This year’s U.S. Perspectives will bring up to date key aspects of last year’s extensive World and U.S. Perspectives documents. In the past 12 months, the contradictions of the world capitalist system have continued to build up, resulting in violent explosions of the class struggle in one country after another, and preparing even more explosive developments for the coming period.
“In order to understand the dynamics of the process it is necessary to determine in what direction and why the mood of the working class is changing. Combining subjective and objective data, it is possible to establish a tentative perspective of the movement that is a scientifically based prediction, without which a serious revolutionary struggle is in general inconceivable. But a prediction in politics does not have the character of a perfect blueprint; it is a working hypothesis. While leading the struggle in one direction or another, it is necessary to attentively follow the changes in the objective and subjective elements of the movement, in order to opportunely introduce corresponding corrections in tactics. Even though the actual development of the struggle never fully corresponds to the prognosis, that does not absolve us from making political predictions. One must not, however, get intoxicated with the finished schemata, but continually refer to the course of the historic process and adjust to its indications.”
Leon Trotsky - The "Third Period" of the Comintern's Errors
Introduction
This year’s U.S. Perspectives will bring up to date key aspects of last year’s extensive World and U.S. Perspectives documents. Last year’s documents retain their validity on all fundamental points, and should be read in conjunction with this year’s perspectives. However, the overall process has accelerated. In the past 12 months, the contradictions of the world capitalist system have continued to build up, resulting in violent explosions of the class struggle in one country after another, and preparing even more explosive developments for the coming period.
Above all, we must understand the profound effect these events are having on the consciousness of the U.S. working class. Long gone are the days of relative stability and “class peace”. Right here, in the heart of world imperialism, colossal explosions of the class struggle are being prepared.
The International Situation
The international situation remains one of extreme volatility and instability. We are well into a period of wars, revolutions, and counter-revolutions. There is not a single stable capitalist regime in the entire world. At the root of this crisis is the crisis of the world capitalist economy, with the U.S. economy at its core. The entire system is unbalanced, and any effort to re-establish equilibrium in one country will simply mean exporting the crisis elsewhere in the global system. This can only delay the day of reckoning, not avoid it. In an epoch of “globalization” of the economy, we also see global economic crises – and global revolution.
Overall world economic growth is expected to continue in 2007, albeit at a slower pace than in 2006 (4.2 percent as compared to 4.8 percent). But this modest rate of growth is not being powered by the traditional economic engines of the world: the U.S., Japan, Germany, the UK, and France. While these economies are all experiencing limited growth, it is countries like China (9.8 percent) and India (8 percent), and the voracious appetite of debt-ridden U.S. consumers that are really keeping the economy afloat – for the time being.
The 13-country Euro zone, Japan, Britain and the four “BRIC” countries (Brazil, Russia, India and China) all reported stronger growth than the U.S in the fourth quarter of 2006. Some analysts even predict that the U.S. may soon cease to be the engine of world growth. This is part of a major restructuring of the global economic system, and the place of the U.S. working class within that structure. This is the real meaning of the savaging of the manufacturing sector and the American labor movement, the lowering of wages, the elimination of pensions, the worsening of workplace conditions, etc. But with modern communications technology, not just manufacturing jobs but information technology, engineering, even radiology and legal services can be “off-shored”. It is estimated that as many as 30 to 40 million U.S. jobs may be lost in the coming decade. It is only the beginning of the globalization of the labor market. The capitalists are forcing U.S. workers to compete with workers worldwide for ever-more scarce, poorly paid jobs.
The world economy as a whole remains highly dependent on the U.S., whose trade deficit with the rest of the world stood at $765.3 billion in 2006. But this reliance on exports to the U.S. market hangs on a knife’s edge as Americans’ consumer spending and optimism dampen in the face of the housing market bust and the generally worsening economic picture. According to Stephen Roach, chief economist at Morgan Stanley in New York, Asia and Europe lack sufficient domestic demand to offset reduced U.S. spending on overseas goods. As a result, Asian stock markets and especially companies that rely on exports to the U.S. have been hammered in recent weeks.
Already, many countries are looking to shield themselves from the effects of an economic slowdown in the U.S., but their options are limited and can only further destabilize the world’s largest economy. No country can exist outside the global economy – the fates of the world’s economies are tied together more closely than ever. The world is forced to bolster a badly weakened U.S. dollar in an effort to avoid a meltdown. China and Japan alone hold over $1.7 trillion in U.S. currency and U.S.-based assets which they can hardly afford to write off.
Japan, the world’s second largest economic powerhouse, has finally managed to pull out of nearly two decades of stagnation with GDP growth of 2.8 percent in 2006. However, its future does not depend only on its own fortunes – its fate is intimately tied to the U.S. and Chinese economies. The U.S. market alone accounts for 24 percent of Japan’s total exports. In January, industrial production in Japan suffered its greatest decline in nearly three years, and zero inflation for the same month is a signal that deflation is still a threat. Interest rates remain at just 0.5 percent, highlighting how fragile the situation is.
While still growing rapidly, there are indications that the Chinese economic “miracle” is on the edge of a crisis of overproduction, a clear sign that the market economy now predominates in the country. The effects of this process within China in particular have been tremendous, and was examined in detail in last year’s World Congress document “Where is China Going?” On February 27, 2007, fears of such a crisis led to a sharp drop in the Chinese stock markets which quickly spread to world markets, yet another graphic reflection of just how inter-connected the world economy has become.
In China, rising alongside the international investment is large-scale social unrest. A 2006 U.S. report entitled "Social Unrest in China" claims that 87,000 'public order disturbances' took place in 2005. China's director of the Office of Central Rural Work Leading Group admitted to 23,000 cases of rural unrest in 2006. To relieve some social tension, China has tried to implement some minor reforms - cracking down on sweatshop conditions in factories, giving more power to the state-controlled union, etc. International Investment, headed by the U.S. and European chambers of commerce, were outraged by the plans, and threatened to move their money elsewhere. The Chinese capitalists and the state are caught between a rock and a hard place, with ever-less room to maneuver between the pressures of investors and the working class.
In the last five years, the economic relationship between the U.S. and China has been one of the main factors keeping the world economy afloat. The U.S. accounts for about 40 percent of Chinese exports. According to Roach, from 2001 through 2006, the U.S. and China together contributed an average of 43 percent to global growth, measured on the basis of purchasing-power parity. A crisis in either country would rapidly spread to the other and to the rest of the world.
Despite the interlocking dependence between nations in maintaining a global division of labor for the capitalists, greater tensions are developing not only between the imperialist nations and the semi-colonies, but also between the imperialist nations themselves. While during trade talks their negotiators may shake hands in front of the cameras, behind the scenes it is a different story. The laws of capitalist competition compel them to eye each other's spheres of economic interests and internal markets in hopes of taking advantage of their competitors and getting the lion's share of the riches. When there is plenty of room for all the capitalists to expand their economies, it is possible for them to sign trade agreements without threatening each other's interests. However, the post WWII period of vigorous capitalist expansion is now a distant memory. Every WTO meeting since 1999 has gone from failure to failure. Inter-imperialist competition also played an important role in motivating the U.S. to invade Iraq in order to demonstrate to their competitors who was in charge of this region's oil business. In the coming year, especially if recession hits, we can expect to see an escalation of trade tensions that will most likely be focused on China. This will create an atmosphere in favor of protectionist policies that the labor bureaucracy is already promoting within the ranks of the working class. To combat this poison, we must counter pose a working class, internationalist perspective.
Just as China is dependent on the U.S., other countries rely on China. A U.S. slowdown would affect not only China but spread to Japan, Taiwan, South Korea and commodity producers such as Russia, Australia, New Zealand, and Brazil. Other countries, particularly in the Americas would be affected as well. The U.S. accounts for 84 percent of Canada’s total exports and 86 percent of Mexico’s.
On the Indian Subcontinent, the Indian economy continues to surge ahead - but with no real benefits for the impoverished masses. Beneath the surface of prosperity lies a boiling cauldron of discontent. Tensions with Pakistan remain high, and within Pakistan itself, the tensions have reached the boiling point. The already festering wound of Kashmir has worsened still more in the aftermath of the October 2005 earthquake. Although Iraq gets the most attention in the media, the U.S. is fighting a losing and increasingly costly war in Afghanistan, where a resurgent Taliban has reasserted control over much of the country. The war in Afghanistan has spilled openly across the border into Pakistan, further exacerbating the economic and social crisis, and the already deep divisions within the Musharraf regime. The mass protest movement of the country’s lawyers in March is an indication of just how unstable the situation is, affecting all layers of society. Musharraf’s government could collapse at any time – either through a coup or a revolutionary upsurge.
In Latin America, the revolutionary wave that has convulsed the region for the past few years continues to gather strength. Despite the many contradictions, recent elections in Brazil, Ecuador and Nicaragua are further confirmation that the Latin American masses are looking toward a revolutionary solution to their problems. In Bolivia the class war has erupted into virtual civil war in recent months, with the masses coming out into open confrontation with the oligarchy, in the face of vacillation by the Morales government. In Cuba, Fidel Castro’s illness has led to an even greater ferment of debate and discussion on the island as to which is the way forward for the revolution, which despite its ties with Venezuela and Bolivia, cannot survive in isolation indefinitely.
In Venezuela, the December 3, 2006 elections marked a decisive turning point in the revolutionary process. Chavez’ overwhelming victory was a clear vote in favor of socialist policies, and the pace of what many had called a “revolution in slow motion” has accelerated since the beginning of the year. The fundamental problems facing the revolution: the question of the state, of the economy, and of the revolutionary party still remain to be resolved. But the formation of the PSUV, the communal and factory councils, and several important nationalizations are all steps in the right direction. Above all, the direct participation of the working class and poor masses in the socialist transformation of society is the key to its success. Either the revolution will result in the abolition of capitalism in the country or it will fail - you cannot make half a revolution. A defeat would be a tremendous setback for the world revolution, but even then, it would not be the end of the revolutionary wave sweeping Latin America. On the other hand, the victory of the revolution would serve as an inspiring model and beacon of hope for the workers and oppressed of the entire planet.
All the contradictions and pressures of the continent-wide Latin American economic and social crisis crash into the world’s most powerful imperialist nation at the U.S.-Mexican border – and they do not stop there. The colossal struggles in Mexico last year: bitter trade union struggles, the massive mobilizations against the electoral fraud, the militant student movement, and the Oaxaca Commune were just an indication of what is still to come. The “victory” of Calderon has resolved nothing. His government is seen by millions as illegitimate, and can rule only by force, just at a time when the Mexican masses have had enough. He is compelled to carry out the wishes of imperialism and the oligarchy, to carry out the privatizations, cuts, and price increases that Vicente Fox could not achieve, and this is a finished recipe for mobilizations and even uprisings at an even higher level. The massive immigrant workers’ movement that exploded last year is a graphic example of how the Latin American revolution is having and will continue to have a profound effect here in the U.S.
In the Middle East, U.S. policy has succeeded only in further destabilizing an already unbalanced region. There is not a single stable country anywhere in the region. Israel continues to grind down the Palestinian people, who live in gulag-like conditions, with no political or economic solution possible within the limits of capitalism. The aftermath of Israel’s imperialist war on Lebanon has intensified the profound contradictions in Israeli society. March’s one-day general strike of the Israeli public sector workers is a reminder that classes do indeed exist in Israel, and that the interests of Israeli workers are in direct opposition to the interests of the Zionist ruling class. In Lebanon, the governmental crisis is an indication of just how unstable the situation remains in the aftermath of last summer’s war.
U.S. tensions with Iran have intensified around the question of uranium enrichment as Bush and co. seem intent on extending the Iraq debacle in the face of all logic. For their part, the mullahs are moving might and main to stave off the revolutionary ferment of the Iranian working class and youth, and are demagogically turning public attention against the threat of U.S. imperialism. But the U.S. has few military options available except for air strikes, with the Israel’s failed effort to bomb the Lebanese into submission calling into question the effectiveness of air campaigns alone. Due to the military overstretch in the Iraqi quagmire, there is no real possibility of a ground invasion of Iran by U.S. forces, let alone an occupation. Nonetheless, given the disconnect from reality that reigns at the White House, an attack of some sort on Iran cannot be entirely ruled out.
It is impossible to say with any precision just when the world economy will enter a recession, but we know that as long as capitalism remains, so too will the boom-slump cycle. What is certain is that the world is in a period of profound economic, political, military, and social crisis. The economic expansion is entirely at the expense of the world’s working and impoverished masses, preparing the ground for revolutionary movements in one country after another in the coming period. Latin America is currently on the front lines of this process, with Venezuela at the forefront. But what we are really discussing and preparing for is not only the Latin American Revolution, but the World Socialist Revolution.
The war in Iraq is at the heart of the instability in the Middle East - and the U.S. It is now the third-longest-running war in U.S. history: longer than the American Civil War, the First and Second World Wars, and the Korean War. Only the Philippine-American and Vietnam Wars have lasted longer. Although control over Iraq's oil was a major reason for the invasion, it was not the main factor. Overall strategic control over the region and teaching a "lesson" to any country that dares "step out of line" was the main objective. However, none of U.S. imperialism's political, economic, or military objectives have been achieved. Far from demonstrating its power, U.S. imperialism has demonstrated the limits of its power. The results will be far-reaching both internationally and within the U.S. itself.
Far from bringing "democracy and freedom" to the people of Iraq, the U.S. invasion and occupation has created an inferno of chaos and destruction which is even worse than during the rule of Saddam Hussein, the former U.S. ally who was no friend of the Iraqi people. The Iraqi people have been condemned to a living nightmare of unemployment, poverty, and sectarian bloodshed. They are subjected to the most demeaning and humiliating treatment on a daily basis through raids, checkpoints, arrests, extortion, beatings, and torture. Entire cities have been reduced to rubble. Basic services such as water and electricity are luxuries even for the rich, let alone the poor. Some estimates put the Iraqi death toll at 655,000 since the war began in early 2003. The United Nations estimates that more than two million Iraqis are now refugees in neighboring countries and that more than 1.9 million are internally displaced within Iraq - roughly 1/6 the country's population. The current government is a puppet government with virtually no support among the population, and remains in power at the whim of the U.S. bayonets that back it.
Over 3,200 U.S. troops have been killed, with another 26,000 wounded. In the U.S., the economic cost of the war has meant across-the-board cuts in social services, health, and education, while a handful of corporations have made a veritable killing off of juicy government contracts. The continuation of the war can result only in a worsening of the situation both in Iraq and here at home.
It is now the most important issue on the minds of American workers and youth. 59 percent of Americans want the troops out immediately or within a year, and a majority oppose Bush's plan for a troop "surge". A majority do not trust the media or the military to tell the truth about what is happening in Iraq. A majority are in favor of Congress using its power to block funding to deploy any more troops. Instead, the Democrat-controlled Congress approved a $124 billion spending bill to continue funding the war. In an effort to appease the millions anti-war voters that swept them into legislative power in November 2006, they cynically tacked on an ultimately unenforceable "requirement" that the troops be withdrawn by September 2008. But the fact remains: they have voted to continue the death, destruction, and war profiteering, and betrayed the illusions of millions who sincerely thought they would be different than the Republicans.
One important reason for the "surge" was U.S. imperialism's need to continue to put pressure on Iran, which in many ways holds the key to a U.S. exit. Bush hoped to show Iran that the U.S. military is not too overstretched, and that decision-makers in Washington do not have their hands tied no matter what the mood at home and the reality on the ground. But this is Bush's last desperate roll of the dice on Iraq, as he hopes against all odds that a miracle will occur. But the initial results of the "surge" were as could be expected in such a dire situation. With half of the 30,000 total troop increase already in place, the monthly death toll in Iraq rose 15 percent in March. At least 2,078 Iraqi civilians, policemen and soldiers died across Iraq in March, 272 more than in February. While sectarian killings in Baghdad have fallen somewhat, the killings have simply spread to other parts of the country like Anbar Province where the concentration of occupation troops is lower - a classic guerrilla tactic. Overall car bomb attacks rose and the number of U.S. soldiers killed, 80, was in line with the grim averages of the previous months.
For all intents and purposes, the U.S. has already militarily and politically lost the war. The ruling class is increasingly divided and concerned about the course of the war. The constant stream of dead and wounded Americans and Iraqis, combined with the high costs and deep cuts, is having a profound effect on workers' and young people's consciousness. There is new generation whose world-view has been entirely shaped by the epoch of war, revolution, and counter-revolution through which we are living. They live in a world where the perpetual "war on terror" - a war of invasion abroad and economic attacks against working people here at home - is the norm. It should therefore come as no surprise that among growing layers of the youth in particular, we can see a profound questioning not only of the war but of the capitalist system itself.
A humiliating withdrawal would be a setback worse than their defeat in Vietnam, complicating their plans for further military conquest and domination, especially in light of the U.S.'s more unstable economic situation. But continuing this ill-conceived adventure can only exacerbate the contradictions rapidly accumulating in the U.S. and further destabilize the Middle East. There are sharp divisions over how to proceed, even within the Republican ranks. There are those who wish to "stay the course", blindly following the path charted by Bush and his out-of-touch-with-reality neo-cons. Other, more far-sighted politicians like James Baker and the "old guard" of the U.S. ruling class, understand that this path is leading U.S. imperialism and capitalism straight over a cliff. Senator Chuck Hagel, a Nebraska Republican and Vietnam War veteran, recently called the Iraq War "the most dangerous foreign policy blunder in this country since Vietnam." This is not the "loony-left" saying this, but a serious contender for the Republican presidential nomination. This reflects the depths of the divisions at the very top of the U.S. government.
A new report from the Council on Foreign Relations think tank bluntly asserts that the situation in Iraq is beyond repair, that a U.S. military victory is impossible in Iraq, and that "amateurish" post-invasion planning has seen Iraq collapse into civil war. According to the report: "The United States has already achieved all that it is likely to achieve in Iraq ... Staying in Iraq can only drive up the price of those gains in blood, treasure and strategic position ... The time has come to acknowledge that the United States must fundamentally recast its commitment to Iraq. It must do so without any illusions that there are unexplored or magic fixes, whether diplomatic or military ... The crisis has now moved beyond the capacity of Washington to control on its own ... The United States lacks the military resources and the domestic and international political support to master the situation ... It is now just a matter of time ... Better to withdraw as a coherent and somewhat volitional act than withdraw later in hectic response to public opposition to the war in the United States ... Some disasters are irretrievable."
Clearly, the more intelligent representatives of the ruling class see the danger of burning out the military and want to cut their losses. They recommend an immediate timetable for withdrawal, and for a political compromise to be reached by negotiating with Iran and Syria. But instead of following this advice, which from the perspective of the ruling class is as intelligent as it gets in the face of such a fiasco, Bush is sending a "surge" of troops to Iraq. In reality, this "surge" is nothing of the sort. The military is so over-extended that there are simply no fresh troops to send. In order to achieve the numbers required for this plan, the tours of duty of some troops are being extended, while the deployment of others is being accelerated. But even this will not save the situation. The 30,000 additional troops are a mere drop in the bucket. There are simply not enough troops to hold down a people that doesn't want them there. Even the mightiest military machine in the world cannot afford to assign an armed guard to every Iraqi worker, peasant, or youth.
Ultimately, Bush is trying to buy more time at home and on the ground in Iraq, hoping to cobble together a political solution that can be passed off as victory to a war-weary population. Like Nixon, he is seeking "Peace with Honor." But the longer it takes, the more unlikely it will work, and like Nixon, he will fail miserably. Incredibly, in their desperation to counteract growing Iranian / Shiia influence in Iraq and Lebanon, it has been revealed that the U.S. has been negotiating with and even funding various Sunni paramilitary groups in Iraq and elsewhere. Far from the hardline approach of "we do not negotiate with terrorists", they are reportedly actually giving money to groups with ties to al Qaeda. The hypocrisy of imperialism knows no bounds.
However, Bush's time and room for maneuver is fast running out. The price tag for the Iraq War is set to rise to nearly $589 billion - more than was spent on the Vietnam War. Even the world's wealthiest nation cannot afford this colossal haemorraging of the national treasure forever. To meet these costs, spending on social programs has been cut to the bone - such is the cold, calculating logic of the profit system. Medicare and Medicaid, which have already been gutted, are to be further slashed by $78.6 billion over the next five years. Medicare recipients will also have to pay higher premiums for prescription drugs and doctors' services, and annual indexing of income thresholds will be eliminated, which in effect means another $10 billion in cuts. Millions more will be cut from programs directly benefiting children. This is truly a budget of "guns before butter". The U.S. is now ranked 37th in the world when it comes to health care indicators. This is "as good as it gets" in the epoch of capitalism's decay, even during an economic expansion.
When we hear the term "military spending", we often think of it abstractly, as though the military were doing the research, development, and manufacturing of arms and equipment itself. The reality is, the real winners from this war are the private armament, security, and construction companies that are making billions off of the U.S. treasury - working people's tax dollars. And if the billions of dollars spent on the war wasn't already a big enough waste, an auditors' report to a House of Representatives committee overseeing work in Iraq found that contractor overcharges and unsupported expenses accounted for one in six dollars spent on the war so far. According to the report, some $10,000,000,000 has been "squandered" by the U.S. government in the course of the war. It also found that Defense and State department officials condoned or allowed repeated work delays, bloated expenses and payments for shoddy work or work never performed.
This is all part of the "privatization" of the war, whereby services formerly provided by the military itself are now contracted out to for-profit corporations. They do everything from providing security and interrogating prisoners to cooking and serving food, cleaning barracks, and fixing machinery. They do all of this with no oversight and no accountability to the military chain of command. As private corporations, the activities of mercenary companies like DynCorp and Blackwater Security are not subject to government oversight or examination through the Freedom of Information Act.
The use of private contractors has doubled since 2001 to about $400 billion a year in 2006. Companies such as Halliburton, Kellogg-Brown-Root, and Bechtel - all of them with close ties to the government - claim that competition over contracts between private companies provides savings and efficiency. But the fact is, there is usually zero competition involved. This is the ultimate form of war-profiteering: no-bid contracts with built-in profits, a system called "cost-plus". In other words, the more they spend, the more profit they make. It's no coincidence that the top 20 service contractors have spent nearly $300 million since 2000 on lobbying and have donated some $23 million to political campaigns of both parties. Waging war is big business and having friends in government sure doesn't hurt.
This privatization of the military effort was worked out at the highest levels of government in the years before the Iraq War even began.The direct links between the Pentagon (Rumsfeld when he was Secretary of Defense), the State Department (Paul Wolfowitz, Douglas Feith, Zalmay Khalilzad, Stephen Cambone), and the private sector (Pete Aldridge of Aerospace Corporation, Thomas White of Enron, Gordon England of General Dynamics, James Roche of Northrop Grumman) are eyeopening. The "revolving door" between government "service" and private corporations has been taken to a whole new level in the last 5 years.
Private contractors do far more than build military bases and serve food to soldiers. Of the estimated 100,000 private contractors operating in Iraq, several thousand are "security contractors" - i.e. private soldiers / mercenaries. Blackwater, the largest of these companies holds an estimated $500 million in known contracts, as well as an alleged "secret black budget". These private soldiers are in effect accountable to no one but the owners of the companies they work for. They are paid far more than regular soldiers, and if they are killed or wounded, they aren't counted in the overall military casualty figures as they are technically "civilians". These mercenaries are typically paid $300 per day, but when they have to protect high level envoys this can double to $600 per day. Even when the U.S. military is is eventually forced to pull out of Iraq it is likely that these private soldiers will remain long afterward (until they too are forced out by events on the ground). Ultimately, they serve the same purpose as the soldiers in uniform - to protect the private profits of the corporations.
The disastrous course of the war has led to a simmering discontent in the U.S. But it is no longer just the "usual suspects" who are against the war - but the vast majority of the population, including millions of former ardent supporters of Bush and his foreign policy. Multiple and in many cases extended tours of duty, often against soldiers' will through "stop loss" programs, have torn apart families, ruined civilian professional careers, and forced the "weekend warriors" of the National Guard and Reserves to become full time soldiers. Poor wages, bad conditions, shoddy equipment, and the growing realization that this is not a war worth fighting has led to growing opposition within the military itself. Iraq War veterans, military families, and even active duty soldiers are increasingly vocal in their opposition to the war. Several high-profile cases of veterans refusing to re-deploy to Iraq and at least one officer who has refused to serve in Iraq are indications that discontent within the military runs deep.
This is reflected in the number of soldiers that went AWOL in 2006, which jumped by 27 percent over 2005. Overall, the Army estimates about 22,500 soldiers have deserted since fiscal year 2000, though some soldiers' rights advocates put the number at double that figure. In any case, the actual number is much higher as these figures do not reflect deserters from the National Guard or the Reserves. 16 soldiers have been put on trial, 90 percent of them have faced jail time. Others have been quietly released out of fear for what they could expose about the conduct of the military in Iraq. There is a growing community of self-exiled deserters in Canada.
Then there's the treatment of the veterans of Iraq and Afghanistan. Disproportionately working class and poor, many join the military because there are no other economic or educational options available to them. As in all wars, these young men and women are treated as heroes as long as they are healthy and able to kill and die. But once they are no longer suited for this "work", they are tossed aside and forgotten.
Although the number of U.S.military personnel being killed is nowhere near as high as it was in Vietnam, the number of soldiers being taken out of action each month is far higher than the death figures indicate. For every soldier killed there are roughly 8 others wounded. Due to modern battlefield medicine, more wounded soldiers than ever survive traumatic injury, but are left with permanent head damage, amputations, and mental illness.
Tens of thousands of veterans suffer from Post Traumatic Stress Disorder (PTSD) with the rate of suicide, domestic violence, and even murder of spouses among veterans far higher than in the rest of the population. As reported in the Archives of Internal Medicine, it is estimated that out of 103,788 returning veterans, 25 percent have had a mental health diagnosis with more than half of them having had two or more distinct conditions. Not surprisingly, those most at risk were the youngest soldiers and those with the most combat exposure. Twenty-two soldiers killed themselves in 2005, accounting for nearly one in five of all Army non-combat deaths. Many of them had been diagnosed with bipolar disorder, severe depression, or anxiety disorder - and many had been redeployed to combat duty after being diagnosed with PTSD resulting from earlier deployments. As explained by Stephen Robinson, the former director of the National Gulf War Resource Center: "What you have is a military stretched so thin, they've resorted to keeping psychologically unfit soldiers at the front."
Then there are the consequences of exposure to radioactive depleted uranium (DU), the full effects of which are not yet known. It is estimated that 56 percent of veterans from the first Gulf War suffer from exposure to DU. Not only are the affected veterans themselves ill, they bring the effects back to the U.S. A study of the families of 251 Gulf War veterans in Mississippi found that an astonishing 67 percent had children born without eyes, ears or a brain, had fused fingers, blood infections, respiratory problems or thyroid and other organ malformations. This is just the tip of the iceberg that will continue to affect veterans and their families for decades to come, as even more troops have been exposed to DU in the Iraq and Afghanistan wars. All this while funding for veterans' services has been systematically cut in order to pay for the war itself.
The callous treatment of the veterans was highlighted by the recent scandal at the Walter Reed Medical Center, where many traumatically injured veterans are treated. An investigation found that soldiers face a nightmare of poor conditions, understaffing, endless bureaucratic hoops to jump through, and general neglect. This led to the resignation of several top Army officials, including the Secretary of the Army, but those really responsible for these injured soldiers and the lack of planning to care for them remain in power. According to the Department of Veterans Affairs, some 1.5 million military personnel have been deployed in the wars in Iraq and Afghanistan - thousands of them are expected to join the ranks of the estimated 195,000 homeless veterans. This is the real "patriotism" of the ruling class toward the working class men and women they send off to fight and die in their wars.
Given the course of the war, and the generalized opposition to it, the potential exists for even larger mass mobilizations against it. The nation-wide mass demonstrations that preceded the war have yet to return on that scale, but the 500,000 that marched on Washington, DC on January 27, 2007, was one of the largest mobilizations since the war began. Although the movement is still largely dominated by petty-bourgeois pacifists, some recent demonstrations have been more militant, class-conscious and political, with rising participation by veterans, trade union locals, and even former supporters of the war. Unfortunately, the current leadership of the anti-war movement remains divided and politically unfocused, while organized labor as a whole has not placed itself at the head of the anti-war movement where it belongs. Many in the anti-war movement correctly condemn both corporate parties for their role in launching and continuing the war. But they offer no real solution other than semi-annual demonstrations and "hope" that the Democrats will "do the right thing." Many youth in particular reject this class collaboration policy, but there is as of yet no concrete alternative.
The Democrats have once again shown their true colors by yet again voting to continue funding the war. Many Americans gave them another chance to "change their ways" after the November elections, but the result has been predictably the same. Most Democrats oppose the war not because it is a war of imperialist domination, but because it is complicating U.S. efforts to more aggressively conduct the "war on terror" in general, and because history shows that the patience of the U.S. working class will not last forever. Like many Republicans they understand that domestic and geopolitical reality will force them to withdraw from Iraq sooner or later - they simply want to turn the inevitable result to their advantage. In so doing, they are cynically using the lives of millions of Iraqis and thousands of Americans like pawns in their power struggle with the Republicans over which gang of billionaire politicians gets to loot the public coffers.
By voting to continue the war, they have provided Bush with the breathing space he needed to try and find some way out of the fiasco. They have allowed him to continue to wholesale destruction of Iraq and its people and have condemned hundreds if not thousands more U.S. soldiers to death and dismemberment. It is also important to note that a major provision in their timetable for withdrawal from Iraq is the privatization of 81 percent of Iraq's currently nationalized oil industry. This would open Iraq up to "investment" by Exxon/Mobil, Chevron/Texaco, BP/Amoco, Royal Dutch/Shell. These "production sharing agreements" would guarantee them true superprofits, allowing them to receive as much as half of the country's oil revenues for the first 15-30 years of the contracts' lifespan, denying Iraq any income whatsoever until the corporations' infrastructural "investments" have been recovered. No matter what the Democrats say in their election-year rhetoric, they will always defend the overall interests of their corporate paymasters over the interests of working people and the youth.
This lack of a political solution to end the war means that the economic, social, and political pressure cooker in the U.S. will continue to build up. Under these conditions, the demand for a mass party of labor on an anti-war platform could potentially get a mass echo and rapidly grow into a powerful challenge to the two-party system. What is needed is a bold lead by the labor movement, breaking its unholy alliance with the Democratic Party, and clearly linking the war in Iraq with the war on working people here at home. We need to organize even larger mass mobilizations with the working class at the forefront. We need to organize in our workplaces, neighborhoods, and schools around a program and policy of militant class independence that can truly address the needs of working people and the youth. We can depend only on our own class forces, organization, and mobilization.
The fact that a vast majority are already against the war causes some to question the usefulness of continuing the mass mobilizations. However, millions of others are finally realizing that we cannot simply wait around for the billionaire politicians to end the war. Life itself has forced them to draw increasingly radical conclusions, and given a clear lead, they will come out on the streets by the millions. We should also keep in mind that a military action against Iran, even if it is only airstrikes and not a full-fledged invasion, could unleash a renewal of the anti-war movement on a scale not seen since before the 2003 invasion of Iraq.
It is clear that the human and political costs of the war are tremendous, leading to mass discontent and serious divisions within the ruling class. However, the accumulated effects of the economic cost of the war on the increasingly feeble U.S. economy may prove to be the most important long-term result of Bush's policy. Some $456 billion has already been appropriated for the war, not included latest funding bill. Even the richest nation on earth cannot afford this policy of "guns before butter" indefinitely.
Since 2001 the US economy has limped along, never really taking off as it did in the 1990s. This "jobless" expansion has been based entirely on the relentless squeezing of the US and world working class. Worker productivity and profits have increased tremendously while wages and job growth have stagnated or fallen behind. Overall GDP has continued to grow, very little has "trickled down" to the mass of the population. Things are far worse now for the majority than they were just 25 years ago.
The U.S. Economy
For several years we've analyzed the sluggish course of the world's most powerful economy. After the short-lived recession of 2001, the economy has limped along for several years, never technically dipping back into recession, but never really taking off as it did in the 1990s. This "jobless" expansion has been based entirely on the relentless squeezing of the U.S. and world working class. Over this period, worker productivity and corporate profits have increased tremendously while wages and job growth have stagnated or fallen behind. In other words, fewer workers are doing more work for less pay, leaving more profits in the pockets of the capitalists. So although overall GDP has continued to grow, very little has "trickled down" to the mass of the population. In fact, things are far worse now for the majority than they were just 25 years ago. For millions of U.S. workers, this boom has seemed more like a prolonged recession.
In the overall context of the global division of labor, the U.S. is being transformed from an economy based on manufacturing to a services-based economy, which requires a brutal "re-tooling" of the American working class. The capitalists do not invest in order to create jobs or to improve the quality of life of "their" country's workers - they invest to make profits. They will invest wherever they can in order to maximize their returns. The capitalists are therefore forcing U.S. workers to compete on the world labor market with workers earning far lower wages, and working and living under far worse conditions. In order to compete in this new world environment, there is only one solution for the capitalist class: to take back the relatively high wages and decent conditions won through bitter struggle by U.S. workers in the past. In the last 25 years, U.S. workers have been faced with unprecedented wage and benefit cuts, mass layoffs, off-shoring, worsening conditions, and the decimation of the unions.
However, in society as in nature, everything has its limits. American society does not exist in a vacuum. As in every country dominated by capitalist property relations, the U.S. is a society with tremendous class divisions and contradictions. Also in society as in nature, every action has an equal and opposite reaction. The sharp, sudden changes being forced on U.S. workers are preparing an inevitable reaction against these attacks. The capitalist class' relentless pursuit of profit is a finished recipe for tremendous explosions of the class struggle in the coming period. Already, there are symptoms of this, for example the movement of immigrant workers and the growing ferment in many trade unions.
At the root of this instability and these contradictions is the economy. Economic forecasts are among the most difficult of predictions, based as they are on incomplete and past data. But over the past few months, there have been many indications that the "joyless" recovery is losing steam, and that the economy may well sink into a recession at some point in the not-too-distant future. The data is contradictory and no single month's numbers can give us the full picture. But it is clear that this is not the steady, robust growth experienced during the post-war boom or even the expansion of the 1990s. This is an uneven, disjointed expansion that has not even nominally benefited working people. So while it is impossible to say with any precision just when a recession will come, what can be said with certainty is that as long as capitalism continues, so too will the boom-slump cycle. What goes up must come down, even if it has not gone up very far. Until capitalism is overthrown by the conscious efforts of the working class, it will always find a way out of its problems - on the backs of the workers.
GDP continued to grow in the fourth quarter of 2006, but at a rate of just 2.2 percent, which was far lower than the 3.5 percent rate initially predicted. This was the sharpest downward revision in a decade, and was attributed to weak business spending and a lowering of inventories by companies. The Federal Reserve predicts GDP will grow between 2.5 and 3.0 percent in 2007, compared to 3.3 percent in 2006. However, even this modest rate of growth is barely enough to keep up with inflation and the weakening dollar, and in no way compares with the robust pace of previous expansions. In an effort to spur growth, the Federal Reserve has held its base interest rate at 5.25 percent since August 2006, after raising it 17 times in a row. But the threat of inflation complicates their monetary policy.
Core consumer prices rose 0.3 percent in February, following a 0.2 percent gain in January. This is up 2.4 percent compared with a year earlier. But in terms of real year-on-year purchasing power, inflation is actually higher than the official figures suggest. It is important to note that "core" inflation does not include food and energy prices, which have seen rapid rises over the last two years, and which especially affect working people. The average retail price of gasoline was up 5 cents, or 1.5 percent, in February, which impacts sales in other areas of the economy. The Federal Reserve is therefore caught between a rock and a hard place. To tame inflation the usual policy would be to raise interest rates, but signs of a slowing economy is pushing them in the direction of lowering rates in order to encourage spending and investment. No matter what course they follow, it will create imbalances in other parts of the economy. Their tightrope act of trying to keep the economy more or less on an even keel by raising and lowering interest rates grows more precarious every day.
Weighing like a ton of bricks on the upward mobility of the economy is the federal debt, which currently stands at a mindboggling $8.8 trillion. Every year since 1969, Congress has spent more money than it has brought in in taxes. To make up the shortfall, the Treasury Department has to borrow money to meet the government's expenses. In fiscal year 2006, the U.S. government spent $406 billion just on paying the interest on this debt. To put this into perspective, the total spent on education in 2006 was $61 billion. The annual interest paid on the national debt is now the second largest single area of federal expenditure, after the Department of Defense.
The trade deficit and the steady decline of the dollar are also factors weighing on the economy. The "current account" deficit is the broadest measure of trade and investment flows, representing the debt owed by the U.S. to the rest of the world. It includes trade in goods, services and investment income. This deficit reached $805 billion in 2005, which was 20.5 percent greater than in 2004, and more than double what it was just 4 years earlier. In 2006 it jumped a further 8.2 percent to a record $856.7 billion, which represents 6.6 percent of GDP. Compare this to current account surpluses of 9.1 percent in China and 3.9 percent in Japan. The imbalance was largely due to high oil prices and continued cheap imports from China. In order to make up the difference between what is sells abroad and what it imports, the U.S. must borrow over $2 billion every day. It does this by selling U.S. Treasury securities to foreign investors, mostly to Japan and China. Over half of U.S. government securities are now owned by foreign investors.
Although the monthly trade deficit narrowed 3.8 percent to $59.1 billion in January, this is more a reflection of the weakening dollar than an actual improvement of U.S. exporting power. The dollar reached a new low against the Euro and other major currencies in April, which means that while Americans can afford to buy less foreign goods, American products are more of a bargain for those buying with currencies such the British Pound, Euro, and Canadian Dollar. The net result is a slightly lower, albeit still colossal trade deficit, but this does little to address the long-term imbalances.
For 31 consecutive years the U.S. has imported more than it exports. The only area where the U.S. maintains an import-export surplus is precisely in the services sector, with a $70.7 billion surplus last year, compared to $66 billion in 2005. In 2006, for the first time in decades, net payments to foreign investors on their U.S. investments turned negative. From a surplus of $11.3 billion in 2005, the U.S. had a deficit of $7.3 billion in 2006. This is another graphic reflection of the U.S.' decline from being an industrial, creditor nation, to a service-based, debtor nation.
Debt in the U.S. was up an incredible 10.1 percent last year, for a total of $4.085 trillion, accounting for a staggering 58.8 percent of all the credit issued worldwide. This is an astonishing figure, considering that the U.S. makes up just 5 percent of the world's population. This represents an increase in indebtedness far greater than the rate of GDP growth. The extension of credit can artificially expand the limits of the market for a certain time, but eventually, all of this must be paid back - with interest.
There are always ebbs and flows in the movement of the economy, even within each cycle of expansion and contraction. And while no single month can determine the overall direction in which the economy is moving, there is ample evidence that things are slowing down, especially in the vital area of consumer spending. Consumer spending accounts for as much as 70 percent of U.S. economic activity. A prolonged slowdown, let alone an actual drop in spending, would represent a grave threat to the economy. The ongoing bust of the housing boom and rising prices are already affecting consumer confidence.
The Reuters/University of Michigan Survey of Consumer Sentiment fell to its lowest level in six months in March. The index slid to 88.4 from 91.3 in February, its lowest since September 2006. Spending - again, much of it on credit - has fallen or stagnated in most sectors, including furniture, clothing, and building materials. In February, major chain stores Wal-Mart, J.C. Penney, and the Gap, reported disappointing sales at stores open at least a year, an important measure of sales performance known as "same-store sales". The Conference Board's index of leading economic indicators, which points to the direction of the economy over the next three to six months, fell 0.5 percent in February, the biggest fall in a year, after a 0.3 percent drop in January.
After the burst of the Information Technology bubble of the 1990s, many investors, including individuals, shifted to the housing sector. With historically-low interest rates and double-digit price rises in many markets, investing in a first or even second home seemed a "safe" way to go. Millions of people became home owners for the first time, and millions of others took out second, third, and even fourth mortgages, with the seemingly endless rising value of their homes as collateral. This artificial sense of wealth compelled millions to borrow money like never before, confident that rising house prices would indefinitely give them the economic breathing space they needed to catch up with their growing debts.
As is to be expected under the anarchy of the capitalist market, speculators piled in as well, buying up homes and "flipping" them for a quick profit. Others bought up lots and built new houses without regard to the real possibilities for selling them. This resulted in a classic crisis of capitalist overproduction - there are now "too many" homes available. Not "too many" to meet the human needs of the homeless and inadequately housed, but "too many" to make a profit within the narrow limits of the capitalist market. In 2005, the housing market began to cool rapidly, and millions of homeowners and many speculators are now faced with a nightmare scenario - owing more on their loans than the homes are actually worth.
One result of this is the "subprime" / adjustable rate mortgage (ARM) crisis, which has already affected at least 10 percent of the housing loans industry. These predatory loans, which start out with a low "teaser" interest rate that then jumps to a much higher rate, has trapped millions of low-income workers in a vice. In some cases, monthly mortgage payments jumped from $700 to $1,100 or more, literally overnight. This is an impossible increase to cover on the low wages made by most of those who "qualified" for these loans. The crisis caused by the defaults on these loans may well spread to the broader financial services sector. At least 20 mortgage lenders who sold mostly subprime loans have already filed for bankruptcy in recent months. Former Federal Reserve Chairman Alan Greenspan commented that the sub-prime crisis is "not a small issue...You can't take 10 percent out of mortgage originations without some impact."
According to the Mortgage Bankers Association, over 500,000 mortgages, were in foreclosure at the end of the fourth quarter 2006, with a total of over 43 million outstanding loans at the end of last year. Credit is being tightened and could take as many as one million potential home owners out of the market. Home repossessions have spiked, as literally millions are faced with foreclosure on their homes. There is the danger of a vicious circle as repossessed homes are put on the market, adding even further to the glut of homes already for sale, putting even more downward pressure on prices. Dean Baker, co-director of the Center for Economic and Policy Research explained that "inventory is 20 percent higher than last year, vacancy rates have soared and prices are down about 3 percent. Now, with the tightening of credit, I don't see how prices don't fall another 5, 6 or 7 percent."
The New York Times reported that, "The slump in home prices from the end of 2005 to the end of 2006 was the biggest year over year drop since the National Association of Realtors started keeping track in 1982." Home values fell 0.2 percent in January from a year earlier, according to the S&P/Case-Shiller index, a measure of home prices in 20 U.S. metropolitan areas. The decrease was the first since the group started the index in January 2001. The National Association of Realtors reported in April 2007 that it expects its measure of home prices to fall in 2007 for the first time since it started tracking sales nearly 40 years ago.
A Bloomberg News survey reported that new home sales in the U.S. dropped 3.9 percent to an annual pace of 848,000 in February, despite predictions they would rise to 985,000. A report from the U.S. Census Bureau showed that in January, existing homes for sale were up 23 percent to 3.5 million. That same month, new homes completed and available for sale reached a record high of 175,000, up 47 percent from a year earlier. The Commerce Department announced that construction of new homes in January fell by 14.3 percent. The Census report also showed a record 2.1 million empty homes for sale on the market - a jump of 34 percent from a year earlier. This is nearly double the long-term vacancy rate, and the sixth straight quarter of record vacant homes.
In short, inventories are up, sales are down, profits are lower. Despite the inevitable fluctuations from month to month, many factors point to a steady downturn or at least stagnation for the housing industry in the coming period - a bleak outlook for the sector that buoyed the economy after the bust of the Information Technology bubble. Some analysts think that if inflation is taken into account, it may take five to seven years for prices nationally to reach the peaks hit in 2005. Others think prices may never recover their recent highs when adjusted for inflation.
The knock-on effect of the housing bust will almost certainly be felt throughout the broader U.S. economy and could even spread internationally. The main victims of the sub-prime mortgage crisis are also those most likely to shop at large discount stores like Wal-Mart and Target, whose sales may be affected as a result. All told, it is estimated that as many as 1.5 million Americans may lose their homes, and another 100,000 people in housing-related industries could lose their jobs. For millions, the "American Dream" of home ownership has turned into a nightmare. As always, it is the working class that must pay for the greed of the speculators and bankers.
Analysts estimate the economy needs to generate between 110,000 and 150,000 jobs each month just to absorb new entrants to the labor market. Job creation has averaged 166,000 per month over the last 12 months, just barely enough to keep up. Most of these are low-wage, non-union jobs in the services industry, which now accounts for 80 percent of the economy. In terms of quantity and quality, these jobs in no way make up for the 3.2 million - one in six factory jobs - that have disappeared since the start of 2000, and which continue to be cut. Despite this, the unemployment rate, taken from a separate survey of households, fell to 4.5 percent of the active population in March. But this figure is misleading, as millions who have been unable to find work are no longer counted as part of the "active" population.
Just 113,000 jobs were added in February, reflecting continued weakness in the housing and auto sectors. There was a 62,000 drop in construction jobs, the sector's sharpest decline since 1991. The only "good news" were the 168,000 jobs added in the service sector, and 39,000 added by the government. This reflects the shift from manufacturing and construction to services and the state. Ironically the "small government" Republicans have presided over greatest expansion of the state in history, mostly related to "Homeland Security".
The overall picture is one of fragility. The ongoing decline of American industry was reflected in January's plunge 9.3 percent plunge of durable goods orders, the worst dropoff in demand in almost seven years. Durable goods includes big-ticket manufactured goods, including cars, aircraft and washing machines. This weakness means more jobs will be on the chopping block.
Extracting maximum profit from as few workers as possible is the key to "success" under capitalism. Despite meager growth in employment, corporate profits have soared in the past year. 2006 was another bonanza year for corporate profits and the stock market, with the stocks of the S&P 500 gaining of 16 percent. But historically, record profits usually come toward the end of the economic cycle. There are many other indications that the cycle of expansion may be nearing its end. When average earnings over a ten-year period are figured in, stocks on the S&P 500 are highly overvalued even in capitalist terms, with an adjusted price-earnings ratio of 25 to 1, well above the historical average of 14 or 15 to 1. Profits currently stand at 12 percent of GDP, the highest level since the 1960s and 33 percent above the historical average of 9 percent. That makes it extremely unlikely that profits can keep growing at this pace. Researchers have found that over the long-term, profits for publicly-traded companies grow at less than 2 percent a year on average, adjusted for inflation. This would indicate that profit growth will most likely decline, possibly sharply at some point in the coming period. Lower profits leads to even lower investment, which means even fewer jobs are created.
There are also limits to how much can be squeezed from workers in both relative and absolute terms. The Labor Department reported that non-farm business productivity slowed to a 1.6 percent annualized pace in the fourth quarter from the 3.0 percent previously reported. This trimmed productivity gains for 2006 as a whole to 1.6 percent, the weakest rise since a matching pace set in 1997. Unit labor costs, a gauge of inflation and profit pressure watched closely by the Federal Reserve, went up by a hefty 6.6 percent annualized rate in the fourth quarter of 2006. For the year as a whole, unit labor costs rose 3.2 percent, the largest gain since 2000. Investment in productive capacity is down, as many investors have doubts about profitability. Non-defense capital goods spending excluding aircraft, seen as a good proxy for business investment, fell 6.3 percent in January, the deepest decline in three years. Factory orders fell 5.6 percent. All of this means that workers are producing surplus value less efficiently and costing employers more - another recipe for job cuts and stagnation in hiring.
There is a growing lack of confidence in economy, with wild ups and downs on world stock markets. In late February, concerns that the Chinese economy is "overheating" (i.e. the danger of a crisis of overproduction), caused the Shanghai stock market to plunge nearly 9 percent in a single day. The panic spread to the U.S., and the Dow Jones dropped 416 points that same day - the biggest one-day point drop since the day the market reopened after the Sept. 11 attacks. A mid-April poll by the Los Angeles Times and Bloomberg showed 60 percent of those surveyed believe a recession is somewhat or very likely in the next year, with more than a third saying their own finances are shaky.
Despite all of this, the onset of an economic downturn may well be delayed for the time being - it is in the interest of the world economy as a whole to continue to prop up the U.S. for as long as possible. What is most important, however, is not the precise moment at which the economy enters a slump at a certain stage, but the effect the constant instability of life under capitalism has on workers' consciousness. This "boom" was made possible by the extreme exploitation of working people, who have been willing to work longer and harder for less in an attempt to solve their problems. Workers have in many ways adopted a "wait and see" approach, hoping things will turn around. When at a certain stage the anemic economic expansion inevitably turns into its opposite, the realization that this is as good as it gets under capitalism will continue to sink in, further transforming the consciousness of millions.
Most people do not learn about the realities of the class struggle from books. They learn from the school of hard knocks - and the system is preparing many hard knocks for the working class. Boom or slump, capitalism can offer the working class nothing but poverty, exploitation, and degradation, even in the richest country on earth. It is the richest country on earth precisely because the wealth created by the many is concentrated in the hands of a few, a process that has accelerated in the last few years, leading to an ever-wider gap between the rich and poor.
According to the Luxembourg Income Study, over the last two decades, the U.S. has had the highest or near-highest rates of poverty for children, individual adults and families among 31 developed countries. The study found that of those 31 countries, with the exception of Mexico and Russia, the U.S. devotes the smallest portion of its GDP to federal anti-poverty programs, and those programs are among the least effective at reducing poverty.
A recent analysis of the 2005 census figures made by McClatchy Newspapers found that the percentage of Americans living in severe poverty has reached a 32-year high. Forty-three percent (16 million) of the nation's 37 million poor are living in deep poverty - the highest rate since at least 1975. The report found that severe poverty is worst near the Mexican border and in parts of the South, where 6.5 million severely poor residents are struggling to find work as manufacturing jobs in the textile, apparel and furniture-making industries disappear. The Midwest "Rust Belt" and areas of the Northeast also have been hit hard as economic restructuring and foreign competition have forced numerous plant closings. These figures do not include the millions of immigrants living in poverty in the shadows of U.S. society. If they were factored in, the numbers would be far higher.
While the number of poor Americans has grown steadily for 30 years, the pace has accelerated. From 2000 to 2005, the number of severely poor Americans grew by 26 percent, which is 56 percent faster than the overall poor population grew over the same period. The McClatchy report describes a "permanent underclass" with no social "safety net" to catch it. The social programs working Americans fought so hard for in the past have been largely dismantled by Reagan-Bush-Clinton-Bush. 2003, the latest year for which complete data is available, the Census Bureau's Survey of Income and Program Participation found that any given month, only 10 percent of severely poor Americans received Temporary Assistance for Needy Families available, and that only 36 percent received food stamps. The rest are left to fend for themselves.
According to the report, nearly two out of three people (10.3 million) in severe poverty are white, but blacks (4.3 million) and Hispanics of any race (3.7 million) make up disproportionate shares. Blacks are nearly three times as likely as non-Hispanic whites to be in deep poverty, while Hispanics are roughly twice as likely. About one in three severely poor people are under age 17, and nearly two out of three are female. This was the trend not only in large urban counties but in suburban and rural areas as well.
When adjusted for inflation, the median household income of working class families has fallen for five straight years. The reason for this is clear: over the same period, the share of national income going to corporate profits has dwarfed the amount going toward workers' wages.
The obscene level to which corporate profiteering has reached can be seen in the case of Ford Motor Company, part of the beleaguered auto industry. The company posted a record $12.7 billion loss in 2006, and is therefore "restructuring" - i.e. laying off tens of thousands of union workers. And yet, it saw fit to pay new CEO Alan Mulally $28 million in salary, bonuses, personal expenses, and stock options for just four months on the job. That's nearly a quarter of a million dollars a day. This is his reward for laying off over 30,000 mostly unionized Ford workers, and to strengthen his resolve when wrenching concessions from the United Auto Workers in upcoming contract negotiations. By contrast, full-time union members - many of whose jobs are on the line - were given "bonuses" of around $500 each in order to "improve morale in the middle of a downsizing."
While corporate profits explode and CEO payouts reach grotesque new levels, working people are caught in an economic vice as wages stagnate or barely keep pace with inflation, while health care, education, and housing costs soar. While the crisis of U.S. capitalism affects all American workers, organized labor in particular is faced with an all-out offensive by the bosses.
The Labor Movement
Compared with most of the world, American workers enjoyed higher standards of living for several decades, due largely to the fierce union struggles of the past. Although there has always been a vast sub-stratum of the class, working in minimum wage, non-union jobs under poor conditions, for a significant sector, it seemed that things weren’t so bad under capitalism after all.
However, with population growth and the emergence of new markets such as China, India, and Eastern Europe, where rock-bottom wages and poor conditions prevail, the capitalist class is forcing U.S. workers to compete for increasingly low wages, benefits and deteriorating conditions. The IMF recently reported that the “effective global labor force” has risen fourfold over the past two decades. This has served to push down wages in the advanced industrialized countries, particularly among unskilled workers. Some analysts predict that the mass layoffs and “offshoring” of the past period are just the beginning - as many as 30 to 40 million more jobs could be lost in the coming years.
In their never-ending pursuit of profits, the capitalists are aggressively dismantling U.S. industry and shifting their investments to other countries and the services sector. This has led to the decline of organized labor, which has been losing ground for the last 30 years. Over this same period, the standard of living of U.S. workers has also suffered a steady fall. One sector after another of the working class has come under attack, a trend that is set to intensify in the coming years. However, it is not just the changes in the world economy that have led to the decline of organized labor.
The current union leadership’s class collaborationist policy of “partnership” with the bosses is in large part to blame for the crisis facing the labor movement. The major unions’ continued support for the Democratic Party (and sometimes even the Republican Party) is another part of the equation. Both these parties represent and defend the capitalists, whose interests are diametrically opposed to the interests of working people.
The trade unions are the traditional mass organizations of the U.S. working class. They are the basic units of economic organization through which workers can struggle collectively against the bosses. The U.S. has a long and militant trade union history, but in the last few decades, class consciousness has been thrown far backwards. It can be laid out as an historical law that in periods of acute class struggle, workers are more likely to participate actively in their unions. But in periods when the class struggle is not so open, when things seem to be improving at least somewhat, workers tend to leave the running of the unions to the “professionals”. As a result, a conservative bureaucracy emerges which is closer in lifestyle, social milieu, habits, and outlook to the bosses. This situation has been taken to the extreme in the U.S. over the past 25 years, with the union leadership more interested in cozy relations with the employers and their government than with defending the interests of the workers they are supposed to represent.
But everything has its limits. Consciousness lags behind events – it has taken a long time for the labor movement rank and file to really become aware of drastic changes that are taking place in the economy and their place in it. Symptoms of a simmering discontent in key sectors is evidence that there is at the very least the beginning of a changing mood, of a desire to organize a fight back against the bosses in defense of workers’ rights, wages, and conditions. This will first be expressed through the unions themselves, for example, as the rank and file confronts the current leadership’s notion that strikes can’t be won. Eventually this must also find a political expression in the form of a mass, class-independent party of labor based on the unions.
When the AFL merged with the CIO in 1955, it was the world’s largest union, with 15 million members. Today, the AFL-CIO has been reduced to around 6 million members, with rapidly shrinking representation in the private sector. The percentage of workers in both public and private sector unions has steadily declined since the late 1970s. In 1977, 23.8 percent of workers were in a union; in 1983, about 1 in 5 workers in the United States was a member of a union. By 1991 the number had fallen to 16.4 percent. As of 2006, only 1 in 8 workers was a union member. The situation in the private sectors has gotten even worse. In 1983, about 1 in 6 private-sector workers was in a union. Twenty-three years later, the share fell to 7.4 percent, or about 1 in 14.
According to the Bureau of Labor Statistics annual union membership report, for the first time in U.S. history, 2006 union membership rates were lower in manufacturing than in the economy as whole. The largest decrease in union membership was in manufacturing, where membership dropped 1.3 percentage points to just 11.7 percent. Overall, the number of U.S. workers in a union fell last year by 326,000 workers, to 15.4 million, or 12 percent of workers.
The capitalist class has mobilized aggressively in the last period to root out unions where they exist, and has spared no expense to try and prevent new ones from being organized. In its report “Dropping the Ax: Illegal Firings During Union Election Campaigns,” the Center for Economic and Policy Research statistically quantified what trade union activists have long known to be true: there has been a steep rise in the number of illegal firings of pro-union workers. The report relied on government data made available through the National Labor Relations Board.
Although employee termination for union activities is illegal, the punishment by the NLRB amounts to a mere slap on the wrist. With so many loop holes and such poor enforcement of the few protections workers legally have, it is easy for bosses to intimidate potential union members by firing a few of them, and at most paying a small fine.The report also shows that over time, the chances of being fired for union activity has increased substantially. In the 1970s, workers had a 1-in-100 chance of being fired for union activity. Today, one in every five union activists can expect to be fired as a result of his or her activities in unionization campaigns.
The long-term decline has also been reflected in strike activity. From 1950 to 1980, there was an average of 300 major work stoppages per year. But between 1981 and 2000 there was only an average of 46 strikes per year. A major turning point was the PATCO air traffic controllers strike in 1981. The PATCO union went on strike and was immediately challenged with Federal intervention by the Reagan Administration, with the President authorizing the sacking of every single striker and their replacement with military personnel. Instead of mounting a united defense of the PATCO strikers, the AFL-CIO allowed itself to be intimidated by the power of the bosses and their government. Labor-Management “cooperation” was offered instead of struggle. Today’s generation of workers is still paying the price for this one-way “cooperation”.
Faced with these declines, one would expect significant union resources and energies to be channelled into strengthening existing unions and to organize new layers of workers. However, millions of dollars that could be spent on this effort are instead being spent on enormous salaries for many union officials and staffers. According to information released by the Labor Management Reporting and Disclosure Act (LMRDA), the number of labor officials and staff earning over $100,000 a year more than doubled between 2000 to 2004, the latest year for which complete data is available. During that same period, the number of officers and staff earning more than $150,000 increased by 84 percent. Also over the course of those years, 5,646 union officials / staff were paid a total of $733.6 million in salaries over $100,000, including multiple salaries, while 870 were paid $181.7 million in salaries worth over $150,000.
To put these figures in perspective, union officials earning over $157,000 found themselves among the richest five percent of all U.S. households, at the same level as many corporate CEOs. Meanwhile, the average rank and file union member earned just $43,000 per year, putting them above the median individual income of $36,500, but well below the level of those that are supposed to be representing us.
The breaking of the PATCO strike by the Reagan government and the “partnership with the bosses” approach of the union leadership paved the way for an upswing in the profits of the biggest U.S. corporations - at the expense of the U.S. working class. Real wages for most workers have stagnated or declined since the late 1970s. 47 million Americans don’t have access to health care. Millions of quality union jobs have been destroyed. Yet for an entire period, with a few notable exceptions, such as the 1997 nation-wide Teamsters strike at UPS, the labor movement has been unable to mount a serious defense, let alone an offensive.
Many bourgeois professors - paid apologists for the ruling class - have gone to great lengths to “prove” that American workers will never again enter the arena of mass struggle because they are “too privileged”, or that they’re “middle class”, or that the class struggle itself no longer exists, or that unions don’t matter anymore. But not only are American workers still proletarians who sell their labor power for a wage, but an upswing in the labor movement is inevitable at a certain stage. When will this happen? Where will it first erupt? It is impossible to say with any precision - this will be worked out by the complex historical process itself. But what we do know is that a pendulum cannot swing one way forever. We must keep our our finger on the pulse of the movement, continually working out our perspectives, methods, approach, and analysis. As Marxists, it is our duty to stand shoulder to shoulder with our class brothers and sisters wherever they may be, particularly in the mass organizations.
The U.S. auto industry and the United Auto Workers (UAW) union that represents most of its workers has been among the hardest hit in the last few years. Since 1999, 790,000 jobs have been lost in this formerly mighty sector of the U.S. economy. The UAW’s membership is now at just around 500,000, down 116,000 from the end of 2004, and only one-third its size in 1979. Some 50,000 jobs were lost in 2006 alone.
When it first entered the scene in the 1930s, the UAW was able to employ militant tactics and organized auto workers on an industry basis rather than a craft basis. At that time, workers in the auto industry and the rest of mass industrial production were almost totally unorganized and had few or no rights. Within just a few years, these workers were waging militant battles with the bosses and the state, occupying factories and winning contract after contract. By 1945, every single auto company was unionized. Through mass struggle, these workers won what would today be considered a true living wage, along with unprecedented benefits and job security. However, the leadership of the UAW at that time limited the struggle to “their” membership. The lack of a broader class-wide perspective, of fighting for higher wages, benefits, and conditions for all U.S. workers, meant that it was only a matter of time before the capitalists came back to exact their revenge and to take back the gains wrested from them in the past.
Decades removed from the mass struggles of the auto workers, the bosses have come to take back what they lost in the past. For its part, the current UAW leadership is in favor of bargaining for concessions with the bosses – i.e. betraying the interests of those they represent. The Big Three automakers say that they can’t compete with foreign companies and that they have to trim capacity. The UAW leadership has done nothing to resist these predations and instead offers pay and benefit cuts at best, or goes along with plant closings and mass layoffs at worst. This sorry cycle has been going on for more than 20 years. Plant closings and layoffs are the weapon of choice for the Big Three in their effort to rid the industry of the unions. The “one way street” of worker-employer cooperation has been an unmitigated disaster for the entire labor movement.
On February 14, Daimler-Chrysler announced plant closings and job cuts that will go into effect in 2008 and 2009. They plan to cut 13,000 jobs across the U.S. and Canada by 2009, mostly by shift elimination. As part of this restructuring plan the company will cut U.S. production capacity by 400,000 units through 2009. Company management has also threatened to sell off its Chrysler unit. Canadian autoparts maker Magna International has offered up to $4.8 billion to purchase Chrysler. But according to recent articles in the Wall Street Journal, it appears that Daimler-Chrysler doesn’t have an earnest interest in selling Chrysler. This confirms the perspective that the “Valentine’s Day Massacre” announcement was intended as a means of blackmailing the UAW into another concession contract. The bosses want to quiet the stirrings of the rank and file in the UAW by holding the threat of plant closures and layoffs over their heads like a sword of Damocles.
This is despite the fact that Chrysler is the most profitable U.S. auto manufacturer and has done well over the past few years. While it’s not ruled out that Daimler-Chrysler may indeed sell off its U.S. operations or close plants and carry out its layoff plans, the timing of the announcement in the lead up to the UAW bargaining convention (and the upcoming contract negotiations with Chrysler in September) makes it clear that the main intention is to intimidate the UAW leadership into making even more concessions at the expense of the workers.
With their backs against the wall, many workers are disillusioned and looking for the least painful way out of the mess they find themselves in. But there are others who are sick and tired of their union serving as a mere appendage of the Big Three automakers. Signs of a changing mood in the UAW are emerging, for example, with the rise of the Soldiers of Solidarity and other militant rank and file groupings across the Midwest. There are many indications that this frustration will increasingly reflect itself through the rank and file pressuring the leadership to put up a fight.
An April 15 article in the Chicago Tribune, titled “UAW Voices Cry for Militancy” highlighted this growing mood. According to Paul Baxter, a 28-year UAW member from Zilwaukee, MI, “We’ve trained a generation of union leaders to be cooperative, and they don’t know how to fight back. We’ve lost our militancy. We’re actually cooperating in our own demise. Our leaders are far removed from the realities of the workplace. Whatever the company says we need to do, the union goes along with it. We’ve become an enabler, like someone who enables an alcoholic to keep drinking.” Another UAW member, Mike Parker, a skilled trades worker at a Chrysler plant in Sterling Heights, MI had the following to say: “Part of the union is clearly broken, and a lot more is under threat. There’s a lot of discontent with what’s going on among the membership. They feel alienated from the union and the company.”
As explained to the Chicago Tribune by Gary Walkowicz, a UAW autoworker at a Ford assembly plant in Dearborn, MI: “We have to draw a line in the sand and give no more concessions. I really believe that is where a lot of members are today who think things are going the wrong way. It just may not have bubbled up to the surface yet.” The article continues: “Walkowicz and some co-workers circulated petitions at the Dearborn plant recently that called for a halt to concessions and obtained signatures from 1,000 workers in four days. Workers at other plants heard about the petition, and 1,000 more active and retired UAW members signed it.”
The current contract, in effect since 2003, allows automakers to replace some workers who make about $27 an hour with new ones who start at $18 an hour. At parts-maker Delphi, replacements start at $14. Todd Jordan, who works at a Delphi plant in Kokomo, IN had the following to say: “The two-tier [wage structure] opened the floodgate to concessions. Everywhere there is two-tier, there’s a divided union and chaos. We’re no longer a union in a sense. It’s run like a business, not a union. We feel the UAW is going into the negotiations in a concessionary mode. They’re almost like the human resources [office] for the Big Three.” This is just an indication of the pressure that is building not only in the UAW, but throughout organized labor. Many in the rank and file are eager to organize a fight back against the attacks of the bosses.
The trucking industry is another key component of the U.S. economy. Over the past 50 years, there has been a steady rise in the use of over-the-road trucks to move all kinds of manufactured and agricultural goods across the country. This places the International Brotherhood of Teamsters (IBT) in a very strategic part of the economy. Edna Bonacich, a professor at the University of California, Riverside and a specialist in supply-chain issues explains the power of the trucking industry this way: “There’s a vulnerability there. If any group in this supply chain were to go on strike, it would cost the companies millions. A coordinated strike could cost them billions.” The IBT is the traditional organization for workers in the trucking industry, and even if they are now only a fraction of that industry, the potential is there to cause a major disruption to capitalism and to give the working class as a whole a sense of their true power.
The capitalists understand this as well. They have put the Teamsters under tremendous pressure to bend to their will. But the Teamsters union is in crisis, with the members putting increasing pressure on the leadership. With contract negotiations at UPS looming and pressure mounting within the union, there is the potential for a nationwide conflict between UPS and the 215,000 Teamsters that work there.
With 1.4 million members, the IBT is the largest union in the U.S. Like the UAW, the Teamsters were tempered in the white heat of the class struggle of the 1930s. By 1949 there were one million members, and in 1964, the union won a national bargaining agreement for all freight drivers. But the “old guard” leadership of the union was corrupt to the core. It was connected with the mafia and embezzled millions from the union’s treasury. These people are still around - the “old guard” is still alive and well and have their representative, James Hoffa Jr. in power.
These people, like their concession-happy cousins in the UAW, have only managed to weaken the union and lose members. No wonder Bush Jr. sings Hoffa Jr.’s praises. At a recent Teamster Labor Day rally in Detroit, George W. Bush described Hoffa Jr. in these terms: “You’ve got a good man running the Teamsters in Jimmy Hoffa. Let me tell you another thing about Jimmy Hoffa. He’s running a good union and in an aboveboard manner. And make no mistake about it, people are beginning to notice, particularly in Washington, D.C.”.
Membership in the union has dropped by 155,000 over the past few years. A recent dues increase has raised an extra $525 million, but only 3.3 percent of this goes to the Teamster strike fund, and just 2.2 percent to the union’s organizing fund. However, as in the UAW, there is a growing ferment of discontent. The November 2006 election campaign for Teamsters President between Hoffa Jr. and Tom Leedham is an important example.
Only 21 percent, or 294,000 Teamsters voted in the election. This is the lowest turnout since the rank-and-file first won the right to vote on March 13, 1989. Hoffa received 65 percent of the votes cast and Leedham 35 percent, roughly equivalent to the 2001 elections. One of the most striking facts of the election was that, according to documents filed with the Election Supervisor, Hoffa outspent Leedham by over $2,000,000. Yet only 13 percent of the overall membership voted for Hoffa, leaving 80 percent completely unmoved by the large amounts of pro-Hoffa propaganda.
The lack of involvement of the vast majority of the members is a testimony to Hoffa’s failed leadership. His “partnership” with the bosses has necessarily resulted in a series of concessionary contracts where workers have found themselves on the losing side of the bargain. The employers have simply insisted that in order to remain in business, they must be competitive, which in turn means lowering production costs to a minimum, including labor costs. Instead of recognizing that workers and their employers have diametrically opposed interests, which means that workers can gain only at the expense of the employers, and that workers must be mobilized to fight for their own interests, Hoffa has demobilized the rank-and-file and in the process has demoralized much of the membership.
But the fact that over 100,000 members voted for Leedham indicates that there is an instinctive left-wing within the Teamsters union, which, if organized around a program of struggle against the bosses’ attacks could develop into a conscious class-struggle tendency, especially in response to the ongoing pension and health care cuts. Leedham won this level of support from rank-and-file members mainly because he comes from a wing of the union that had gathered around the militant Ron Carey in the 1990s. Carey’s administration implemented many reforms throughout the 1990s, including eliminating multiple salaries for union bureaucrats, organizing 20 Overnite terminals, and leading the first successful strike in decades in this country against UPS. The conflict with UPS proved once again that strikes are still an effective weapon against the employers when they are led by those who actually intend to use the strike to win. This represented a grave threat to the policy of class collaboration practiced by the majority of the union bureaucrats, and to the profits of the employers. For this, Carey was framed by the state, and in the end abandoned by many of his supporters in the union.
The examples of the UAW and the Teamsters are an indication of what is developing beneath the surface of the labor movement. The U.S. does not exist in a vacuum, and the longer it takes for the class struggle to find an open, organized expression, the more explosive it will be when it does erupt. The lack of a political alternative for working people is also a major contradiction confronting American workers; this will be discussed in detail in another section.
It is the duty of Marxists to work within the unions, taking jobs in unionized workplaces whenever possible. In this work, we not only want to introduce propaganda to workers but lead them in their day-to-day struggles. This means that our struggle must be aimed first and foremost against the employers, not against the union bureaucrats for their class collaboration. In order to point the way forward to workers, we must be prepared to make practical proposals involving class struggle tactics. This might involve demanding higher pay, better benefits, or more job security. It might mean raising the demand of 30 hours work for 40 hours pay if workers are confronted with layoffs. It might mean demanding that seniority be respected. Or it might involve championing the needs of part-timers in order to lift them to the level of the full-time workers so that the workforce is no longer divided. No matter what the situation, by showing the way forward to the membership as a whole, tremendous pressure will be placed on the bureaucrats to put up a fight. Then, if they refuse, the members will see with their own eyes and through their own experience that the bureaucrats must be replaced.
The way forward for working people is clear. We must wage a relentless struggle against the strategy of forming a partnership with the bosses. This strategy has led only to a lowering of the standard of living for working people. We must urge our co-workers to organize independently of their employers and independently of the Democratic Party which is tied to big business just as much as the Republicans. When we are organized and mobilized to fight, workers wield tremendous power. After all, capitalism cannot exist for a single day if workers refuse to go to work.
A clear example of the potential strength of organized workers can be seen in the massive movement of immigrant workers that erupted seemingly out of nowhere in the spring of 2006.
The Immigrant Workers Movement
Last spring, millions of immigrant workers, their families, and allies took to the streets of the U.S. in a spontaneous movement against the draconian anti-immigrant measures being proposed in the form of the Sensenbrenner Bill (HR4437). But this was only the spark that lit up the inflammable material that had accumulated for decades. Some 12 to 14 million undocumented immigrants, a majority of them from Mexico and Central America, live in the shadows of U.S. society, doing back-breaking and dangerous work for low wages, under poor conditions, with few rights. HR4437 was simply the last “last straw” after decades of indignities, and the pent up frustrations exploded to the surface. Hundreds of ad hoc committees were organized in factories, schools, and workplaces to plan for May Day 2006 - which was almost certainly the largest national strike / boycott in the history of the U.S.
The movement was inevitably heterogeneous at first, with “immigrants” of from all layers of society participating in its early days. Business owners and factory workers marched together in the “spring time” of the movement; there was a carnival atmosphere as millions of oppressed workers felt the strength of their unity for the first time. Latino radio stations and business owners jumped on board, pushing the movement forward. But the seeds for the future division of the movement along class lines were present from the beginning, and have intensified in the months since May Day 2006. Because at root, this was not a movement of “immigrants” – it was a movement of immigrant workers, and the slogans and banners reflected this: “We are workers not criminals!” “You accept our labor, now accept us!”
The traditional, mostly petty-bourgeois leadership of the immigrant rights movement was completely overwhelmed by the masses. Accustomed to decades of slow, uphill work, with a few limited reforms as their goal, they were completely unable – and unwilling – to channel the colossal energy of the masses into real change. They were terrified of the movement, and moved might and main to control it, to keep it within safe limits. As has happened so often to mass grass roots movements in the U.S., these “leaders” were quick to sell out the movement to the Democratic Party, who promised larger “crumbs” than they had ever imagined possible. In so doing, they betrayed the just aspirations of immigrant workers for a complete and total amnesty.
After the mid-term elections in November, the pressure to stop the mega marches and to let the professional politicians handle things intensified. Many of the coalitions that were formed to organize the 2006 marches have split or imploded, others are rent by internal tensions. Many who, emboldened by the pressure of the masses, made radical speeches and pronouncements a year ago, have retreated back to their reformist positions with the ebb of the movement. These divisions and changes of heart can ultimately be traced to the class, material, and political interests represented by those involved. It is a classic example of the contradictions that arise in all social movements between reformism and revolution, class collaboration and class independence.
The basic, organic demand of the movement: “Unconditional Legalization / Amnesty for All!” goes far beyond the safe limits the corporations and their politicians can accept. Both big business political parties are interested in having a vast pool of cheap, unorganized, and expendable labor. This is why they have rushed to push through various “compromise” bills, which although presented as being less onerous than HR4437, are still overwhelmingly anti-immigrant and anti-worker. These are enforcement-first bills, which include “guest worker” programs, national identification systems, and heavy fines and fees. Many bills also include lucrative contracts to companies like Halliburton for the construction of border fences and detention centers. As with all laws under capitalism, it all comes down to maximizing and protecting the profits of big business at the expense of the working class.
The key lesson of the successful struggle against Sensenbrenner is that politics is not made only by Congress, but on the streets. This spring, the movement has struggled to pick up steam, abandoned by many of those who supported it in the past. These former allies opportunistically supported the movement in order to pursue their own interests. But they understand that a unified, organized, and militant immigrant workforce that they cannot control is the last thing they want. The lesson is clear: immigrant workers can rely only on their own forces, organization, and class independence, reaching out to their natural allies, the unions and working class in general.
This mass movement of the oppressed represents a real threat to the power of the capitalists, who rely on these millions of workers with no few or no rights in order to divide the working class, drive down wages, and increase profits. In order to punish and frighten the movement, the government has unleashed a wave of state terror against immigrant communities ranging from “no match” letters to large-scale raids and deportations. This has had an effect on the movement, as entire communities have been atomized. Nonetheless, at the grass roots level, there is still a ferment and desire to continue the struggle, as nothing whatsoever has been resolved.
There is enormous pressure on grass roots immigrant rights groups to support the “Security Through Regularized Immigration and a Vibrant Economy Act” (STRIVE). This proposal, put forward by Republican Jeff Flake (AZ) and Democrat Luis Gutierrez (IL), is being presented as a “lesser evil” and “the best we can get”. While on the surface it isn’t as overtly aggressive as Sensenbrenner’s HR4437, and imposes lower fines than the White House’s current proposal, it remains an enforcement-first bill that offers little or nothing to immigrant workers and their families.
Far from amnesty and full rights for all, the STRIVE Act includes several provisions from the Sensenbrenner bill, excludes millions of immigrant workers, and imposes many conditions, restrictions, fines, and fees in order for just some immigrant workers to achieve even partial legal status. The vast majority of immigrants between ages 21 to 65 will have to leave the U.S. to “touch back” in their country of origin within 90 days of the application process, which would be extremely costly and disruptive. Those who entered the country after June 1, 2006, or who temporarily left the country after that date, or were unemployed (or unable to prove employment) during that period would also be ineligible.
The proposal indefinitely delays any legalization program until the Secretary of the Department of Homeland Security (DHS) certifies to Congress that new systems to make immigration document verification more secure are ready to use; that a new Electronic Employment Verification System has been implemented; and that new border surveillance technology has been adopted and implemented. It is unclear how many months or years it will take to achieve these “trigger” milestones before a partial legalization program would be implemented.
In the meantime, the act criminalizes all those who entered the country without documents and expands the list of crimes for which immigrants can be denied legal status. Those who cross the border without documents would be criminalized and subject to six months in prison for a first offense; two years for a second offense, and five years for a third offense.
It also accelerates technology and border infrastructure, including unmanned aerial vehicles, cameras, sensors, etc. It would double the number of Border Patrol agents to about 24,000 by 2012, with emphasis on the recruitment of former military personnel with experience in border enforcement in Iraq and Afghanistan. A further 1,200 Immigration and Customs Enforcement (ICE) agents would be added as well. It also extends deployment of National Guard troops. It requires the DHS to build at least 20 additional detention facilities with the capacity to detain 20,000 people.
The Democrats’ proposal also includes a “New Worker” temporary Visa Program, which is just another name for a “Guest Worker” Program. This is presented as a “realistic” solution, one which would “legalize” hundreds of thousands of immigrant workers. However, according to the Southern Poverty Law Center (SPLC), these programs leave workers in slave-like conditions despite legal protections on paper. A report titled “Close to Slavery” released by the SPLC, explains how “guest” workers are routinely cheated out of wages, live in cramped, unhealthy housing and are held “virtually captive” by their employers. The often have their identity papers and travel documents confiscated, leaving them entirely at the mercy of the employers. They have little or no access to health or medical care in the event of illness or an accident. The report also notes that many must pay thousands of dollars to recruiters for jobs and visas. They often have to sign over deeds for property or cars in their home country as collateral, leaving them with crippling debts carrying high rates of interest.
According to SPLC president Richard Cohen, “The mistreatment of temporary foreign workers in America today is one of the major civil rights issues of our time.” Mary Bauer, director of the immigrant justice project for the Center said in a recent interview that, “Workers are abused fairly systematically. This is not a question of bad employers. It’s built into the structure of the program. There are few legal rights and the legal rights that do exist are almost never enforced … A small guest worker program now is terrible. What makes us believe that a giant guest worker program is going to be better?”
“New Workers” would be tied to a single employer and required to work for the duration of the contract. Leaving the job early would be considered breach of contract, allowing the employer to have the worker deported. Workers would only be able to leave an abusive employer if they can prove in advance that they have another job with another employer, who must be registered with the government to participate in the program. All workers participating in the program would be tracked through an “Alien Employment Management System” to allow for easy deportation. STRIVE does not guarantee the right to join a union or engage in collective bargaining. It is precisely this level of control and atomization of the workforce that makes the proposal attractive to big business, who would be able to bring in workers not only for agriculture, but throughout the economy. This would be used as a battering ram against the unions.
STRIVE also creates significant civil penalties for employers who do not comply with requirements under the new system and establishes serious criminal penalties for knowingly hiring undocumented workers (fines of up to $5,000 and three years in prison). It also creates an national biometric system to electronically verify employment authorization which will apply to all workers in the U.S. These measures can only lead to increased discrimination, racial profiling, and infringement on civil rights in general.
In the last few months, Immigration and Customs Enforcement (ICE) has stepped up its raids across the country, tearing families apart and terrorizing entire communities. The STRIVE Act offers no moratorium on raids or deportations. In fact, it expands the ability of the DHS to subject immigrants to “expedited removal” (deportation without a hearing). This will result in far more erroneous deportations, separation of families, etc. The Act also grants immigration enforcement authority to state and local police, allowing the federal government to “deputize” local law enforcement to work with immigration agents in areas within 100 miles from the border and in “high impact areas” – i.e. any community in the country where immigrants are concentrated. The proposal declares that the “law enforcement personnel of a state, or a political subdivision of a state, have the inherent authority of a sovereign entity to investigate, apprehend, arrest, detain or transfer to federal custody (including the transportation across state lines to detention centers) an alien for the purpose of assisting in the enforcement of the criminal provisions of the immigration laws of the United States in the normal course of carrying out the law enforcement duties of such personnel.”
Politicians from both major parties support this legislation. Those that oppose it do so on the grounds that it is “too lenient” on undocumented immigrants. And we are supposed to believe that this is a “pro-immigrant” law? Even if passed in the House in its current form, the STRIVE Act would have to be reconciled with the even more anti-immigrant Senate Bill. This is not what millions of immigrant workers marched for last spring. The only way we will win our rights and dignity is by organizing in our workplaces, schools, and communities, and through mass mobilizations. We can rely only on ourselves. We cannot rely on the politicians of big business to help us. Their interests are diametrically opposed to ours.
The natural allies of immigrant workers are our class brothers and sisters in the U.S. and around the world. An important result of last year’s movement has been the ferment of debate within the trade unions, many of which previously supported a “guest worker” program. Now, due to the pressure from the rank and file, support for unconditional legalization and full rights for all has been mounting in major unions both in the AFL-CIO and the “Change to Win” coalition. The way forward is clear: All workers in the U.S. must unite to defend the rights of all working people, no matter where they were born.
In the last 20 years, millions of immigrant workers have fled poverty, exploitation, and repression in their countries of origin only to find much the same and in some cases even worse in the “land of milk and honey”. In the final analysis, there is no solution to the question of immigration within the narrow limits of capitalism. The struggle for immigrant workers’ rights is a transitional struggle, which must ultimately be linked to the need for the socialist transformation of society. But winning unconditional legalization for all would be a tremendous victory for all workers, it would unleash a wave of organization and unionization, and inspire the broader labor movement to fight for its rights, improved wages and conditions. This is precisely what the capitalist class fears. These attacks are in reality a sign of weakness not of strength. They would prefer to rule through “legality”, the media, public opinion, etc., but have had to resort to terror and violence.
The ruling class also fears the effects the spreading Latin American revolution will have on the millions of Latinos living in the U.S. The attacks on immigrants and the push to increase security and militarization of the border is precisely to stem the flow of radicalized workers and peasants into the U.S. - Revolutions do not respect borders. The U.S.-Mexico border serves as a transmission belt for all the pent-up contradictions in Latin America, right into the heart of world imperialism.
Any legislation passed by the corporate parties will be anti-immigrant and anti-worker through and through, and will have a negative effect on the entire labor movement. It will serve to undercut and disorient the movement for immigrant rights, and will give legal cover for increased repression. The pro-Democrat reformists may raise a few demagogic complaints, but in the end will content themselves with a few crumbs and paid positions, while the masses will be left with nothing.
However, nothing fundamental will have been solved, and the contradictions of the world economic system, with immigrant labor in the U.S. as one of its most acute expressions, will continue to build up, preparing the way for even greater explosions of the class struggle. Events in Latin America will also play an important role in determining how things develop, with the Mexican revolution reaching the boiling point right across the U.S. border. It is the duty of the Marxists to provide a clear internationalist class analysis and orientation to the movement, and to prepare the forces of Bolshevism among immigrant workers, who will be on the front lines of the struggle for socialism in the U.S.