Saturday, September 29, 2007

Burma and "democracy"

Burma (or Myanmar as the present rulers want it to be called) is, and has been since 1962, a military dictatorship, one which even has had the cheek to claim to be socialist. Now, once again, sections of the population are demonstrating for there to be more elbow room for people to organise politically and to express critical political views.

Naturally as socialists we would welcome this as freedom of movement and expression, the freedom to organise in trade unions, to organise politically and to participate in elections are of great importance to all workers and are vital to the success of the socialist movement.

We must, however, warn workers in Burma against becoming the pawns of capitalist interests, both home-grown and external.

Burma is the largest country in South East Asia and is of strategic importance, especially for its north-eastern neighbour, China (which also has the cheek to claim to be socialist), as it provides Chinese capitalism with an outlet to the Indian Ocean. In April this year the Chinese authorities approved the construction of an oil pipeline from the Burmese port of Sitwe to China (see here). According to an article in Asia Times (27 September), other economic interests are involved too (see here).

The current regime in Burma is pro-China. The US, anticipating that its main rival for world hegemony this century is likely to be China, has been pursuing a policy of trying to encircle China with a ring of military bases. They are anxious for "regime-change" in Burma, to one favourable to them, so as to further hem in China. And to this end are encouraging, and no doubt financing, the Burmese opposition.

China, on the other hand, is anxious to maintain the present regime and is likely to use its position as one of the five permanent members of the UN Security Council, with the power of veto, to prevent Burma being given anything more than a slap on the wrist for shooting down demonstrators.

Neither the US nor China care a fig about "democracy" in Burma. They are both concerned merely with their own strategic interests. So, workers in Burma should not be taken in by Bush when he says he wants to see Burma become a "democracy". What he means is that he wants to see a regime installed in Rangoon that will be pro-US and pro-market capitalism. And there is no reason whatsoever why workers should help him do this.

Nevertheless, workers should still try, independently of pro-capitalist groups, to take advantage of this rivalry between China and the US to gain a little more elbow room to pursue their own class interests.


Monday, September 24, 2007

News from Turkey

Apparently a popular craze of Japanese children is “Mushiking: King of Beetles” which is viewed as a cartoon, read as a novel and played as a card game. According to a report in the Turkish press Today’s Zaman (1 September), quite a war is raging between rival German and Japanese traders whilst the Amanos Environmental, Conservation and Solidarity Association is also weighing in to try and stop the illegal trade in stag beetles. The Amanos Mountains in the Hatay province of Turkey – near the Syrian border – has a particularly coveted variant, because of its “impressive antlers”, of the stag beetle Lucanus cervus and this is where the unregulated trade is booming.

In the early days of the trade Germans were paying villagers between 5-30YTL per beetle (approx. £2-12) but were then selling them on to the Japanese for up to $3,000 each. A nice little profit for the Germans, not entirely appreciated by the Japanese who then came up with ingenious plans to outdo their rivals. Having arrived in Turkey one method the Japanese employed was to buy a cheap collection of beetles mounted on card and to replace the dead specimens with live, sedated beetles (sedated for 20 hours with “special chemicals.”) Another way of smuggling them out live was in nappies – presumably being worn by babies and, presumably, also sedated. Once in Japan said revived beetles could be bred in laboratories.

Why so important to have live beetles, besides the obvious profit to be made from breeding? Because the beetles are first and foremost prized as “pets”, kept in boxes and fed “special food” until they die (life span about 2 months). Once expired they are turned into keyrings or become part of a collection. It seems the Turks discovered this illegal trade by chance when “trying to help a Japanese team which was visiting the region”. At the time of writing the president of the Amanos Environmental, Conservation and Solidarity Association, who wants to “stop the illegal trade and protect one of Turkey’s assets”, was still awaiting a response from the Agricultural Ministry.

At the opposite end of the country the Ministry of Tourism protects the indigenous mountain goat and various other prized animals by outlawing hunting to locals but encouraging “eco-tourism” in the form of ‘bounty’ hunting by foreign tourists who pay a premium fee for such privileges.

Meanwhile, more news from Hatay province and nearby Sanliurfa in the South East where people are telling of having to work as seasonal farm labourers a long way from home. One reason given is lack of water for irrigation of their own land leading to food shortages and another that there is a general lack of jobs in their own area. Many of them travel as large family groups to the Black Sea region to pick cotton or fruit taking with them tents, bedding, cooking pots and pans, buckets, water containers, in fact everything they will need. At this time, the end of the season, many are returning home – a journey of 12 hours or more – not by bus which would cost over £20 a head but in shared, open lorries carrying 2 or 3 families, in total over 50 people and costing in the region of £8 a head, a huge saving for a large family group.

The reason that this article was considered newsworthy was because there have been a number of serious accidents recently involving these ‘people-carriers’ resulting in many fatalities of seasonal workers. To quote one of the returning workers, “we came in trucks, we’ll return in trucks, we can’t even earn enough to pay our transportation costs. There are too many workers and not enough work. If we had jobs in our home towns we wouldn’t come here.” Besides the appalling conditions of the journey one man also commented on the treatment suffered at the hands of the agents. “The agents cheated us. They said jobs and accommodation were ready and waiting for us but they weren’t, and then they take 2.5YTL (a pound) from everyone of us for each day’s work.” (Probably more than 10%).

For the sake of profit any lengths are acceptable.


the Pope and Capitalism

"The emergencies of famine and the environment demonstrate with growing clarity that the logic of profit, if predominant, increases the disproportion between the rich and the poor and leads to a ruinous exploitation of the planet."

"Capitalism should not be considered the only valid model of economic organisation,"

"When the logic of sharing and solidarity prevail, it is possible to correct our route and point it towards fair and sustainable development."


No, the Pope hasn't turned into a marxist. As the article indicates he thinks capitalism and fair wealth distribution are possible, which isn't the case.

(Hat tip: Alan J)

Saturday, September 22, 2007

Britain and the South Atlantic

Recent weeks have seen America, Russia, Canada and Denmark staking claims to regions of the Arctic. Just the other day Russia declared the Lomonosov Ridge is Russian.

This isn't the only area where claims are being made though. The Guardian reports:

Britain is preparing territorial claims on tens of thousands of square miles of the Atlantic Ocean floor around the Falklands, Ascension Island and Rockall in the hope of annexing potentially lucrative gas, mineral and oil fields, the Guardian has learned.

The UK claims, to be lodged at the UN Commission on the Limits of the Continental Shelf, exploit a novel legal approach that is transforming the international politics of underwater prospecting.

Britain is accelerating its process of submitting applications to the UN - which is fraught with diplomatic sensitivities, not least with Argentina - before an international deadline for registering interests.

(The rest here.)

There is a scramble for resources going on. Watch this space for future developments.

Tuesday, September 18, 2007

This Year's Moral Panic

This summer has seen a moral panic grip the UK media. The death in Liverpool of Rhys Jones, the 11-year old boy killed by a bullet from a teenage gang was preceded by a number of gang-related murders, and resulted in much circulation-driven hyperbole about “what sort of society we live in”.

This is nothing new. In the 60s it was Glasgow’s razor gangs that made the headlines. The technology has advanced a little now, that’s all. There have in fact been countless episodes of social panic because of a perceived rise in violent crime. A recent Home Office study (National Crime Survey) found that when polled, people always over-estimate the crime rate in their locality. (Unsurprisingly the greatest disconnect from reality was for tabloid readers).

Nevertheless, law and order is back at the top of media and voters’ concerns. The media debate – and politicians’ response – has focussed on the problems of youth, their schools and their parents. One suggestion amongst the various boot camps being proposed, is to lower the age of criminal responsibility from 10 to 8 years old. The Prime Minister himself has commissioned a study into the effect of violent videos on children. The last ten years has seen an unprecedented 2700 new laws introduced. We can expect that trend to continue.

Why people behave the way they do is of course a hugely complex and multi-faceted subject. World socialists don’t lay claim to any specialist understanding in this respect, suffice to say that how people behave is usually down to what they have learnt, be that formally or informally. This learning may be psychological (e.g. secure emotional attachment and nurturing with a parent in the first few years of life), or it may be material, in terms of (for example) the physical environment, or nutrition during childhood.

Much has been made of the fact that gang-members dripping with “bling” (an average teenager on the street may wear close to one thousand pounds-worth of digital accessories) don’t appear to fit the traditional image of impoverished and desperate members of the working class such as the Glasgow razor gangs. It is likely however that the foot soldiers of the gangs do not make that much money, and this certainly applies to the very young members who are the focus of so much media concern.

However, in a world that increasingly only looks at the price tag, the outward display of some sort of wealth masks perhaps a desperate cry for some sort of recognition. For the market system a pair of training shoes accords status and belonging. This skewed perspective is a measure of just how warped capitalism is. But in any case, world socialists have never just viewed poverty as being about the absence of things, such as cars or money. Increasingly in the older capitalist nations at least, poverty may owe more to an absence of less concrete – but no less critical – human needs such as self-esteem, a sense of belonging or a purposeful, creative and productive life. (There is plenty of evidence that above a certain level, as a society becomes economically better off, it simply becomes a less healthy place for humans in terms of mental wellbeing).

It is likely then, that membership of a gang provides its members with some of the things that this society denies them outright. However warped or misplaced, a gang may provide some sort of shared experience and common purpose, a little excitement and a lot of status. After all, the apparent cause of most of these gang murders is not usually down to drug-related battles, but appears to be summed up in one word: respect.

Certainly it would be churlish to ignore that a lot of the gangs are commercially-focussed, profit-driven drugs operations. According to Assistant Commissioner Tarique Ghaffur, head of the specialist crime directorate, this is an expanding economy. “It is a huge growth industry and it has not peaked. The challenge is when you do a big operation there are people, gangs, ready to replace and replace and replace". Take away the market system by abolishing money and wages and commodities, and you end at a stroke most of the “drugs” problem.

The market system allows us only limited access to wealth. At the same time it bombards us with images and messages of what we could be having. It pressures us into valuing ourselves against everyone else, then offers an arbitrary set of rules to be followed.

Predictably, less media attention was given to the death – only a few weeks after the killing of Rhys Jones – of 18-year old Ben Ford, who was the youngest soldier to die in Afghanistan. Perhaps if we want to genuinely try and understand what sort of society we are bringing our children into we could start by asking why a youth with a gun in his hand defending “his” turf in Moss Side or Brixton is viewed so very differently from the uniformed youth in Afghanistan or Iraq with an Army issue rifle.


Monday, September 17, 2007

Northern Clay

Currency cranks claim -- echoed in some badly edited economics textbooks -- that banks have the power to "create credit" by a mere "stroke of a pen": that if someone deposits, say, £100 in a bank, then the bank can lend out many times this amount. This is not the case. Banks are essentially financial intermediaries making a profit from borrowing money and lending it at a higher rate of interest to others. They have no power to "create credit" as they cannot lend more than has been deposited from them, than what they have in effect borrowed from depositors.

This is obvious in the case of other financial institutions such as a building society or a credit union. A building society accepts deposits from savers, which is lends out to others to buy a house (originally it was only to its members, the savers, a principle still maintained in credit unions). Everybody, even currency cranks, accepts that building societies can only lend what has been deposited with them. They seek deposits by offering savers an attractive rate of interest. Without these deposits they cannot function, and the amount of the deposits they have determines how much they can lend to home buyers. Building societies make a surplus (which in theory belongs to their members) by charging house-buyers a higher rate of interest than they pay their depositors. Which is why when interest rates go up and they have to pay more to depositors, they also have to charge house-buyers more and mortgage rates go up too.

Northern Rock used to be a building society, but in 1997 they "demutualised" and became a bank. From then on the surplus it made from charging borrowers more than it paid depositors became "profit" which belonged to its shareholders and the explicit aim became to maximise this. This essentially legal change did not change its economic function as a financial intermediary nor free it from the limitation of only being able to lend what it had borrowed. It didn't suddenly acquire any right to create credit by the stroke of a pen. But it did allow it access to a wider range of sources from which to obtain money to lend. Instead of being restricted to savers it could now borrow money on the "money market" where short term debts that can easily be converted into cash are traded. It was still a financial intermediary borrowing at one rate and lending at a higher one, only it now had a wider range of who to borrow from.

In recent years Northern Rock seems to have based its whole strategy on taking advantage of the relatively low rates of interest on the money market. The papers are reporting that while its loans and assets are worth £113 billion, only £24 billion of this was covered by depositors. The rest -- well over three-quarters -- coming from money borrowed on the money market.

The trouble has been that since the beginning of August the money market, like other financial markets, has been in turmoil. Banks and other financial institutions have been reluctant to lend money on it, so institutions such as Northern Rock who have been relying on it to borrow cheaply have been in trouble. So much trouble in the case of Northern Rock that it has had to go cap in hand to the Bank of England which as the "lender of last resort" to banks has loaned them the money -- or rather opened a credit line for them -- but at 6.75 percent, one percentage point above the bank rate.

Northern Rock is probably not so worried about its depositors withdrawing their money as it is about its inability to continue borrowing money from the money market at a lowish rate of interest --since it is from the difference between this rate and the rate it charges house-buyers that it makes a profit. Already it is forecasting lower profits. And because its share price has fallen -- due to some of its shareholders bailing out too -- is liable to be taken over by some rival. In fact, this is what the papers are predicting.

One thing that won't happen -- because it can't -- is that Northern Rock's beleaguered chief executive, Adam Applegarth, will not be taking out his pen and simply creating the missing credit.


Sunday, September 16, 2007

Feeling sleepy

It's September and the autumn. That means the leaves are turning gold or red and the thieves are meeting up in seaside resorts to talk BS. Most people of sense don't bother with party conferences. Some people are alas required to listen. There will be reports on the Libs, Labs and Cons at this blog. Stay tuned if you can keep awake.


Tuesday, September 11, 2007

Chile Myth and Reality

Thirty-four years ago this week "Chile's armed forces stage a coup d'√Čtat against the government of President Salvador Allende, the first democratically elected Marxist leader in Latin America." (See here.) There is no doubt on this anniversary that the lie concerning Marxism will be repeated ad nauseam, hence the need to repeat what was stated in the Socialist Standard from October 1973.


The events in Chile are already a myth. There, according to left and right-wing commentators alike, a democratically-elected Marxist government was overthrown by the armed forces, so proving the impossibility of establishing Socialism peacefully by using the existing machinery of limited political democracy.

Let us try to scotch this myth now by showing that the failure of the so-called Chilean experiment has absolutely no relevance to the question of whether or not Socialism can be established peacefully and democratically.

First, Allende and his Popular Unity were not Marxists and were not trying to establish Socialism. The programme of the Popular Unity, an alliance whose main elements were the so-called Socialist Party and the so-called Communist Party, was essentially one of state capitalism for Chile. It called for the break-up of the big landed estates, for the nationalisation of foreign-owned and some Chilean-owned industry, and for various social reforms. Even if implemented in full this programme would have left the basic position of the working class in Chile unchanged: they would have remained propertyless wage-workers forced to sell their mental and physical energies to an employer (even if the State) in order to live; production would have remained geared to the market; and the government would still, under pressure from the world market,have had to restrict the consumption of the working class in order to allow the maximum amount of surplus value to be extracted for re-investment.

Secondly, not only was the Allende government not trying to establish Socialism, but it did not even have majority support for its programme of state capitalism. Allende was elected President in September 1970 in a three-way contest, but with only 36 per cent of the vote. Subsequent elections showed that his government never did manage to acquire majority support. The last elections in March this year still gave its opponents 55 per cent of the vote.

Thirdly, because of this limited electoral support, the Popular Unity did not completely control the State machine. Parliament remained in the hands of its opponents who, although they did not have the two-thirds majority needed to impeach Allende himself, harassed his Ministers and delayed and altered his proposed laws.

For three years those whose vested interests were threatened by the coming of state capitalism to Chile - the American corporations, the Chilean landowners and big capitalists - sabotaged and plotted against the Allende government, but the fact remains that the conflict in Chile was between private capitalism and state capitalism, not between capitalism and Socialism.

That the limited democracy that existed in Chile has been a victim of this conflict can only be a matter of regret for Socialists. For, whatever its limitations, capitalist political democracy at least allows the working class to organise to defend its everyday interests and to discuss differing political views, including those of Socialists. Its suppression in Chile by a military junta represents, in the sense, a step backward for the working class of Chile - not that much of it would have survived had the Popular Unity's full state capitalist programme had been implemented, if the experience of Cuba is anything to go by.

But it still remains true that, in the quite different political conditions (which have never yet existed) of an immense majority of workers in all the industrialized countries of the world being Socialists and organised to win and control political power, Socialism could be established peacefully . The overthrow of a minority state capitalist government in Chile by forces acting on behalf of private capitalist groups will not deflect us from this position into urging the working class to adopt the futile and dangerous policy of armed insurrection.

Thursday, September 06, 2007

Only Workers are Productive

"Irish workers are second most productive in the world" headlined the business section of the Irish Times (4 September) reporting on an International Labour Organisation (ILO) study on productivity in various different countries.

Productivity as measured by the ILO is a pretty nebulous concept. They take a country's total GNP and divide it by some measure of the amount of work done, either the total number of hours worked by workers in that country or this divided by the total number of workers (work per hour). It was on this second measure that Irish workers came second (to US workers).

The result is not really a measure of productivity in the true sense of output per workers who actually produced it. This would have to be the total amount of new value produced in a year divided by the total number of hours of productive work. But this is not what the ILO is measuring.

For two reasons.

First, GNP includes some double-counting (for instance, by including government spending -- which has to come from the total amount of new wealth and is not an addition to it, as assumed) and also, for some countries, income that has nothing to with what's produced by workers there (for instance, Norway's oil rents and, in fact, Ireland's income from "financial services").

Secondly, because the hours of work of all workers are included, even those in engaged in non-productive work (for instance, most government workers and also the domestic staff of the rich).

But the ILO figures still tell us something: that despite the enormous waste of labour under capitalism, "productivity" still increases from year to year. This is a distorted reflection of the increase in real productivity that also goes on and which is why socialists say that the world is capable of producing enough for all, once the profit barrier and the waste of capitalism is eliminated and production re-oriented towards the satisfaction of people's needs.

Also, the whole concept of productivity (even in the ILO's form) brings out that the only way wealth is produced is by the application of human labour to materials that originally came from nature, and that therefore wealth is produced only by those who so apply their labour, the producers -- under capitalism called, appropriately enough, the working class.


See Also:

  • From the Mailstrom Blog: The ILO Report
  • Wednesday, September 05, 2007

    5th September 1972

    A Socialist Standard article from September 1984 with the apposite title 'Billion-dollar games' concerns the Olympics. The athlete Carl Lewis who won four gold medals said that "the Olympics are about money and not much else". US Congressman Dana Rohrabacher disagrees: for him they "..represent the noblest elements of humanity.. a beacon of light shining upon mankind's higher aspirations.." This is so much global warming, as is his call for the United States to boycott the Beijing Olympics. Perhaps there will be a boycott, and like reformism in general, it will serve to distract workers from their true interests. No, the Olympics are "..a further example of the way capitalist rivalries and priorities pollute and distort every aspect of life under the present social system."

    Such rivalries often lead to workers murdering others in their masters' interests, and this was true at the Munich Olympics on this day in 1972. The Socialist Standard of October that year carried the following comment.

    "Since it has never happened before, the killing of the Israeli Olympic athletes helped foster the idea that we are living in times of special cruelty and disarray, and that guerilla tactics are something of an innovation. It needs only a little effort to recall many examples of similar tactics, sometimes by small bands of killers and sometimes by larger, more organised groups. If the Arabs showed great courage in their raid, it was not the first time that bravery has been used to murderous ends. Capitalist States are always organising the courage of their peoples in a massive effort of destruction. At such times they use any weapon they can, including that of the ultimatum. The famous demand for unconditional surrender in the last war was no more that a threat to murder and destroy on a savage scale, if the other side did not give way - and it was a threat the Allies carried out. The men who plan and implement such ultimata are not called terrorists and murderers but there is nothing to choose between them and those who did the killing at Munich, or indeed the Israeli nationalists who waged so ruthless a guerilla campaign against the British occupation in the years after the war. Capitalism is a mass of conflict, springing from the competing economic interests of many rival groups both national and international. In one way or another, force is always applied in these conflicts and capitalism continually conditions its people to accept the use of force, often on a terrifying scale and intensity. The Arabs at Munich acted as they have been conditioned to. The outcome of violence is never pleasant, whether it is eleven dead bodies at Munich or a hundred thousand at Hiroshima. But if the working class are not clear on the issue, if their ideas on it are confused by the illogicalities and the violence of nationalism, they can have no hope of ending a victory of which bloodshed is so integral a part."