Without Workers Management There Can Be No Socialism

October 31, 2007 by Leave a Comment

Kiraz Janicke
Venezuelanalysis.com

Over the weekend of October 26 to 27, several hundred people attended a two day conference on Worker’s Management: Theory and Practice, as part of a program, “Human Development and Transformative Praxis,” run by Canadian Marxist academic Michael Lebowitz at the International Miranda Center in Caracas. The first day addressed the theory and historical experience of worker’s control and attempts to build socialism, with presentations by Pablo Levin, the Director of the Center for Planning and Development at the University of Buenos Aires, British Marxist economist Patrick Devine (the author of Democracy and Economic Planning), Michael Lebowitz, and sociologist Carlos Lanz Rodriguez, a former guerrilla and now president of CVG-ALCASA the state owned co-managed aluminum factory. The second day of the conference focused on the various practical experiences of worker occupied factories in Latin America. Speakers included, Carlos Quininir (Zanon) and Jose Abelli (FACTA), from the recovered factory movement in Argentina, Serge Goulart from the Occupied Factory Movement in Brazil, as well as spokespeople from various examples of state owned companies under workers control or workers co-management and worker run cooperatives in Venezuela, including the Tachira Textile Cooperative, Inveval – an expropriated valve manufacturing company under workers control, ALCASA, and Cemento Andino in Trujillo, one of the most recent examples of workers control in Venezuela.

During his opening presentation Lebowitz said, “On May Day 2005 I marched with workers in Caracas and the slogan workers were chanting at the time was, ‘Without co-management there is no revolution!'”

“Indeed, the main slogan of that march organized by the UNT [National Union of Workers] was “Co-management is revolution and Venezuelan workers are building Bolivarian socialism.”

From its beginning, the UNT, which came together in December 2002 when the old corrupt Confederation of Venezuelan Workers (CTV) supported the bosses lockout and sabotage of the oil industry and has functioned essentially as an alliance of trade unions and union leaders and is characterized by internal divisions.

Despite the million strong May Day march in 2005, the UNT was unable to organize a united May Day demonstration in 2006 and at its second congress shortly thereafter, in the context of simmering factional divisions, fractured over the question of whether to hold elections or wait until after the presidential elections in 2006 in order to focus on supporting Hugo Chavez’s campaign for presidency.

Since then the UNT has remained divided and although union leaders Orlando Chirino from the Current for Revolutionary Class Unity and Autonomy (C-CURA), and Marcela Maspero, of the Collective of Workers in Revolution (CRT), the two principal currents involved in the split, agreed in July to organize elections within the UNT before the end of this year, this has still not occurred. Although the UNT continues to organize on a regional level, it does not function as a united union federation and at the national level, it could be argued, its existence is nominal only.

Problems of Worker Management

As Lebowitz pointed out, we don’t hear much talk of co-management or workers control coming from the UNT anymore. “We don’t have masses of workers saying, ‘without worker management there is no socialism’ or ‘that you cannot build socialism without worker management.'” Nevertheless, Lebowitz argued, “I think we have to recognize the essential truth of this proposition”

Framing the discussion, Lebowitz said it is useful to look at the different dimensions of what President Chavez has called “the elementary triangle of socialism,” – units of social property, social production organized by workers, and production for the needs of communities. “You can’t separate these in socialism” he argued. Capitalism is based on a different triangle he said; private property, exploitation of labor, and production for profit.

Lebowitz then drew on the lessons of the experience of worker self-management in the former Yugoslavia. He pointed out that although the enterprises were state owned and were viewed as social property, they functioned in the market and were driven by one thing, self interest of the workers in an individual enterprise; there was no concept of solidarity, that is, production for the needs of communities.

In order to maximize the income of workers in each individual enterprise, they invested in automation to increase production, rather than take on new workers. By 1971 there was 7% unemployment in Yugoslavia, plus 20% of the workforce worked outside the country as guest workers in Western Europe.

“Legally these enterprises were social property, but social property means that everyone in society has equal access to the means of production and benefits from it, the unemployed though, had no access to the means of production.”

“In fact, what happened in the context of the market,” Lebowitz said, was “a new productive relation had emerged in these enterprises, group ownership, group property.”

“Of course” Lebowitz continued, “all members weren’t really equal – it was the managers and technical experts that had the knowledge about marketing products investments, banking, and establishing links with other enterprises, creating mergers.”

There was no sustained effort in the workplace to truly educate workers on how to run the enterprises, he added, “the result was that the distinction between thinking and doing remained.”

Workers became dependent on the managers and technical experts “and in the end it was the managers who emerged as the capitalists, leaving the workers as wage laborers.”

According to Lebowitz, the Yugoslav case “demonstrates that the existence of workers councils, even with the legal power to make decisions, is not the same as worker management.”

Additionally, “It demonstrates that the focus upon the self-interest of the workers in an individual enterprise is not the same as focusing on the interest of the working class as a whole.”

Lebowitz then came back to the elementary triangle of socialism; “Of course it can’t all be put into place once there is a long process of struggle to develop each side of that triangle, but if we are not actively building each side we inevitably infect the whole process. How can you build socialism without real workers management? How can you create real developed human beings, without protagonistic democracy in the workplace and the community?”

In his introductory presentation Devine said that the question of how to organize production had been the subject of fierce debate since the time of Marx and the two principal ways of achieving this had been either through the market or the system of central planning adopted in the Soviet Union, where there was no democracy and workers had no power to make decisions.

Devine agreed with Lebowitz that worker managed enterprises, which are truly autonomous, function as a form of “group private property” and he said by seeking to maximize income, “they set up pressures against the participation of workers”

In order to develop socially oriented production he argued that production decisions cannot be made solely by workers in an individual enterprise, but must be made with the participation of all the social owners of an enterprise, that is all the social groups affected by the activities of an enterprise, including suppliers, consumers, and environmental groups and so on, to determine what counts as social production.

In small-scale enterprises, Devine contended, it is fairly easy to determine what counts as social production. However, in much more complex and large-scale industries that involve production and distribution on a national or even international level and do not correspond to a single community, it is therefore more difficult to ascertain what can be determined as production in the social interest.

Therefore Devine suggested, “A model of bottom-up planning involving part of the social owners at each level through a process of coordinated negotiation, applied up to the national level and at an international level a coordinated set of activities that meet social needs at that level.”

“This is neither the anarchy of market forces, or top down planning, but participatory democratic planning from below, initially directly, then indirectly through elected and recallable representatives”

In this context, key debates in the discussion of how to build workers democracy and socialism, throughout the conference, included; not only the question of state owned enterprises under workers control vs. worker owned cooperatives and how to overcome the social division between intellectual and manual labor, but also how to build links with communities and the role of the trade unions in relation to the different experiences of workers’ participation. Different perspectives on these issues were reflected through the various examples from Argentina, Brazil and Venezuela.

Experiences of Worker Management in Latin America

Jose Abelli from FACTA, a network of independent workers cooperatives, explained that the recovered factory movement in Argentina, which is composed primarily of independent worker cooperatives with few ties to the traditional trade unions, developed as a defensive mechanism, “as a form of resistance to harsh neoliberalism” and was born directly out of the need to defend employment in the context of the economic crisis of 2000.

Abelli said that the 220 recovered and self managed factories in Argentina have generated 300 million dollars in the Argentine economy this year and generated 2,000 jobs since the economic crisis.

What the recovered factory movement in Argentina shows, Abelli argued, is that not only can workers manage factories, but also the economy and that, “we can administrate society in a manner more just than private capital.” “We have demonstrated that economy is not the property of a few powerful, important men,” he added.

However, for Abelli, it is important that the worker cooperatives in Argentina “are independent of political parties and the state.” This reflects a different political context. “We obviously don’t have a government like here in Venezuela,” he said.

Abelli also pointed out that the Venezuelan government was supporting the worker’s cooperatives in Argentina and had recently signed an agreement with FACTA for the purchase of 2,000 tractors.

Serge Goulart, a spokesperson for the Occupied Factories Movement in Brazil, which works closely with the unions and is part of the CUT (Central Union of Workers) said the Bolivarian revolution, is the “oxygen” of the workers movement in Brazil. He explained to the conference how the Venezuelan government is helping out the Flasko plastics factory in Sao Paulo, closed in 2003 and subsequently occupied by workers, by supplying raw materials in exchange for technology to produce plastic housing in Venezuela.

For Goulart, in contrast to Abelli, it is important for workers to demand 100% state ownership under workers control, because, “We don’t want to become small capitalists.”

However, Goulart explained that unlike many cooperatives in Argentina or the example of Inveval in Venezuela, where all workers are paid exactly the same, the occupied factories in Brazil had a policy of paying workers on the basis of award rates for different types of work, this is because, he explained, if skilled workers are not paid a higher rate they would look for work elsewhere and not stay with the occupied factories.

Goulart also warned of threats to workers management, not only by the governments and capitalists in Argentina and Brazil, but also from the state bureaucracy in Venezuela. He referred to the example of Sanatarios Maracay, where although the Venezuelan National Assembly has approved its expropriation, sections of the state bureaucracy have sided with a parallel union supported by the boss to remove occupying workers from the main installations of the factory.

A spokesperson from Inveval, Nelson Rodriguez, explained to the conference how the workers council functioned there. He said the highest decision making body is the general assembly of workers in the factory but also there are a number of elected permanent commissions, including finances, social and political formation, a technical commission, administration, discipline, security and control and services. However, to ensure democratic accountability within the factory, Rodriguez said any person elected to a commission could be recalled at any time through a general assembly of the workers council.

In order to overcome the division between intellectual or administrative labor and manual labor, they also rotate different types of work within the factory, combined with political discussion within the workers council, education for collective development, and technical training.

On the question of cooperatives vs. state ownership with workers’ control, Rodriguez told Venezuelanalysis.com that factories should be 100% state owned under worker control, because, “Cooperatives have a capitalist structure in reality.”

Also key to the experience at Inveval are the links between the workers council and the local community. Not only does the factory provide a space for health and education missions, but the workers council also participates in the local communal council.

Rodriguez presented to the conference an explanation of a delegate system developed by workers at Inveval based on their own experience, where workers councils send delegates to communal councils and vice versa, but which could be applied on a much broader scale to federations of workers councils and communal councils in order to construct structures of popular power.

A battalion of the new United Socialist Party of Venezuela (PSUV) also functions out of Inveval. Rodriguez told Venezuelanalysis.com, “The PSUV is a huge political school, to drive forward the revolution, and together with the construction of popular power proposed in the constitutional reform – through workers, students, campesino and communal councils, the aim is to create a socialist state, because the state is not socialist.”

“We participate in the battalion as workers, not as citizens, but from the point of view of workers.”

Significantly, Rodriguez explained that the workers council at Inveval developed largely outside the framework of the organized trade union movement in Venezuela. And in February 2006, the workers in Inveval initiated the Revolutionary Front of Workers in Occupied and Co-managed Factories (FRETECO), because, “We saw that here in Venezuela the unions were not supporting the struggle for occupying and taking over factories through the UNT.”

According to Rodriguez, the leaders of the UNT were more interested in factional struggles and winning elections, rather than putting forward a strategy that corresponded to the political reality of Venezuela.

“Therefore we saw the necessity to organize a way that we could support workers in taking over factories and support factories in the same situation,” he said

FRETECO held its first congress in October 2006 with workers from 15 occupied factories participating. However, it is open to all groups of workers involved in conflicts over occupied factories and is now comprised of approximately 20 factories, with workers from newly occupied factories regularly coming to them for advice and support.

The conference also heard from Alcides Rivero a spokesperson from ALCASA, arguably the most important experiment of workers co-management in Venezuela. In 2005, at the behest of President Chavez, a process of worker’s co-management was initiated in ALCASA, a company that had been owned by the state for 38 years, but had been run down by previous governments in order to prepare it for privatization.

Rivero outlined the first stage of co-management in ALCASA, “the construction of the political viability of co-management,” which was characterized by the initiation of open workers assemblies and discussion of an 18-point plan to re-launch the company and a process of electing a new management through secret ballot. Of the 2700 workers in ALCASA 95% participated in these elections. The workers also elected 36 spokespeople to work together with the management in making decisions.

“This revolutionary proposal of Chavez,” Rivero pointed out, “was an extraordinary experience, never before had workers been able to participate in making decisions.”

However, Rivero contended, there are obstacles. One of the obstacles is the culture within ALCASA, and “Every workplace has its own culture. In ALCASA there was a culture where workers only worked to get money, and didn’t have a vision of creating a new society.”

Related to this question of culture was the sharp polarization between different unions within ALCASA, principally the conflict between union leaders Trino Silva and Jose Gil. “The confrontation within the Chavista political movement within ALCASA is amazing,” Rivero said. According to Rivero, the unions in ALCASA, “have a monetarist view,” and “are concerned with power. They view the elected spokespeople as a threat.”

“This is a culture from the fourth republic,” Rivero argued. In order to overcome these cultural problems, Rivero said that political formation is essential; for this reason the Negro Primero Centre for Political and Social Formation was set up in ALCASA in 2005. However, not only is political formation necessary he said, but also technical training and education. “Together with workers from PDVSA we have created the Bolivarian University of Workers. I study there.”

Rivero also spoke of the challenges posed by the technocracy of the CVG industrial complex for co-management, “because the CVG is a monster.” “ALCASA is the only section of the CVG industrial complex that has co-management, there is also Venalum, Carbonorte Feromineria, but there is no line to push forward with co-management in these other sections,” he said.

Despite these challenges the process of workers co-management in ALCASA has resulted in significant achievements, including increased production, improved working conditions, and, according to a report on May 8 2007, “Balance and Perspectives on Co-management in CVG ALCASA” by Carlos Lanz Rodriguez, is now entering the “third stage of co-management” (the second stage being a focus on developing co-management and a new strategy for the company), which involves a debate and discussion on the humanization of labor, including the reduction of the working day, the democratization of knowledge to reduce the social division of labor within the factory and the decentralization of decision making through the construction of workers councils.

Another question for the development of workers democracy and socialism in Venezuela is the issue of worker’s management in strategic industries. During a report back session from a series of workshops on how to move forward with the struggle for workers management and socialism, workers asked, “Why can’t we have workers management in PDVSA?”

They pointed to the example of the guide committees, organic workers organizations that sprang up within PDVSA during the bosses lockout and sabotage of the oil industry in December 2002 to January 2003, saying these showed that workers could run strategic industries.

Not only is it necessary for the means of production to be socially owned, but that it is necessary for workers to be able to participate and make decisions in strategic industries, not just small factories, “if we are truly to advance to socialism” they asserted. In addition to making decisions in the factories, they argued, workers also need to make decisions within the institutions of the state, which are also very vertical.

The key task, they determined, is to build on and strengthen the existing examples of workers control, workers cooperatives, and workers organizations, and in particular to strengthen political consciousness of workers to deepen the struggle for socialism.

“The political formation of the workers is essential, but not only political formation, also ideological and technical formation and training are necessary for workers to run factories and society,” one woman said.

In his closing presentation Lebowitz questioned the lack of confidence in workers to manage strategic industries such as PDVSA, saying “the same logic that say’s there’s no place for co-management in strategic industries would also extend to the position that there’s no place for workers’ strikes in those sectors.”

Lebowitz also pointed out that while cooperatives don’t fundamentally break with private property, they could act as an “important school for socialism” showing that workers do not need bosses. “This is obvious when we hear the workers here and see the sense of pride and dignity that they have.”

Similarly, he said that the example of Yugoslavia showed that state owned enterprises under workers control in and of themselves were insufficient to create socialism, but could be viewed as Lenin described them as a “threshold” on the path to socialism.

What is necessary, Lebowitz argued, is to shift the focus from the self-interest of workers in an individual state enterprise or workers cooperative to the general interest of society as a whole. “This cannot be achieved by a distant state telling the workers ‘you must serve society'” he continued, but conversely, what is needed is a strong community voice. Lebowitz then pointed to the example of the communal councils in Venezuela as an essential tool, together with the workers cooperatives and state enterprises under workers control or co-management, to push forward the struggle for socialism.

A key weakness in the struggle for workers management and socialism in Venezuela, Lebowitz pointed out, is the lack of a political strategy and the economism of the trade unions. “Their whole orientation towards higher wages and their tendency to act like a labor aristocracy in a society where so many people are poor.” This is not just a case of bad policy Lebowitz argued, “There are in fact structural reasons for the way they behave.”

What is happening to the UNT he said “is the reproduction of the privileges of the trade unions in the Fourth Republic.” Therefore, Lebowitz concluded, “Not only do you need a revolutionary state, you also need new revolutionary trade unions.”

Summing up, Devine argued that the logic for state owned enterprises under workers control as opposed to worker owned cooperatives is compelling because it, “at least formally, represents the society as a whole” where as cooperatives represent a form of “group private property.”

But, he said, that depends on two things; firstly, “the nature of the state, the extent to which it remains a capitalist state, the extent to which it is a socialist state, the extent to which it is a state in transition.” In Venezuela, Devine contended, there is “a state in transition.” “If it is the case that Venezuela is in a transitional phase, then of course you either go forward or you go back.”

Devine suggested, that “One way of thinking about the way forward in Venezuela is to think of transforming state property into social property, to create a structured system of democratic participatory planning, which is built up from below, but results in an integrated plan that has been created by the localities and the enterprises themselves.”

“The immediate task facing revolution,” he added, “is the development of participatory worker councils and communal councils. Without these, together with education programs and the human transformation they enable, nothing else is possible, this is an immense task and will take place over a long period.”

“One thing that is clear from historical experience is that, without active participation of workers, the community and other groups in civil society there can be no socialism.” However, Devine concluded, “I am inspired by the enthusiasm, the knowledge, the commitment of the people here, and I have great confidence that you will succeed in moving things forward, but it will obviously not be easy.”

Source URL: http://www.venezuelanalysis.com/analysis/2784

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Fidel Reflects on the Elections

October 22, 2007 by 3 Comments

Our elections are the antithesis of those held in the United States, not on Sundays but on the first Tuesday of November. Being very rich or having the support of lot of money is what matters the most there. Huge amounts are later on invested in publicity, specialized in brain washing and the creation of conditioned reflexes.

With honorable exceptions, no one can hope to be appointed to an important post without being backed by millions of dollars.

Being elected President in the US requires hundreds of millions, which come from the coffers of big monopolies. Elections can be won by a candidate earning a minority of votes.

Less and less citizens are going to the ballots; there are many who would rather go to work or spend their time doing anything else. There is fraud, tricks, discrimination against ethnic minorities and even violence.

Having more than 90 per cent of all citizens voting in the elections and school children guarding the ballots is an unheard of experience; it’s hard to believe that this occurs in one of the “dark corners of this world”, a harassed and blockaded country named Cuba. That is how we exercise the vigorous muscles of our political awareness.

Fidel Castro Ruz
October 19, 2007
6:12 p.m.

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Environmental Clearance, a farce played by MoEF-The Vedanta Case

September 24, 2007 by 3 Comments

Rahul Choudhary

Whether it is the Samata ((1997)8SCC19) case, Kudramukh case or more recently the Vedanta Mining case in Orissa, mining is always in disputes and creates a tremendous conflict of interest. For government and the mining company it is always a lucrative enterprise, but for environmentalist, tribal and other affected by mining, it is a disaster. While the mining company flaunts the benefits, concealing the real impact of its project in order to get the environmental clearance from the Ministry of Environment and Forest (MoEF), the Ministry itself never seeks to assess the real impact through its so-called expert committees. There are numerous examples where a mining company has tried (rather successfully) to evict members of some indigenous community, projecting the dense forest as rocky and barren land. Even when there are hundreds of indigenous people affected, they are projected as few, and most of them are not even included in the list of Project Affected Persons (PAP).

Vedanta Alumina Limited, a subsidiary of M/s Strerlite Industries (India) Ltd proposed a one million tonne per annum capacity alumina refinery project together with a 75 MW coal based captive power plant. The bauxite for the refinery was to be sourced from the Niyamgiri Hills. Interestingly, the Alumina refinery was granted environmental clearance without linking the project with the Mining.

M/s Sterlite (the parent company of M/s Vedanta) applied for environmental clearance on 19.03. 2003 to the MoEF. In the application, Vedanta stated that no forestland is involved and that within the radius of 10 kms there is no reserve forest. M/s Vedanta thereafter on 16.08.2004 applied for use of 58.943 ha forestland consisting of 28.943 ha village forest and 30 ha reserve forest. However, the application for environmental clearance was not modified and the same was processed on the premise that no forestland is involved.

Further, though Mining at Lanjigarh was integral part of the Alumina refinery project, Vedanta could not have started the work on the Alumina refinery without getting the clearance for mining also. As per the guidelines of the MoEF – “for projects requiring clearance from forest as well as environment angles, separate communications of sanction will be issued, and the project would be deemed to be cleared only after clearance from both angles…”

M/s Vedanta requested the MoEF to grant environmental clearance for the Alumina Refinery Plant stating that it would take three years to construct the refinery plant whereas mines can be opened up in one year. In its application for seeking environmental clearance for the project dated 19.3.2003 it is stated that “nil” forestland is required for the alumina refinery and that within a radius of 10 km of the project site there is no reserve forest, which is contrary to the facts on record. Subsequently, on 16.8.2004 a proposal for allowing the use of 58.943 ha forestland, consisting of 28.943 acre of “Gramya Jungle Jogya” land and 30 ha of reserve forest, was moved under the FC Act through the State Government to the MoEF. Out of the above, 26.123 ha forestland was required for the refinery, 25.82 ha for the mine access road and the balance 7.0 ha was required for the construction of the conveyor belt for the transportation of the mineral from the mine site to the plant.
The MoEF gives environmental clearance for Alumina Refinery Project by delinking it with mining project. In the environmental clearance it is stated that no forestland is involved, even though the application under the Forest Conservation Act was still pending.

As per para 4.4 of the guidelines laid down by the MoEF “Some projects involve use of forest land as well as non-forest land. State Governments / Project Authorities some times start work on non-forest lands in anticipation of the approval of the Central Government for release of the forest lands required for the projects. Though the provisions of the Act may not have technically been violated by starting of work on non-forest lands, expenditure incurred on works on non-forest lands may prove to be infructuous if diversion of forest land involved is not approved. It has, therefore, been decided that if a project involves forest as well as non-forest land, work should not be started on non-forest land till approval of the Central Government for release of forest land under the Act has been given”

But Vedanta started the work on Alumina Refinery in blatant violation of this provision.

Three applications were filed before the Central Empowered Committee (CEC), constituted by the Supreme Court of India against establishment of project and the environmental clearance granted by the MoEF without considering the forest area on 22 Sept 2004 to M/S Vedanta Alumina Ltd. The CEC heard the matter and also conducted a site visit of the proposed refinery plant and mining area. The CEC filed their report on 21 Sept 2005 before the Supreme Court with the recommendation that the apex court may consider revoking the environment clearance dated 22/09/2004 granted by the MoEF for setting up of an Alumina refinery plant by M/S Vedanta and directing them to stop all further work on the project.

The Supreme Court in its order dated 03/02/2006 in I.A.NO 1474 with I.A.No.1324 in writ petition (civil) No.202 of 1995 directed the MoEF, GOI, New Delhi that various studies to assess the impact of the project may be carried out within three months. Accordingly the MoEF placed the application for forest diversion of Lanjigarh Bauxite Mine before the Forest Advisory Committee (FAC), constituted under section 3 of the Forest (Conservation) Act, 1980. The FAC after examining the proposal also suggested for carrying out in depth studies to assess the impact of the project. The MoEF, GOI, New Delhi directed the Central Planning and Designing Institute (CMPDI), Ranchi to carry out the above-mentioned studies.

The Wildlife Institute of India (WII) submitted their report dated 14 June 2006 to Forest Advisory Committee and it was examined by them in its meeting held on 30 Aug 2006.The WII was asked to reexamine the report in the light of facts and figures put forward by the State of Orissa. The WII prepared a supplementary report dated 25th Oct 2006. In this report WII put their point of view on wild life, likely adverse impact of mining and identification of alternate source of bauxite among others. The studies related to soil erosion, impact on ground vibration and the studies related to soil erosion, impact on ground vibration on hydrological characteristics, flow of natural water resources/ streams etc were carried out by the Central Planning and Designing Institute (CMPDI), Ranchi as per the request made by the Orissa Mining Corporation (OMC) and after their proposal was accepted by the OMC.

The approach of the Supreme Court is perplexing, as the Central Empowered Committee clearly pointed out the illegality in the clearance granted and once the clearance is granted then post facto impact study is not provided in law.

The Niyamgiri hill is spread over in 250sq.km. of area. This hill is also known as Dongaria Kondha country. Dongaria Kondh is one of the primitive and schedule tribes of the state and fully dependent on the Niyamgiri Hill. If one claims to be Dongaria Kondh then he must reside in the Niyam Giri Hill. Niyamgiri Hill is also a source for Vamsadhra River, along with for various other perennial streams. Mining in the Niyamgiri Hill involves a blatant violation of various laws which are there for the protection of Scheduled tribes, like the Orissa Schedule Areas Transfer of Immovable Property (Regulation) 1956, the Scheduled Caste and Schedule Tribes (prevention of Atrocities) Act 1989. .

The mining company put up the point that by mining there will be a development of the area, the villagers will get employment etc. But the reality is the villagers who are self-dependent, having land of their own will become marginalized workers in the mines. As most of the villagers are unskilled for industrial or mining work, they will only get job of informal and unskilled labourers dependent on the whims of the company and the contractor. They lose everything to pass over to the next generation except the misery of working in the mine. We all know also who benefited from the mining at Dhanbad and various parts of Rajasthan for several decades.

The Supreme Court is hearing the matter in detail but has not stayed the work on this 4000-Crore-Rupees-project on the ground of large investment involved. Tendentially, the company’s argument before the Court is that, as they have spent a large amount of money, so the project should not be scrapped.

While at the same time, the Courts are quick in granting the removal of jhuggi jhopris (urban poor settlements) in Delhi and other metro cities in the country on the ground of  being unauthorised. However, if the investment of the jhuggi jhopris is considered, then that is in fact an absolute investment by the poor people living there. Moreover, the same courts have allowed construction of big shopping malls and even 5-star religious temples like the Akshardham Temple in East Delhi on the same land from where the authorities removed the Jhuggi jhopries.

With all regards to Indian judiciary, we must admit that in recent years, unlike in the 1960s-70s, it is unwilling to check the reckless pace of corporate industrialisation, which is taking its toll on the environment, tribals and people in the pursuit of profit. On the other hand, the downtrodden majority has no recourse left within the coordinates of the status quo (as fixed in the constitution, interpreted by the judiciary and amended by the legislature), except queuing up for electoral rituals now and then.

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FREE PROF. JOSE MARIA SISON !

September 7, 2007 by Leave a Comment

Sign the online petition and send emails to Dutch, Filipino, U.N. and U.S. officials and members of the media!

Joma Sison Questions & Answers Fact Sheet

What you can do to demand the release of beloved Philippine leader falsely arrested and in detention

On August 28, 2007 Professor Jose Maria Sison, a Filipino political refugee living in exile for 20 years in Utrecht, Netherlands, was lured by Dutch police under false pretenses, arrested and unjustly detained. As the chief political consultant of the National Democratic Front of the Philippines (NDFP), Professor Sison has been an instrumental force in pursuing peace talks between the Government of the Philippines and the Philippine underground movement. Sison was a political prisoner under the Marcos dictatorship and has since been exiled and suffers continuous harassment and persecution by the Philippine Government.

At the age of 68, Professor Sison is one of the most influential figures in Philippine politics, highly regarded by millions of Filipino workers, peasants, women, students, national minorities, and other segments of Philippine society seeking national sovereignty and genuine democracy for their homeland.

Internationally, he is a renowned writer and poet and a highly respected anti-imperialist intellectual providing incisive analysis on the crisis of the world capitalist system. He is currently the chairperson of the International League of Peoples Struggle (ILPS), an alliance of over 100 peoples organizations from over 20 countries in the world advancing national independence, democracy and social liberation.

At the same time as his arrest, the Dutch police, in Gestapo-like fashion, raided the homes and seized the property of 7 other NDF personnel, This bolsters our belief that Prof. Sison is not the only target of the attacks. The entire NDFP Peace Panel based in the Netherlands are also being subjected to harassment and repression.

According to Netherlands authorities, Sison is being charged with incitement to murder in the Philippines. Dutch prosecutors allege that he ordered the killings of Filipinos Romulo Kintanar and Arturo Tabara. This is only the latest in the long list of politically-motivated false charges being levied against Sison. Recently, the Philippine Supreme Court dismissed the rebellion charges against Sison and 50 other personalities including progressive members of the Philippine Congress and leaders of the mass movement. The court ruled that the pieces of alleged evidence used in the rebellion cases, including the Kintanar and Tabara deaths, can no longer be used in other legal proceedings against Sison and his co-accused.

The attacks on Sison are part of the continuing political repression being implemented by the US-backed Arroyo regime. In the past, this has included extrajudicial kilings, abductions and the filing of false charges against activists and critics of the Arroyo regime.

As Sison is one of the sharpest critics of US imperialism and Philippine President Arroyo’s puppetry to the Bush regime, the Bush-Arroyo clique have worked hand and hand to criminalize him, even going as far as placing him on the U.S. list of Foreign Terrorists. Just last month, the Court of First Instance of the European Court of Justice nullified the Council of the European Union’s inclusion of Sison on their “Terrorist List” and they found no basis or due process for the original listing.

The solitary confinement and treatment of Sison, not allowing visitors such as his wife, children, or his doctor to see him, while in detention violates provisions of the United Nations High Comission on the Rights of Refugees. Sison is a recognized political refugee in the Netherlands.

We again call on all truth and freedom seeking people to help defend Professor Sison’s rights and demand that the Netherlands authorities release him at once.

Sign the online petiton and send emails to public officials

CALL, FAX, MAIL, AND/OR VISIT ACCOUNTABLE BODIES IN THE NETHERLANDS, PHILIPPINES, UNITED STATES, & UNITED NATIONS TO DEMAND IMMEDIATE AND UNCONDITIONAL JUSTICE NOW!

(Phone numbers, fax numbers, emails and addresses of officials are listed at freejomapetiton.org/freejomapetition.html along with the text of the petition, which can also be used as a script for call-ups or visits to officials. The text can also be printed as a petition and names gathered in support.)

FREE JOMA SISON!
DROP ALL THE FALSE CHARGES!
STOP THE POLITICAL PERSECUTION OF FILIPINO PROGRESSIVES!

FreeJomaPetition.org
Solidarity Center – 5C
55 West 17th St
New York, NY 10011
For further information call: (212) 633-6646
FreeJomaNow@gmail.com

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Some important trends in the Indian Economy

July 7, 2007 by 2 Comments

Deepankar Basu

In an article in the Business Standard a couple of months ago, economic commentator T N Ninan pointed to some of the important emerging trends in the Indian economy, what he called the “mega trends”. In his words, these trends deserve to be called “mega trends” because they “cannot easily be reversed, have large ripple effects, and … therefore will define the future”. While these “mega trends” are important for throwing up interesting empirical regularities, these can be equally well, if not better, understood within a Marxist paradigm, a paradigm built on looking at reality from the perspective of labour. Adopting the perspective of labour is important for another reason: it allows us to see the incompleteness, the one-sidedness of bourgeois economic analysis. It is only by complementing Ninan’s “mega trends” with some important but neglected trends that are often invisible to bourgeois economists (which I merely point to at the end) that we can get a better understanding of the evolution of Indian economy and society.

The first trend – “acquiring of scale” in Ninan’s words – refers to the growing “concentration and centralization” of Indian capital, a process that inevitably accompanies the development of capitalism. The growth of concentration and centralization is leading to the much talked about growth of “self-confidence” of Indian capital, buttressed no doubt with incursions into foreign territories. As Ninan points out, Indian capital was acquiring “three overseas companies a week, through 2006.”

The second trend – “spread of connectivity and awareness” according to Ninan – refers to the technological development accompanying the growth of capitalism; Ninan limits himself to the technological developments in the communications sector but it can easily be extended to other sectors of the economy too. But there are several important reasons to focus on the transportations and communications sector. First, an increasing efficiency of communications and transportations is essential for a smooth and efficient completion of the numerous “circuits of capital”; the increasing volume of surplus value being generated in the economy needs well functioning circuits of capital to be realized into profit. Second, technological development of the communications technology, especially information technology, is important for the establishment of the networks through which finance capital exerts its influence over the economy. Third, and related to the earlier, is the necessity of swift and reliable communications to support all the processes that facilitates the “concentration and centralization of capital”.

The third trend – “the growth of the middle class” in Ninan’s analysis – if put into proper perspective, refers to two things: (1) the increasing inequality that inevitably comes along with the growth of capitalism, and (2) the changing nature of the Indian working class. What Ninan refers to as the “middle class” is really the fraction of the Indian working class (though it does not want to see itself as part of the working class) that acquires high wage employment in the “leading” sectors of the economy by acquiring skills useful for capital.

The fourth trend – what Ninan calls the “growing problems of growth” – refers to the serious environmental problems created by a regime dominated by the logic of capital accumulation. As the problem of global warming caused by increasing concentrations of greenhouse gases in the Earth’s atmosphere has come into focus, it has become clear that cosmetic changes and technological solutions will not be enough to deal with the whole range of environmental problems under capitalism. What will be required is a wholesale, radical socio-economic transformation, in other words, a transition to socialism. It will become increasingly important for radical political forces representing the interests of capital to come to grips with this issue in India and other underdeveloped economies undergoing rapid (dependent) capitalist development.

The fifth trend – “India’s growing openness to the world” according to Ninan – refers to the growing penetration of the Indian economy by imperialist capital; being supplemented by the growing “export of capital” from India to foreign economies, the two together points to the growing “interpenetration” of imperialist and Indian capital and the incorporation of the Indian capitalist class into the global ruling bloc. The penetration of imperialist capital underlies the oft-forgotten “dependent” nature of the capitalist development in India, a capitalism which cannot, almost axiomatically, benefit the majority of the population.

The sixth trend – what Ninan sees as “the continuing dominance of youth” – refers to the demographic backdrop of capital accumulation in India. The fact that a large proportion of the population will be part of the workforce (if they manage to get employed at all!) will mean that huge reserves of labour will be readily available for capital to exploit and extract surplus value. It will be a long time before these reserves dry up and increasing wages start eating into the profit rates, a process that seems to have already started in China.

It is not, as Ninan asserts, that these “mega trends” will “define” the future in a mechanical sense; it is rather the case that these trends will define the framework within which the class struggle will unfold. For it is the class struggle which will ultimately “define” the future of India. But even in the sense of defining the framework of class struggle, Ninan’s characterization is inadequate because it leaves out labour from the picture, other than in a marginal sense. How will India’s working class evolve over the next few years or decades? What are the trends, working silently but decisively, that can be observed in the evolution of the Indian working class? To even attempt to pose this question adequately, one will have to look at the agricultural sector of the Indian economy and all the forms of labour associated (directly or indirectly) with it. Ninan, quite remarkably, has nothing to say about the sector of the economy which continues to employ (directly or indirectly) the majority of the working people in India!

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Party and Movement – Unity and Contradiction

July 6, 2007 by 3 Comments

Pratyush Chandra

A few months back, a comrade associated with a communist organisation in India circulated a question – “Are there no possibilities of outside-party movements now?” This question is already internationally debated, prominently within a large section of radicals, who have either been part of the party based movements or have struggled fervently against what could be called the party’s tendency to “substitute” the spirit of self-emancipatory struggles through its organisational conservatism and control. However, this question has been reframed in various ways, especially as, “Is there any possibility of party movements now?” The issue has become all the more relevant in the context of recent revolutionary upsurges in Latin America, given the rising scepticism among the traditional left and jubilation among the non-party/post-party left.

Recent arguments and endeavours for building a unified revolutionary party in Venezuela to spearhead the Bolivarian transformation beyond the present stage have once again brought to focus the issues of party, party structure and its relationship to movements. In India, where the ‘communist movement’ despite its splintering has been a decisive force both within state politics and radical politics, the question has become significant with mushrooming of diverse varieties of movements independent of party influences. Also, I believe, this question of party and beyond party has always been a central concern in socialist and working class movements the world over (many times as discussions over the dialectic of spontaneity and organisation).

I

Any “yes-no” answer to the above-mentioned question is bound to be refuted by counter-examples. In fact, a crucial part of the answer to that question lies in understanding movement, party and party building as processes, in their fluidity, not as fixtures imposing themselves on the spontaneity of the masses. If a party is organically linked to a movement, then it perpetually recreates itself in the moments of that movement. A revolutionary party is nothing more than an organisation of the militants of a revolutionary movement. You can have a group-structure (well-organised or loose) prior to any movement, but until and unless it refounds itself within the movement, it generally polices the popular energy.

There are innumerable examples of movements throughout the world that can claim to be partyless or above/beyond parties – prominent among them are the Venezuelan, Argentine and Zapatistas in Mexico, anti-globalisation movements etc. However, there are numerous groups, even traditional party structures operating within most of these movements – but none of them individually can claim these movements to be ‘theirs’. What is a movement which is not more than a party? But in the very “organisation” of all these movements, we find a continuous party building process or rather processes going on in the attempts to give definite expressions to the goals and visions of the movements.

So, in my opinion, to put it rather schematically, what we witness in the formative processes of a movement is that groups or group-structures (it is immaterial whether they call themselves parties or not), with their own prior movemental experiences come into contact with mass spontaneity – where they are either reborn as groups of “militants” trying to give expression to the movemental needs and goals or they come as predefined structures shaping the movement according to their own fixed needs and goals (for example, to win elections etc).

When I say they “come”, it does not mean that these groups are not there. But their there-ness is defined by the consolidation and institutionalisation of their prior experiences, gains and failures. During these latter processes, these groups either congeal as having interests which are now accommodated within the system or they are ready to unlearn and relearn during the course of new struggles of the oppressed and the exploited. In the first case, they are there as part of the hegemony or as its agencies (conscious or subconscious), and in the second case, they are “reborn” as groups or parties of militants, of organic intellectuals – intellectuals organically linked to the working class, as Gramsci would put.

On this perpetual making and remaking of the organisation and party within and with relation to movements, Marx made a very interesting observation in his letter to Friedrich Bolte (November 23, 1871), where he recapitulates the role and problems of the First International:

“The political movement of the working class has as its object, of course, the conquest of political power for the working class, and for this it is naturally necessary that a previous organisation of the working class, itself arising from their economic struggles, should have been developed up to a certain point… [O]ut of the separate economic movements of the workers there grows up everywhere a political movement, that is to say a movement of the class, with the object of achieving its interests in a general form, in a form possessing a general social force of compulsion. If these movements presuppose a certain degree of previous organisation, they are themselves equally a means of the development of this organisation.”

It is important to remember and grasp the dialectics of Marx’s dual assertion about the need of a communist party, on the one hand, and what, as Engels asserted in his 1888 preface of the English edition of the Communist Manifesto, “the emancipation of the working class must be the act of the working class itself”. The latter was already there in the General Rules of the First International (“That the emancipation of the working classes must be conquered by the working classes themselves”). In his Critique of Gotha Programme too, while criticising the Lasalleans, Marx says, “The international activity of the working classes does not in any way depend on the existence of the International Working Men’s Association.” Marx clearly rejects here any substitutionist tendency, which has been rampant within the workers and peasants’ movements in India and elsewhere, as the ‘vanguard’ organisations attempt to “possess” movements. A striking example is the following quote from the party programme of the largest constituent of the parliamentary left in India:

“The people’s democratic front cannot successfully be built and the revolution cannot attain victory except under the leadership of the working class and its political party, the Communist Party of India (Marxist).”

In the above-quoted letter to Bolte, Marx made a very illuminating remark on the function of sectism within the working class movement, which can be a lesson for all of us today:

“The International was founded in order to replace the Socialist or semi-Socialist sects by a real organisation of the working class for struggle. …The Internationalists could not have maintained themselves if the course of history had not already smashed up the sectarian system. The development of the system of Socialist sects and that of the real workers’ movement always stand in inverse ratio to each other. So long as the sects are (historically) justified, the working class is not yet ripe for an independent historic movement. As soon as it has attained this maturity all sects are essentially reactionary. Nevertheless what history has shown everywhere was repeated within the International. The antiquated makes an attempt to re-establish and maintain itself within the newly achieved form.”

As the most recent and clear example of “the antiquated” making an “attempt to re-establish and maintain itself within the newly achieved form” are, what Michael Lebowitz calls, the “glum faces” in reaction to Chavez’s call for a unified party in Venezuela. To resist the replacement of “the Socialist or semi-Socialist sects by a real organisation of the working class for struggle” at the time when the working class has attained maturity is “essentially reactionary”.

In India, too, at the grassroots level the labouring classes have time and again come together and demonstrated their will and energy to move beyond the systemic logic, but the presence of the “antiquated” becomes a hurdle in transforming this solidarity into a decisive challenge to the system. This hurdle is perpetuated by schematically subordinating the working class consciousness (dubbed “economistic”) to the “politics” of parties. The party becomes an organisation above class rather than “the organisation of what already exists within the class” (Mario Tronti), in other words, as the organisation of class capacity. Hence the issue of class seizure and control of production apparatuses and means of production as a challenge to capitalist hegemony transforming the social relations is relegated to a secondary level, while the issue of ensuring formal political consolidation and stability in a competitive setup becomes the end of party politics. The issue of posing class alternatives to capitalist regime of accumulation is sidelined in the process of the “accumulation of power”.

However, this “antiquated” cannot be fought by wishing away the notion of “party”, it can only be done by viewing party building as a process with all its contradictions and as a continuous class struggle, including against internalised hegemonies – against labour aristocrats and party bureaucrats.

II

In West Bengal (in fact, everywhere in India) the working class and the poor peasantry have outgrown the traditional left. This is not something new and to be lamented upon. It always happens that organisations develop according to the contemporary needs of the class struggle, and are bound to be institutionalised, and even coopted, becoming hurdles for further battles, not able to channel their forces for new exigencies of class dynamics and struggle. This happens so because in the process of a struggle, a major segment devoted to the needs of this struggle is caught-up in the networks it has established for their fulfillment. It is unable to detach itself from the fruits of the struggle, therefore losing its vitality and is overwhelmed by the existential needs.

In the name of consolidation of movemental gains, what is developed is a kind of ideologisation, a fetish – organisation for organisation’s sake. This leads to the organisation’s and its leadership’s cooption in the hegemonic setup (obviously not just in the formal apparatuses) which in turn due to struggles has to concede some space to new needs and aspirations. In fact, this is how capitalism reproduces itself politically. And this is how societal hegemonies gain agencies within radical organisations, and are organisationally internalised – developing aristocracies and bureaucracies.

Two important points regarding the recent agitations in West Bengal can be fruitful for us in understanding the above-mentioned dynamics:

1) As prominent Marxist-Feminist historian Tanika Sarkar says, “an amazing measure of peasant self-confidence and self-esteem that we saw at Singur and at Nandigram” is a result of whatever limited land reforms the Left Front (LF) initiated and is in the “very long and rich tradition of the Left politics and culture”.

2) The price of state power that helped sustain this was the cooption of the LF in the hegemonic policy regime, which is neoliberal for now. So the vested interests that developed during these struggles and cooption led to a situation where “[b]eyond registration of sharecroppers and some land redistribution, no other forms of agrarian restructuring were imagined.” Also, “industries were allowed to die away, leaving about 50,000 dead factories and the virtual collapse of the jute industry”, as competition and the flight of capital were not challenged (which probably in the federal setup of India could not be challenged) by questioning the nature of production relations.

However, there is no fatalism in the above view – the radical vitality of an organisation/party is contingent upon the sharpening of struggle between hegemonic and counter-hegemonic tendencies within an organisation, which in turn is embedded within the overall class struggle, i.e., it all depends on class balance and struggle within an organisation.

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Should the Financial System under Capitalism be Regulated?

July 5, 2007 by 1 Comment

Deepankar Basu

A view that is very popular among the votaries of capitalism rests on the alleged efficiency of the financial markets of a “well functioning” capitalist economy. Financial markets, it is claimed, provide the prime mechanisms for channeling funds from savers to the most efficient investment projects, thereby increasing the overall efficiency of the economy. Lack of well-developed financial markets are often interpreted as markers of underdevelopment and economic stagnation. That this is not always the case, that financial markets are unusually prone to “irrational exuberance”, that financial booms and busts are part of the regular functioning of financial markets if often forgotten by this fundamentalist viewpoint.

A more nuanced version of this view is marked by a more measured view towards financial markets. Proponents of this view start by asserting that the financial system is composed of two parts: financial markets and the web of interdependent financial institutions. They recognize the fact that financial markets, by themselves, are often unable or unwilling to perform several important functions (like collecting, processing and disseminating reliable information about borrowers; providing liquidity services; offering deposit and check-writing facilities) required for the smooth functioning of an advanced capitalist economy. Hence, they recognize the important role of institutions, especially financial institutions (like commercial banks, insurance companies, mutual funds, etc.), within the architecture of advanced capitalism. But very often they also go on to assert that the financial system works best if left to itself; that government intervention in the financial system creates unnecessary inefficiencies. When confronted with the evidence of endemic instability of the financial system, they argue that crises and problems have led, over the years, to the development of a host of institutions that are capable of dealing with such episodes; it is both unnecessary and undesirable for the State to regulate the financial system, they claim.

A closer look at the history of the financial system in the US – the leading capitalist nation today – will demonstrate that such a view is seriously misleading; the government has always had to intervene to put the financial house in order. In fact one can go further and assert that the financial system cannot properly function without supervision at crucial moments by the State, if not constant supervision. Let me illustrate this with three well-known historical instances when the State had to step in to deal with the endemic instability of the financial system in the US. These historical instances are important, apart from illustrative purposes of this article, for at least two more reasons. One, they are the defining interventions in the financial system of the US; the financial system as we know it today has been largely shaped by these interventions and the institutions created at those moments. Two, they destroy the facile opposition that is often constructed, both by the Right and even some on the Left, between private capital and the State; the State is an institution created to protect the interests of capital as a whole even though, on occasion, it has to act against some capitals (some firms or industries or even some sectors of the economy). These instance demonstrate clearly that even when the State acted against some financial firms or sectors it was doing so to save and strengthen the capitalist system.

The first major instance of government intervention stands at the very foundational moment of the modern financial system in the US. The unregulated banking industry in the US led to massive bank failures in the late 19th century: waves after waves of bank failures where savers lost their deposits and lenders could not borrow to meet their needs; this led the Congress to create the Federal Reserve System (the Central Bank of the US) in 1913.

Within less than two decades we come to the second major intervention: creation of the FDIC. In the late 1920’s, the US economy was into the biggest downturn it had ever faced: the Great Depression. During this traumatic period, there were thousands of bank failures again (along with a huge stock market crash) and confidence in the whole financial system was greatly eroded. The Congress again stepped in to create the FDIC (Federal Deposit Insurance Corporation) which was meant to deal with the problems that the unregulated banking industry could not handle: bank runs.

The third major intervention (also made around the time of the Great Depression) had been to restrict competition in the banking industry (i.e., to force some form of branching restrictions across geographical regions) and also to restrict the areas into which a commercial bank could enter (basically to separate commercial and investment banking to prevent conflict of interest).

The last instance of government intervention is important because over the last few decades, these laws and the supporting institutions have been generally nibbled away at. For instance, the Glass-Steagall Act of 1933 had created a “wall” separating commercial and investment banking; from the 1970s onwards the growing power of finance has been continuously trying to attack and change this very important law. Finally in 1999, the Gramm-Leach-Bliley Financial Services Modernization Act repealed the Glass-Steagall Act!

The effects are already coming to the fore in the form of major banks’ (like J P Morgan Chase’s) involvement in financial frauds and other irregularities (see the Spring 2007 issue of Dollars & Sense). For instance, Chase was one of the banks which had systematically assisted Enron in its accounting frauds. It had also, in its role as an underwriting agent – one of the main functions of an investment bank – sold Enron stocks to the public knowing full well that Enron was in bad shape. This is precisely the kind of “conflict of interest” that the Glass-Steagall Act was meant to take care of. Now that it has been thrown out, we can expect many more instances of such irregularities.

The bottom line is that I do not share in the optimism about the US financial system (which many people seem to harbour), nor do I think that there is any evidence for such optimism. To suggest that the US financial system has managed to take care of the problems of instability is to willfully ignore well-known empirical evidence. Here are a few: the Savings and Loan (S&L) crises through the 1980’s, the wave of bank failures in the late 1980’s, the stock market crash of 1987, the LTCM scandal in 1998 (when the Fed had to step in to bail out a major financial firm), the dotcom bubble and bust, the imminent meltdown in the sub-prime mortgage market …one could go on and on; but let us look a bit more closely at only two of these well-known episodes of financial trouble: the LTCM fiasco and the sub-prime mortgage meltdown currently underway in the US.

LTCM (Long Term Capital Management), a very famous financial firm of the late 1990s in the US had been feted by Wall Street as one of most technologically sophisticated financial firms in existence; after all it had offered close to 40% annual returns for two years in a row and had towering figures from theoretical finance among its founding members. It was a “hedge fund” formed in 1994 and had, among its founder member two Nobel laureates in Economics: Myron Scholes and Robert Merton. Within four years LTCM was on the verge of collapse! More details about the the rise and fall of LTCM can be found here (there are lots of useful references at the end of this article; among others, there is a very nice PBS documentary on the whole episode which is worth watching.)

A little note about “hedge funds” might not be inappropriate at this point. A “hedge fund” is, to be brief and simple, a financial institution which pools the money of a few very rich individuals and then invests it around the world to make huge profits. Membership to hedge funds is not open; it’s stocks don’t trade in the financial markets; it is always very secretive about how it invests and also about who its investors are. Usually the smallest amount of money that is required by an individual to become part of a hedge fund (i.e., an investor who is one of the many whose money has been pooled into the hedge fund) is $1 million. In most cases, it is much higher. If we look at hedge funds from the point of view of ordinary citizens, we cannot escape the well-known (and increasingly well-recognized) fact that they are notorious for creating instability in financial markets, especially in the low and middle income economies. Their huge size and ability to move funds very rapidly gives them undue power and influence over small and medium economies (now even large economies are facing the music of hedge funds), whose macroeconomic stability is severely jeopardized by their investment strategies.

Coming back to the stunning LTCM collapse, it is important to remember that the Federal Reserve Bank of New York had to step in to arrange credit for its bailout. If the Fed had not intervened to bail out the tottering giant, it might have led to a asset price deflationary spiral leading to a string of failing firms and lost jobs and lost output and macroeconomic instability. For the purposes of this essay, it is merely necessary to note that the financial system could not deal with this problem on its own!

Let us now move on to the second story, a story that is still unfolding: the sub-prime mortgage lending crisis in the US. Referring to the sub-prime mortgage meltdown that is currently underway in the US, a recent report by the Centre for Responsible Lending has estimated that more than 1 million low-income families have lost their homes on net (i.e., after accounting for those who have gained home ownership) over the past nine years. Have the banks and financial firms that created this crisis lost much? It is doubtful whether the banks originating the mortgages, the focus of all the attention in the mainstream press, have really lost anything.

Let me remind readers that the “sub-prime” mortgage meltdown refers to the market for mortgage loans (i.e., loans for buying real estate) supposedly for low-income households without good credit histories. The rule of the game, as it evolved over the last decade, was that the house that is bought with the mortgage loan is used as collateral for the loan so that whenever a family fails to make a single monthly payment (there might be a little variation on this), it leads to “foreclosure” and the bank that had made the loan takes possession of the house to recoup its losses.

But why the term “sub-prime”? The attribute of “sub-prime” comes from the fact that most of these loans made on this market are at above-average (much above the market interest rate for mortgages) interest rates and at very onerous terms; the term contrasts this market with the “prime” mortgage market where loans are available at much lower interest rates. In most cases, these “sub-prime” loans are made in bad faith because the concerned families are “convinced” of the suitability of high-interest rate and “coaxed” into the loans at unreasonable terms. More often than not big banks use various kinds of methods to consciously keep out low-income families from the “prime” mortgage market (where they might have got loans at reasonable rates and terms); most of these families, needless to say, are either African-American or Latinos. Once, in this way, these families have been pushed out of the “prime” mortgage market and into the “sub-prime” market, the same banks turn into loan sharks and strip the low-income families to their bones. It is, therefore, hardly surprising that many families are unable to meet the monthly payments of the mortgage and lose their house and most of their life’s savings. That is what has been documented by the Centre for Responsible Lending and that is what is creating havoc in the lives of many working-class Americans.

These are but two small instances of the operation of financial system under advanced capitalism; one can very easily multiply them ad nauseum. The evidence, if one cares to look, strongly suggests that the US (or any other capitalist economy for that matter) will have to learn to live with inescapable instability; these episodes are as much part of life under capitalism as are economy-wide business cycles. Of course, under capitalism, the overwhelming cost of these episodes of financial and other forms of instability will be always borne by the working people. Hence, all political formations claiming to represent the interests of the working people must vociferously argue for the regulation of the financial system without taking recourse to the false opposition between the State and capital.

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Nandigram: Peasants Resistance against Land Grab

July 3, 2007 by 1 Comment

Ish Mishra

Machiavelli’s living role model for his Prince, Cardinal Caesar Borgias who subsequently manipulated his ascendance to the papacy of the Roman Church as Alexander VI, “did nothing but deceive the people and found enough opportunities to do so and did it magnificently”. If Machiavelli had to choose a model for his Prince in the contemporary Indian politics, where conquests are not decided by the war of sword but of numbers, he would face a great difficulty, due to abundance of modern Indian Borgias, nevertheless Buddhadeb Bhattacharjee would be a serious contender. The West Bengal Government declared that in the process of “developing the state, the interest of agriculture shall not be compromised and that no land acquisition shall be implemented without the consent of the peasants and the local communities” and next day the chief minister, Mr. Bhattacharjee unleashes the rein of terror on the peasants by ordering Police firing in collusion with the CPI(M) patronized goons, as has been purported by the preliminary CBI inquiry. The philosopher of the European Renaissance had advised the successful Prince to kill quickly and reward gradually. If the political economy of Left Front Government, particularly after the take over by the “Marxist” Nadir – Budhadeb Bhattacharjee is any indicator, the CPI(M) seems to have heeded Machiavellian advices more earnestly than the Renaissance absolutist monarchies did.

The heinous act of killing, wounding and maiming innocent farmers, artisans and agricultural laborers – a crime against humanity – reminds the stories of the gory acts of medieval sadist despots. The Nandigram, that has become a common noun from proper noun due to the brutal repression of the heroic resistance by the farmers of the area against the expropriation of their agricultural land for creating “foreign territories” – the SEZs. It once again witnessed death of 14, protesters and injury to hundreds in police firing aided and abetted by CPI(M)’s lumpen brigade on the14th March 2007 on the orders of the Marxist Chief Minister, Buddhadeb Bhattacharjee, committed to the “development of West Bengal at any cost”. However, the peasants’ resolve not to be displaced at any cost forced the postmodern Nadirs to step back from their declaration of creating the SEZ for Salim group at any cost. The CPI (M) supremo Prakash Karat has gone all the way out to defend Singur “take over” for the Tata’s “pro-people” car factory and Nandigram atrocities and killings in the name of establishing governance as they don’t want to allow West Bengal into becoming a “Chhattisgarh”! A party refusing to part away with the prefix-Communist from their name despite acting as agents of corporate houses is using the “law-and-order” argument more dubiously than any social democratic party. This is being met by pervasive protest and condemnation, even by its allies and sympathetic intellectuals including the veteran Economist Ashok Mitra. Now Prakash Karat had declared that there would be no land acquisition for SEZ in Nandigram area. This wisdom needed so much of bloodshed and terror. Apart from the loss of lives and causing irreversible harm to the interest of the working people politically and economically, its ideological bankruptcy has made the other imperialist parties and rightwing lumpen elements into heroes. Prakash Karat to counter Advani, reminded of the state engineered Gujarat pogrom by Narendra Modi government in order to defend the repression at Singur and Nandigram. Well Modi and Bhattacharjee, despite opposite ideological declarations and pretensions bear many similarities. Prakash Karat defends the West Bengal Chief Minister as “elected by the people” in the same language as the Hindutva lumpen brigade defends Modi. Both of them take pride in “developing” their respective states with the same formulae as the Corporate led imperialist globalizations seeks to develop the “under-developed” and “developing” countries of the world.

Buddhadeb Bhattacharjee announced that there would be no forced acquisition in Nandigram and sent the police to kill the people resisting the land grab. One stark similarity between Kalinganagar and Nandigram is that at both the places people are firmly refusing to be displaced and the agitators were shot dead in a targeted manner. The one difference, which has gone unnoticed, is that Naveen Patnaik shed crocodile tears by announcing a judicial enquiry where as the West Bengal’s self claimed leftist chief minister and the CPI(M)’s leaders went out of way to defend the Police action in the name of law and order. The CPI(M) led left front government, despite opposition by some of the constituent parties of the front, had expressed its determination to go ahead with the plan of creating the SEZs at any cost, and has been forced to make a hasty retreat.

CPI(M) ideologues aided and abetted by its propaganda brigade are justifying the governmental decision in the name of the law and order, using Marxist and Leninist jargons, creating the confusion of the contexts by juxtaposing of 19th century England and early 20th century Russia over 21st century India. Probably for such Marxists of his time Marx had pejoratively said that “thank God! I am not a Marxist”. History never repeats itself. As a philosopher of the Greek antiquity had rightly said that every thing in the world is in continuous state of change and flux and that the only constant is the change itself. History does not repeat itself, it only echoes. The creation of “foreign territories” within the country under the SEZ Act 2005 echoes the creation of fortified enclaves in the costal regions by various – French, Dutch and English East India Companies – in the costal regions of the country. It appears that history has taken a full circle. But much water has flown down the Bay of Bengal. Capitalism and innately linked imperialism has made multiple advances since then. Imperialism in its latest avatar of globalization has become so ubiquitous that now there is no need of any Lord Clive, all the Sujauddaulas have turned into Mir Zafars.

European Renaissance was not the “rebirth” of classical antiquity. “Rebirth” is a myth. It was not the rebirth but the reconstruction of the society with the nostalgic memory of the classical antiquity, according to the needs of the new social forces that had matured in the womb of decaying feudalism. It announced the emergence of a new era which witnessed the emergence of a new species of hero – the hero of finance struggling to get money making included in the circle of virtues, even if on the periphery. This new hero proved to be very smart. In less than 150 years time it became the hero and moved from periphery to centre. The17th century ideologue of this new hero, John Locke declared in unambiguous and categorical terms, “governance is a serious matter; it can be entrusted with only those who have already proved their worth by amassing sufficient wealth.” Their demand for freedom and equality was interpreted as universal equality and liberty and which eventually led to universal franchise and territorial-national universal citizenship and establishment of representative democracies, dictatorship of proletariat and their reversal into capitalism. There have been many insightful presentations and discussions and shall be more on the changing nature of citizenship and its theorization based on the changing nature of the economic base structure and its political superstructure. SEZ is the cheapest and sure-shot technique of the latest stage of the imperialist capitalism leading to the erosions of citizenship rights of people working in and outside these “foreign territories”, which in essence are “Special Exploitation Zone” and its long term possible implications. Also the details of fiscal and revenue implications are beyond the scope of this presentation and constitute the subject matter of separate discussions. The country-wide intensification and radicalization of the resistance against the land grab campaign by the state and corporate nexus for industrialization/SEZ/real estate provides a ray of hope for the anti-imperialist struggles all over the world over and Nandigram has created a precedent by forcing the government to rollback.

Indian parliamentary parties have gone many steps ahead of their colonial predecessors in using the draconian colonial Land Acquisition Act 1894, in the sense that even they did not acquire the agricultural land for private capitalists in the name of “public utility”. But preceded by Kamalnath and Chidambaram, Man Mohan Singh also reiterated his government’s firm determination to go ahead with the SEZ plans at any cost. Seeing his sense of history with gratitude to colonialism for “civilizing” India into a “nation” as revealed by him while being awarded with an honorary doctorate at Oxford University’s University and his World Bank affinity, it is not unexpected. This has provided an opportunity to CPI (M) leaders to shift the blames and devise new methods of the expropriation of agricultural land for national/transnational corporate houses. The Nandigram has taken an initiative and shown the way. There have been reports of peasants’ resistance against SEZ from all the corners. Only future will tell how long and to what extent the peasants struggling for the right to land and livelihood can hold against the formidable nexus of Indian state and the imperialist capital.

Heroic struggle of the peasants of Nandigram and Kalinganagar have challenged and foiled the neo-imperialist strategies of land expropriation by the state-corporate-judiciary nexus and forced a debate upon non-devastating models of development by laying their lives. “Their martyrdom shall not go in vain and let us salute the martyrs of Nandigram and Kalinganagar and resolve to condemn the brutalities of Budhadeb Bhattacharjee and Navin Patnaik governments in no uncertain terms”, said an activist of the Kalinganagar movement. “These local battles would strengthen the international forces seeking human emancipation and an end to exploitation of human by man”.

(A modified version of the article was published in Red Star April 2007)

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Nandigram to Beijing via Moscow

June 27, 2007 by Leave a Comment

Pothik Ghosh

There was a time when the spectre of communism haunted private property, but times have changed. The spectre of private property haunts communism now. Even as the ‘communist’ government of West Bengal resorted to state terrorism in Nandigram to acquire land from unwilling villagers to jump-start industrialisation for ‘development’, Communist China passed a law that would make right to private property legally enforceable for the first time since the 1949 revolution. The legislation, which is meant to give people a stake in their assets and protect them from a capricious party bureaucracy that has used the proxy of state ownership to dispossess many of them, seems to be a markedly different response to development than that of their CPI(M) comrades in Bengal.

There are, of course, obvious limits to how far the common citizens of China can go with the law. Given the infamous unaccountability of the Chinese state, it’s most likely to be used by its avaricious political elite to legalise its ownership over assets acquired, in the name of the state and public good, by expropriating individual citizens.

Therefore, in terms of the final solution, the responses of the communists of China and West Bengal to the question of ownership have turned out to be not so different after all. The two cases are, however, not strictly comparable. For one, while post-revolutionary China has always been a one-party state, the Left Front has come to power in West Bengal and held on to it by participating in the Indian system of multi-party electoral democracy.

For another, LF-ruled West Bengal has always recognised the legally established form of mixed ownership of property in India. Yet, the vengeance with which the Indian state has often used the principle of eminent domain to dispossess traditional socio-economic communities in order to acquire land for ‘development’ and ‘public good’ emphasises its institutional affinity for the ideology and rhetoric of state socialism. It would, therefore, make perfect sense to historically examine the ‘socialist’ discourse on ownership of property.

State ownership cannot truly socialise property because of the way the state structurally is: an alien authority dispensing governance to a passive population. Public ownership of property is thus the ownership of bureaucracies, and ensembles of vested interests. Such institutionalised diminution of public participation by the modern state holds true even in a representative electoral system like India’s.

On the other hand, legally enforceable right to private property, even if it were to exist as a fundamental right, would not lead to a participatory democracy. The dangers that the new Chinese law poses, bears that out. Even as the disintegration of stratified pre-capitalist communities has always led to legalised private property and capitalism, such breakdown has not always yielded by itself even functional democracy.

The link between private property and democracy is much more tenuous than commonly accepted. While the 19th century Prussian model of Junker capitalism – where landlords and companies expropriated the peasantry from above and legalised property so acquired as their own – will certainly not yield democracy; the 19th century US way, where private property was established through the emergence of small-to-medium independent farmers from below, is a case of capitalistic ownership coinciding with the formal democratic project.

It was not without reason that Russian social democrats Plekhanov and Lenin championed the latter, rejected the former (enforced by liberals like Stolypin in Russia), and yet managed to distinguish themselves from the Populists and Narodniks, who opposed Stolypin’s reforms because it destroyed the traditional peasant community. Clearly then, asset redistribution programme was not merely an end in itself for the social democrats. It was of even greater consequence to them precisely because it engendered the possibility of an alternative conception of political power than that embodied by the modern state.

Lenin and his fellow-travellers’ quest, at least till the October Revolution of 1917, was as much socialisation of economic assets as an alternative political structure that was more democratic than any. The reason they envisaged the two together was because they understood the individual’s freedom from the community both as his freedom from the oppressive bonds of the community and from its protection. Their vision was to reconcile the question of individual liberty (rights) with that of communitarian protection (social entitlements). The social democrats knew that only universal empowerment would arm people with the capacity to both facilitate and participate in modern development.

The unfortunate part of the story is that as the movement progressed, the search for an alternative political structure became subordinate to the nature of ownership of property. This was largely because the Bolshevik Revolution, just like other similar Left-led movements that occurred later elsewhere, was forced by the exigencies of modern politics to concentrate on dealing with the might of the pre-revolutionary state and emphasised the seizure of state power as its cardinal goal. As a result, it was rendered incapable of imagining configurations of power outside the framework of the modern state.

The horrors of collectivisation of agriculture in the erstwhile USSR of 1920s must be ascribed to this derailment of political imagination. The alternative cannot, however, be a utopian community of subsistence farmers. Land and capital will have to be consolidated to make both agriculture and the larger socio-economic order more productive and viable. Chinese historian Qin Hui’s is opposed to both the ‘Leftists’, who favour state ownership; and ‘liberalisers’, who are all for privatisation.

In an interview to the New Left Review, the communist dissident has accurately likened the former to Russian Populists and the latter to Stolypin-style liberals. The opposition between the two, as is evident in China and, to a lesser extent, India, is false. They actually complement and fulfil each other. The real issue then is that of finding an alternative political culture and institutional structure, which will drive development through democratic management of the commons.

A modified version of the article was published in The Economic Times

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Fidel reflects: They will never have Cuba

June 18, 2007 by Leave a Comment

I hope that no-one say that I am gratuitously attacking Bush. Surely they will understand my reasons for strongly criticizing his policies.

Robert Woodward is an American journalist and writer who became famous for the series of articles published by The Washington Post, written by him and Carl Bernstein, and which eventually led to the investigation and resignation of Nixon. He is author and co-author of ten best-sellers. With his fearsome style he manages to wrench confessions from his interviewees. In his book, State of Denial, he says that on June 18, 2003, three months after the Iraq war had begun, as he was on the way out of his White House office following an important meeting, Bush slapped Jay Garner on the back and said to him:

“Hey, Jay, you want to do Iran?”

“Sir, the boys and I talked about that and we want to hold out for Cuba. We think the rum and the cigars are a little better…The women are prettier.”

Bush laughed. “You got it. You got Cuba.”

Bush was betrayed by his subconscious. It was in his mind when he declared what scores of dark corners should be expecting to happen and Cuba occupies a special place among those dark corners.

Garner, a recently retired three-star general who had been appointed Head of the Post-War Planning Office for Iraq, created by secret National Security Presidential Directive, was considered by Bush an exceptional man to carry out his war strategy. Appointed for the post on January 20, 2003, he was replaced on May 11 of that same year at the urging of Rumsfeld. He didn’t have the nerve to explain to Bush his strong disagreements on the matter of the strategy to be pursued in Iraq. He was thinking of another one with identical purpose. In the past few weeks, thousands of marines and a number of US aircraft carriers, with their naval supporting forces, have been maneuvering in the Persian Gulf, a few miles off the Iranian territory.

It will very soon be 50 years since our people started suffering a cruel blockade; thousands of our sons and daughters have died or have been mutilated as a result of the dirty war against Cuba, the only country in the world to which an Adjustment Act has been applied inciting illegal emigration, yet another cause of death for Cuban citizens, including women and children; more than 15 years ago Cuba lost her principal markets and sources of supply for foods, energy, machinery, raw materials and long-term low-interest financing.

First the socialist bloc collapsed followed almost immediately by the USSR, dismantled piece by piece. The empire tightened and internationalized the blockade; the proteins and calories which were quite well distributed despite our deficiencies were reduced approximately by 40 percent; diseases such as optical neuritis and others appeared; the shortage of medicines, also a result of the blockade, became an everyday reality. Medicines were allowed to enter only as a charitable act, to demoralize us; these, in their turn, became a source of illegal business and black-market dealings.

Inevitably, the “special period” struck. This was the sum total of all the consequences of the aggression and it forced us to take desperate measures whose harmful effects were bolstered by the colossal media machine of the empire. Everyone was awaiting, some with sadness and others with oligarchic glee, the crumbling of the Cuban Revolution.

The access to convertible currency greatly harmed our social consciousness, to a greater or a lesser degree, due to the inequalities and ideological weaknesses it created.

Throughout its lifetime, the Revolution has taught the people, training hundreds of thousands of teachers, doctors, scientists, intellectuals, artists, computer engineers and other professionals with university and post-graduate degrees in dozens of professions. This storehouse of wealth has allowed us to reduce infant mortality to low levels, unthinkable in any Third World country, and to raise life expectancy as well as the average educational level of the population up to the ninth grade.

By offering Cuba oil under favorable terms of payment at a time when oil prices were escalating dramatically, the Venezuelan Bolivarian Revolution brought a significant relief and opened up new possibilities, since our country was already beginning to produce her own energy in ever-growing amounts.

Concerned over its interests in that country, the empire had for years been planning to destroy that Revolution, and so it attempted to do it in April 2002, as it will attempt to do again as many times as it can. This is why the Bolivarian revolutionaries are preparing to resist.

Meanwhile, Bush has intensified his plans for an occupation of Cuba, to the point of proclaiming laws and an interventionist government in order to install a direct imperial administration.

Based on the privileges granted to the United States in Bretton Woods and Nixon’s swindle when he removed the gold standard which placed a limit on the issuing of paper money, the empire bought and paid with paper tens of trillions of dollars, more than twelve digit figures. This is how it preserved an unsustainable economy. A large part of the world currency reserves are in US Treasury bonds and bills. For this reason, many would rather not have a dollar crisis like the one in 1929 that would turn those paper bills into thin air. Today, the value of one dollar in gold is at least eighteen times less than what it was in the Nixon years. The same happens with the value of the reserves in that currency.

Those paper bills have kept their low current value because fabulous amounts of increasingly expensive and modern weapons can be purchased with them; weapons that produce nothing. The United States exports more weapons than anyone else in the world. With those same paper bills, the empire has developed a most sophisticated and deadly system of weapons of mass destruction with which it sustains its world tyranny.

Such power allows it to impose the idea of transforming foods into fuels and to shatter any initiative and commitment to avoid global warming, which is visibly accelerating.

Hunger and thirst, more violent hurricanes and the surge of the sea is what Tyranians and Trojans stand to suffer as a result of imperial policies. It is only through drastic energy savings that humanity will have a respite and hopes of survival for the species; but the consumer societies of the wealthy nations are absolutely heedless of that.

Cuba will continue to develop and improve the combative capacities of her people, including our modest but active and efficient defensive weapons industry which multiplies our capacity to face the invaders no matter where they may be, and the weapons they possess. We shall continue acquiring the necessary materials and the pertinent fire power, even though the notorious Gross Domestic Product as measured by capitalism may not be growing, for their GDP includes such things as the value of privatizations, drugs, sexual services and advertising, while it excludes many others like free educational and health services for all citizens.

From one year to the next the standard of living can be improved by raising knowledge, self-esteem and the dignity of people. It will be enough to reduce wastage and the economy will grow. In spite of everything, we will keep on growing as necessary and as possible.

“Freedom costs dearly, and it is necessary to either resign ourselves to live without it or to decide to buy it for its price”, said Martí.

“Whoever attempts to conquer Cuba will only gather the dust of her soil soaked in blood, if he does not perish in the fight”, exclaimed Maceo.

We are not the first revolutionaries to think that way! And we shall not be the last!

One man may be bought, but never a people.

Fate decreed that I could survive the empire’s murderous machine. Shortly, it will be a year since I became ill and, while I hovered between life and death, I stated in the Proclamation of July 31, 2006: “I do not harbor the slightest doubt that our people and our Revolution will fight until the last drop of blood.”

Mr. Bush, don’t you doubt that either!

I assure you that you will never have Cuba!

Fidel Castro Ruz
June 17, 2007
2:03 p.m.

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