Kashmir's Ordeal - Chapter One

Lal Khan analyses the world situation, looking at the economic and political turmoil all across the world. From this analysis he draws one conclusion: the human race must put an end to the capitalist system before the capitalist system puts an end to the human race.

A World In Turmoil

For Marxism neither pessimism nor spurious optimism can play a role in determining the analysis of events. The first necessity is to understand the meaning of the conjuncture of historical forces leading to the present world situation.

Ted Grant 1

Humanity in Chains

At the dawn of the 21st century, the human race finds itself in a war-ravaged world. Millions of people are forced to endure the extreme poverty, disease, unemployment, illiteracy, and all the other wretched miseries that are the inevitable consequences of capitalist exploitation. Religious fundamentalism, as oppressive and intolerant now as it was in the Middle Ages, continues to grow unabated. The United States government condemns fundamentalism in places like Afghanistan and Iran, while openly supporting it in the American 'Bible Belt', where school children are still taught Creationism. There are increased levels of racial and religious intolerance, genocide (or “ethnic cleansing”) and sectarian violence. Crime and corruption have reached unprecedented levels. These are all symptoms of a socio-economic system in terminal decay. There is exponential rise in destructive capacity available to the human race. Three times more people have been killed in the last 90 years than in all the previous 500 years. In the wars of last decades more children were killed than soldiers. There are more than three dozen armed conflicts still going on in the world. In comparison, the 40 million unnatural deaths that occurred during the 19th century, an estimated 44 million people died of genocide and about 40 million of famine in the 20th century. Since the end of World War II in 1945 there have been over 250 major wars in which 23 million people have been killed and countless millions injured and bereaved. World military expenditure increased from $ 742 billion in 1994 to $ 879 billion in 2003 and now it has crossed the trillion dollar mark. Expenditure on nuclear weapons alone since 1945 is estimated at $ 8 trillion.

To make matters worse, our very existence is threatened by the spread of nuclear weapons, a vile trade that continues despite the end of the Cold War. Added to this is the threat to the environment. Combined with the destruction of the rainforests, the pollution of the oceans and the atmosphere, the depletion of the ozone layer and clear evidence of global warming, this is the most imminent threat to the continued existence of the human race.

So what are our capitalist masters doing about it? Why, nothing of course! While our beautiful planet drifts inexorably towards environmental disaster, they deny all the evidence and refuse to believe there is a problem. The greatest offender of all is the Bush administration the worst government America has ever been encumbered with. With only 3% of the world's population, America is responsible for 25% of world pollution. Yet the first thing Bush did after he cheated his way into power was to delight his oil-producing buddies by opting out of the Kyoto agreement because 'It wasn't in America's interests'. What he means of course is that it is not in the interests of big business.

The captains of capitalism are driven only by greed; so blinkered is their vision that they can see nothing ahead of them but the need to make more and more profit. In doing so, they are leaving us with a world that not even their own children will thank them for.

Meanwhile, the infrastructure of the capitalist system the International Monetary Fund (IMF), the World Bank, and the World Trade Organization (WTO) continues to spread its morbid influence all over the world in the service of the multinational corporations. These corporations are indifferent to the increasing misery and hardship they are inflicting on the world's poor.

There is but one conclusion to be drawn from all of this: the human race must put an end to the capitalist system before the capitalist system puts an end to the human race.

Newspeak Economy

In his brilliant work of fiction, Nineteen Eighty-Four, George Orwell creates an imaginary despotic regime under which there is a special language devised to name things by their opposite meanings. George Orwell wrote:

Newspeak was the official language of Oceania and had to meet the ideological needs of Ingsoc … Its vocabulary was so constructed as to give exact and often very subtle expression to every meaning that a 'party' member could properly wish to express, while excluding all other meanings … Newspeak was designed not to extend but to diminish the range of thoughts .. 2

In the present world situation, the imperialist media and the dominating intelligentsia have changed the meaning of words into their opposite. This is especially true in the sphere of economics. In Newspeak “war” was called “peace”, “hate” was called “love” etc. Today “reforms” means “counter-reforms,” poverty alleviation policies result in the expansion of poverty, “exploitation” is called “investment” and so on.

The doctrine of neo-liberalism, which currently dominates global policy making, has been fully ingrained in the well-known charter identified as the Washington Consensus.

The package of measures such as deregulation, privatisation, competitive exchange rates, fiscal discipline, tax reforms through the cutting of material tax rates, and security of property rights, is one of the key instruments of globalisation. This package has been prescribed for the vast majority of developing countries irrespective of their stage of economic and social development.

The process of globalisation received a significant boost on April 15, 1994, when more than 100 countries, both developed and developing, signed the Marrakesh Declaration. These countries thereby confirmed their adherence to the Uruguay Round Agreements (URAs) and the WTO, which took over the expanded role of General Agreement on Tarrifs and Trade (GATT).

The WTO, which formally came into existence on January 1, 1995, is responsible for carrying forward the agenda of globalisation a process which otherwise has its roots in the early 19th century. The rules, regulations, and mechanisms implemented by the WTO cover a large number of areas such as goods and services, agriculture, textiles and clothing, intellectual property rights, anti-dumping measures and so on.

In its essence and intent, the WTO focuses less on trade and trade-related issues and more on production, investment, exchange and distribution of income and wealth within and between the member countries.

Under the WTO, the economies of the member countries are undergoing a major metamorphosis. The international division of labour and production is increasingly oriented towards the classical model of the comparative cost principle with the developing countries specialising in primary and agricultural goods and the developed countries exclusively producing the high-tech, high-value added and industrial goods.

This pattern of global production, distribution and the terms of trade has put the economies of the countries producing raw materials in steep decline. Resources, both financial and non-financial, are continuously flowing from the developing countries to the developed industrial countries.

One clear and incontrovertible fact is that one of the results of globalisation is the phenomenon of rising poverty and inequalities in the distribution of world income. Starting from the early 19th century to the close of the 20th century, the gaps between the income, wealth and assets of the poor and that of the rich of the world have widened by a margin that is simply mind-boggling.

The ratio of incomes of the world's poorest one fifth population to the richest one fifth had been estimated at 1:3 in 1820 which rose to 1:11 in 1913, 1:30 in 1970 and 1:59 in 1989. The poorest one fifth of the world has a share of only 1.4 per cent in the world GDP while the richest one-fifth has a share of 82.7 per cent.

The distributional pyramid of the global income has been completely inverted with a weak and narrow base of incomes of the poorest one fifth of world population and with the preponderantly heavy share of the richest one fifth at the top.

Share for the poorest and the richest one fifth of the world population for the year 1997 indicates that the ratio between the two shares has further risen to 1:87 providing a clear testimony that globalization and rising income inequality and global poverty are correlated and synchronized phenomena.

The world GDP (Gross Domestic Product) for the year 2003 was estimated at $ 34.5 trillion. Out of this, the US with a GDP of $ 10.9 trillion has a share of about 31.6 percent. With Japan's GDP at $ 4.4 trillion and that of Germany at $ 2.1 trillion, the combined share of the world's three richest countries in the global GDP comes to be 50.4 per cent. With the combined population of 501 million, their share in the world population comes to only 8 per cent. 3

The extremely skewed distribution of world GDP results from the difference in the concentration of the ownership of assets between the rich and the poor countries and between the rich and the poor segments of the population within the poor countries. Roughly speaking, about 90 per cent of the productive resources in the developing countries, including physical capital and land, financial capital (stocks and securities) and human capital in the form of better education and health facilities, are owned by the richest 20 per cent of the population. The other 80 per cent of the population shares the remaining 10 per cent of income-generating assets and capital. As a natural consequence, the poorest segments of the population in the developing countries are those that are left with virtually no physical or financial assets to generate a flow of income.

Poverty begets poverty while wealth generates additional wealth; that is the process of development under capitalism. The poor are thus caught in a vicious circle of ever-growing poverty and the rich capitalise and benefit from the virtuous circle of burgeoning prosperity. This is an iron law of economic backwardness and development.

The current state of global poverty is simply unsustainable.

In the Annual report of “State of the World 2005: Redefining Global Security”, according to Michael Renner, who co- directed the State of the World Project, terrorism is “ only symptomatic of a far broader set of deep concerns that have produced a new age of anxiety. Rising military expenditures or dispatching troops cannot resolve this. Nor can they be contained by sealing borders or maintaining the status quo in a highly unequal world.”

These concerns include “endemic poverty, convulsive economic transition that causes growing inequality and high unemployment, international crime, the spread of deadly armaments, large scale population movements, recurring natural disasters, ecosystem breakdown, new and resurgent communicable diseases, and rising competition over land and other natural resources, particularly, oil”. All of these problems create the conditions in which political instability, warfare, and extremism thrive;

“Global military spending is now approaching one trillion dollars a year,” Renner told IPS. “Preventive strategies to deal with social and environment problems generally cost so much less”. 4

A Threatened Planet

This year's 'State of the World' report includes contributions from 20 authors on issues ranging from demographic changes, infectious diseases and crime, to food security, the oil economy and arms expenditure. According to the report, heavy dependence on fossil fuels is one of the most destabilising factors in today's world. Increasing competition for access to sources of energy is fuelling geopolitical rivalries, such as the struggle between China and Japan for Russian oil and gas, as well as civil wars, and serious abuses of the human rights of indigenous populations.

Despite reports of new finds, oil is in fact being found in smaller and smaller quantities and in ever more remote regions. Amid rising global demand, production has plateaued or actually declined in 33 of the 48 largest oil producing countries, including in six of OPEC's eleven members states.

Moreover, severe swings in price and supply, spurred over the past year by political uncertainties and the war in Iraq, is undermining global economic security. At the same time, the burning of fossil fuels for energy is contributing to global warming and climate changes. These changes not only pose long term threats to human society, but also contribute to the frequency and intensity of extreme weather events, such as the four hurricanes that devastated Florida and parts of the Caribbean last summer and fall. Katrina and Rita are the latest disasters.

Access to water is also a growing global concern. Due to severe water shortages, conflicts have arisen among neighbouring countries in many parts of the world. These conflicts have affected much of the horn of Africa, including Sudan's Darfur province. World-wide, some 434 million people currently face water scarcity, while insufficient access to water is a major cause of the loss of rural livelihoods and compels farmers to abandon their homes and fields.

By 2025, between 2.6 billion and 3.1 billion people are expected to be living in water-stressed or water-scarce conditions. More than 30 countries, most of them in Africa and the Middle East, have already fallen below even the most conservative benchmarks for sufficient per capita cropland or renewable fresh water. The inadequacy of food and its distribution are also growing problems, which in the absence of a solution, contribute to global insecurity. Worldwide, almost two billion people suffer from chronic hunger, an increase of 800 million in the last decade.

On the health front, infectious diseases killed nearly 15 million people in 2002, including some three million AIDS victims, most of whom died in their peak parenting and wage earning years.

Twenty previously curable diseases, including tuberculosis and malaria, have re-emerged or spread geographically over the last decade, while at least 30 diseases not previously known have been identified since 1975.

Other demographic factors contributing to instability include the “youth bulge”- a situation where people aged 15 to 29 account for more than 40 percent of all adults-which is currently affecting more than 100 developing countries. In many countries, particularly in the Middle East and sub- Saharan Africa, youth unemployment runs at more than 20 per cent. More than 200 million young people who are unemployed or under employed-and thus may be forced to resort to crime or insurgency to earn enough to support their families-represent a serious destabilizing force for many societies.

Shifting just 7.4 per cent of donor governments' military budgets into development assistance would provide the necessary funds, for necessary social development according to the report. 5

Unprecedented Instability

All of these changes are occuring while man is preparing to land on Mars, and at a time when science and technology have developed the capacity to produce more than the needs of all the human inhabitants of this planet. In the last 15 years, we have seen the advent of one hundred thousand new millionaires while more than two billion souls have been forced below the absolute poverty line. Aggressive US imperialism ravages one country after another with its colossal military might to enhance and sustain the rule of finance capital. All this has exacerbated socio-economic contradictions and brought them to a critical point, hence the upheavals and the convulsions across the world. The situation is becoming intolerable for the masses. In several countries and regions around the globe, we see the break down of civilisation, and elements of barbarism are rearing their ugly heads.

What is the main characteristic of the world situation? It is precisely the breakdown of the old stability, the violent disruption of the old equilibrium everywhere. Instead, wherever we look we see colossal and unprecedented instability at all levels. This is the most unstable period since 1945. Instead of full employment, and prosperity, there is crisis, growing unemployment, poverty and cuts in living standards, in even the most prosperous countries. The gap between the rich and the poor is constantly increasing and economic power is being concentrated into fewer and fewer hands.

The old equilibrium has been destroyed, not only between the classes but also between the nations. Not since 1945 has the world situation been so disturbed and chaotic. The relations between the powers are increasingly tense, and the USA's ambitions for world hegemony are leading to one war after another. Thus, the war in Iraq was not accidental, but expressed a general tendency. It has all kinds of implications for the general situation in the Middle East and on a world scale […] beneath the apparent surface of tranquility there lies a silent accumulation of bitterness, anger, frustration and despair.

Instability is rooted in the situation itself. Thus, changes that in a different situation would have no effect, or a significant result, now set off colossal transformations. The nature of these changes can be economic, political or military. But in every case, the effects are always disproportionate to the cause. Non- dialectical thoughts, which always skate over the surface of events without ever suspecting the existence of a deeper lawfulness, seeks the exploration in this or that incidental factor-the actions of George Bush, the lunacy of Bin Laden etc. These individual factors undoubtedly play a role, but the deeper cause is the fact that the capitalist system on a global plane is coming up against its limits and foundering on its inherent contradictions of private property and the nation state. 6

The convulsive character of the present period is no accident. It is merely an expression of the fact that on a world scale the capitalist system has exhausted its potential as an historically progressive force. The development of the productive forces, which achieved impressive results in the period 1945-74, is now being held back by the limitations of private property and the nation state. These now constitute the main barriers to human progress. The future development of the human race depends on the sweeping away of these monstrous barriers and the achievement of a harmonious and rational economic system on the basis of world socialism. Sudden and sharp turns are rooted in the situation.

Lenin said that politics is concentrated economics. The vagaries of the world economy find their expression in the psychology of all classes, beginning with the ruling class. The mood of the spokespersons of capitalism swings between the wildest optimism and the deepest depression.

At bottom, the global crisis of capitalism is a crisis of overproduction (expressed as over-capacity). The crisis is aggravated by debts and deficits. However, they are not the cause, but only the symptoms of the underlying problem. Despite a decade or more of globalisation, none of the old contradictions have been removed. On the contrary, they have been multiplied a thousand-fold and reproduced on a far vaster scale than ever before. The conflicts are being played out before our eyes, passing from one country and continent to another ceaselessly and with incredible speed. The national question, instead of disappearing, has assumed an intense and particularly poisonous character everywhere. One war follows hard on the heels of another. This reflects the impasse of the world economy, shackled and suffocating in the straitjackets of the “free market economy.” This is the epoch of capitalism “red in tooth and claw.”

These underlying antagonisms are the real explanation for the change in America's role in the world and its adoption of more aggressive imperialist policies. The capitalists in all countries are faced with the iron necessity of conquering foreign markets, like dogs fighting over a bone. In this climate the idea that supposedly impartial international forums can eliminate conflicts between the imperialists is as nonsensical as the idea that one can persuade a man-eating tiger to eat grass. This applies not only to the UN but also to the WTO, the future of which is now in doubt.

However, nothing is ever simple in the world economy or in world politics. Dialectically one thing affects another and the whole fragile mechanism of world trade can be irreparably damaged. The world economy is being split up on a regional basis, as each rival imperialist gang hastens to consolidate its control over different parts of the globe.

We are therefore entering into a period in history that will be more similar to the 1930s than that of the last half century. This will be a stormy period for the world economy and will be the backdrop for wars, revolutions and counter-revolutions in one country and continent after another.

These contradictions are already leading to the eruption of wars and conflicts all around the world. There are more conflicts and insurgencies raging across the world today than ever before in history. One of these flash points is Kashmir.


1. Ted Grant, The Unbroken Thread, p. 273

2. George Orwell, Nineteen Eighty-Four, pp. 312 - 313

3. Dawn, 3 January 2005

4. As quoted by Jim Lobe in Terror War: Diverting Attention from Roots of Insecurity,     Dawn 14, February, 2005

5. Ibid

6. Alan Woods, The Molecular Process of World Revolution: Part One, p. 3

Join us

If you want more information about joining the IMT, fill in this form. We will get back to you as soon as possible.