German Government delivers air defence system to Kiev

Johannes Stern

Germany’s traffic light coalition government is supporting the escalation of the NATO proxy war against Russia in Ukraine with further arms deliveries to Kiev and a reinforcement of its own war offensive.

“Germany delivers the first of four IRIS-T SLM air defence systems to Ukraine,” announced the Ministry of Defense on Tuesday via Twitter. “The recent Russian missile attacks on Kiev and other cities” has shown “how important this capability is for the self-defence of Ukraine.”

Ukrainian Defence Minister Oleksi Resnikov praised German arms supplies, stating, “A new era of air defence has begun in Ukraine. IRIS-Ts from Germany are already here. The American NASAMS are coming. This is only the beginning. And we need more. No doubt that Russia is a terrorist state.”

In a further tweet, he expressed his “personal thanks” to his “German colleague,” Defence Minister Christine Lambrecht (SPD), for “her partnership and strong commitment to supporting Ukraine” and assured, “We will win.”

The system produced by the German defence company Diehl Defence is one of the most modern air defence systems and, according to the manufacturer, is suitable for 360-degree all-round defence against aircraft, helicopters, drones, cruise missiles and short-range ballistic missiles. Even the German army does not yet have IRIS-T systems.

Diehl IRIS-T SLM launcher (Matti Blume, CC BY-SA 4.0, via Wikimedia Commons) [Photo]

The delivery of the system is part of the massive war escalation that is currently being organized by the leading NATO powers and increases the risk of a nuclear third world war. Just a few days ago, US President Joe Biden warned against a “nuclear Armageddon.” Now the war is being fueled massively.

At the beginning of the latest meeting of NATO defence ministers in Brussels, NATO Secretary General Jens Stoltenberg announced an expansion of NATO states’ military production capacities. “The longer this war lasts, the more important it is that we are able to replenish supplies,” he said. In the war against Russia, Ukraine needs a “wide range of different systems. They need almost everything.”

Germany is playing an increasingly prominent role in the flooding of Ukraine with deadly military equipment. According to the official list of the German government on “military support services for Ukraine,” the following further arms deliveries are planned or already on their way:

• 16 Zusana armoured howitzers (joint project with Denmark and Norway)
• 130 field heaters
• 36 ambulances
• 10 Bridge systems (heavy and medium bridge systems)
• 90 heavy-duty semitrailers
• 4 self-propelled howitzers 2000 with ammunition package
• 2 multiple rocket launchers MARS II with ammunition
• 50 Dingo armoured Transport Vehicles
• 167,000 rounds of handgun ammunition
• 12 M1070 Oshkosh heavy-duty semitrailers
• 20 70mm rocket launchers on pickup trucks with 2000 rockets
• 255 rounds of 155mm Vulcano artillery ammunition
• 30,000 rounds of 40mm ammunition
• 5032 antitank handguns
• 200 commercial truck vehicles
• 24 drone defence systems
• 16 BEAVER bridge-laying tanks

The delivery of heavy battle tanks is also being prepared. Before the meeting of NATO defence ministers began, the chairman of the federal parliament’s (Bundestag) Foreign Affairs Committee, Michael Roth (Social Democrats, SPD), calculated that 13 European states had a total of 2,000 Leopard 2 tanks. He therefore suggests that “together we put together a contingent of Leopard 2 tanks, which we then deliver to Ukraine as quickly as possible.”

The proposal was immediately supported by the Chairman of the Defence Committee, Marie-Agnes Strack-Zimmermann (Free Democrats). In addition, she reiterated her demand on Deutschlandfunk radio to also provide Ukraine with Marder infantry fighting vehicles from the German armed forces. These are now urgently needed by the Ukrainian army, especially on the southern front, she claimed. Russia’s approach is pure “terror” and “beastly.”

Coming from the mouth of a leading German warmonger, this is repulsive and hypocritical. Putin’s invasion is reactionary and corresponds to the unscrupulous interests of the capitalist oligarchy that has ruled the Kremlin since the Stalinist dissolution of the Soviet Union. But the Russian missile strikes do not come close to the destruction perpetrated by the US-led and German-backed wars in the Middle East, North Africa and Central Asia, where entire countries have been destroyed and millions of people killed.

Above all, representatives of German imperialism should remain silent for all time when it comes to the question of war crimes. If anything was “bestial,” it was the crimes of German imperialism. During the Second World War, the Wehrmacht waged a war of extermination in the East, which claimed the lives of between 24 and 40 million inhabitants of the Soviet Union. Six million Jews were industrially killed in extermination camps. Some of the worst massacres—such as that of Babyn Yar, where a special commando unit shot 33,771 Jews in two days—occurred in Ukraine.

The official propaganda that today the war against Russia is about “self-defence of Ukraine” or even about “peace,” “democracy” and saving human lives is an absurdity. In reality, it is about the same predatory goals as then. The imperialist powers have provoked Putin’s invasion of Ukraine to defeat Russia militarily and exploit the resource-rich country. They cooperate with fascist forces in Kiev and use the Ukrainian population as cannon fodder.

The ruling class in Germany also sees the war as an opportunity to rise again to a leading military power despite its historical crimes. “As the most populous nation with the greatest economic power and a country in the middle of the continent, our army must become the cornerstone of conventional defence in Europe, the best-equipped military force in Europe,' said Federal Chancellor Olaf Scholz (SPD) at the recent German army (Bundeswehr) conference in September.

Berlin’s plans to organise Europe under German leadership are now being intensified. According to a report by Der Spiegel, “On the sidelines of the NATO Defence Ministers’ Meeting in Brussels headquarters, a joint declaration of intent will be signed by the European states wishing to participate in the common defence system against ballistic missiles and other aerial threats proposed by Chancellor Olaf Scholz.”

According to Der Spiegel, “the Israeli ‘Arrow’ system is likely to be purchased for missile defence.” The news magazine makes no secret of the fact that Germany is thus preparing for a potential nuclear war. The system is “designed to launch rockets beyond the Earth's atmosphere,” writes Der Spiegel. “Above all, incoming nuclear, biological or chemical missiles are to be destroyed safely by means of these so-called high shooters.”

Scholz already announced the establishment of a German-European missile system as part of the war escalation against Russia in March. It was “urgently necessary that we provide the Bundeswehr [Armed Forces] with more resources, with more tanks, more air defence capabilities, and enable it in many other ways so that it can perform the task it has to perform,” he explained on the ARD show “Anne Will” at the time. The multibillion-dollar project is now underway.

White House draws up blueprint for World War III

Andre Damon

Less than one week after US President Joe Biden warned that the US conflict with Russia could trigger a nuclear “Armageddon,” the White House published a national security strategy pledging to “win” American global hegemony through military violence.

The document pledged to expand the US military, “integrate” economic life with war-making, and “win the competition for the 21st century” in what it called the “decisive decade.”

Embracing in all fundamentals the 2018 national defense strategy published by the fascist would-be dictator Donald Trump, Biden’s national security strategy affirms that the United States is locked in an existential national conflict with Russia and, most of all, China.

Joint Cheifs of Staff Chairman Gen. Mark Milley (left) with President Joe Biden (AP Photo/Steve Ruark)

“We are now in the early years of a decisive decade for America and the world,” declares Biden’s personal introduction to the document. “The terms of geopolitical competition between the major powers will be set.”

These opening remarks echo Biden’s declaration in March that the world is on the brink of a “new world order,” and that “we’ve got to lead it.”

Biden’s strategy, like Trump’s 2018 national security strategy, is violently nationalistic, declaring that the United States acts not in the interests of humanity or of its allies, but fundamentally to preserve its selfish interests. “Our strategy is rooted in our national interests,” Biden declares.

“Our military power continues to grow,” the document menaced, pledging to “Modernize and strengthen our military so it is equipped for the era of strategic competition.”

For these reasons, the document threatens, “nations are seeing once again why it’s never a good bet to bet against the United States of America.”

“Nuclear deterrence remains a top priority for the Nation,” and is “foundational” to the US’s strategy.

War, Biden says in his introduction, will be a source of national rejuvenation: “the United States has a tradition of transforming…foreign challenges into opportunities to spur… rejuvenation at home.”

The document sets forth the concept of “integrated deterrence,” developing key concepts in Trump’s 2018 national defense strategy, which pledged that “long-term strategic competition requires the seamless integration of multiple elements of national power—diplomacy, information, economics, finance, intelligence, law enforcement, and military.”

Similarly, the new national security strategy declares, “We will leverage all elements of our national power to outcompete our strategic competitors”

It adds, “Our National Defense Strategy relies on integrated deterrence: the seamless combination of capabilities to convince potential adversaries that the costs of their hostile activities outweigh their benefits. It entails: Integration across domains, recognizing that our competitors’ strategies operate across military…and non-military (economic, technological, and information) domains—and we must too.”

In perhaps the most chilling passage, the document declares that “The Biden-Harris Administration has broken down the dividing line between domestic and foreign policy.”

These concepts, pioneered under the Trump administration that openly drew inspiration from the Third Reich, echo the infamous “total war” manifesto of Alfred Jodl, chief of the German High Command during World War II, which declared that “Only the singleness and unity of state, armed forces, and people can assure success in war.”

Noting the continuity with Trump’s fascist “America first” ideology, New York Times reporter David Sanger observed that “The president took some unusual positions, especially for a Democrat,” noting that “he took a dark view of the benefits of globalization, describing at length how it has fueled pandemics and disinformation and contributed to supply chain shortages.”

The central target of the United States is China. The document asserts, “We will effectively compete with the People’s Republic of China, which is the only competitor with both the intent and, increasingly, the capability to reshape the international order.”

So single-minded is the focus on China, that the war in Ukraine is not even mentioned a single time in the White House’s fact sheet or document. Despite the Biden administration’s claims that the world would bloom like a garden were it not for Russian President Vladimir Putin’s invasion of Ukraine, the strategy does not predicate the US military buildup and preparations for war on the actions of the Russian president.

Rather, the US struggle to “win” the 21st century is predicated on the fact that the “post-Cold War era is definitively over and a competition is underway between the major powers to shape what comes next.”

Even as the national security strategy set its sights on China, the US continued to massively escalate the war with Russia. Speaking at a meeting of the U.S.-led Ukraine Defense Contact Group, Defense Secretary Lloyd J. Austin made clear that the US has instructed its Ukrainian proxy forces to continue their offensive through the winter.

“I expect that Ukraine will continue to do everything it can throughout the winter to regain its territory and to be effective on the battlefield, and we’re going to do everything we can to make sure that they have what’s required to be effective,” Austin said.

Ahead of this week’s NATO summit, NATO Secretary-General Jens Stoltenberg made clear that the US and its allies will respond to Russia’s threats to use nuclear weapons in the conflict with its own nuclear saber-rattling.

Stoltenberg announced, “Next week, NATO will hold its long-planned deterrence exercise, Steadfast Noon,” announcing his intention to launch a training mission for nuclear-capable bombers in Southern Europe.

Under conditions in which Ukrainian president Volodymyr Zelensky has called on NATO to wage preemptive strikes on Russia, and Russia has threatened to use nuclear weapons in Ukraine, the NATO training exercise threatens to further escalate the war.

Viewing the present conflict within the context of Biden’s national security strategy, it is clear that the strategists of US imperialism see the war in Ukraine, horrific and bloody as it is, as just the opening skirmish of an even greater and more disastrous global conflict.

UK economic crisis leading to soaring housing costs

Thomas Scripps

The combined effects of interest rate rises pursued by the world’s leading central banks and Chancellor Kwasi Kwarteng’s mini budget of giveaways to the super-rich is hiking up UK mortgages and rent. A wave of arrears, bankruptcies, repossessions and evictions is threatened.

Roughly 600,000 mortgages will be renewed in the next six months, meaning nearly 3,300 households a day will have to take on hundreds of pounds a month in extra repayments. Around 2 million coming to the end of a fixed rate deal will have to do the same in the next year. Another 2 million already on variable rate deals will see an immediate increase.

The Chancellor Kwasi Kwarteng (third from left) meets retail and challenger bank leaders at the Treasury, October 6, 2022. [Photo / CC BY-NC-ND 4.0]

After Kwarteng’s September 23 budget, investors led a run on the pound and UK bonds, signaling they expect the Bank of England to raise interest rates to 6 percent by early next year. This led to a mass withdrawal of mortgage deals by high street banks—as much as 40 percent of offers. They have gradually returned, but at much higher repayment rates.

According to data provider MoneyFacts, the average cost of a two-year fixed rate mortgage is 6.43 percent, and a five-year fixed rate mortgage is 6.29 percent—both the highest since the 2008-9 financial crash. These figures sat at just 2.25 percent and 2.55 percent a year ago and have continued to increase over the last three weeks.

Two months before Kwarteng’s budget, UK Finance, the banking trade body, was warning that much smaller expected rises in interest rates would lead to two-year mortgage holders losing a quarter of their disposable income to increased repayment charges. Five-year mortgage holders would lose a fifth.

Now the fall will be significantly worse. The Royal Bank of Canada has calculated that average mortgage repayments will rise by between £250 and £470 a month, or £3,000-£5,640 a year. As an example, MoneyFacts predicts that a household with a £200,000 mortgage paying back over 25 years would be charged over £400 more a month for a two-year deal than they would have been last December.

According to property market consultancy BuiltPlace, mortgage payments accounted for 20 percent of household income this June. It expects this to rise to 27 percent if mortgage rates hold at 6 percent. This is higher than during the financial crash (24 percent) and close to the all-time high of 30 percent in 1990.

There is a particular squeeze on the rentier landlords with buy-to-let mortgages, the price of which will be paid by renters. “I think a lot of landlords are going to either try to up the rent as much as they can to ensure that they are still making money on their buy-to-lets, or they’ll have to try to pump a little bit more equity into those properties to bring their mortgages down,” the head of research at Hamptons Aneisha Beveridge told the New Statesman.

RBC analysts say passing on these costs could lift rents by £280 a month. They are already at record highs—a UK average of £1,159 a month, rising to £1,945 in Greater London—and paid by some of the most impoverished families in the country.

Sue Anderson, head of media at debt charity StepChange, told Reuters, “Many households can ill afford this extra pressure - nearly one in two British adults are struggling to keep up with household bills and credit commitments, up from 30% in October 2021 and 15% in March 2020.”

This is putting it mildly. Millions of households are only keeping up with bills at all by skipping meals and switching off the heating.

Typical housing in a British city. Terraced housing in Lea Road, Wolverhampton [Photo by Roger Kidd / CC BY-SA 4.0]

The response in the City has been a mixture of joy at the sudden windfall of mortgage payments and concern that the process might bleed their debtors dry. Reuters wrote bluntly, “While British households head into a winter of soaring energy costs, a tumbling currency and nearly double-digit inflation, the country’s banks are in line for a handsome payday as mortgage prices spike after a decade of stagnation.”

According to market analyst Jefferies, Britain’s largest retail banks—NatWest, Lloyds and Barclays—will grow their revenue by £12 billion by 2024 (a 25 percent increase), in large part thank to fattening mortgage margins.

Reuters continues, “Banks are finding the home loan market stacked in their favour after years of low mortgage rates, but are also aware that bigger mortgage bills could spell trouble for cash-strapped customers.”

John Cronin, banking analyst at Goodbody, told the news service, “The problem is people refinancing at 6%, who were at say 2%, are going to suffer massive outflows of cash to support those mortgage payments.” He added, “My worry is that the banks’ provision models don’t adequately reflect that affordability challenge”.

Jim Leaviss, at investment manager M&G, agreed, “Everyone who rolls off fixed on to variable, or fixed on to a new fixed rate, is going to see their monthly payments go up so dramatically on top of what's going on already around food and energy costs.”

A senior banker explained that though mortgage defaults were currently low, they were typically the last expense to be cut back: “We expect it to be larger scale than normal, and it’s not started yet.”

One of the UK largest mortgage lenders, Santander, has already reported an increase in customers falling behind on mortgage payments. The bank is putting aside extra money to account for defaults. Borrowers’ finances are stress-tested for possible interest rate rises when they apply for mortgages, but the increases are already reaching the limit of these tests.

CEO Mike Regnier told the Guardian, “There are lots of customers who… will be paying significantly more than they were doing previously, and that will come as a shock. And some people will find that very difficult.”

Soaring mortgages have intensified concerns about a housing crash already playing out across advanced economies internationally. Adam Slater, from forecaster Oxford Economics, warned, “This is the most worrying housing market outlook since 2007‑08,” predicting house prices would fall 13 percent across 2023-24.

A deeper 20 percent fall, BuiltPlace analyst Neal Hudson warned, would leave one in 20 mortgage holders nationally, and one in 10 in London, in negative equity. This is when the value of the house falls below the value of the mortgage used to buy it, making it largely impossible to move or refinance.

Previous crashes have seen house prices fall by 26 percent (2007-9) and 37 percent (the early 1990s).

Popular personal finance adviser Martin Lewis warned on Good Morning Britain Monday, “If you’re watching, regulator, Bank of England, government, you need a mortgage emergency plan now, or there’s a ticking timebomb”.

OPEC agrees to major oil production cut, sparking US-Saudi rift

Gabriel Black

The Organization of the Petroleum Exporting Countries (OPEC) agreed last Wednesday to cut its members’ oil production by 2 million barrels per day. The decision is seen as one of the most significant by the oil cartel in recent history.

The oil cut is widely viewed as a slap in the face to the United States and the Biden administration. It comes just two months after President Joe Biden’s trip to visit Mohammed bin Salman, the crown prince of the theocratic dictatorship of Saudi Arabia. The Financial Times described the move as a “breach in the alliance” between Saudi Arabia and the US.

The Biden administration has been somewhat restrained in its public response to the announcement. President Biden stated that he was “disappointed.”

But his administration also released a statement accusing OPEC of “aligning with Russia.” Russia is a member of the expanded group of OPEC known as OPEC Plus. Russia’s deputy prime minister, Alexander Novak, attended the meeting in Vienna.

Though the production cut was announced as 2 million barrels per day, the actual reduction is expected to be closer to 1 million. The world produces about 100 million barrels of oil (mb/d) every day. Already, most OPEC members are struggling to meet their expected quotas, which is why the projected impact of last week’s announcement is smaller than the nominal reduction. Nevertheless, removing 1 percent of the world’s oil from the market over the coming months will have a significant impact.

First, the cuts mean that energy prices will remain higher for longer. OPEC members cited the risk of global recession as justification for their cut. Anticipating that the US-led rise in global interest rates will trigger a full-on recession by the end of next year, OPEC wishes to signal to the markets that it will take measures to keep oil at about its current general price range.

Oil is the bedrock of the modern economy, used in the production and distribution of virtually every product on the planet. The cuts will encourage not just high oil prices, but high prices in general. There is a significant risk that as the world’s central banks take the global economy into a recession, the downturn will be combined with high energy prices. The combination of mass joblessness and high prices is a recipe not just for misery, but also for a social explosion.

Such concerns motivated US Treasury Secretary Janet Yellen’s comment that the cuts were “unhelpful and unwise.” Yellen had in mind the effect energy prices would have on the class struggle, particularly in developing countries. She told the Financial Times, “We’re very worried about developing countries and the problems they face.”

There is no shortage of hypocrisy in Yellen’s comments. She is leading a rise in interest rates that is not only engendering mass joblessness, but also a surge in the dollar. A high dollar lessens the ability of developing countries to pay debts, frequently denominated in US dollars.

The American ruling class is content to take destructive economic measures which it sees as benefiting its interests, but is incensed by OPEC countries asserting their interests.

“It’s hard to overstate how anxious the Biden administration is about a potential resurgence in oil prices,” said Bob McNally, a leading oil energy analyst.

Alarmed by the surge in workers’ struggles across the country and the looming midterm elections, the Biden administration is terrified that even with a recession prices will not decline.

At OPEC’s press conference in Vienna, the UAE energy minister stated that the cuts were aimed at staving off a crash in oil prices that would contribute to ongoing difficulties in raising money for new oil and gas projects. Since 2014, new oil and gas investment has been substantially reduced.

OPEC members are also reported to be annoyed about the recently implemented price cap on Russian oil. They worry that measures which so far have been used only against Russia could, in the future, be deployed against other countries—pitting Western control over the financial system against rent-seeking resource-based states.

Within the US ruling establishment, there are growing calls to punish Saudi Arabia. “There’s got to be consequences for that. Whether it’s lifting the cartel’s immunity or rethinking our troop presence there,” Democratic Senator Chris Murphy told CNN.

Murphy continued, “For years we have looked the other way as Saudi Arabia has chopped up journalists, has engaged in massive political repression, for one reason: we wanted to know that when the chips were down, when there was a global crisis, that the Saudis would choose us instead of Russia. Well, they didn’t. They chose Russia.”

Thus, Murphy acknowledged that the Democratic Party can overlook Saudi Arabia murdering journalists and executing its citizens ... as long as its rulers toe the line against those regimes targeted for destruction by American imperialism.

The hostility they now express is not a reaction to the greed of the Saudi despots and the other members of the oil cartel. It is rather an expression of their diverging objective interests as the crisis of capitalism intensifies.

United Nations, diplomatic preparations for military intervention in Haiti met with widespread protests

Alex Johnson

As protests and violent clashes in Haiti rage, the United Nations, Washington and Ottawa are mulling over the deployment of foreign troops to quell widespread political and social opposition to Prime Minister Ariel Henry.

Demonstrators protest against fuel price hikes and to demand that Haitian Prime Minister Ariel Henry step down, in Port-au-Prince, Haiti, Monday, Sept. 19, 2022. [AP Photo/Odelyn Joseph]

Discussions among Haitian government officials and foreign diplomats have been held in recent days around how to crush the growing insurrectionary movement developing within Haiti’s working class and prop up the illegitimate, US-installed Henry regime. An intervention is seen as necessary to both safeguard the operations of American multinationals and repel the homicidal gangs affiliated with powerful sections of Haiti’s oligarchy.

In a letter sent to the UN Security Council last week, Secretary-General Antonio Guterres made it a matter of “urgency” that one or more nations consider the Haitian government’s request for the deployment of an “international specialized armed force” to eliminate a blockade being imposed by gangs on the Varreux fuel terminal, located north of the capital Port-au-Prince, and buttress Haiti’s crumbling security forces. 

Thousands of demonstrators took to the capital Port-au-Prince this week to oppose the government’s request for a military deployment. The repeated occasions in which American imperialism and its allies imposed bloody colonial occupations to pursue their predatory economic interests are lodged deeply in the public’s memory. Demonstrators on Monday shouted against any plans for “foreign occupation” and reiterated their demand for the removal of Henry. 

Haiti’s national police responded with brutality, shooting several people and killing at least one young woman. According to the AFP, one protester denounced any invocation for the placing of “boots on the ground” while another claimed Henry’s regime, which was never formally elected by the population, had “no legitimacy to ask for military assistance.” 

The plans being crafted for a foreign occupation have nothing to do with ensuring the welfare of the Haitian masses, but of placing Haiti yet again under the direct control of one or another imperialist power to suppress dissent in the poorest country in the Western Hemisphere and secure the strategic interests of finance capital. 

The fraudulent rhetoric being issued to justify an expedition is associated with a bloody record in Haiti, replete over the last century with violent colonial takeovers that saw the death and torture of tens of thousands. The assassination of Haitian president Jean Vilbrun Guillaume in 1915 led to President Wilson sending in the US Marines under the pretext of resolving the nation’s “unstable” conditions. What transpired was the looting of Haiti’s treasury for two decades by American financiers, forced labor under the Corvée system enforced by troops, and the smashing of the cacos, a peasant-based nationalist rebel insurgency that rose up in response to the occupation. 

Guterres’ letter came two days after Haiti’s Council of Ministers adopted a resolution authorizing Henry to request an armed intervention in response to the rout of its security forces at the hands of a coalition of armed gangs.

The UN chief noted the specialized force “would, in particular, support the HNP (Haitian National Police) primarily in the Port-au-Prince metropolitan area … to remove the threat posed by armed gangs.” Guterres had not suggested if the intervention would be a UN deployment. Thus far Washington has stated that it is reviewing Haiti’s request for military assistance. 

Haiti’s ambassador to the United States, Bocchit Edmond, echoed demands for an intervention by appealing on Monday that the United States and Canada take the lead in a so-called strike force sent to Haiti. It should be recalled that the same imperialist interests now sounding the tocsin for foreign intrusion introduced a military intervention from 2004 to 2017 known as MINUSTAH, under the auspices of the United Nations, that was complicit in countless human rights abuses, killed thousands of peaceful protesters and triggered the first modern outbreak of cholera.  

Whether or not a troop deployment to the island nation would be long-term or of a temporary duration has not been made entirely clear. What is strongly suggested however from the formulations of Guterres and the desperate appeals of Haiti’s ruling class is that plans are being drawn up for a substantial crackdown on the civilian population under the guise of combating “armed gangs.”

A few days prior to Guterres’ letter, the Organization of American States (OAS), headquartered in Washington D.C., released a statement during a session of its General Assembly acknowledging that the agency was “concerned” by the inability of Haiti’s police forces to maintain order. The OAS asked its member states to “urgently offer direct support to the Government of Haiti to improve the training of port security agents” and “strengthen the capacities and the means of the PNH.”

The drumbeat for closer US control over the Haitian government’s policymaking, and possibly another incursion in the Caribbean, is being sounded within the Democratic Party. On the same day of the OAS statement, the National Haitian American Elected Officials Network sent out a statement in coordination with Florida Democratic Congresswoman Sheila Cherfilus-McCormick calling on Biden to take “immediate” action on the country’s social breakdown. 

Opposing layers of Haiti’s corrupt political and academic establishment are seizing on the turmoil to make a bid to imperialism for their installation into power. The main opposition group is the Commission for a Search to a Haitian Solution to the Crisis, an organization comprising Clinton Foundation-backed operatives and privileged intellectuals that drafted the so-called Montana Accord, a petition for the overthrow of Henry’s regime. The Montana Accord group has expectantly come out against the government’s request for foreign intervention to reinforce Henry’s rule.

Fritz Alphonse Jean, the President-elect of the Montana Accord, labeled the calling for international military intervention in Haiti “shameful.” Steven Benoit, premier-elect of the Montana Accord, declared that the prime minister’s office had “committed a crime of high treason” and that they should “Prepare to pay the consequences.” 

The catalyst for the political crisis lies in the protesters’ demand that the unelected Henry be ousted from power and escalating class tensions—fueled by skyrocketing prices for basic necessities, including the government’s ending of subsidies for fuel that served as a lifeline for Haiti’s impoverished masses. The protest movement has grown at the same time as a renewed outbreak of cholera, the fatal waterborne diarrheal illness that killed about 10,000 people after the 2010 earthquake. 

The blockade of the Varreux fuel terminal has led to a crippling shortage of bottled water amid the resurgence of cholera, with 19 confirmed cases and 170 suspected cases, 40 being infants. The outbreak has reportedly reached Haiti’s National Penitentiary in Port-au-Prince, one of the most overcrowded prisons in the world, where those incarcerated face serious illness and death. Inmates have told the press they believe more than 60 people have died since the outbreak began on October 2. 

Political rivals of Henry’s regime allied with layers of the ruling elite are vying for control over the nation’s most lucrative assets in Haiti’s coastal region. The Varreux terminal is a storage center holding about 70 percent of the country’s fuel and is being controlled by the G9 Family and Allies gang federation, headed by former police agent Jimmy “Barbecue” Chérizier. 

As of late September, the volume of fuel stored in the dock’s tanks amounted to 10 days of diesel consumption and 12 days of gasoline, while access to these facilities by government-appointed operators and trucking units have proven impossible. 

Tensions at the fuel terminal began to flare in July when Henry named a new director for Haiti’s customs agency amid an investigation from the US that his government was involved in illegal arms trafficking, an accusation that coincided with Haitian customs and police authorities interdicting roughly 120,000 rounds of ammunition on board a container ship at a ferry terminal in Port-au-Paix on July 1. 

Henry, after having his US visa revoked and facing mounting pressure to strengthen customs security, launched a crackdown at the seaports to collect an estimated $600 million in undeclared duties from Haiti’s wealthiest businesspeople and stop the gun trafficking trade that has fallen into the hands of G9. The former customs director, Rommel Bell, has been under investigation by Haiti’s anti-corruption unit, which has accused Bell of smuggling illegal arms. 

The involvement of state institutions in arming gangs can be traced back several years when a Florida gun shop owner,  Junior Joseph, was convicted in 2019 for trafficking illegal arms with the help of Haitian police and Senator Herve Fourcand. The former government led by President Jovenel Moïse, who was assassinated in 2021, and his Haitian Tèt Kale Party (PHTK) collaborated with Chérizier in sanctioning extrajudicial killings and massacres against civilians, which included providing weapons and vehicles to the G9 gang alliance. 

Chérizier was a political sponsor of Moïse in the latter’s effort to use G9 to suppress social opposition to his corrupt regime and direct the gang federation against his political and business opponents until he was assassinated in July 2021. From then on Chérizier and his allies have vowed to depose Henry under the false banner of fighting for a “revolution.”

Henry has commanded a de facto dictatorship over the country since being handpicked to replace Moïse by the so-called CORE group of countries, which flung the surgeon into the prime minister’s role due to his being a longtime lackey of US imperialism. A year after the assassination, Henry heads a frail regime hated by Haiti’s working class and peasantry and menaced with gang warfare financed by sections of the ruling elite. The requests for “specialized forces” arises from the bitter internecine opposition Henry has faced from gang-affiliated cronies.

IMF cuts growth forecast amid warnings of global recession

Nick Beams

The International Monetary Fund has said more than a third of the global economy will contract either this year or next with the three major economies, the US, the European Union and China continuing to stall.

Pierre-Olivier Gourinchas, second from left, director of research at the International Monetary Fund, speaks at a news conference on the IMF's world economic outlook during the 2022 annual meeting of the IMF and the World Bank Group, Tuesday, October 11, 2022, in Washington. [AP Photo/Patrick Semansky]

In its World Economic Outlook report issued at its semi-annual meeting in Washington yesterday, the IMF said growth would slow from 6 percent in 2021 to 3.2 percent in 2022 and to 2.7 percent in 2023. This is the weakest growth path since 2001, except for the global financial crisis of 2008-2009 and the onset of the COVID-19 pandemic.

It said inflation, which was 4.7 percent in 2021, would be 8.8 percent for 2022, coming down to 6.5 percent in 2023 and then falling to 4.1 percent in 2023.

The growth figures are a continuation of the downward revisions the IMF made since its meeting in April. For advanced economies, growth is expected to come in at 2.4 percent this year, following growth of 5.2 percent in 2021 and then fall to 1.1 percent in 2023, with “the slowdown gathering strength.”

In the US, the world’s largest economy, growth is expected to be only 1 percent in 2023, falling from 1.6 percent this year. The projection for 2022 was revised down by 0.7 percentage points from the estimate in July “reflecting the unexpected real GDP contraction in the second quarter.”

For the US, the IMF said: “Declining real disposable income continues to eat into consumer demand, and higher interest rates are taking an important toll on spending, especially spending on residential investment.”

The forecast for the euro area is growth of 3.7 percent in 2022, falling to just 0.5 percent in 2023. The slowdown for Germany, the euro area’s largest economy and the world’s fourth biggest, is “especially sharp” with negative annual growth expected next year.

The IMF projected a “significant slowdown” for the UK with growth falling from 3.6 percent in 2022 to just 0.3 percent in 2023 as “high inflation reduces purchasing power and tighter monetary policy takes a toll on consumer spending and business investment.”

The growth forecast for China this year has been revised downward to 3.2 percent. This is the lowest growth rate in more than four decades, excluding the contraction at the start of the pandemic in 2020. Growth is predicted to rise to 4.4 percent in 2023, but this is still well below the target of the government for growth of above 5 percent.

Summarising the outlook in his foreword to the report, IMF economic counsellor, Pierre-Olivier Gourinchas, said: “The worst is yet to come, and for many people 2023 will feel like a recession.”

With higher energy prices, “winter 2022 will be challenging for Europe, but winter 2023 will likely be worse.”

Despite the worsening economic outlook, the IMF is insisting there must be no letup in the interest rate hikes by central banks, spearheaded by the US Federal Reserve, which are bringing financial turmoil and recession.

The rate hikes are being conducted under the banner of the fight against inflation, but the real aim is to induce an economic contraction—recession if necessary—to batter down wage demands as workers seek to redress the daily gouging of their living standards by the highest inflation in four decades.

Real wages must be driven down even lower even as the IMF has acknowledged that “nominal wage growth in 2021 did not fully keep up with price inflation,” meaning that real wages were flat or falling and, against a backdrop of even higher inflation, this pattern continued into 2022.

While no mention was made by the IMF of their crucial role, this situation is the result of the sabotage by the trade unions in all the major economies of the wages struggles of the working class. The number one concern of the IMF, as it is of all governments and central banks, is that the working class breaks out of these shackles.

This issue was placed front and centre in Gourinchas’ policy prescriptions in his foreword. “Central banks around the world,” he wrote, “are now laser-focused on restoring price stability, and the pace of tightening has accelerated sharply.”

There should be no let-up because “under-tightening would entrench further the inflation process, erode the credibility of central banks, and de-anchor inflation expectations.”

In the language of the economic institutions of capital, “entrenching” inflation and “de-anchoring” expectations are code words for a situation in which workers realise, from their daily experiences, that the cuts to the living standards will continue unabated and escalate their action.

Gourinchas warned that as economies start “slowing down and financial fragilities emerge, calls for a pivot toward looser monetary conditions will inevitably become louder.” While financial policy should ensure the markets remain stable, “central banks around the world need to keep a steady hand with monetary policy firmly focused on taming inflation.”

In other words, the class war launched against the working class through the high interest rate regime must continue and be deepened, with financial authorities taking the necessary action to protect the casualties that may result on the side of finance capital.

As the IMF revises down its growth forecasts, with “the worst yet to come,” predictions of recession have been coming thick and fast.

Earlier this week, in a major interview with the US business channel CNBC, JP Morgan chief Jamie Dimon said the US economy would likely enter a recession in the next six to nine months. He warned that this could lead to “panic” in credit markets, noting that depressed market conditions for initial public offerings on Wall Street and high-yield debt deals could soon spread.

There could be a further 20 percent fall in Wall Street’s S&P 500 index which would be more painful than the 20 percent decline so far this year.

S&P Global Market Intelligence has downgraded its forecast for growth and says the US economy will enter a recession in the last quarter of this year. It predicted the GDP would contract by 0.5 percent next year, well down from its previous forecast of 0.9 percent growth. S&P cited the “broad tightening of financial conditions” as the chief reason for the downward revision.

The Bank of America has said that higher interest rates will lead to the loss of tens of thousands of jobs a month starting from the beginning of next year. There would be a loss of about 175,000 jobs a month in the first quarter of next year and the job losses would continue throughout 2023.

Michael Gapen, head of US economics at the Bank of America, told CNN the premise was now for a “hard landing” with the unemployment rate climbing to 5 percent or 5.5 percent over the next year from its present level of 3.5 percent.

Signs of tensions over the global consequences of the US interest rate hikes were evident in remarks by Josep Borrell, the EU’s high representative for foreign affairs, to a conference of diplomats earlier this week.

He said central banks were being forced to lift rates to prevent their currencies falling against the US dollar, likening it to German domination of monetary policy before the establishment of the euro single currency.

“Everybody is running to increase interest rates, this will bring us to a world recession,” he said.

US imposes crippling controls on export of advanced chips to China

Peter Symonds

In a move aimed at crippling China’s hi-tech sectors, the Biden administration announced last Friday sweeping measures effectively banning the export to Chinese corporations of advanced computer chips and the equipment needed in their manufacture.

President Joe Biden attends an event to support legislation that would encourage domestic manufacturing and strengthen supply chains for computer chips in the South Court Auditorium on the White House campus, March 9, 2022, in Washington. [AP Photo/Patrick Semansky]

While imposed on the basis of “national security,” the export controls will impact the broad range of China’s commercial sectors that involve artificial intelligence (AI), high performance computing or supercomputers. 

The latest export bans underscore the determination of US imperialism to weaken and ultimately subordinate China, regarded in Washington as the chief threat to its global hegemony. China, currently the world’s second largest economy and predicted to overtake the US by the end of the decade, is no longer simply the manufacturing hub for low-cost goods. It threatens American dominance in hi-tech areas where AI and high-end computing are necessary.

Paul Triolo, a technology expert at consultancy Albright Stonebridge, told the Financial Times that the US actions were a “major watershed” in US-China relations. “The US has essentially declared war on China’s ability to advance the country’s use of high-performance computing for economic and security gains,” he said. 

The latest controls extend the measures imposed by the Trump administration on the Chinese hi-tech corporation, Huawei, that effectively ended its position as the leading manufacturer of mobile phones and networking equipment. Huawei’s founder reportedly told staff that the company’s survival was at stake. Now the Biden administration is seeking to wreak devastation throughout hi-tech sectors of the Chinese economy.

The controls are based on a “foreign direct product rule” that is very far-reaching in scope. It effectively bans any US or non-US company from supplying targeted Chinese entities with hardware or software whose supply chain contains any American technology. Some 30 Chinese corporations have been placed on a list of “unverified” companies, giving them 60 days to satisfy stringent US requirements. Failing that, they will be placed on the “entity list” that bars US companies from supplying them with technology without difficult-to-obtain US licences.

There has been an extraordinarily rapid change in chip manufacture, as measured by the size and thus the number of electronic components in the circuitry that can be etched onto a silicon wafer. The size, measured in nanometres (nm) or billionths of a metre, is approaching molecular dimensions. The manufacture of advanced chips requires highly sophisticated equipment. Overwhelmingly, the most advanced 3nm and 4nm chips are produced by the Taiwan Semiconductor Manufacturing Company (TSCM), Intel and Samsung. 

By banning the export of the most advanced lithography equipment needed to etch chips, the US export controls seek not only to block access to the latest chips but to obstruct Chinese efforts to develop its own chip manufacturing capacity. 

The bans extend restrictions put in place in July requiring top US toolmakers—KLA Corp, Lam Research Corp and Applied Materials Inc—to end exports of equipment capable of making 14nm or smaller chips to wholly Chinese-owned companies.

Jim Lewis, a technology analyst at the US-based Center for Strategic and International Studies (CSIS), likened the US controls to those put in place at the height of the Cold War. He told Reuters: “This will set the Chinese back years. China isn’t going to give up on chipmaking ... but this will really slow them [down].”

The new controls also ban “US persons”—both citizens and companies—from providing direct or indirect support to Chinese companies involved in advanced chip manufacturing. “That is a bigger bombshell than stopping us from buying equipment,” a human resources executive at a Chinese semiconductor plant told the Financial Times. “We do have [US passport holders] in our company, in some of the most important positions,” she said.

The bans are likely to impact on non-US corporations. Washington has been pressuring the Dutch-based chip equipment supplier ASML to stop selling deep ultraviolet (DUV) lithography machinery to China that can be used to make chips as advanced as 5nm. The US also has been pressing Japan to bar the export of similar equipment. The controls will affect foreign companies operating chip manufacturing plants inside China, such as SK Hynix, one of South Korea’s two main memory chip producers.

At the same time, the measures will impact heavily on American corporations, as the Chinese semi-conductor market accounts for nearly a quarter of global demand. US equipment maker Applied Materials derived 33 percent of its sales from China last year and its peer Lam Research 31 percent. Intel is expected to be hard hit, because many of most advanced chips are used in Chinese supercomputers. 

China responded angrily to the new bans. “Out of the need to maintain its sci-tech hegemony, the US abuses export control measures to maliciously block and suppress Chinese companies,” foreign ministry spokeswoman Mao Ning told the media. “It will not only damage the legitimate rights and interests of Chinese companies, but also affect American companies’ interests.” 

An article in the Asia Times earlier this month suggested that Chinese companies were developing alternatives to work around already heavy US restrictions. It cited the case of one of China’s largest chipmakers, Semiconductor Manufacturing International Corporation, which it declared “recently shocked the US by announcing that it had produced 7nm chips” despite being denied access to the most advanced chipmaking equipment. 

The very fact that the US Commerce Department has announced the latest extensive export controls in order to block Chinese military development underscores the fact that the US is preparing for war. While seeking to undermine China’s technological advances, the US is engaged in shoring up its own supply chains in the event of conflict. 

The technology bans are on top of the huge trade tariffs imposed on Chinese goods by the Trump administration that have been maintained by Biden.

The US measures designed to undermine the Chinese economy go hand in hand with a US military build-up throughout the region, along with military provocations in the South China Sea and Taiwan Strait close to the Chinese mainland. 

Last century, the US provoked a war in the Pacific with Japan by imposing an oil embargo in the 1930s aimed at strangling the Japanese economy. Likewise, the latest US export controls on computer chips point to the extreme tensions between the US and China and the advanced character of US war preparations.