Putin, Xi meet as Shanghai Cooperation Organization summit opens in Uzbekistan

Alex Lantier

Russian President Vladimir Putin and Chinese President Xi Jinping met yesterday at the opening of a two-day security summit of the Shanghai Cooperation Organization (SCO) in the Uzbek city of Samarkand.

Chinese President Xi Jinping, left, and Russian President Vladimir Putin pose for a photo on the sidelines of the Shanghai Cooperation Organization (SCO) summit in Samarkand, Uzbekistan, Thursday, Sept. 15, 2022. [AP Photo/Alexandr Demyanchuk]

The SCO is a Eurasian regional organization founded in 2001 by the “Shanghai Five”: China, Russia, and former Soviet Central Asian republics of Kazakhstan, Kyrgyzstan and Tajikistan. They have since been joined by India, Pakistan and Uzbekistan. Afghanistan, Belarus and Mongolia have “observer status” in the SCO, which also has Armenia, Azerbaijan, Cambodia, Nepal, Sri Lanka and Turkey as “dialogue partners.” SCO member states account for one-quarter of the earth’s surface, 30 percent of the world economy and 40 percent of its population.

The summit is however overshadowed by the US-NATO war with Russia in Ukraine, combined with growing US threats against China over Taiwan. A week before the Samarkand summit began, Russian troops suffered a devastating defeat at the hands of Ukrainian troops trained, armed and coordinated by the NATO powers.

Speaking to Xi, Putin acknowledged Chinese concerns with the Kremlin’s invasion of Ukraine and the debacle suffered by the Russian army in Kharkov. “We highly value the balanced position of our Chinese friends when it comes to the Ukraine crisis,” Putin said. “We understand your questions and concern about this. During today’s meeting, we will of course explain our position.”

Putin also explicitly condemned US moves to arm Taiwan and, repudiating the “One China” principle that Washington adopted in its 1972 Shanghai Communiqué, press Taiwan to formally declare independence and break with Beijing. “We intend to firmly adhere to the principle of ‘One China,’” Putin said. “We condemn provocations by the United States and their satellites in the Taiwan Strait.”

Putin asserted that the “Moscow-Beijing tandem” plays a “key role” in ensuring global stability and indirectly criticized Washington, declaring: “Attempts to create a unipolar world have recently acquired an absolutely ugly form and are completely unacceptable.”

Calling Putin an “old friend,” Xi replied: “China is willing to make efforts with Russia to assume the role of great powers, and play a guiding role to inject stability and positive energy into a world rocked by chaos.”

In a press release, China’s Ministry of Foreign Affairs said: “President Xi emphasized that China will work with Russia to extend strong mutual support on issues concerning each other’s core interests, and deepen practical cooperation in trade, agriculture, connectivity and other areas.”

Putin’s public acknowledgment of Chinese concerns over the Ukraine war point to the enormous tensions and political crisis inside the SCO as Washington and its NATO allies intensify operations against Russia and China. During the war in Ukraine, Beijing has pursued a delicate balancing act. It rejected NATO calls to impose sanctions on Russia but, at the same time, took no overt action in support of Moscow that could provide a pretext for NATO sanctions against China.

Last week, Li Zhuanshu, the president of the Standing Committee of China’s National Popular Assembly and number three official in the Chinese state hierarchy, traveled to Russia and made a more direct statement of support for Moscow, declaring: “Just like the Ukraine issue now, the United States and NATO had pushed straight to Russia’s doorsteps. This involves Russia’s national security and the safety of its people’s lives. In light of this, China understands that Russia needed to do what is appropriate and is giving coordinated support on multiple fronts.”

Clearly, however, concerns are mounting behind the scenes in Beijing that the Kremlin has no solution to avert an escalation and end its war with NATO in Ukraine.

The SCO, and its predecessor, the “Shanghai Five” association formed in 1996, has developed under the shadow of imperialism and the Stalinist bureaucracies’ restoration of capitalism and the dissolution of the Soviet Union in 1991. The Soviet bureaucracy’s final act of treachery against the Soviet workers and socialism threw Eurasia open to imperialist military intervention. After the SCO’s foundation, Washington seized on the September 11 attacks to occupy Afghanistan and set up military bases in Central Asian countries.

This unleashed a bloody imperialist drive to dominate strategically vital areas of Central Asia and the Middle East and plunder their resources. US and NATO forces have since intervened militarily in Iraq, Pakistan, Libya, Syria and Ukraine, where in 2014 the NATO powers backed a far-right putsch in Kiev that split Ukraine and set into motion the current war. Collectively, these wars cost millions of lives and turned tens of millions into refugees.

Deepening US economic decline and military defeats in Afghanistan and Iraq, coupled with China’s growing economic influence in Eurasia, has brought the struggle over Eurasia to a new peak of intensity. In this, military and financial considerations are inseparably linked. NATO’s waging of war against Russia in Ukraine is in the final analysis, like the world wars of the 20th century, the product of the insoluble contradiction between global economy and the capitalist nation-state system.

A September 14 editorial in China’s state-run Global Times titled “Non-dollar settlement in energy trade will break US hegemony” called on Russia and China to “step up cooperation to break the US dollar’s dominance in the energy market.” It pointed to the devastating inflationary effects of the Ukraine war and the current surge in prices for energy, which is traded in dollars, combined in the dollar’s rise in value against other currencies as the US Federal Reserve raises interest rates.

The Global Times wrote, “A strong dollar means energy products will become more expensive in terms of other currencies. When energy and raw material prices rise, the prices of other products will go up, leading to high inflation globally. … The reason why the US can, time and again, export its own inflation crisis caused by its previous monetary easing policy to the world is mainly because the dollar still holds the dominant position in the global foreign exchange market, reserve assets, trade settlement and other fields.”

It called for using the SCO as a forum to develop trade in oil and gas in non-dollar currencies. It noted that China buys Russian oil and gas with a mixture of Chinese yuan and Russian rubles, while India has paid for Russian energy in dirhams, the currency of the United Arab Emirates.

US imperialism is bitterly hostile to such a policy. In 2019, Denmark’s Saxo Bank calculated that a shift of intra-Eurasian trade out of the US dollar could lead the dollar to collapse, losing 30 percent of its value against gold.

A significant event at yesterday’s summit in Samarkand was the announcement that Iran, previously an SCO “observer” state, will formally join the SCO next year. Iran has faced two decades of US war threats and crippling sanctions, as Washington cut it out of all dollar-denominated financial transactions. Last year, it signed a 25-year military alliance with China and held naval exercises with Russian and Chinese warships in the Indian Ocean.

“The relationship between countries that are sanctioned by the US, such as Iran, Russia or other countries, can overcome many problems and issues and make them stronger,” Iranian President Ebrahim Raisi said while meeting Putin in Samarkand. “The Americans think whichever country they impose sanctions on, it will be stopped. Their perception is a wrong one.”

The various capitalist regimes in the SCO are however neither willing nor able to wage a consistent struggle against imperialism or resolve the bitter legacy of the Stalinist dissolution of the Soviet Union. The case of Putin, who launched his ill-fated intervention in Ukraine while denouncing the Bolshevik revolutionaries who founded the Soviet Union for making too many concessions to Ukrainians, is the starkest illustration of this point.

It is impossible to unify Eurasia against imperialism under the leadership of capitalist regimes. Indeed, shortly before the Samarkand summit, two former Soviet republics and SCO observer states, Armenia and Azerbaijan, plunged back into war over the disputed Nagorno-Karabakh region. It is unclear, moreover, whether Xi will meet Indian Prime Minister Narendra Modi, after clashes in 2020 along the unresolved Sino-Indian border inherited from British rule over India.

Irish government moves nearer NATO and war with Russia

Dermot Quinn & Steve James

The Irish coalition government made up of Fianna Fáil, Fine Gael, and the Green Party has seized on the humanitarian crisis generated by the Russia-Ukraine war to intensify efforts to abandon Ireland’s formal neutrality and lead the country into the imperialist war fighting alliance, NATO and related European Union (EU) military structures.

Over 47,000 Ukrainian refugees have now arrived in Ireland. This has emboldened mainstream media efforts to echo the remarks of Ireland’s former Taoiseach and deputy premier Leo Varadkar, who branded Russian premier Vladimir Putin “the Hitler of the 21st century'”. A wave of anti-Russian hysteria has been whipped up, sanctioned by the government and encouraged and egged on by the state broadcasting service RTE.

In April, US puppet and Ukrainian President Volodymyr Zelensky told Ireland’s Dáil (parliament), “Although you are a neutral country, you have not remained neutral to the disaster and to the mishaps that Russia has brought to Ukraine.”

Address by the President of Ukraine, Volodymyr Zelenskyy, at a Joint Sitting of Dáil & Seanad Éireann in Leinster House on April 6, 2022 [Photo by Houses of the Oireachtas/Flickr / CC BY 4.0]

There has been a backlash from right-wing pro-NATO members of the Dáil and media over remarks made by Sabina Higgins, the wife of President Michael D. Higgins, who wrote a letter to the Irish Times at the beginning of August calling for peace talks between Ukraine and Russia. Higgins’ letter enraged those leading the pro-NATO campaign, particularly as her proposal for talks had avoided the requisite anti-Russian rhetoric.

The move to formally abandon neutrality coincides with decisions by Sweden and Finland to join NATO. The Irish shift is part of the massive escalation in efforts by the US and European imperialist powers to encircle Russia and accelerate the drive to all-out war. The Irish ruling elite want to show just how loyal they are to their imperialist allies.

This is in defiance of overwhelming opposition from working people. A recent Irish Times/lpsos poll showed that 66 percent of Irish people do not want any change in Ireland’s current position. Only 24 percent supported change, while 11 percent did not know. Ireland’s currently policy precludes the country from joining any military alliance and requires a United Nations Security Council resolution for Irish troops to be committed abroad.

Origins of Irish neutrality

Popular support for military neutrality is bound up with hostility among Irish workers to the horrors of imperialism. By contrast, the Irish ruling class has for decades employed neutrality as a tactic to advance its own class interests by attempting to use one or other imperialist power as a counterweight to Britain.

The Irish Free State (later the Republic of Ireland) was founded one hundred years ago in 1922 based on crushing all working class demands that went beyond the interests of the Irish bourgeois nationalists. These later founded Fianna Fáil and Fine Gael, still the two main bourgeois parties.

The intention of those who took control of the 26-county state in the South of Ireland, after bloody partition by Britain, and having suppressed the working class, was to keep the South of Ireland subordinate to imperialist interests. The Irish Free State came into existence as a mechanism by which the British ruling class could rely on the weak Irish bourgeoisie to prevent opposition to British domination of the island spilling over into a struggle for socialism in Ireland and Britain itself.

The 1922 Constitution of the Irish Free State stated that “Save in the case of actual invasion, the Irish Free State shall not be committed to active participation in any war without the assent of parliament”.

The Free State remained a dominion of the British Commonwealth with the UK remaining in control of marine defence as well as three naval bases known as the “Treaty Ports”—at Berehaven, Loch Swilly and Spike Island.

The Treaty Ports were handed back to the Irish government as part of a 1938 settlement. This followed five years of the Anglo-Irish Economic War in which Eamonn de Valera’s new Fianna Fáil government implemented, at great social cost, protectionist measures against Britain designed to foster Irish capitalism. In consequence, the Irish government remained at least nominally neutral during World War Two, although neutrality in practice had a pro-British bias.

British wartime Prime Minister Winston Churchill was urged by Northern Ireland Prime Minister Lord Craigavon to invade the South. Churchill in the end relied on agreed military overflights of Donegal to Northern Ireland during the “Emergency” of world war. Close co-operation with Britain against a possible German invasion was also prepared.

There were limits, however. In 1940 a British delegation floated the possibility of ending partition if the Irish government would fully support the British war effort. De Valera refused, seeking to advance Irish capitalism by balancing between the imperialist combatants. Relations were maintained with Japan and Nazi Germany, while close relations with the US also served as a growing counterweight to British influence.

Ireland eventually joined the United Nations in 1955, having been blocked by the Soviet Union in 1945, although Ireland refused to join NATO due to British membership of the anti-Soviet alliance. The Irish government sought an alliance with the US outside the confines of NATO, but this was refused by Washington. Cooperation was nevertheless continually deepened with the US on security matters.

Ireland’s formal neutrality, and history of brutal national and class oppression, was used by the US and other powers to obscure the barbaric aims of imperialism, particularly in Africa. Between 1960 and 1964, for example, over 6,000 Irish soldiers served in the Congo, in a brutal war following Congolese independence from Belgian colonialism. Subsequent UN deployments saw Irish troops dispatched to many of the world’s poorest countries, including Haiti and Angola, seeking to secure imperialist interests.

By the 1960s, Ireland had abandoned its protectionist experiments, reducing tariff barriers on trade and opening up the economy to US capital and investment. The South became a hub for multinational companies attracted by low taxes and compliant unions. The integration of the ruling elite as junior partners of the imperialists was accelerated by accession to the European Community in 1973. Today more than a thousand large global American companies have operations in Ireland, paying one of the lowest corporation tax rates in Europe at 12.5 percent, and enjoying access to the EU’s huge single market.

Partnership for war

Irish integration into Europe also drew Ireland into European and NATO mechanisms. In 1999 Ireland was accepted into NATO’s Partnership for Peace programme (PfP), which serves as a waiting room for NATO membership. Candidate countries are set targets in terms of military organisation, spending and equipment. As of July 2022, Ireland was deemed to have 15 of 27 set goals outstanding.

In 2003, to stress its loyalty to the US, the Fianna Fáil government supported the invasion and occupation of Iraq, assisting US “shock and awe” bombing by offering Shannon Airport in the west of Ireland as a hub and refueling depot. The invasion resulted in the death of more than a million people and the destruction of an entire society.

Shannon Airport terminal and control tower [Photo by Joseph Mischyshyn / CC BY-SA 4.0]

By 2006 the airport became one of the main locations for “rendition flights” carrying prisoners held by the CIA to countries where they were subsequently tortured. Shannon is currently used to refuel daily arms flights to Ukraine.

By June this year, the Irish government was also considering joining the joint NATO/EU hybrid and cyber warfare thinktank based in Helsinki, Finland, and has already joined the NATO Co-operative Cyber Defence Centre of Excellence in Tallinn, Estonia.

Taoiseach Martin has been floating plans to avoid a referendum on NATO membership, which would stand a high chance of losing. In June, Martin declared, “We need to reflect on military non-alignment in Ireland and our military neutrality. We are not politically neutral.” He continued, “We don’t need a referendum to join NATO. That’s a policy decision of government.”

Ireland is also integrating its forces into the EU’s own military apparatus. In 2006, Willie O’Dea, then the Minister of Defence, announced that Ireland would seek to join European Union battle groups. It has subsequently participated in a succession of battle groups involving up to 1,500 troops.

In 2017, the Dáil voted to join the European Union’s Permanent Structured Co-operation (PESCO) Agreement, made up of 25 of the EU’s 27 member states. Thus far, the country has only participated in one of PESCO’s 60 projects. In June, however, the Dáil voted to participate in four more, including work against cyber threats, medical training, disaster relief—“both within and outside EU territory”—and sea mine clearance.

Also driving the ruling elite in Ireland towards NATO militarism is the very real threat from the working class, which has seen living standards plummet and poverty increase.

More than 781,794 people are experiencing deprivation in Ireland, with 660,000 people now living in poverty, of which 210,000 are children. Over 133,000 people living in poverty are in employment. According to the latest data produced by Eurostat, energy prices have risen by 39.1 percent in the past twelve months, driving overall yearly price inflation to 7.3 percent.

The housing and rental crisis has extended its shadow over the whole country, particularly in larger towns and cities. The latest figures released by the Department of Housing show that the number of homeless people increased in June to 10,492, up more than a quarter on the same period last year. The number of homeless families has now increased to 1,385 and there are over 3,000 children homeless. The NATO-Russian war crisis serves to divert class tensions against an “external foe.”

William Ruto sworn in as Kenyan President as IMF demands austerity

Kipchumba Ochieng

William Ruto has been sworn as Kenya’s fifth president since independence in 1963. He is set to impose International Monetary Fund (IMF) austerity measures and wage class war against workers and the rural masses, as prices soar.

Kenya's President-elect William Ruto addresses the media at his official residence of the deputy president in the Karen area of Nairobi, Kenya Wednesday, Aug. 17, 2022. (AP Photo/Mosa'ab Elshamy)

On Tuesday, Ruto took his oath of office in Nairobi’s Kasarani Stadium a week after his election was upheld by the Supreme Court. Ruto’s electoral rival, Raila Odinga, had alleged mass electoral fraud and sought to annul the August 9 election’s result that gave Ruto 50.5 percent of the vote against Odinga’s 48.8 percent. The court unanimously dismissed the appeal.

Ruto won the elections by styling himself as an outsider and a “hustler” against Kenya’s ruling “dynasties” combined with anti-Chinese demagogy. Bourgeois papers presented him as the son of “a peasant farmer who went barefoot and sold chickens for school fees” (in words of The Star) to become Kenya’s fifth president, fighting the Kenyatta and Odinga political dynasties.

At the inauguration, Ruto pledged a Hustler Fund to boost business, “dedicated to the capitalisation of micro, small and medium-sized enterprises […] to make credit available on affordable terms that do not require collateral;” a Judiciary Fund to increase the number of small claims courts; to appoint six judges rejected by former president Uhuru Kenyatta over alleged integrity issues; to introduce new fertiliser prices; measures to increase police autonomy from the executive; and measures to “make fertiliser, good quality seeds and other agricultural inputs affordable and available.”

Ruto has nothing to offer to working people. The deepening economic, social and military crisis underway globally has no solution within the borders of Kenya. Confronting an upsurge of the class struggle, amid growing concerns about food insecurity, unemployment, war, and surging prices, Ruto will turn to austerity, police-state measures, his imperialist backers in Washington and London, while whipping up communalism and Christian bigotry.

Kenya is one of the highest countries on the list for civil unrest according to Verisk Maplecroft, a UK-based risk consulting and intelligence firm. Last May and July, rising food costs spurred protests in Nairobi under the hashtags #LowerFoodPrices and #Njaa-Revolution (hunger revolution in Swahili). It raised the spectre of Sri Lanka, where President Gotabhaya Rajapakse fled a country rocked by protests over soaring costs of living and IMF-imposed austerity.

Inequality in Kenya is among of the highest worldwide. According to Oxfam, less than 0.1 percent of the population (8,300 people), among which is Ruto himself, own more wealth than the bottom 99.9 percent (more than 44 million people). Fully 7,500 new millionaires are expected to be created in the next decade.

On the other hand, workers, especially youth, face mass unemployment. More than three-quarters of Kenya’s 50 million people are aged under 35, yet youth unemployment is 39 percent.

Kenya’s cost of living, driven by the US-NATO war on Russia in the Ukraine, are soaring, climbing to a five-year high of 8.5 percent last month. The Kenya National Bureau of Statistics (KNBS) reported that prices of maize flower, sugar and rice rose 4.7 percent, 4.6 percent and 2.9 percent, respectively. Market surveys show that maize and wheat flour, upon which millions of Kenyans depend, have actually risen by 67 percent over the last three months.

Tuesday’s speeches already indicate the pretexts the new executive will use to make workers pay for the global economic crisis. Ruto claimed that “clearly, we are living beyond our means.” Ruto’s Deputy President, Rigathi Gachagua declared: “The truth of the matter is that we have inherited a dilapidated economy which almost facing shut down. We have a huge task to liberate this country and bring it back to where Kibaki left it,” that is, a decade ago.

Gachuga was silent on the fact that Ruto had been deputy president since Kibaki left office.

Ruto will ruthlessly impose the IMF’s agenda. The IMF has classified Kenya’s $70 billion debt as high-risk, with debt at 70 percent of the GDP and consuming 63 percent of tax collections. In April 2021, at the height of the COVID-19 pandemic, it granted a 38-month $2.34 billion loan.

Obeying the IMF, Ruto has pledged to eliminate subsidies on unga (maize flour) and fuel, whose prices are expected to soar. From October, the Kenya Revenue Authority will impose a 6.3 percent tax hike on excisable goods and services. There an ongoing hiring freeze in the public sector.

The IMF is demanding Ruto implement a national tax policy, which would impact previously untaxed sectors like informal business and agriculture and raise prices for staples like flour and maize. It is calling to raise sales taxes on petroleum products from 8 to 12 percent, that all goods should be taxed at 16 percent with a minimum rate of at least 12 percent. Civil servants also face cuts, as the IMF calls to slash the public sector wage bill.

Despite Ruto’s pledge to expand democracy, stating, “I will work with all Kenyans irrespective of who they voted for,” his track record says otherwise.

Ruto was mentored by Kenya’s pro-Western dictator Daniel Arap Moi, under whom he became MP for Eldoret North (1998-2013) and Home Affairs minister (2002). Ruling Kenya from the death of its first president, Jomo Kenyatta, in 1978 until 2002, Moi tortured and killed left-wing opponents while amassing a fortune of over $3 billion. He implemented IMF austerity, devastating living standards of the workers and rural masses.

Ruto has a long record of whipping up communalism, the Kenyan elites’ traditional weapon to divide and rule the working and oppressed masses. His political career started 30 years ago as an organising secretary of the Youth for KANU 1992 (YK’92) that lobbied for Moi’s re-election in 1992 in Kenya’s first multi-party elections since independence.

Well-funded and well-armed, Moi used Ruto’s YK’92 to whip up ethnic violence against Kikuyu ethnic groups in the Rift Valley Province. It is estimated that over 600 people were killed and 75,000 displaced in post-election violence.

In the 2007–2008 Kenyan electoral crisis, Ruto organised, paid and armed militias from his ethnic group (Kalenjin) to attack Kikuyus. At least 1,200 people were killed and 600,000 forced to flee their homes amid a rampage of rival militias of Uhuru Kenyatta’s Kikuyu and Ruto’s Kalenjin tribes, wielding machetes, knives, and bows and arrows.

Local broadcasters critical of Ruto were restricted in their coverage of Ruto’s inauguration. Ruto is expected to attack homosexuals’ rights and abortion, having opposed—with church backing—the current constitutional provision authorising abortion if there is a risk to the mother’s health.

In foreign policy, Ruto, who pledged to deport Chinese workers during the campaign to whip up anti-China sentiment, is expected to closer align himself with the Washington and London. Ruto has already met two of US President Joe Biden’s anti-China and anti-Russia hawks, US Senator Chris Coons and US Trade Representative Katherine Tai, who attended Ruto’s inauguration.

Coons is a leading anti-China hawk in Washington, having promoted US House Speaker Nancy Pelosi’s provocative visit to Taiwan. He also called to send US troops to fight Russia in Ukraine, threatening all-out nuclear Armageddon.

By sending anti-China and anti-Russian hawks to Nairobi, Washington is sending a message that Ruto must implement the IMF diktat and submit to the US offensive against Beijing and Moscow.

Warnings of financial turbulence amid rising workers’ struggles

Nick Beams

The latest US inflation data and the certainty that the Federal Reserve will continue to lift interest rates and tighten its monetary policy, all combined with a rising US dollar, is sending tremors through the global financial system.

As the Federal Reserve announces a rate change, traders work on the floor at the New York Stock Exchange in New York, Wednesday, June 15, 2022. (AP Photo/Seth Wenig)

Markets around the world fell yesterday on the back of Tuesday’s slide on Wall Street—the largest in two years.

This rise in the dollar’s value as a result of the Fed’s interest rate hikes is causing concern for financial authorities and governments in Asia as their currencies fall. Bloomberg has reported that the Japanese government is said to have asked banks for an indicative price for the value of the yen at which it could intervene to try to stabilise the currency.

The yen has hit a 24-year low against the dollar and the Japanese finance minister Shunichi Suzuki has said the government would not rule out an intervention in foreign exchange markets. The South Korean won has fallen along with the Thai baht, the Indonesian rupiah, the Philippine peso and the Malaysian ringgit.

One of the major concerns of the governments of the region is that the decline in the value of their currencies against the US dollar adds further fuel to the inflation fire which has already seen the eruption of mass protests in Indonesia earlier this month.

The other worry is that the fall in currency values sets off a financial crisis as took place in the Asian financial crisis of 1997, sparked by a collapse in the value of the Thai baht.

In the US, the latest data make clear price hikes are not abating. The key issue in ruling circles is how far and how fast interest rates must be raised to suppress the growing movement of the working class for wage increases to compensate for the highest inflation in four decades.

An article in the Financial Times (FT) quoted Tim Duy at SGH Macro Advisors, which provides research for hedge funds, who made clear the central bank had much further to go.

“We’re not seeing enough of the results of monetary tightening showing up in the economy to think that the Fed’s job is anywhere near done,” he said.

The article noted that “economists’ primary concern is that expectation of future inflation could spiral out of control, setting off a feedback loop whereby workers demand higher wages.”

Former treasury secretary Lawrence Summers, who has called for an unemployment rate of 5-6 percent for several years or a 10 percent unemployment rate for at least a year, is pressing ahead with this demand.

In his latest intervention, in a comment on Twitter, he said that “it has seemed self evident to me for some time now that a 75 basis points move in September is appropriate. And, if I had to choose between 100 basis points in September and 50 basis points I would choose a 100 basis points move to reinforce credibility.”

What is meant by “credibility” is that the Fed displays its unrelenting determination to raise interest rates to a level sufficient to bring about a recession so that wage demands are pushed back under conditions of sweeping job losses.

But the Fed’s drive against the working class via its monetary tightening policy is raising concerns about its effects on the stability of financial markets.

Besides the impact of interest rate hikes, there is another issue which is rapidly coming into view. This is the consequences of the Fed’s decision to start reducing it $9 trillion holdings of financial assets at the rate of $95 billion a month, a process known as quantitative tightening (QT).

This means that instead of being a buyer in the $25 trillion US Treasury bond market, the Fed becomes a seller.

The concern is this will lead to a liquidity contraction where there is a shrinking pool of buyers for government debt.

This is what took place in the meltdown of financial markets in March 2020 when, at one point, no buyers could be found for Treasury bonds, threatening a collapse of the entire financial system. That was only narrowly averted through a massive intervention by the Fed which doubled its holdings of financial assets to more than $8 trillion.

Despite several inquiries and reports on the meltdown, nothing has been resolved and there is a growing fear that in conditions where liquidity is at its tightest since the early months of 2020 that another crisis could erupt.

Commenting on the effect of QT to the FT, New York University economist Viral Acharya warned that “we could have a problem of liquidity stress in the banking system. And whenever banks are stressed, it usually spreads over to non-banks and Treasury markets and other [funding] markets.”

Acharya was the co-author of a paper with Raghuran Rajan, former governor of the Bank of India, to the Jackson Hole meeting of bankers and financial official at the end of August, that warned of the effect of QT on liquidity.

Rajan has proved to be an insightful observer in the past. When he was an economist at the International Monetary Fund, he presented a paper at the Jackson Hole conclave of 2005 in which he warned that the Fed’s ultra-easy monetary policies were creating the conditions for a financial crisis.

The conclave was conceived as a celebration for the retiring Fed chair and the architect of those policies, Alan Greenspan, and so Rajan was rounded on by all and sundry, particular Summers. But three years later, in September 2008, the global financial crisis erupted.

The Bank of America has warned that Treasury market strains are “arguably… one of the greatest threats to global financial stability today, potentially worse than the housing bubble of 2004–2007,” which was the trigger for the crisis of 2008.

The giant bond trader Pimco has warned that the current structure of the US Treasury market “leaves it vulnerable in times of stress to further bouts of the extreme market price volatility seen in March 2020.”

Articles in the mainstream media as well as comments by economists always involve a mystification of the operations of finance capital. But there is a profound relationship between the gyrations of the financial markets and the struggles of the working class.

Notwithstanding the vast profits accumulated on Wall Street by banks, hedge funds, speculators and investors, the financial system does not create an atom of real wealth. It is a mechanism through which the wealth created by the labour of the working class is siphoned to the upper echelons of society, the top one percent, and their props in the upper reaches of the middle class.

That process is being threatened by the rising movement of the working class in support of wage demands and an end to the increasingly intolerable, exploitative, working conditions imposed over decades. The fear is that this movement threatens to bring down the entire house of financial cards.

This is why in the US, particularly with regard to the struggle of rail workers, in the UK, where the economy has become a cesspit of financial parasitism, and around the world, all the forces of the state, including its financial arm, the central banks, are being mobilised with the support of its bought-and-paid-for servants in the trade union apparatuses to attempt to suppress it.

Azeri-Armenian clashes erupt amid NATO war with Russia in Ukraine

Alex Lantier

Fighting broke out between Azeri and Armenian forces during the night of September 12-13, as Azeri forces crossed the border into Armenia and attacked Armenian positions around the towns of Vardenis, Goris, Sotk and Jermuk. Clashes continued yesterday between the two former Soviet republics, after a cease-fire brokered by Moscow on September 13 immediately broke down.

Yesterday, Armenian Prime Minister Nikol Pashinyan reported that 105 Armenian servicemen had been killed so far in this month’s fighting. Azerbaijan reported 50 fatalities among its troops.

On September 13, Armenian and Azeri officials blamed each other for starting the conflict. The Armenian Defense Ministry reported “intensive shelling” from Azeri troops as well as drone attacks, announcing: “Armenia’s forces have launched a proportionate response.”

The Azeri Defense Ministry for its part accused Armenia of “large-scale subversive acts” along their joint border and claimed that it was repelling an Armenian attack.

Armenian civilians reported that heavy fighting prevented them from evacuating the area, as well as extensive damage to civilian infrastructure. “The entire village is being bombed, we can’t even evacuate the children, we managed to evacuate only part of them,” an inhabitant of the village of Geghamasar told Radio Free Europe. “The fire is very intense in the area, the roads are also under shelling, we are hiding.”

Sevak Khachatryan, who lives in Sotk, posted a report on Facebook with pictures of burnt-out buildings that stated: “After night-time shelling in Sotk, the community building has been damaged, several houses have burned, roofs and windows are damaged. The full extent of the damage remains unclear. Currently, fighting is ongoing.”

Though Moscow had brokered a cease-fire, which by most accounts was launched by Turkish-backed Azerbaijan, US officials tried to blame Russia for the conflict. “Whether Russia tries in some fashion to stir the pot, to create a distraction from Ukraine, is something we’re always concerned about,” US Secretary of State Antony Blinken declared.

At the same time, the US State Department released a statement declaring, “We urge immediate steps to reduce tensions and avoid further escalation.” State Department spokesman Ned Price reported that Blinken had called Azeri President Ilham Aliyev, stressed his “deep concern” and urged Aliyev to “cease hostilities” against Armenia. Price said Blinken had called Pashinyan to tell him that Washington “would push for an immediate halt to fighting and a peace settlement between Armenia and Azerbaijan.”

French President Emmanuel Macron released a statement reporting that he had contacted Azeri President Ilham Aliyev to demand that he “end hostilities and return to respecting the cease-fire.” Macron also said he had spoken to Pashinyan to stress French support for “respecting Armenia’s territorial integrity.”

The resurgence of the Armenian-Azeri conflict points to the growing danger that NATO’s war on Russia in Ukraine could spread into a broader war across the Caucasus and the Middle East.

Yesterday, Pashinyan appealed to Russia and to the Collective Security Treaty Organization (CSTO) to intervene militarily against Azerbaijan. “We asked support from CSTO, including military support to restore Armenia’s territorial integrity and ensure the withdrawal of the Azerbaijani Armed Forces from the territory of Armenia,” Pashinyan told the Armenian parliament.

Pashinyan also spoke with Iranian President Ebrahim Raisi, who declared that a new war would be “unacceptable” and called to ensure that Iranian trade routes with Armenia remain open.

Turkish President Recep Tayyip Erdogan issued a bellicose statement of support for Azerbaijan yesterday. “We hope that Armenia will turn away from this wrong path as soon as possible and devote its time and energy to strengthening peace. Of course, this attitude will have consequences for the Armenian side,” he said.

The current fighting is the poisoned product of the Stalinist dissolution of the Soviet Union in 1991, as well as the eruption of NATO wars in the region over the last three decades. Fighting broke out between Armenia and Azerbaijan in 1988 over the disputed Nagorno-Karabakh enclave inside Azerbaijan, but which had a majority Armenian population. The fighting escalated into a full-scale war after the dissolution of the Soviet Union, as both Armenia and Azerbaijan became independent and Armenia seized the Nagorno-Karabakh.

This fratricidal war between forces who had until then all been Soviet citizens lasted from 1992 until an uneasy ceasefire in 1994, claiming 30,000 lives.

NATO’s wars in the Middle East, and especially its war for regime change in Syria that began in 2011, blew apart the precarious balance between Armenia and Azerbaijan. As ethnically-Turkic Azerbaijan built ties to Turkey, Armenia relied on close ties with Iran and support from Russia which has a military base in the Armenian city of Gyumri. Tensions erupted amid the NATO war in Syria, as Turkish troops faced off against Iranian and Russian troops fighting to prevent the toppling of Syrian President Bashar al-Assad.

In 2020, amid the COVID-19 pandemic, a new war erupted between Armenia and Azerbaijan, as Azeri forces reconquered most of the Nagorno-Karabakh enclave. It cost nearly 7,000 lives, with Azerbaijan reporting 3,006 fatalities including 100 civilians, and Armenia 3,910 fatalities including 85 civilians. Azerbaijan’s fielding of Turkish Bayraktar drones, which are now playing an important role in Ukrainian fighting against Russia, helped tip the balance in favor of Azerbaijan.

After the 2020 war, Russia deployed a contingent of several thousand peacekeepers along the front lines between Armenian and Azeri troops. These forces have failed to halt repeated Azeri incursions into Armenian-held territory which have escalated since the outbreak of the NATO-Russia war over Russia’s “special military operations” in Ukraine.

Several officials in Europe linked the new outbreak of fighting in the Caucasus to the war in Ukraine. The French daily Le Figaro wrote: “Two factors seemed to have motivated Azerbaijan. First, the Russian defeat in Kharkov. ‘Russia is less able to dissuade Azerbaijan,’ said Florence Parmentier, secretary-general of the Center for Political Research at the Institute for Political Studies in Paris. Second, there is Europe’s dependency on natural gas imports.”

In July, European Union (EU) Commission President Ursula von der Leyen traveled to the Azeri capital of Baku to negotiate a deal to obtain Azeri gas as a partial replacement for Russian gas that EU countries are refusing to pay for amid the war in Ukraine. The Azeri-Armenian conflict is now intertwined with conflicts inside the EU over how to handle massive energy shortages and a likely economic collapse in Europe this winter.

“I think there is a feeling in Azerbaijan that now is the time to deploy its power, its military advantage and to extract the maximum that it can get,” said Laurence Broers of the Chatham House think-tank in London. “I think the risk is of the establishment of sort of new buffer zones, security zones, a kind of a fragmentation of at least the southern part of Armenia and a powerlessness among outside actors to stop that from happening,” he added.

A sordid fight over money between Black Lives Matter factions

Trévon Austin

On September 1, 26 chapters of Black Lives Matter Grassroots filed a lawsuit in Los Angeles County Superior Court accusing the top executive of the Black Lives Matter Global Network Foundation (BLMGNF) of illegally “siphoning” $10 million in donation money.

In addition to denunciations of much of the BLMGNF leadership, the suit accuses Shalomyah Bowers, the head of BLMGNF, and his Bowers Consulting Firm of funneling millions of dollars from BLM’s coffers, using the organization as his own “personal piggy bank.” 

The day after the lawsuit was filed, Melina Abdullah, co-founder of the BLM Los Angeles chapter and co-director of BLM Grassroots, held a press conference announcing the lawsuit, at which she claimed that Bowers pays himself upwards of $2 million a year.

Following Abdullah’s press conference, the BLMGNF Board of Directors released an official statement denying the allegations against Bowers and other leaders and labeling the lawsuit “another round of struggle for ‘control’” of BLM. It called the allegations “slanderous and devoid of reality.”

The Board of Directors brought forward counterclaims against Abdullah and other BLM Grassroots leaders, alleging that they have been taking $10,000 per month in personal stipends, going on secret retreats to Jamaica, and docking the pay of BLM operatives forced to take leave because they or a family member had contracted COVID-19. 

The BLMGNF statement includes excerpts from a January 2022 letter from BLM Grassroots leaders detailing “countless allegations of Melina Abdullah’s financial malpractice, unprincipled decision making, and a leadership style rooted in retribution and intimidation.”

The controversy surrounding the lawsuit is only the latest in a long line of scandals involving BLM’s finances. Amid the popular protests against the brutal murder of George Floyd by Minneapolis police in 2020, the bourgeois media and the Democratic Party promoted Black Lives Matter and its leaders as the official voice of the millions of all races and ethnicities demonstrating against police brutality. This promotion was accompanied by official endorsements and large donations of cash from corporate America to BLM. 

The families of victims of police brutality and many local activists, however, soon questioned BLM’s financial secrecy:

• Three months after 10 local BLM chapters published a November 2020 statement demanding greater financial accountability from BLMGNF directors, the organization publicly released information about its finances for the first time. It reported that BLMGNF had raised more than $90 million in 2020, incurred $8.4 million in operating expenses, distributed $21.7 million in grants to more than 30 organizations, and retained some $60 million.

•  In March 2021, Lisa Simpson, the mother of 18-year-old Richard Risher, killed by Los Angeles police in 2016, and Samaria Rice, the mother of 12-year-old Tamir Rice, killed by Cleveland police in 2014, released a statement demanding that BLMGNF stop exploiting the deaths of their children to make money.
  They wrote: “We don’t want or need y’all parading in the streets accumulating donations, platforms, movie deals, etc. off the death of our loved ones, while the families and communities are left clueless and broken. Don’t say our loved ones’ names, period! That’s our truth!”

• In April 2021, the New York Post revealed that Black Lives Matter co-founder and nominal head Patrisse Cullors and her wife had purchased four properties worth approximately $3 million between 2016 and 2021. Less than two months after the news became public, Cullors resigned as executive director of BLMGNF, claiming she wanted to concentrate on other projects, including books and a production deal with Warner Bros.

• In April 2022, a New York Magazine report revealed that BLMGNF had purchased a $6 million luxury home in southern California with donation money. According to the report, BLMGNF bought the 6,500 square-foot property, complete with seven bedrooms and bathrooms, a sound stage and music studio, a pool, and parking for almost 20 cars, in October 2020 to serve as a “safe-house” and headquarters for BLM leadership to create social media content. In June 2021, Patrisse Cullors, Alicia Garza and Melina Abdullah recorded a video outside the mansion to mark the first anniversary of George Floyd’s murder.

• In May 2022, the Associated Press published tax documents showing that BLMGNF paid out millions to entities controlled by relatives and close associates of then-Executive Director Cullors. BLM paid out $25,997,945 in grants, including a $2,167,890 payout to the Bowers Consulting Firm, owned by Shalomyah Bowers.

• Melina Abdullah, a professor of Pan-African studies at California State University Los Angeles and co-founder of Black Lives Matter LA, was featured in a Levi’s jeans “Beauty of Becoming” marketing campaign, despite the news that Levi’s contractor worked to kill a minimum wage bill in Haiti.

With each revelation, the fraudulent character of Black Lives Matter has become clearer and clearer. The organization lost credibility among millions of Americans who’d previously supported BLM under the impression those at the helm were genuine about a fight against police violence. The parasitic layers in the leadership were sent into crisis, prompting Cullors to resign as executive director in June 2021. Since then, virtually every news story about Black Lives Matter has involved a scandal.

According to the lawsuit filed by Black Lives Matter Grassroots, Bowers was originally hired by Cullors to help run BLMGNF in 2020. Melina Abdullah claims that when Cullors decided to step down as executive head of BLMGNF, she left Bowers with a transition plan to hand over control of the BLMGNF to the BLM Grassroots leadership.

According to the lawsuit, Cullors appointed two BLM members, Monifa Bandele and Makani Themba, as co-senior executives to oversee the transition, while Bowers remained in his administrative role. But Bowers allegedly failed to follow Cullors’ transition plan and BLM Grassroots was denied access to BLMGNF’s social media accounts.

“This is the case of a rogue administrator, a middleman, turned usurper, who was hired to collect donations and account for expenditures of the Black Lives Matter movement,” the lawsuit reads.

While claiming that Bowers sees BLMGNF as his personal “piggy bank,” the suit further alleges that Bowers’ activities were the catalyst for the series of fraud investigations launched by state and federal authorities into BLMDNF’s finances, which BLM Grassroots claims paved “a path of irreparable harm to BLM in less than eighteen months.”

As part of its counterclaims against Abdullah and BLM Grassroots, BLMGNF cited letters that BLM Grassroots allegedly sent in January over concerns about Abdullah’s leadership.

One complaint alleging Abdullah’s mishandling of a $7 million budget reads:

“I’m writing to you today with some serious concerns about the management and operations of Black Lives Matter Grassroots… It is my view that the Black Lives Matter Grassroots team, of which I am a part, is ill-equipped at this time to run and manage a multi-million dollar organization.”

Australia Government Direct Aid Program 2022

Application Deadline:

18th September 2022 at midnight (GMT).

Tell Me About Award:

The Direct Aid Program (DAP) is a small grants program funded from Australia’s aid budget. It has the flexibility to work with local communities in developing countries on projects that reduce poverty and achieve sustainable development consistent with Australia’s national interest.

The program aims to:

• advance development outcomes through projects primarily focused on practical and tangible results. This may include projects which support good governance, human rights and those with a strong advocacy component,
• support Australia’s wider foreign and trade policy interests and public diplomacy objectives, including promoting a distinctive and positive image of Australia, and
• allow for a wide geographic reach reflecting that Australia has global interests and that DAP provides an effective way to build relationships and maintain Australia’s profile.

DAP projects cover a range of sectors such as education, health, water and sanitation, environmental protection, women’s empowerment and gender equality, supporting people with disabilities, economic livelihoods, food security and human rights.

DAP projects engage a wide range of partners including community groups, non-government organisations, educational institutions and local governments.

The Australian High Commission no longer accepts unsolicited applications or runs an open round for the Direct Aid Program, but works with trusted partners to deliver developmental and/or humanitarian outcomes for local communities in Ghana, Burkina Faso, Cote d’Ivoire, Guinea, Liberia, Mali, Senegal, Sierra Leone and Togo. 

What Type of Award is this?

Grants

Who can apply?

Funding is available on a not-for-profit basis to community groups, NGOs and other entities engaged in development activities in countries that are eligible for ODA.

Which Countries are Eligible?

West African countries

How Many Positions will be Given?

Not specified

What is the Benefit of Award?

• There is no minimum amount that a single DAP project can receive but the maximum is $60,000 over the life of the project (dependent on the country). Activities can run up to a maximum of two years.
• The management of the Direct Aid Program varies from mission to mission. To find out more about how the program is managed in a particular country, please contact the Australian mission overseas that administers DAP in that country.
• Stories about projects funded by the DAP can also be found on the social media of the Australian mission overseas that administers DAP.

How to Apply for Program?

Apply here

Visit Award Webpage for Details