds from $5 billion a week to $4 billion but will delay any further reductions from November until early next year.

It repeated earlier commitments to the financial markets it would not increase its base interest rate of 0.1 percent until inflation was “sustainably” within the range of 2 to 3 percent. This was not expected until 2024.

A somewhat different assessment was set out in an article in the Australian Financial Review by Gareth Aird, the head of the Australian economic division at the Commonwealth Bank, published earlier this week.

He began with a pointed remark on methodology, noting that when economists try to predict the future it always looks good “because the problems of the present have essentially been assumed away.”

“My overriding sense is that most economists are currently so fixated on the medium term that they are unwittingly downplaying what is an extraordinary negative near-term shock for the Australian economy.”

Aird forecast that the Australian economy will contract by a “whopping” 4.5 percent in the September quarter and this “massive loss of production will be accompanied by a huge fall in jobs.”

The bank’s estimate is employment will decline by half a million, representing 7 percent of NSW and Victorian workers and there will be no immediate bounce in the December quarter.

Taking issue with the “consensus view” that an economic rebound will be very swift once stay-at-home orders are lifted, he said things would look very different when the NSW and Victorian economies exit lockdowns.

“Economic activity and employment will rise because the base will be low. But the reopening will likely be accompanied by a surge in COVID-19 cases—as has been the case overseas.

“It will be simply a matter of time before the virus has spread across the entire country, although some states will try to keep it out for as long as possible.”

“Living with COVID-19,” he continued, would produce what he euphemistically termed a “significant period of adjustment for households and businesses as the virus circulates within the community in large numbers and hospitalisations rise.”

But, in line with his fellow economists, for whom the economy in the final analysis is not concerned with the lives, health and well-being of the population but corporate profits, the “good news” is that by the middle of next year Australians will have “adjusted” to life with COVID.

By that time Australia would be in a similar position to that of the UK—where infections, hospitalisations and infections of children have continued to rise as a result of the reopening of the Johnson government. COVID-19 will be treated “in much the same way as we treat other viruses” and the “economy should start to fire on all cylinders again.”

This is a repeat of one of the big lies used to push the reopening program. Society has not “learned to live” with other deadly viruses, such as polio, along with smallpox and others, but has eradicated them. But this policy, entirely possible if scientific measures are undertaken, has been ruled out for COVID because of its impact on profit.

Economic activity in Australia is being impacted by the surge of the pandemic around the world, making clear that eradication has to be a global strategy.

As thousands of workers in warehouses and distribution centres are in isolation because of virus infections, major retailers are reporting that their global supply chains are being increasingly disrupted.

Bernie Brooks, a former CEO of Myer, now running a handbag and jewellery chain, told the Guardian that there was a “dramatically bad” supply chain situation across Asia, the source of many of the goods on the shelves of retailers.

“What we continue to see is just this snowball down a hill, a gathering of different [COVID-19 related] influences… that means that probably the supply out of Asia has been the worst I’ve seen in 40 years of retail history.”

Earlier this week, an Australian Broadcasting Corporation (ABC) report said: “Balloons, books, bikes, hair products, game consoles. Name almost any item imported to Australia and you can bet a retailer is struggling to get it, and it’s costing a fortune to get it here.”

The ABC report quoted a retailer of children’s bicycles who said she was now waiting months for some stocks. “Before when we had a sale, we would just call up [the wholesaler] and order it and we would have it within days.” Now the supply of cheaper bikes had dropped by 50 percent and the waiting time for high-end bikes was between six and 10 months.

Paul Zahra of the Retailers Association told the ABC that small businesses had been “absolutely decimated by this pandemic” and would be “even more impacted by the supply chain issues that they’re currently experiencing.”

It is not only a question of supply. Retailers, he said, were paying up to four times the previous cost of shipping products to Australia and this would ultimately impact on prices.

The growing supply chain crisis is not confined to the retail sector but is hitting manufacturing industry as well.

Virtually every manufacturing firm is dependent on the supply of raw materials, such as steel and copper, components and parts, ranging from the most complex to the simplest, from all over the world—China, Southeast Asia, India and Europe. And these suppliers, in turn, are part of other global supply chains, all of which are being disrupted. The result is that orders that used to be filled within days now take weeks or months.

Schlumberger Foundation Faculty for the Future Fellowship 2022/2023

Application Deadline: 5th November 2021 for the 2022 Fellowships (the deadline for reference letters is November 11th, 2021)

Offered annually? Yes

Eligible Countries: Developing Countries and Emerging Economies

To be taken at: Top universities abroad

Accepted Subject Areas: Physical sciences and related disciplines

About Fellowship: Each year, The Faculty for the Future fellowships, Launched by the Schlumberger Foundation, are awarded to women from developing and emerging economies who are preparing for PhD or post-doctoral study in the physical sciences and related disciplines at top universities for their disciplines abroad. Grant recipients are selected for their leadership capabilities as for their scientific talents, and are expected to return to their home countries to continue their academic careers and inspire other young women.

Offered Since: 2004

Type: PhD/PostDoctoral, Fellowship

Selection Criteria: A successful application will have gone through four selection rounds, with the reviewers paying particular attention to the following criteria:

• Academic performance;
• Quality of references;
• Quality of host country university;
• Level of commitment to return to home country;
• Commitment to teaching;
• Relevance of research to home country;
• Commitment to inspiring young women into the sciences.

Eligibility: Applicants must meet all the following criteria:

• Be a woman;
• Be a citizen of a developing country or emerging economy;
• Wish to pursue a PhD degree or Post-doctoral research in the physical sciences or related disciplines;
• Have applied to, have been admitted to, or are currently enrolled in a university/research institute abroad;
• Wish to return to their home country to continue their academic career upon completion of their studies;
• Be very committed to teaching and demonstrate active participation in faculty life and outreach work to encourage young women into the sciences;
• Hold an excellent academic record.

Number of fellowships: Several

Value of Award: Faculty for the Future grants are awarded based on the actual costs of studying and living in the chosen location, and is worth USD 50,000 for PhDs and USD 40,000 for Post-doctoral study. Grants may be renewed through to completion of studies subject to performance, self-evaluation and recommendations from supervisors.

How to Apply: Interested candidates may Apply below

Visit Scholarship Webpage for Details

Iran’s President Raisi faces fifth wave of pandemic as economic pressures and opposition from workers grow

Jean Shaoul

By far the country worst affected by Covid-19 in the Middle East, Iran has for weeks been grappling with a fifth wave of infections—the strongest yet. Daily deaths and cases are mounting amid criticism of the government’s handling of the pandemic on social media.

According to the latest official figures, over 12,000 people, including children, have died from Covid-19 in the last two weeks, overwhelming Iran’s rundown public health service. It brings the total death toll to more than 110,000, although the state-run Shargh daily said that “experts believed the actual figure is 2.5 times more.”

Some 7,689 people are in severe condition and are being treated in intensive care units, while more than 600 people are dying every day, including members of Iran’s ruling circle. Last week, local media reported that Hassan Firouzabadi, the chief of Iran’s armed forces until 2016 and then military advisor to supreme leader Ali Khamenei, had died of coronavirus aged 70.

Hospitals are so overcrowded that patients line the floors and the most desperate lay waiting on the streets. Vital medicines are in short supply.

US sanctions on Iran targeting its oil exports, which have suffered a catastrophic loss of $100 billion in revenues, and its access to the US-dominated international banking system, have ravaged the country’s healthcare system, denying it access to pharmaceuticals and medical supplies.

People wait for their turn to receive Covid-19 vaccine at a vaccination center in Iran Mall shopping center in Tehran, Iran, Monday, Aug. 9, 2021. So far only 3 million people out of Iran's population of 80 million have had both vaccine doses. (AP Photo/Vahid Salemi)

At the same time, Iran’s pro-business clerical regime, by seeking to impose the full burden of the economic crisis caused by the sanctions and the pandemic on the working class and poor farmers to protect the country’s corrupt financial elite, has played a crucial role in allowing the coronavirus to sweep through the population.

Chairing his first cabinet meeting, President Ebrahim Raisi, a member of the “hardline” or “principalist” faction around Khamenei, was forced to admit the scale of the crisis confronting workers and their families. He said that Iran is “seriously lagging behind” in many areas and pledged to improve its economy and Covid response, saying that the current situation “does not befit” the Islamic republic.

However, he failed to announce any measures to reduce the transmission of the disease other than “advising” people to wear masks and maintain social distancing. Raisi lifted a six-day closure and travel ban last month, even as cases were rising.

The pandemic is all but invisible in the country’s heavily censored media, with the president calling for any public discussion of the pandemic to focus on “creating maximum hope and refraining from creating fear and anxiety in the people.” Last month, the Iranian authorities arrested six prominent human rights lawyers and activists who were reportedly preparing a complaint against the government’s mismanagement of the COVID-19 crisis. While one of them was released the next day, the rest were detained.

A health official has admitted the government spent more than $800 million on a drug with a poor record of treating the disease’s symptoms. This money could have been used to purchase more than 160 million doses of the Astra-Zeneca vaccine, more than enough to vaccinate every Iranian adult. Instead, Khamenei banned the purchase of American and British vaccines in January, claiming that the West would use them to experiment on Iranians.

As a result, Iran’s vaccination programme has been slow to get off the ground. Although Khamenei and government officials insisted that Iran was developing its own “safe and effective” vaccines, and that most of the population would be inoculated by mid-summer, problems with its development left the country dependent on the import of vaccines from Russia and China that have only recently become available. According to the Health Ministry, just 9.5 million of Iran’s 85 million population have received their second dose of a vaccine and just under 19.5 million Iranians have received their first.

Last week, 10 prominent Iranian activists, including Narges Mohammadi and Mohammad Nourizad—both of whom served time as political prisoners, and renowned filmmakers Jafar Panahi and Mohammad Rasoulof—wrote to Michelle Bachelet, the United Nations High Commissioner for Human Rights, and other international rights organization. The called for urgent action on Iran’s Covid crisis, including requiring the Iranian government to import vaccines.

They said, “We will be facing terrifying mass deaths in Iran if enough vaccines are not imported to vaccinate everyone in the country,' blaming Khamenei's vaccine ban, the lack of other vaccines and the government's promotion of large religious gatherings that acted as super-spreaders, while stressing that the official figures are not to be trusted.

Iran’s currency has fallen to nearly one tenth of its value since 2017, forcing the government to print money to make up for its loss of foreign income. Inflation is approaching 50 percent, eroding workers’ wages. Government officials have admitted that up to 60 percent of Iranians have fallen below the poverty line, far higher than the 30 percent reported in official statistics, and are unable to afford many food items. New data show that the prices of seven food items, including cooking oil, beverages, mushrooms, tomatoes, butter and carrots, rose more than 100 percent in July compared with last year, along with an increase in the cost of medications.

Real estate prices have also risen after people bought properties to protect their savings, leading to higher rents amid a massive shortage of affordable homes as workers have moved from the drought-affected rural areas to the cities.

Speaking on state television, President Raisi insisted he would deliver on his campaign promise to build one million affordable housing units for sale a year during his term in office. But the scale of the task was revealed in Iran’s business media, which reported it would cost $15 billion a year, more than last year’s oil export revenues. The reports pointed out that at $200 per square metre, even a 50 square metre apartment would cost $10,000, beyond the reach of most workers. Others questioned how electricity and water would be supplied to new homes given the existing power and water shortages.

Strikes and protests that subsided with the onset of the pandemic have now begun to reemerge, including the ongoing strike by contract workers in the state-owned petrochemical industry and protests over the shortage of electricity and water.

On Sunday, hundreds of teachers rallied outside the parliament and the budget and planning building in Tehran to protest the cancellation of a pay increase, agreed by the former Rouhani administration. They chanted, “With Masters and PhD, we are paid a small salary.” Their wages, around $120 a month, are far less than the $400 minimum needed to avoid poverty. Masoud Mirkazemi, the incoming head of the Budget and Planning Organization, dismissed the pay increase as unaffordable and criticized the previous administration for making such a pledge to teachers.

The regime came under further criticism when leaked video clips from security cameras in Tehran's Evin Prison, where many political prisoners are held, revealed the scale of the physical abuse suffered by inmates. According to the website of Iran International, one clip shows police officers attacking a handcuffed prisoner as others look on. Another shows several people trying to prevent the suicide of a fellow prisoner and a third shows inmates carrying another prisoner, presumably to the clinic, without the assistance of wardens.

While all the political factions would like to see the lifting of US sanctions and the revival of the nuclear accord with the major powers—as a way out of the economic, social and political crisis confronting the regime—it is becoming increasingly unlikely that the US will agree to lift all the sanctions reimposed by the Trump administration in 2018, as well as additional ones imposed later. While Raisi has expressed his support for the talks in Vienna to lift the sanctions, he said he would not agree to negotiate under pressure, a reference to the demands by the United States and its European allies not to further delay the talks.

Tehran is hoping to take advantage of the collapse of Washington’s puppet regime in Afghanistan—although relations with the Taliban are by no means good—to improve its bargaining position and is in no hurry to restart the talks, paused in June pending Raisi’s inauguration.

Iran’s new foreign minister Hossein Amir-Abdollahian said it was important for Iran to maintain symmetrical relations, implying that he sought to strengthen relations with Iran’s neighbours and regional countries, and underlined the importance of Asia for the new administration, including the further strengthening of ties with Russia and China, in line with Tehran’s “look to the east” policy.