Strikes erupt across Portugal as government fails to adopt budget

Alejandro López & Alex Lantier

Prime Minister António Costa’s seven-year minority Socialist Party (PS) government collapsed on Wednesday, as parliament voted its budget down. The pseudo-left Portuguese Communist Party (PCP) and Left Bloc (BE), which, since 2015 have backed Costa from outside his government, suddenly opposed the budget. It is the first time since the 1974 Carnation Revolution toppled fascistic dictator António Salazar’s Estado Novo regime that a Portuguese budget has been rejected.

Finance Minister Joao Leao holds his head during a debate at the Portuguese Parliament before the voting of the government's state budget, in Lisbon, Wednesday, Oct. 27, 2021. (AP Photo/Armando Franca)

As President Marcelo Rebelo de Sousa schedules a week of talks with the leading parties to prepare snap elections, the ruling elite is clearly terrified of an eruption of the class struggle.

In the capital, Lisbon, Metro de Lisboa workers have been holding strikes for a week for wage rises, better living and working conditions, and career advancement plans. All stations were shut yesterday morning as workers massively joined the strike. Amid broad anger among metro workers at a long-running wage freeze, further strikes are planned next week. Earlier this month, 90 percent of railway workers at state-owned Comboios de Portugal struck for higher pay and more hiring.

Today, Portuguese National Health Service pharmacists are to go on strike today until November 2 to demand wage increases and greater opportunities for career advancement. They are joined by workers at the beer and alcohol distributor Novadis, who will strike and protest at the Sagres de Vialonga bottling plant. Novadis workers are demanding wage increases, suppression of wage inequalities between workers in Lisbon and other parts of Portugal, and the use of the “bank of hours” scheme to impose flexible work schedules and limit overtime pay.

Next week, nurses are set to strike on November 3-4. They are demanding the permanent hiring of temp nurses working for the Public Health System, the hiring of more staff, and increasing bonuses paid to health workers during the COVID-19 pandemic.

On November 5, teachers are set to strike to protest the low pay increase, well below the 5 percent official inflation rate that was set in the now-failed PS budget. Teachers had already organized work stoppages in September as the school year started. Now, they are also set to join a nationwide one-day protest strike by civil servants scheduled for November 12.

Civil servants will strike against the 0.9 percent salary increase proposed by the PS, which would mean a cut in real wages of over 4 percent. On November 11-12, firefighters and prison guards will strike. Firefighters are demanding wage increases and the granting of a risk bonus equivalent to that paid to the security forces. The Tax Workers Union has also announced a strike for December 5.

EU austerity policies imposed since the 2008 Wall Street crash, and continued under Costa, have devastated the working class. Portugal is one of the most unequal EU countries. Official 2020 data showed that 2 million people face poverty and social exclusion, as 16 percent of Portuguese (1.6 million people) live on incomes below the poverty line, including 10 percent of employed workers. Working class opposition erupted in 2019, as a wave of strikes and “yellow vest” protests against social inequality modelled on those in France, spread across Portugal.

While the initial shock of the COVID-19 pandemic temporarily halted the eruption of the class struggle in Portugal, it is now returning in full force. Workers are outraged as the PS negotiates a multi-billion-euro EU pandemic bailout payoff with Brussels, while trying to slash real wages for working people and hand over massive sums to the super-rich.

Moreover, it comes amid an international eruption of strikes by US auto, health and food workers, rail and transport strikes in Germany and France, strikes by UK bus and university workers, and nationwide work stoppages called in South Korea and Sri Lanka. The critical issue, the International Committee of the Fourth International (ICFI) has explained, is the independent organization and international unification of the working class. The ICFI is fighting to build an International Workers Alliance of Rank-and-File Committees (IWA-RFC).

Workers in Portugal face union bureaucracies that cut them off from their class brothers and sisters internationally, and reactionary bourgeois parties like the PS and its pseudo-left satellites, the PCP and BE. These parties have not only imposed EU austerity and real wage cuts for years on working people, but implemented the EU’s deadly policy of “living with the virus” during the pandemic. Over 1 million people have contracted COVID-19 and 18,000 have died in a country of barely 10 million, and daily infection numbers are now climbing back toward 1,000.

The violent hostility of the PCP and BE to the class struggle emerged in the 2019 truckers strike, when the PS called out the army to break the strike and force truckers back to work at gunpoint. The PCP, the BE and the union bureaucracy isolated the strike, blocking solidarity action by broader layers of workers to halt the military onslaught against the truckers. The budget talks have again utterly exposed these bankrupt, pseudo-left organizations of the affluent middle class.

Signs that the PS might fail to ram through its austerity budget mounted this month. On October 18, as anger increased among teachers at the budget, the BE published a “public clarification” desperately denying the PS government’s claim that the BE would, as usual, support its budget. The BE vaguely declared it was still looking for a “convergence” with the PS, to “make the state budget viable,” thus “promoting a social and economic relaunch.”

Last weekend, PCP secretary Jerónimo de Sousa issued a statement on the PCP’s central committee meeting. “Portugal does not need a budget, but a response to existing problems,” he wrote, adding: “The country’s situation and the problems it faces due to decades of right-wing policies aggravated by the pandemic demand a response and a solution that cannot wait.” Issuing a few demands for wage increases and social programs, he pledged to act “always with the same coherence and decisive action, always on the side of the workers and the people.”

This is a pack of lies by a pretentious bureaucrat who has spent years helping impose the same right-wing policies that he is now denouncing. To maintain the false pretence that they oppose austerity, however, the BE and PCP felt compelled to oppose the budget in the October 27 vote in parliament, leading to its immediate failure.

President de Sousa is now moving to dissolve the government and call snap elections, having declared: “My position is very simple; either there is a budget or there will be a dissolution.” De Sousa clearly aims to defuse mounting class struggles by distracting workers with an election campaign, and then assemble a new, reactionary government that will continue imposing EU austerity and murderous pandemic policies on the working class.

Yesterday, EU Vice-President Valdis Dombrovskis demanded Portugal continue austerity, declaring: “There will be no payments unless targets are met.” He threatened to withhold the next €1.3 billion EU bailout payment to Portugal. That is, there is plenty of money—so long as it all goes to the super-rich, and none of it goes to working people, who are to be bled white with falling real wages, social cuts, and the economic devastation of the COVID-19 pandemic.

Peasant protests demanding fertiliser erupt across Sri Lanka

Gamini Karunathilaka & W. A. Sunil

Tens of thousands of farmers in Sri Lanka have been involved in daily protests since the beginning of September to demand fertiliser be provided for paddy cultivation during the Maha (north-east monsoon) season. Peasants growing paddy, vegetable and other commercial crops have held demonstrations in paddy fields, farmland and in the cities.

Farmers marching in Kantale (Photo credit Facebook Sampath Lahiru)

The protests were precipitated by the Rajapakse government’s sudden decision in April to ban imports of chemical fertiliser and other agrochemicals. President Rajapakse attempted to justify the ban by claiming that chemical fertiliser, along with pesticides and fungicides, had caused health problems in rural areas.

The real reason for the ban, however, was because the government confronted a rapid drop in foreign reserves caused by the global crisis and exacerbated by the COVID-19 pandemic. Colombo also slashed many other imports to try and save its foreign exchange holdings.

With Sri Lanka’s annual imports of fertiliser costing about $US400 million, the government also wants to end the meagre fertiliser subsidy it provides farmers.

The farmers’ protests, which initially began in June, were halted during the six-week lockdown imposed on August 21 in response to the Delta variant rapidly spreading across the island.

The demonstrations resumed when the lockdown was lifted last month, the rural masses fearing that their crops would fail without fertiliser and other necessary agrochemicals, throwing them deeper into poverty. The peasants and small farmers have threatened to abandon all cultivation if they are not given fertiliser. Some groups have said they will march to Colombo in their thousands if the government does not address their demands.

Speaking to the media, farmers have angrily explained that crops failed for the last Yala (north-western monsoon) season because they did not have fertiliser. Television reports have shown demonstrating farmers burning and destroying failed sweet corn and other crops.

Several farmers spoke to the WSWS about the problems they confront.

Karunaratne, a farmer from Ginnoruwa in Uva Province, explained that farmers’ representatives had clashed with Mahaweli irrigation project officials at a meeting. Mahaweli is Sri Lanka’s largest irrigation scheme. When officials proposed releasing water to prepare paddy fields for cultivation, the farmers’ representatives refused to accept any water until they were provided with fertiliser. Similar incidents occurred in several other places in meetings with irrigation officials.

Abeyratne, a peasant from Hebarawa in the same area, described the extreme indebtedness of farmers and peasants. “Without fertiliser our situation has now gone from bad to worse,” he said. “We are living under conditions of never-ending indebtedness. Every new season we hope to save ourselves from the debt issue but it never happens and the price of everything, including food items, has gone up to unbearable levels.

“I borrowed 50,000 rupees ($US250) by pawning my gold chain and ring in order to obtain money for last year’s cultivation. Now the banks refuse to give any new loans because the previous loans haven’t been settled. Last season I had to borrow from a lender who charged higher interest rates but our harvest was reduced by a half because there was no fertiliser. How are we going to be able to pay back these loans?”

A 36-year-old woman from Kilinochchi, in the country’s war-torn north, said that it was hard to make any profit from rice cultivation, even with the necessary fertiliser and agrochemicals. “I prepared the land hoping to receive manure but nothing happened,” she said. “I’m a tenant farmer but if we can’t cultivate rice in this season then we won’t be able to get land for the next.”

Farmers demonstrate in Kilinochichi in the war torn north (Photo credit Gnanasangary)

Gunatilake, a vegetable farmer from Bandarawela, said: “Peasants have been using inorganic manure for decades so it’s impossible for them to get used to organic manure all at once. Farmers have not even been guaranteed the provision of other suitable inputs. How can one prevent pests and various diseases affecting crops without pesticides? Some of these chemicals are available on the black market but at intolerable prices.”

Sri Lankan Agriculture Minister Mahindananda Aluthgamage has insulted farmers and peasants, claiming that the multibillion-dollar profit-making agrochemical companies were behind the protests.

President Rajapakse insisted that the government would not remove the fertiliser import bans. But when plantation companies warned that this would drastically impact tea production, the government quickly allowed imported fertilisers for that industry. Sri Lanka hopes to earn $1.4 billion from tea exports this year.

Vegetable farmers protesting at Nuwara Eliya in the central plantation district (Photo credit Malayagakuruvi)

Many Sri Lankan agricultural scientists have criticised the government’s sudden bans and called for the combination of inorganic and organic agricultural inputs, based on a proper plan, and systematically implemented. They warned that Colombo’s hurried actions would result in declining harvests and a severe food shortage.

Last week, the government began importing shipments of nano-nitrogen liquid fertiliser, a type of chemical fertiliser, from India for distribution among farmers. Agricultural specialists, however, warned that this was not a viable solution. Saman Dharmakeerthi, a professor of soil and agriculture management at the University of Peradeniya, said the liquid fertiliser was only four percent nitrogen and that this was inadequate.

Agriculture Minister Aluthgamage has said that farmers would be compensated if they incurred losses and that government authorities were ready to purchase a kilo of paddy at a guaranteed 70-rupee price if farmers cultivated their crops with organic manure.

Aluthgamage’s promises and the import of nano-nitrogen have not succeeded in quelling the protests, which are the result of decades of accumulated discontent and anti-government distrust that has deepened with the COVID-19 pandemic.

According to a 2016 government survey, over 142,300 rural households were under the then-official 4,116-rupees poverty line and 61 percent of rural households were indebted. The poverty-line figure, even on 2016 data, was insufficient for survival, and the high debt levels have worsened exponentially during the last five years.

The lack of adequate land, exploitation by the banks, usurers, agricultural companies and their middlemen, along with the spiralling cost of cultivation, are just the most obvious problems confronting the rural masses.

The opposition Samagi Jana Balavegaya (SJB), which was formed early last year by a majority of MPs from the United National Party (UNP), and the Janatha Vimukthi Peramuna (JVP) have intervened in the farmers protests in an attempt to politically exploit and derail them.

Sajith Premadasa, the SJB parliamentary opposition leader, has been seen mingling among farmers in several parts of the country, feigning concern and calling on the government to remove the fertiliser ban, while insisting his party would resolve farmer’s problems. These claims are worthless.

The capitalist SJB, in fact, has called on the Rajapakse government to appeal to the International Monetary Fund (IMF) to solve the economic problems. But as the Sri Lankan masses are fully aware, the sort of solutions proposed by the IMF and slavishly implemented by consecutive Sri Lankan governments have been for a full-scale austerity restructuring of the economy.

Economic reforms implemented by UNP governments since 1977 have seen the rural farming sector opened up to big business, and the systematic gutting of fertiliser and other necessary subsidies for farmers. Successive Sri Lankan governments since then have intensified these policies. Current SJB leaders were part of the 2002–2004 UNP administration and Sirisena-Wickremesinghe government in 2015–2019 which brutally imposed these assaults.

Farmers burn effigy of agriculture minister at Naamal Oya in Ampara (Photo: WSWS media)

The JVP-controlled All Ceylon Farmers Organisation, which has organised many of the current protests, is attempting to direct the pent-up anger against Agriculture Minister Aluthgamage. At demonstrations, farmers’ have beaten and burned his effigy.

The JVP and its farmers’ organisation are deliberately attempting to cover up the fact that the root cause of the government’s social attacks is the capitalism profit system.

Since the early 1990s, the JVP has transformed itself into a party of the Colombo political establishment, openly propping up capitalist rule in Sri Lanka.

In 2004, the JVP became part of Chandrika Kumaratunga’s coalition government and held four ministries. Anura Kumara Dissanayake, the JVPs’ current leader, was appointed Kumaratunga’s agriculture minister and actively imposed her regime’s austerity measures.

The JVP supported former President Mahinda Rajapakse and then moved to bring the Sirisena-Wickremesinghe government to power in 2015. When workers’ and peasants’ struggles erupted against that government, the JVP intervened to divert the movement into futile appeals to the government.

The SJB, JVP and the peasant organisations are promoting the illusion that peasants’ and farmers’ problems, including the fertiliser issue, can be resolved by pressuring the Rajapakse government. This is false.

The Sri Lankan ruling elite and their successive governments have not, and never will, address the social and democratic problems of workers and the poor. Amidst an unprecedented crisis triggered by the pandemic, the Rajapakse government and the capitalist class are preparing even more brutal attacks on the masses.

France, Britain threaten trade war over Brexit fishing dispute

Alex Lantier

Paris and London are threatening each other with large-scale trade war measures starting next week, amid a mounting post-Brexit dispute over how to assign fishing rights in the English Channel.

On Wednesday, French police vessels stopped two British fishing boats off the French coast, detaining one at the Le Havre port. They said the ship detained in Le Havre “was not on the list of fishing licenses granted to the United Kingdom” by French and European Union (EU) authorities. They threatened both “the confiscation of the fisherman’s catch” and to criminally prosecute the ship’s captain.

It was an act of retaliation against British authorities, who have granted only 15 of 47 French requests for fishing licenses in British waters. Jersey island, a UK dependency off the French coast, has also granted only 66 of 170 French fishing license requests. While British officials claimed they granted around 1,700 EU vessels fishing licenses or 97 percent of the total requested, French Fisheries Minister Annick Girardin replied that only 90.3 percent of license requests were granted, and that UK refusals almost exclusively target French ships.

As Paris and London mount these attacks against fishermen on both sides of the Channel, relations between the European powers are unraveling. Tensions over Brexit are becoming entangled with French hostility to the Australia-UK-US (AUKUS) alliance against China, which led Australia to suddenly repudiate a €56 billion French submarine contract. Moreover, both French and British imperialism are stoking nationalism to try to distract from the pandemic and a rising tide of COVID-19 deaths across Europe.

Yesterday, Girardin went on RTL radio to threaten Britain with large-scale retaliatory measures if London does not grant French vessels fishing licenses before November 2. These are:
*intensified health screening of all British seafood products in France;
*banning British fishing vessels from docking at French ports where their catch is processed;
*imposing security checks on all British vessels in French waters;
*intensified security and customs screening of all British truck freight arriving in France.

The French measures are intended to make it virtually impossible in practice for Britain to export goods to France, and for British ships to sail in French waters. Referring to the British government’s sudden scrapping last year of the Brexit treaty negotiated in 2019 with the EU, Girardin told RTL, “It has been nine months that French fishermen have no longer been able to work. The British are not respecting treaties they signed. We have had enough.”

French officials have made other bellicose threats, including to cut off electricity exports to Britain and also to Jersey, which relies on France for 90 percent of its electricity supply. This would likely shut down hospitals and schools on the island.

“Now we must speak the language of force because I believe unfortunately that this British government understands nothing else,” France’s European Affairs Minister Clément Beaune told the far-right TV channel CNews. “We will have no tolerance and make no exceptions,” he continued, adding: “We cannot act as if we have climate of trust with a partner who does not respect the rules.”

The British government issued a statement calling the French threats “disappointing” and promised to retaliate in kind if they were imposed. Yesterday Foreign Secretary Liz Truss summoned France’s ambassador Catherine Colonna to the Foreign Office to face questions today about “disproportionate” threats.

Environment Secretary George Eustice told Sky News, “We don’t know what they’ll do, they said they wouldn’t introduce these measures until Tuesday probably at the earliest so we will see what they do. But if they do bring these into place, well, two can play at that game and we reserve the ability to respond in a proportionate way.”

The escalating tit-for-tat attack on key economic activity and international trade, on which millions of jobs depend, testifies to the irrationality of the capitalist nation-state system. It is a vindication of the principled position taken by the Socialist Equality Party of Britain on the Brexit referendum in 2016. Calling for an active boycott of the referendum, mobilizing the working class in Britain and across Europe against both the nationalism of the Brexiteers and the EU, a brutal tool of European finance capital. 

The Brexit referendum triggered the fight over the division of fishing rights after Britain left the EU, but EU policies and French trade war threats are a deepening expression of the same reactionary nationalist tendencies. This emerges very starkly from the COVID-19 pandemic. London and the EU capitals pursued a virtually identical policy of “living with the virus,” leading to over a quarter-million COVID-19 deaths in Britain and France, and 1.3 million across Europe.

With the highly advanced state of breakdown of international relations in Europe, the danger of a military clash is growing rapidly. Already in May, a previous Franco-British fishery dispute off Jersey led to a tense naval standoff, as London and Paris dispatched warships to the disputed waters. 

Now, the fishing dispute is taking on the character of an all-European diplomatic crisis, as French President Emmanuel Macron meets today with Biden to try to repair US-French relations after the AUKUS treaty in the lead-up to this weekend’s G-20 summit in Rome. 

Earlier this month, French Prime Minister Jean Castex had spoken on the fisheries dispute at the French National Assembly, demanding “firmer support” from the EU against London. Calling on the EU to “ensure Britain respects the terms of the Brexit accord,” he threatened to veto the execution of Brexit accords and also “place in question… our bilateral relations with Britain.”

Yesterday morning, Germany, Italy, Spain, the Netherlands, Belgium and Ireland alongside Cyprus, Greece, Portugal, and Sweden issued a joint statement demanding a British response to French fishing license requests that respects Brexit accords. It concludes, “We call on the United Kingdom to provide a response as soon as possible and to engage in further technical work in accordance with the spirit and the letter of the Agreement.”

British officials for their part are announcing plans to build an alliance with the so-called Visegrad group (Poland, the Czech Republic, Slovakia and Hungary) targeting France. The right-wing UK DailyExpress wrote that London aims to build an “alliance with ‘sympathetic’ nations against anti-UK France,” cited a senior source close to British Foreign Minister Truss. The source said Truss “is talking a lot to the Baltics [Lithuania, Estonia and Latvia] and the Visegrad 4.”

The source added that “the EU basically is France,” and dismissed it with the statement that Truss is “fairly relaxed about what they think.” The source suggested that Britain encourage Poland and other Visegrad group countries to follow the example of Brexit: “Perhaps we should set up an advisory unit on leaving the EU.”

Draconian PTA, Presidential Pardon to Criminals and Impunity to Security Forces

Kumarathasan Rasingam

President Gotabaya Rajapakshe in his speech in the United Nations General Assembly in his ambitious statement said “Fostering greater accountability, restorative justice and meaningful reconciliation through domestic institutions is essential to achieve lasting peace. So too is ensuring more equitable participation in the fruits of economic development. It is my Government’s firm intention to build a prosperous, stable and secure future for all Sri Lankans, regardless of ethnicity, religion or gender.”

It is to be noted that his actions and moves were just opposite to what he promised considering his actions and inactions: Also a long list of emblematic cases which UNHRC and other Human Rights Organizations listed still remain unattended. Some of them are listed below:

[1] Killing of five [5] students in Trincomalee allegedly killed by the Sri Lankan Special Task force [STF] on January 02, 2006. So far no one has been held responsible for the brutal killings.

[2] Killings of 17 employees of the French INGO Action Against Hunger – ACF  [known as Muttur Massacre] were shot at close range in the city of Muttur – close to Trincomalee. In August 2006. The victims included 16 Tamils and one Muslim.

[3] Killing of Journalist and founder of Sunday Leader was killed on his way to work around 10.30 am on 8th January 2009. In April 2019 Wickkremasinghe’s daughter Ahimsa Wickremasinghe filed a civil suit against Gotabaya Rajapakshe [Now President of Sri Lanka] in the State of California. USA alleged Gotabaya Rajapakshe was behind his death.

[4] Killing of Mylvaganam Nirmalarajan Jaffna based Journalist on October 19, 2000. A group of gunmen stormed his house in Jaffna and brutally killed him. He was reporting for various news organizations including BBC Tamil and Sinhala, Tamil daily Veerakesari and Sinhala weekly Ravaya.

[5] Presidential Pardon of Sunil Ratnayake in 2020 who was found guilty of the massacre of Tamil civilians including a five year old child in Mirusuvil, Jaffna. This is one of the emblematic cases that traversed the criminal system in Sri Lanka with the highest Court of the land affirming the conviction. Despite no evidence to show a miscarriage of justice, a Presidental Pardon was granted, robbing the victims of accountability and undermining the justice system in Sri Lanka.

[6] Decision to drop case against  the formerNavy Commander Wasantha Karannagoda, a man who was wanted over the abduction and suspected to be involved in the killings of 11 youths, This latest announcement from Sri Lankan Authorities is drawing international condemnation, including from the UN High Commissioner for Human Rights and Amnesty International.

[7] Earlier this year the Attorney General’s decision to discontinue the prosecution in the assasination of the Tamil MP and human rights activist Joseph Pararajasingam who was gunned down during Christmas Mass in 2005 in the Batticoloa Church. It is notable that one of the accused is S. Chandrakanthan  alias Pilliyan, a present Member of Parliament in the ruling government.

[8] Another interesting case that received wide attention was the decision by the Attorney General to withdraw the indictments against the finance minister Basil Rajapakshe [Brother of President Gotabaya Rajapakshe] and others related to the alleged misappropriation of public funds in the DIVINEGUMA DEPARTMENT.

[9] Appointing Retired Army Generals alleged to have committed war crimes in top posts in the civil administration of the country and assigning some to diplomatic posts to represent the  country is deplorable.

These few examples highlighted in this article are only an indication of the many setbacks in the judicial system in Sri Lanka. The failure of this system begs the question as to why victims should trust a rotten judicial system that continues to betray them.

UK budget: austerity for workers and billions for bankers

Robert Stevens

UK Chancellor Rishi Sunak delivered a class war budget yesterday, ending the limited social concessions passed during the pandemic and returning to a slash and burn Thatcherite orthodoxy.

The intended direction of travel is epitomised by the statement by the Office of Budget Responsibility statement that public spending is set to fall 'back sharply from its peacetime high of 53.1% of GDP in 2020-21 to 45.1% this year and to 42.1% next year as pandemic-related support comes to end.'

Sunak, who is worth an estimated £200 million and is married into one of India richest billionaire families, rubber stamped a series of massive attacks on workers’ living standards, and yet more subventions to the banks and super-rich who have made a financial killing during the pandemic.

Chancellor of the Exchequer Rishi Sunak leaves No11 Downing Street to deliver his 2021 Budget to the House of Commons. 27/10/2021. (Picture by Luca Boffa / No 10 Downing Street/FlickR)

It was Sunak’s third onslaught against workers in the space of eight months, following his budget in March and his announcement in September of a hike in National Insurance Contribution taxes and end to the triple lock pension system.

Sunak’s budget was a masterclass in smoke and mirrors, heavily trailed as doling out tens of billions in giveaways to workers that have been hammered during the pandemic.

It was nothing of the sort. In his speech to MPs, Sunak declared he was inaugurating an “new age of optimism”. This was a reference to former Tory Chancellor David Cameron, who in a 2009 speech ushered in the “Age of Austerity”, a year before becoming prime minister. In office Cameron, in government with the Liberal Democrats, unleashed a savage onslaught against the working class including £100 billion in cuts to local council jobs and services.

But Sunak’s age of optimism is reserved for the oligarchs, while workers suffer continued austerity. In the largest transfer of wealth announced, Sunak slashed by 60 percent surcharges on bankers’ profits that were due to be enacted in 2023. This measure alone saves the banks £4 billion in taxes over five years.

The initial surcharge, along with a planned increase in corporation tax for the banks, would have meant banks paying a combined rate of 33 percent. With the new measures, including the cutting of the profit surcharge 8 percent to 3 percent, the banks will pay a combined rate of just 28 percent.

The Financial Times wrote approvingly last week of his “effort to keep the City of London competitive on a global scale in the wake of Brexit.”

For public consumption, however, the media gave the impression of Sunak carrying out a “£150bn splurge on public services” (Daily Mail) as part of Prime Minister Boris Johnson’s pledge to “level up” the country.

Sunak’s first job was in fact to warn everyone of “the importance of strong public finances,” under conditions in which “Coronavirus left us with borrowing higher than at any time since the Second World War.” He unveiled a ‘Charter for Budget Responsibility’ which “sets out two fiscal rules which will keep this government on the path of discipline and responsibility. First, underlying public sector net debt… excluding the impact of the Bank of England… must, as a percentage of GDP, be falling. Second, in normal times the state should only borrow to invest in our future growth and prosperity.”

Borrowing for public spending would cease as “Everyday spending must be paid for through taxation.” This was necessary to balance the books for day-to-day spending by the end of the parliament in 2024-25.

Central to the new fiscal tightening was his plan to “keep welfare spending on a sustainable path.” This month, the government ended the £20 per week uplift in the Universal Credit welfare benefit payment in place since the beginning of the pandemic. This has thrown millions of people into desperate financial circumstances overnight, the largest one-off welfare spending cut in British history taking £6 billion a year away from the poorest households.

Due to criticism, Sunak made a few token changes to the Universal Credit system in the budget. At best these would only benefit a small minority of the around six million people claiming the benefit and then only by a small amount. Announcing a cut to the UC taper rate, taxing claimants 63p in the pound on anything they earn over their base level of benefits, to a rate of 55p Sunak hailed it as £2 billion gift to the lowest-paid workers.

This still means that the poorest in society lose a collective £4 billion a year, or a £1,040 per year cut for claimants. The change only affects less than a third of those who lost the £20 uplift. The Independent noted that “a lone parent on minimum wage part-time will still lose £361 next year.”

Sunak announced an increase in the minimum wage of just 6.6 percent, with those aged 23 and over expecting £9.50 per hour. This will help only 2 million workers out of a workforce of over 30 million people. Moreover, such a small increase will be cancelled out by inflation with the RPI inflation rate already at 4.9 percent and expected to soon top 5 percent. Sunak acknowledged that even the CPI rate of inflation, which doesn’t include rising housing costs, would top 4 percent next year.

Much of the spending announced by Sunak was capital spending and very little was actual new money. The Financial Times noted, “An £11.5bn allocation to build up to 180,000 new affordable homes, £10bn to ‘unlock 1m new home’ and the £5bn cladding fund—all cited by Sunak on Wednesday—had each been previously announced”. One example, which will have tragic repercussions, is the pittance of £5 billion for spending to remove dangerous cladding on residential buildings. The amount required is up to £50 billion, and the £5 billion that Sunak hailed in the budget is the fourth time that this measure has been announced already!

Sunak’s budget fraud was punctured by sober analysis of documents accompanying the budget statement by the Institute for Fiscal Studies (IFS) and the OBR. With the huge increase in the cost of living, including mammoth rises in energy prices over the last months, the OBR noted that real household disposable incomes, after inflation is factored in, fell by 0.6 percent last year. This year it will rise by barely 1.1 percent year and in 2022 will increase by an even smaller 0.3 percent. As reported by the Guardian, the OBR estimates that “on a per person basis, real household disposable incomes only return to pre-pandemic levels in the latter half of 2023, with growth of 1.5% that year.”

Even this is optimistic, with more than a decade of austerity having already vastly reduced workers’ disposable income. Commented on the result of a social counter-revolution, the IFS tweeted that “real wages are expected to remain stagnant for 20 years. In 2026, wages are forecast to be £11.70 lower than if the pre-2008 trend in wage growth had continued.”

Noting the impact of the two budgets this year and the NIC tax rises being imposed, the IFS wrote, “Rises in national insurance contributions and (through a freeze to the personal allowance) income tax in April will come on top of rising inflation, taking a significant swipe at people’s spending power.

“According to the new forecasts, over the next year a median earner will find their pre-tax pay just about outpaces inflation, but after the extra income tax and NICs due their take-home pay will fall by about 1%, or £180 per year, in real terms.”

The Resolution Foundation assessed that Britain was “still in the midst of its weakest decade for pay growth since the 1930s,” and that real wages would continue to fall to 2024. The think tank said that the measures of the Johnson government, including Wednesday’s budget, would raise household tax bills by £3,000 on average by 2027.

Floods in Greece expose the fatal consequences of climate change and austerity policies

Katerina Selin

Heavy rains led to devastating floods across Greece in mid-October. Based on the number of emergency calls, the fire brigade estimates that almost 2,000 houses were flooded across the country during the storm named “Ballos.” Most affected was the Attica region and the Greek capital, Athens.

The flood of water turned streets into rivers, swept away hundreds of cars and caused power cuts in several districts. Areas of the island of Euboea were also affected, where catastrophic fires had raged in the summer. A 70-year-old farmer died in the floods on the island. Last weekend, following heavy rainfall, flooding occurred again on the island of Corfu, with houses, shops and fields inundated in a number of villages.

Despite previous warnings from scientists, the government did nothing to protect the population from the floods. Instead, it reacted with the same criminal negligence and ignorance it has shown with regard to the COVID-19 pandemic and the country’s recent forest fires. The aftermath of the storm once again revealed the glaring deficiencies in flood and disaster protection and the widespread unsafe and cramped construction and dilapidated infrastructure which prevails in Greece—a result of decades of austerity policies.

On social media, scenes from the northern Athens district of Nea Philadelphia shocked viewers. A video shows students rescuing themselves from their flooded school via a makeshift bridge of desks and chairs. The images were reminiscent of natural disasters in developing countries. “Welcome to the Middle Ages or Greece 2021,” commented one Twitter user.

Many tweets linked the school flooding to the government’s recent attacks on public education, which led to tens of thousands of teachers and students going on strike just days before the storm.

The affected school complex houses a primary school, a kindergarten, a high school and a lyceum. While the students essentially rescued themselves, the fire brigade arrived later to pump out the water. “We cannot possibly drown in our own schools!” the Nea Philadelphia student committee declared in an angry statement to the government. They said the students of the lyceum have been taught in makeshift classrooms made out of shipping containers for 10 years.

“You bear a great responsibility! You, previous governments and of course all municipal authorities up until today. You have not taken any action for years because our safety and health cost money. Today’s pictures from a school just a few kilometres from the centre of Athens prove these are not random events. It is criminal decisions that leave us unprotected.”

On the Monday after the storm, students, together with the parents’ association, protested in front of the local town hall, demanding immediate action and funding to repair the damage to the school and better protection in future from floods and earthquakes.

The students also demanded the reversal of the announced merging of hundreds of classes across the country, which will result in even more students being crammed into small, often dilapidated classrooms. This will not only increase the spread of COVID-19, it will also make rescue operations more difficult in the event of floods, fires or earthquakes.

As videos from the student newspaper Foititikos Kosmos show, the ground floor of the Athens School of Fine Arts was also flooded, forcing students to flee the building. In the Faculty of Philosophy at the National and Kapodistrias University of Athens, rain began to drip through the ceiling during lectures. Flooding also occurred at the University of Western Attica and the University of Crete.

Ιn the northern Greek city of Thessaloniki, a road collapsed, causing a bus carrying 15 oil workers to fall into a hole. Fortunately, the passengers were not seriously injured. In southern Athens, near Stavros Niarchos Park, dozens of people had to rescue themselves from a bus that had become stuck in a flooded road subway and was submerged in muddy water.

Passengers wade through rainwater after a bus got stuck in a flooded underpass, October 14, 2021 (AP Photo / Thanassis Stavrakis)

The flood disaster was entirely predictable. Meteorologists and scientists had predicted that there would be heavy rainfall and flooding in the autumn, exacerbated by fierce forest fires during the record heat of the summer which had stripped away vegetation which would normally impede the flow of water and limit landslides.

“With fires, we always know that there will be flooding afterwards. This is the norm,” Nikos Belavilas, a professor at the National Technical University of Athens and head of the Urban Environment Laboratory, told Open TV. He says it was fortunate that not too much rain fell on burnt areas—otherwise the damage would have been even greater.

Experts consider the recent storm to have been of medium strength and expect even greater torrents of rain in the near future, an eventuality for which Greece is completely unprepared. Researchers have long warned that extreme weather events will increase with climate change.

Dimitris Pirounakis, the president of the Greek Environmental Federation, explained in an interview with the website News247: “One of the effects of climate change in Greece is that we will have more droughts in the future, resulting from long periods without rain. But when it rains, the intensity will increase, leading to more flooding.”

The danger was pronounced, especially in scorched areas such as northern Evia, he said. “Forests can prevent large amounts of water from flowing into the cities but due to the forest fires the cities are no longer protected from rainwater. Combined with deforestation and anarchic and unsustainable construction in cities (building on watercourses), this is what has happened. And that was just the beginning. Unless the necessary measures are taken to rebuild and prepare for floods, there will be very big problems in future.”

Clogged and partly dried-up rivers like the Kifissos in Athens, blocked drains and sewer manholes, a lack of street cleaning and an overall lack of stormwater infrastructure have quickly led to mudslides flooding streets, Pirounakis said.

In recent decades, there have been repeated flood disasters in Greece, which have had a disastrous impact on the lives of the working class due to the governments’ austerity policies under the dictates of the European Union and the International Monetary Fund. In 2017, when the pseudo-left Syriza (Coalition of the Radical Left) party was in office, 23 people died in floods in Mandra, a town in western Attica.

At the time, the WSWS explained that essential public sectors such as urban planning and flood protection were being systematically undermined. These included the dissolution of the Public Corporation of Urban Planning and Housing (DEPOS), the relaxation of building regulations as part of the government’s privatisation policies since 2011, and the abolition of the Organisations for Regulatory Planning and Environmental Protection in the cities of Athens, Thessaloniki and Ioannina in 2014.

The consequences of these policy shifts are also pointed out by Aris Kalantidis, professor of urban planning at Manchester Metropolitan University, who told News247 that the replacement of the independent regulatory agency in Athens by a ministry-affiliated and opaque agency, meant that de facto planning and oversight no longer exist.

While Greek politicians often refer to global climate change in general terms as a natural phenomenon in order to avoid their own responsibility for the consequences, the reality is that the rapid destruction of the planet makes immediate action all the more urgent.

Huge financial, technical and human resources must be invested immediately in public infrastructure, disaster prevention, scientific research and the fight against climate change. Families affected by forest fires and floods must receive comprehensive compensation and support.

The implementation of these measures, however, are incompatible with the capitalist profit system and the agenda of its political representatives. The ruling class in Greece and around the world acts in the interests of the banks and corporations, pumping billions into military budgets and pushing ahead with privatisation and cuts in key public sectors.

Germany’s reopening policy leads to surge in COVID-19 infection rates

Tamino Dreisam

Germany’s COVID-19 incidence rate, which is the number of people per 100,000 inhabitants infected within seven days, has exploded over recent days. Within a week, it rose from 75 infections per 100,000 inhabitants to 118, an increase of about 50 percent. The number of daily new infections increased to more than 23,000 on Wednesday. The number of cases is significantly higher than at the same time last year.

The number of people infected with COVID-19 requiring intensive care has also been rising steadily since the beginning of October. There are currently 1,622 COVID-19 patients in intensive care. There were 150 new hospitalizations registered for the day on Monday. The incidence rate for hospitalization is 2.77 per 100,000 inhabitants. Around 70 people are succumbing to the virus every day.

The sharpest rise in infections has been recorded in the state of Thuringia, which is governed by a Left Party/Social Democrat/Green coalition. At 224 infections per 100,000 inhabitants, the incidence rate is more than twice the national average—an increase of 85 cases per 100,000 people compared to the previous week. At 7.72 per 100,000 inhabitants, the incidence of hospitalization is also well above the national average.

Like last year, schools and kindergartens in particular are once again central sources of infection. The age group with the highest infection rate is 5- to 14-year-olds, with an incidence rate of 224 per 100,000 people, followed by 15- to 34-year-olds with an incidence of 138. The number of outbreaks in schools increased sharply from early August to early October, directly due to the opening of schools without adequate safety measures.

Over the last four weeks, there were 166 outbreaks in kindergartens and 758 in schools. The figures for the last two weeks are incomplete due to late reporting, meaning the true number of outbreaks is likely even higher. At the end of September, the number of outbreaks in schools reached a new high of 243 per week. An outbreak results in an average of five infections.

Despite this catastrophic situation, all parties in Germany’s federal parliament are in favor of further dismantling protective measures. Health Minister Jens Spahn (Christian Democrats, CDU) repeated his call on Sunday to end the “epidemic situation of national importance” when it expires on November 24. This decision will remove the legal basis for most of the protective measures against the spread of COVID-19.

This corresponds to the interests of all parties of the ruling class. The liberal Free Democrats and far-right Alternative for Germany have long been in favor of an end to the remaining public health measures, but the nominally “left” parties are also open supporters of the policy of mass infection.

The Greens are calling for a “transitional arrangement” once the “epidemic situation” comes to an end. Keeping the “epidemic situation” unchanged is the “wrong answer,” they claim. SPD parliamentary group leader Rolf Mützenich told the Redaktionsnetzwerk Deutschland (RND) that the SPD was also not aiming to extend the “epidemic situation.” According to Die Welt, the Left Party is also calling for an end to the “epidemic situation.”

Leading representatives of the Left Party, such as party founder Oskar Lafontaine, or the former parliamentary group leader Sahra Wagenknecht, are working with right-wing COVID-19 deniers and are calling for an end to all protective measures in the form of a “Freedom Day.” The state governments in which the Left Party is involved are already systematically dismantling public health measures.

The unions also support the reopening policy. Maike Finnern, chairwoman of the Education and Science Union (GEW), campaigned in comments to the RND to keep schools open in autumn and winter. “If the prevention path is continued consistently, the schools can remain open,” she cynically declared. In fact, the GEW supports the current moves to dismantle the last remaining mitigation measures. “We expressly welcome the fact that the masks are falling,” said Bernd Schauer, GEW State Director of Schleswig-Holstein, in response to the news that the state would scrap its mask mandate in school classrooms.

With the dismantling of the last remaining safeguards, the established parties are creating conditions for mass death on a scale that will surpass the tens of thousands of fatalities recorded last winter.

Scientists around the world are warning of the dangerous consequences these policies will have. “The Delta variant is so infectious that the unvaccinated are infected very quickly, and this is especially due to the seasonal effect when everyone goes inside,” warned Christian Karagiannidis, the scientific director of the intensive care register of the German Interdisciplinary Association for Intensive Care and emergency medicine (DIVI), in an interview with Deutschlandfunk.

He dismissed the official propaganda that it is possible to open everything up because of the high vaccination rate, warning that the policy threatened to overwhelm ICUs. “On the one hand, we are seeing a very significant increase for about ten days with considerable growth rates in the incidence rates ... and the incidence rates are still extremely closely linked to admissions to intensive care, and that causes us great concern,” he said.

The situation in hospitals is already worse than at the same time last year. There are currently over 1,500 COVID patients in intensive care, compared to 360 in autumn 2020. The number of free beds was 8,000 last October. Currently, only 2,500 beds are free.

Karagiannidis also denied official claims that COVID-19 was “less severe” for young people. He gave two reasons for this. Firstly, “the severity of the disease is of course extremely high and the burden on the intensive care units due to cases requiring ventilation is enormous.” Secondly, “because the young people survive longer, the occupancy on the wards is kept high for a very long time.”

What’s behind Tesla’s $1 trillion market valuation?

Gabriel Black

On Monday, Tesla, the leading electric car company, owned by Elon Musk, achieved a market valuation of over $1 trillion. Tesla now joins Apple, Google, Facebook, Microsoft and Amazon among the ranks of corporations whose market capitalization has surpassed the $1 trillion mark.

Tesla stock surged Monday upon the announcement that rental car giant Hertz was buying 100,000 Teslas for its rental fleet. As a result, the personal fortune of Musk, already ranked as the world’s richest person at $271 billion, rose another $36 billion on that day alone.

The spectacular rise of Tesla’s valuation is a testament to the illusory character of present-day capitalist growth, spurred by endless sums of money funneled by governments into financial markets. Tesla’s rise is also an indication of a general shift in the productive forces toward renewable energy, along with increasing automation.

In the deal reached between Tesla and Hertz, the latter said it would buy 100,000 Tesla Model 3 cars as part of its plan to go electric. The deal is being subsidized, according to reporting by the Wall Street Journal, by a 30 percent tax credit expected to be passed as part of the budget bill currently under discussion. Additionally, it is expected that half of these 100,000 vehicles will be made available to rent to Uber drivers.

Tesla’s stock price was already on the rise before the Hertz announcement. Between October 11 and October 25, Tesla’s share price went vertical. It rose from $791 to $1,024 under conditions of a general upward trend in the markets in the first half of October. But even this pales in comparison to the last two years.

Before the pandemic hit, in February 2020, Tesla’s share price reached a high of $180. Today, less than two years later, it is above $1,000.

Its market capitalization has skyrocketed. At the beginning of 2020, it had a total valuation of around $80 billion. Now it has surpassed the $1 trillion mark.

For comparison, Toyota’s market capitalization has essentially remained flat from 2017 to the present. For almost all this time, it has been valued at around $200 billion. This is despite the fact that Toyota is tied with Volkswagen as the largest car company by revenue. Toyota takes in $250 billion each year. In contrast, Tesla made just $31.5 billion last year.

Toyota produces about 10 million vehicles a year, compared to Tesla’s production volume of less than 1 million.

The extraordinary growth of Tesla’s stock has cemented Elon Musk as the richest man in the world. This comes from both his massive stake in Tesla and his ownership of SpaceX. Forbes ranks Jeff Bezos as the next wealthiest man, at $198 billion.

What stands behind this extraordinary and seemingly bizarre explosion in the value of Tesla?

There are at least three major forces at work.

First, the world’s financial markets are awash in unimaginable amounts of money. This may seem surprising to the vast majority of working people, who are struggling to meet their basic needs and facing surging gas and grocery costs. But in the realm of high finance, there is money in super-abundance.

Governments and central banks have been pumping vast sums of money into the markets since the 2008 financial crisis. The US Federal Reserve led the way by adopting the policy of “quantitative easing,” a euphemism for electronically printing trillions of dollars in order to buy toxic asserts from the banks, depress interest rates and drive up stock prices. This policy has been intensified over the last two years, as governments and central banks sought to stave off a financial crisis and economic slump—perhaps without precedent—in March 2020.

Nearly every leading capitalist power is pursuing the same policy.

At present, in addition to keeping interest rates near zero, the US Federal Reserve is funneling $120 billion into the financial markets every month.

The resulting debt bubble threatens to implode. Financiers and central bankers around the world are nervous, and rising commodity inflation and working-class struggle compound their fears.

Tesla has benefited from this environment. With endless cash but few opportunities to profitably invest in traditional industries, finance has rushed toward companies that could disrupt existing markets. Tesla has the potential to do this through its edge in electric vehicles.

The second factor is the shift toward renewable energy technologies. Capitalist profit and national interests make impossible the allocation of resources and the international coordination required to seriously address the climate crisis. But there is a definite movement by capital to transition away from fossil fuels.

Ten years ago there were fewer than 0.1 million electric vehicles globally, according to the International Energy Agency (IEA). In 2020, that number had multiplied by over 100, surpassing 11 million vehicles. Even without new climate legislation, the IEA expects the global number of electric vehicles to rise to 137 million by 2030.

This is a significant shift in auto, one of the world’s largest industries. The shift falls far short of what is required to save the planet from the impact of climate change, however.

To meet net-zero carbon emission goals by 2050, the number of electric vehicle sales would have to be 358 million by 2030, according to the IEA. (It should also be noted that electric vehicles must have a carbon-neutral supply chain to truly stop emissions. The minerals and materials required to build these cars rely still on a largely fossil fuel-based production and distribution system).

Tesla remains a global leader in electric vehicles, its sole product. It currently boasts a 520-mile range in its newest model.

A third major component of Tesla’s expansion is its bet on new, massive, state-of-the art facilities for electric vehicle, battery and solar production.

Tesla’s original factory in Fremont, California, sits on the site of a former General Motors and Toyota joint venture—the New United Motor Manufacturing plant, which dates back to the 1960s. The World Socialist Web Site previously published an exposure of the grueling, unsafe conditions there.

Tesla, however, has built three “giga factories” in the last few years in Nevada, New York and Shanghai. It will soon open up two new giga factories in Texas and Berlin. It is rumored that several more are in the works, as well as additions to existing ones. Tesla boasts that the Nevada factory will in the end be three times the size of Central Park, making it the largest building and factory in the world. It will be topped with solar panels.

The giga factories are considered to be cutting-edge in terms of automation. Tesla has bought several leading automated machine companies over the last few years.

This will not make the facilities any less exploitative, but markets are betting it will give the company an edge.

Because major industries require significant capital investments in machinery and facilities, companies have to wait for the machinery to transfer its value to production before updating it. If they did not, they would not reap the full value from their large investment.

This can give newcomer companies, like Tesla, an advantage, because they are free to invest in the latest technology and the largest factories, having few pre-existing factories themselves.

Something should also be said of Tesla’s place as a “meme stock.” Elon Musk has created a “green,” “disruptive” entrepreneur persona that has attracted non-institutional investors.

The son of a mining magnate from South Africa, Musk has also demonstrated his capacity to ruthlessly squeeze his workers. He openly courted the far-right with his opposition to the most basic public health measures to halt the pandemic (to which California Democrats capitulated).

In summary, Tesla’s valuation is overwhelmingly fictitious. It is a gigantic bet, fueled by the general market frenzy, and liable—like the rest of the economy—to “pop.”

It is not impossible for Tesla to partially live up to the valuation that has been placed on it. The technology being developed at Tesla and other advanced technology firms can play a progressive role in the development of the global productive forces, but only if it is freed from the capitalist framework of private ownership and nationalism.

As economic pressures mount, Tesla and its counterparts will have only one surefooted strategy: further squeezing their workforce to extract ever greater profit, generating ever greater resistance from the workers.