Zelensky appoints new prime minister in major government shakeup

Jason Melanovski

Volodymyr Zelensky [AP Photo/Ukrainian Presidential Press Office]

Last week, Ukrainian President Volodymyr Zelensky undertook the largest shakeup of top government officials since the NATO-backed proxy war between Ukraine and Russia began in February 2022. Zelensky has officially appointed a new prime minister along with reshuffling several other top cabinet positions. The primary aim of the government shakeup is to solidify Kiev’s ties with the US administration of Donald Trump. US imperialism is still Ukraine’s most important military backer.

Yulia Svyrydenko, 39, was confirmed as the country’s new prime minister on Thursday and will replace former Prime Minister Denys Shmyhal, who has served as prime minister since 2020. Shmyhal will remain part of the Zelensky government as the newly appointed defense minister.

Svyrydenko previously served as first deputy prime minister and minister of economic development and trade. She played the leading role in negotiating the “critical minerals deal” this past spring between Ukraine and the Trump administration that saw Ukraine hand over vast sections of its economy to US imperialism in exchange for continued military aid in the war against Russia.

“She was the key and the only person leading these negotiations. She managed to prevent them from unraveling,” said Tymofiy Mylovanov, a former economy minister who previously worked with Svyrydenko.

The eventual signing of the agreement came at a critical time for the Zelensky administration, less than two months after a disastrous public White House meeting between Zelensky and Trump. While initially intended for the signing of an earlier version of the minerals deal agreement, the meeting ended in a shouting match between the Ukrainian and US presidents.

Plans to sign the deal were scrapped, and Zelensky was ejected from the White House following a public dressing down by both Trump and US Vice President JD Vance for failing to be sufficiently indebted to his US backers.

Apart from her experience with the Trump administration, Svyrydenko is reported to be a Zelensky loyalist and friendly with Zelensky’s closest aide Andriy Yermak. She has also earned praise from the American Chamber of Commerce in Ukraine for her management of the Ukrainian economy.

In addition to a new prime minister and switching Shmyhal to defense minister, Zelensky removed Oksana Markarova as Ukraine’s ambassador to the US. She had been criticized by Republican leaders due to her ties to the Biden administration and in particular Victoria Nuland, Biden’s undersecretary of state for political affairs.

Underlining the commanding role of the US over the Zelensky regime, Zelensky had previously announced his intentions to appoint outgoing Defense Minister Rustem Umerov as the US ambassador, but that move was reportedly nixed by Washington, according to opposition MP Yaroslav Zheleznyak.

Instead, Olha Stefanishyna, Ukraine’s former deputy prime minister for European integration, will become the country’s ambassador to the US, Zelensky announced last Thursday. 

Despite a concerted effort to remake a cabinet dedicated to pleasing the Trump government, Zelensky’s political standing in Washington is still very much in question, according to recent reports.

On Friday, investigative journalist Seymour Hersh reported that US officials have tired of Zelensky and could move to have him replaced within a “few months” by former top General Valery Zaluzhny. Now ambassador to the UK, Zaluzhny has long had extensive ties to the far right. Nearly a year and a half following his dismissal in February 2024, he remains one of the most popular figures in Ukraine and well connected within NATO.

As Hersh reported on Substack:

Zaluzhnyi is now seen as the most credible successor to Zelensky. I have been told by knowledgeable officials in Washington that that job could be his within a few months. Zelensky is on a short list for exile, if President Donald Trump decides to make the call. If Zelensky refuses to leave his office, as is most likely, an involved US official told me: “He’s going to go by force. The ball is in his court.” There are many in Washington and in Ukraine who believe that the escalating air war with Russia must end soon, while there’s still a chance to make a settlement with its president, Vladimir Putin.

Hersh’s article echoes a recent report in the Financial Times that despite renewing arms shipments to Ukraine, Ukraine’s European backers are “still assuming Trump was predisposed to seeing Putin as his main negotiating partner in any settlement and Zelensky as the primary obstacle to a workable peace deal.”

Apart from his shaky relationship with Trump, there are also indications that Zelensky has alienated sections of the Ukrainian ruling class. Amid mounting social discontent and fatigue with the war, they view Zelensky’s continued rule as a threat to their own interests. 

One recent article by the British Spectator titled “Ukrainians have lost faith in Zelensky” noted that a recent “spate of arrests and searches against Zelensky loyalists suggest serious political infighting at the heart of the Kyiv government.” The article continued to quote a former senior official in Zelensky’s administration as saying, “If the war continues soon there will be no Ukraine left to fight for,” and stated that Zelensky was “prolonging the war to hold on to power.” 

A recent poll showed that 70 percent of Ukrainians believe that their leaders use the war to enrich themselves. Hundreds of thousands of Ukrainians have been killed in the war so far, with many more maimed and wounded. 

Amid the cabinet reshuffle last week, Zelensky once again submitted to parliament to continue martial law and military mobilization for another 90 days, which was first implemented in February 2022. Under these measures, tens of thousands of Ukrainian citizens such as the Trotskyist youth leader Bogdan Syrotiuk have been imprisoned, thousands of Ukrainian men have been dragged to the front by press gangs and over 6.8 million people have fled the country, the majority of whom will never return. Should the measure pass, it will mark the 16th extension of martial law and mobilization under Zelensky, whose presidential term was originally scheduled to end in May 2024.

German Chancellor Merz announces massive cuts to social welfare benefits

Peter Schwarz

German Chancellor Friedrich Merz arrives for the cabinet meeting at the chancellery in Berlin, Germany, Wednesday, June 11, 2025 [AP Photo/Markus Schreiber]

Germany’s federal government is preparing massive cuts to social welfare benefits, pensions and healthcare starting in the autumn. Chancellor Friedrich Merz made this clear last Friday at his summer press conference. The business pages of the main media outlets are also full of suggestions on how to save billions at the expense of the needy, pensioners, the sick and wage workers.

It is now clear that the Christian Democratic Union/Christian Social Union and Social Democrats (SPD) deliberately omitted the planned social cuts from their coalition agreement and delegated them to expert commissions in order to first push through the massive increase in military spending. They apparently anticipated tremendous resistance if they had announced a huge increase in rearmament spending and social cuts at the same time. But now, as Merz made clear, there is no more time to lose. Workers and the most socially vulnerable are to pay the costs of rearmament and war.

“The population must know that we all have to make greater efforts for old-age care, healthcare, and long-term care,” said the chancellor at the summer press conference. “We confront a huge socio-political challenge.”

While it was originally stated that experts would work out proposals for “reforming” social insurance provision by the middle of the legislative period in spring 2027, Merz is now pushing for faster action. “We don’t have that much time,” he urged. “What we haven’t decided by the middle of the legislative period will no longer be possible in the second half. We have to solve the problems faster than we currently think we can.”

Reports on the growing deficits of the social insurance providers make it clear how much money is at stake. The spread of low wages, collective agreements below the inflation rate, and so-called “non-insurance benefits,” which have been imposed on the social insurers without the provision of corresponding revenues to fund them, are causing their income and expenditures to diverge further and further.

The deficit of the statutory health insurance providers rose from €1.9 billion in 2023 to €6.2 billion in 2024 and €4.5 billion in the first quarter of 2025. Estimates for the whole of 2025 put the deficit at between €10 billion and €27 billion. Due to high inflation, health insurance fund expenditures are rising much faster this year, at 6.8 percent, than revenues, which are based on the wages of insured persons and will only increase by 3.7 percent.

As a result, statutory health insurers have increased the additional contribution, half of which is paid by employers and half by employees, from an average of 1.7 percent of earnings last year to 2.5 percent (in some cases even more than 4 percent) this year. A considerable portion of the meager wage increases agreed upon by the unions is thus eaten up by the increased additional contribution alone.

There is also a big hole in the statutory pension insurance system. After several positive years, the deficit amounted to €2 billion in 2024, and this year it is expected to reach €7 billion. The reserves will be depleted by 2027 at the latest.

The federal government is determined to pass these deficits on to the insured through lower benefits and higher contributions. It has categorically rejected an increase in state subsidies, which already fall far short of covering “non-insurance benefits.” Because government debt will rise from €2.7 trillion to €3.7 trillion in the coming years solely due to additional war loans, it has ruled out any increase in social spending.

Pensions have been declining for years because, despite regular nominal increases, they are subject to additional taxes. Until 2004, pensions were only taxed at a low rate. Since then, the portion subject to income tax has been gradually increasing and will reach 100 percent in 2040. At that point, there will no longer be any tax-free pensions.

Pensioners also pay compulsory contributions to health and long-term care insurance. Since its introduction 30 years ago, the contribution to long-term care insurance has risen from 1 percent to 3.6 percent (4.2 percent for childless people). This year, a one-time flat-rate contribution of 4.8 percent will be levied, which will eat up half of the 3.74 percent pension increase.

As a result, more than half of all pensioners, a total of more than 10 million, receive a pension of less than €1,100 per month, which is below the official poverty line. One in five residents of Germany over the age of 65 is now considered at risk of poverty. Nevertheless, the next round of cuts is imminent.

At the same time, the citizens’ income benefit, which is available to people with no or low incomes, is at the top of the government’s list of cuts. It is to be downgraded to a “basic security” payment before the end of this year. The €40 billion spent on regular payments, housing and heating in 2024 will be drastically cut.

Meanwhile, the most absurd scenarios for solving the social insurance crisis are circulating. Marcel Fratzscher, president of the German Institute for Economic Research (DIW), which is close to the SPD, has proposed the introduction of a “baby boomer solidarity surcharge.” Pensioners who earned slightly more and who followed the advice of politicians and paid into an additional private pension scheme would give up part of their income to supplement the pensions of those who could not afford such additional provision.

The rich and super-rich, whose assets and incomes have exploded in recent years and who do not contribute a cent to the statutory insurance funds, often not even paying taxes, are not being prosecuted. There are now 249 billionaires and 1.6 million millionaires in Germany (not including owner-occupied properties) with total assets of €5.4 trillion.

Society simply can no longer afford these super-rich, and the billions spent on war and armaments. They must be expropriated, and society must be reorganized on a socialist basis, according to the needs of the majority rather than the profit interests of the rich.

Bourgeois commentators are certain that fierce class struggles are imminent. The Frankfurter Allgemeine Zeitung carried the headline: “Now it’s going to be expensive for all of us,” and the Süddeutsche Zeitung declared: “Friedrich Merz must take money from all citizens.”

Under the headline “The last summer before the great distribution struggle,” Wirtschaftswoche drew a long arc from Friedrich Engels’ 1845 work The Condition of the Working Class in England to Emile Zola’s novel Germinal, which depicts the misery and struggles of French miners, and Thomas Piketty’s analyses of today’s “wealth gaps between rich and poor.” Piketty concludes “that we are now dealing with a new class society that is divided into a (small) property-owning class of the wealthy, rentiers, and heirs on the one hand, and a (large) working class of service providers on the other.”

Wirtschaftswoche proceeds to give Merz advice on how he can best master “the great redistribution struggle of the coming years.” But this struggle cannot be mastered. Capitalist society is bankrupt. The ruling class is responding to this with war, class war and dictatorship. That is the reason for Donald Trump’s rise in the US. In Germany, Merz and Klingbeil are moving in the same direction.

EU interior ministers intensify attacks on refugees

Peter Schwarz

The ongoing assault against migrants and refugees serves as a lever for capitalist governments to eliminate democratic rights, suspend basic human rights, and establish dictatorship. This applies to both the United States and the European Union.

German Interior Minister Alexander Dobrindt and Poland's Tomasz Siemoniak in front of the Polish border fence with Belarus [Photo by MSWiA_GOV_PL]

Under Donald Trump, masked immigration officials—the so-called “ICE Gestapo”—are terrorizing entire communities. They are arresting people who have lived in the United States for years or decades and deporting them to concentration camps at home and abroad from which there is no escape.

The EU is no less committed than the United States in this respect. For years, European borders have been sealed off, refugees illegally turned back, imprisoned in inhumane camps, and deported to countries where they have no chance of survival. In the process the Mediterranean Sea has become the world’s deadliest refugee route, claiming the lives of tens of thousands in the course of the past decade.

On Tuesday, the interior ministers of the EU member states met in Copenhagen to discuss further tightening up migration and refugee policies. Since the meeting was informal, no official decisions were made, but the interior ministers agreed on basic issues:

The EU’s external borders is to be further sealed, and funding for the EU border agency Frontex tripled in the EU budget to a total of €34 billion.

Rejected asylum seekers are to be deported more quickly and in greater numbers, including to war zones such as Syria and Afghanistan.

Return centres are to be set up outside the EU’s borders, from which refugees will be deported with the assistance of Frontex without ever having set foot on EU soil.

Overall, border protection and deportations are to be better coordinated and tightened.

The EU’s tougher stance on migration is being fueled not least by the change of government in Germany, now ruled by a coalition of the Christian Democratic Union CDU, Christian Social Union CSU, and Social Democratic Party SPD. Germany is—in the words of the new Interior Minister, Alexander Dobrindt (CSU)—no longer the “braking cabin,” but rather the “locomotive.”

This is not strictly true, since Dobrindt’s predecessor, Nancy Faeser (SPD), had already significantly advanced the expansion of Fortress Europe. She had ensured the faster deportation of rejected asylum seekers, expanded the list of “safe countries of origin” to include Algeria, Tunisia, India, and Morocco, restricted family reunification, tightened European asylum law, and—in violation of the Schengen Agreement—introduced controls at the German border.

But Dobrindt has now gone much further. Barely in office, he deployed 3,000 additional federal police officers to tighten controls at the German border. In doing so, he violated existing law. Asylum seekers from so-called “safe third countries” were immediately deported without even being able to apply for asylum or residency.

In addition, the border controls led to freight traffic jams and prevented thousands of cross-border commuters from getting to work on time. This resulted in considerable tensions with France and Poland, which responded with countermeasures and their own controls of their borders with Germany.

Dobrindt has promised to turn “the migration wave into a migration turnaround” and earned himself the nickname of “Migration Sheriff” for his aggressive approach. Last Friday, he invited the EU Commissioner for Home Affairs and several European interior ministers to a “Migration Summit” on the Zugspitze, Germany’s highest mountain, to provide “important impetus for a tougher European migration policy.”

On Monday, Dobrindt, together with his Polish counterpart Tomasz Siemoniak, inspected the 190-kilometer-long, five-meter-high, barbed-wire, camera-secured fence that Poland erected along its border with Belarus to keep out refugees. It is guarded by 11,000 soldiers and border guards and cost over 600 million euros.

At the end of June, after the Israeli attack on Iran, Dobrindt was also the first leading international politician to visit Israel and demonstratively expressed his solidarity with Prime Minister Benjamin Netanyahu, whom he would be legally obliged to arrest if Netanyahu visited Germany, following the arrest warrant issued by the International Criminal Court.

It was no coincidence that Dobrindt was chosen as Interior Minister by the CDU/CSU/SPD coalition. He is known as an unscrupulous, chauvinistic agitator and could just as easily be a member of the far-right Alternative for Germany (AfD).

Ten years ago, as Transport Minister under Angela Merkel, he pushed through the “foreigner toll,” which the CSU had placed at the center of its election campaign. A toll was to be levied exclusively for foreigners on German highways. Since this was incompatible with EU law, Dobrindt proposed a toll for everyone, for which German drivers would then be compensated by abolishing vehicle tax.

Economically, the toll made absolutely no sense, as the revenue barely covered the costs of its collection. It served solely to fuel xenophobic sentiment. Ultimately, it was overturned by the European Court of Justice, and the federal budget was left with losses of €243 million.

Even with his latest anti-migrant rhetoric, Dobrindt isn’t simply trying to limit immigration. The number of asylum applications for Germany had already fallen under the previous government by 30 percent year-on-year in 2024,. Many refugees from Syria and other countries currently work in logistics, healthcare, industry, and other sectors, where they are urgently needed.

The incitement against refugees and migrants serves to divide the population and divert growing anger over social cuts, falling wages, and a lack of housing onto the most vulnerable members of society. Refugees who had to flee their homes from wars instigated by NATO are being blamed for a social crisis that is, in reality, the result of rising military spending and the insatiable greed of the super-rich.

The Merz government’s program to make Germany “ready for war” and transform the country into Europe’s strongest military power is incompatible with basic human rights and social concessions. The crimes this government is capable of are demonstrated not only by its continued support for the genocide of the Palestinians in Gaza, but also by the its conduct with regard to EU refugee policy.

Unspeakable conditions prevail in Greece, where the construction of concentration camp-like deportation centers is well underway. The minister responsible for migration, Makis Voridis, and his successor, Thanos Plevris, both defected from the far-right LAOS party to New Democracy, the sister party of the CDU-CSU, which forms the government in Greece.

A reporter for the British Daily Mail recently visited one of these camps, a warehouse on Crete where 400 migrants were crammed together. Her description speaks for itself:

The smell of unwashed men and urine inside the camp clouded my eyes. As we entered, the migrants cried for help and raised their hands to show ten fingers, the number of days they had been imprisoned there.

The atmosphere was like a powder keg, and the conditions were, to say the least, intolerable. Some migrants lay on mattresses which they had to share because there were so few. For the unfortunate ones, it was a concrete floor with a T-shirt as a pillow.

They are being treated worse than animals. This is the fate that the capitalist governments in Europe and the US have in store for anyone who stands in the way of their plans for war and further enrichment of the already wealthy.

Japan’s upper house election result foreshadows political upheavals

Peter Symonds

In the Japanese election on Sunday, the ruling coalition—the Liberal Democratic Party (LDP) and its junior partner Komeito—lost its majority in the upper house of the Diet, or parliament. It was the second blow to the government, which lost its majority in the lower house in national elections held last October. The election was to replace half of the upper house legislators who serve for six years.

Japan’s Prime Minister Shigeru Ishiba attends a press conference at the headquarters of the Liberal Democratic Party (LDP) in Tokyo Monday, July 21, 2025 after his ruling coalition failed to secure a majority in the upper house. [AP Photo/Philip Fong]

In the past, one election loss has usually led to the prime minister making a public apology and resigning. However, Shigeru Ishiba has not resigned and has declared that he will continue in office. He declared on Monday that, as the largest parliamentary party, the LDP had “a responsibility to prevent politics from stagnating or drifting,” amid global uncertainty.

While global issues were largely excluded from the election campaign, the most obvious remain Trump’s huge trade tariffs and demands that Japan make further major increases in military spending. Yesterday, the government reached a trade deal with the US that reduced the threatened tariff rates, but agreed to boost US imports, including of rice. Prior to the election, Ishiba had flatly rejected rice imports, fearing a backlash particularly among the LDP’s voter base in rural areas.

The LDP has only been able to remain in office as a minority government as a result of the deep divisions among the opposition parties—between the far-right and the nominally liberal parties. The two parties that made significant gains in the upper house election—the fascistic Sanseito party and the conservative Democratic Party for the People (DPP)—did so on the basis of populist appeals and demagogy aimed at voters hit hard by inflation, low wages and job security.

Sanseito, established just five years ago, increased its seats from one to 15. It openly ran a Trump-style campaign focused on whipping up anti-immigrant xenophobia, by blaming foreigners for every social ill from low wages and crime rates to rising property prices to dangerous driving. Its racialist propaganda accuses foreigners of diluting Japan’s cultural “purity.”

Sanseito’s leader, 47-year-old Sohei Kamiya, is a former army reservist, English teacher and supermarket manager who was a member of the LDP. He established Sanseito in 2020 and, with the onset of the COVID-19 pandemic, promoted anti-vaccine conspiracy theories. During the 2022 campaign for the upper house, during which the party won its first seat, he engaged in a fascist, antisemitic rant against “Jewish capital.” 

Kamiya criticises women’s participation in the workforce and calls for a cultural return to traditional gender roles. Sanseito’s policies include a universal monthly child benefit payment of 100,000 yen ($US670) to encourage larger families, along with tax cuts and repealing the LGBT Understanding Promotion Act.

However, the party’s chief focus is an anti-foreigner agenda including curbs on immigration, stopping welfare payments to non-Japanese residents and restricting land ownership for foreigners. 

Last week, eight non-governmental organisations issued a joint statement warning against “rapidly spreading xenophobia.” It continued: “The argument that ‘foreigners are prioritized’ is totally unfounded demagoguery.” More than 1,000 organisations subsequently supported the statement.

Unlike Sanseito, the DPP is not a far-right party, but it did make a definite populist pitch to widespread discontent and anger over deteriorating living conditions. The DPP emerged from the break-up of the Democratic Party of Japan, forming in a split in 2018 from the Constitutional Democratic Party of Japan (CDP), the largest opposition party. It won 17 seats in Sunday’s election, bringing its total in the upper house to 22.  

In the lower house election last year, the DPP quadrupled its seats to 28 and become the fourth-largest party. The DPP campaigned against the ruling LDP coalition and the opposition CDP, but has assisted the minority Ishiba government to pass legislation in the lower house. 

DPP leader Yuichiro Tamaki studied law at the elite University of Tokyo, after which he joined the Ministry of Finance and spent a year at Harvard. He declares that he is “neither left nor right” and postures as the defender of the working-age population whose disposable income has barely increased in decades. Tamaki criticised the country’s so-called “silver democracy”—the over-65s that make up nearly 30 percent of the population and are proportionately more likely to vote.

In an appeal to disadvantaged and disenchanted voters, the DPP’s central election slogan was “increase take-home pay.” Tamaki’s policies include slashing the unpopular consumption tax and introducing “education bonds” to fund spending on children and social programs. 

While Tamaki distances himself from anti-foreigner xenophobia, saying that it only appeals because “people feel left behind and are starting to blame foreigners,” he nevertheless supports legislation to restrict land acquisition by foreigners. He also supports the militarist agenda of expanding the armed forces carried out by the government, which is in the process of doubling military spending to 2 percent of GDP.

The growth of Sanseito and the DPP reflects a generational divide. An exit poll by Kyodo News last Sunday found that half of men and women under the age of 40 reported voting for those parties. Among men and women over 60, the numbers reversed, with half voting for the main establishment parties—the LDP and CDP.

The New York Times also reported that another poll found strong support for the two populist parties among members of the so-called “Ice Age” generation, which refers to those who entered the workforce in the aftermath of the implosion of Japan’s share market and property bubbles in 1989–90. The subsequent protracted economic stagnation, lasting into the early 2000s, left many of the estimated 17 million graduates who entered the workforce without permanent employment and condemned to low paid temporary and part-time jobs. As the economy recovered, they were passed over as corporations employed young graduates.

The workforce as a whole is now being hit by economic slowdown, inflation and falling real wages. Last year, Japan’s GDP grew by a minuscule 0.1 percent and declined by 0.2 percent in the first quarter of this year. Estimated GDP growth for 2025 is just 0.6 percent, but the real result could be lower because Trump’s tariffs, which come into effect on August 1, will hit the auto industry hard as well as the economy as a whole. 

Inflation is compounding social distress. A Lowy Institute article pointed out that staple rice dramatically increased in price. In May, a five-kilogram bag of rice cost 4,268 yen ($29.90), nearly doubling from 2,228 yen a year before. A survey late last year by Save the Children Japan found that a third of low-income families were reducing their rice consumption due to rising prices.

The fragmentation and instability of the Japanese political establishment derives from economic stagnation that began in the early 1990s, along with the deepening divide between rich and poor and growing social tensions. Previously, the LDP had ruled continuously since it was formed in 1955, and the opposition was dominated by the Japanese Socialist Party and Japanese Communist Party. 

The Japanese Socialist Party no longer exists. It faded into oblivion after joining a grand coalition government with its long-time rival the LDP in 1994–96 and implementing the LDP’s pro-business policies. While some factions joined dissident LDP groupings to form the Democratic Party of Japan, the remainder renamed themselves the Social Democratic Party, which won just one seat in Sunday’s upper house elections.

The Stalinist Communist Party long ago abandoned its anti-capitalist pretensions under the guise of adopting the parliamentary road to socialism. It functions as part of the Japanese political establishment as the de-facto ally of the CDP, steeped in nationalism and advocating a mixture of social reforms and pacifism. In Sunday’s election, it lost four seats, reducing its total in the upper house to just seven.

In the absence of a genuine socialist and revolutionary alternative, populist parties of the right and extreme right have been able to capitalise on widespread disaffection and opposition. They have been encouraged by sections of the ruling class who fear the growth of working-class opposition to deteriorating social conditions and the emergence of trade war and military conflict.

Ishiba and the LDP remain in power, but the future of both is highly uncertain. Ishiba, who is regarded as a moderate within the right-wing LDP, faces opposition from the party’s right wing who had backed former Prime Minister Shinzo Abe. Moreover, the LDP itself, lacking a majority, could face a no-confidence vote and survives only due to the present lack of a credible alternative. Amid rising global geo-political conflict and economic crisis, all of this foreshadows further political upheavals in Tokyo.