Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts

Saturday, 3 September 2016

Update #93

In this week's update:
  • Branch meeting - Brexit and British capitalism
  • Jeremy Corbyn in Nottingham on Wednesday 7th September
  • Dates for your diary

Branch Meeting


The SWP is a party of activists who know that we need to understand the world to be effective in our actions. Our meetings have a discussion about key issues: economic, political, historical and cultural; as well as planning for events and activities.

This month, in the wake of Brexit - what does it mean for British capitalism?

Thursday 7th September
7 pm
West End Community Centre on Mackworth Road (next to Britannia Mill).





Jeremy Corbyn rally in Nottingham

The Labour Party leadership contest is set to become even more bitter. While ballot papers are being sent out many longstanding labour party members are being suspended and so prevented from voting. BFAWU bakers union general secretary Ronnie Draper was suspended last week. He has been a labour party member for 40 years. See the SW article here. Others have been suspended for inappropriate postings on facebook and social media. The claim that such decisions have been made by the NEC is a joke given it has not met since last month! Ronnie is an outspoken supporter of Jeremy Corbyn. John McDonnell has rightly said this “appears to be a rigged purge of Jeremy Corbyn supporters.”
As Ronnie Draper says – the suspension will not stop him campaigning.  This is crucial. The best way to defend Corbyn and beat the Labour right is to mobilise on the streets and in the workplace. As the infighting in Labour deepens the Tories are on the attack.

Support Jeremy - he is speaking at Nottingham's Forest Recreation ground at 6.30 pm on Wednesday 7th September!


Dates for your diary

  • Sunday 2nd October 'Unwelcome the Tories' - protest at Tory Party conference in Birmingham. Details of transport TBC
  • Saturday 8th October Stand Up To Racism national conference - details soon!

 Can't make our meetings?
If you want to find out more about us, meet some of our comrades, sign up to any of our petitions, find out about campaigns we are involved in, buy our paper or get hold of some of our other literature, why not come along to the campaign stall on Saturdays?

Find us on St Peter's St from 12 pm!

Wednesday, 8 April 2015

Crisis in Ukraine

One of our recent meetings was on the subject of the situation in Ukraine at the moment. The comrade who gave a talk on the topic has given us his notes to publish. We had a great discussion about an area that many comrades in the branch were not very familiar with - enjoy!

Crisis in Ukraine
 
Events in Ukraine are the result of a dialectical process involving amongst other things: the imperialist rivalry between Russia and the West; the economic collapse of Ukraine; the struggle for power between the oligarchs who dominate Ukrainian political life and various ethnic tensions. Since the fall of the Soviet Union the EU and NATO have sought to expand their sphere of influence into the former Soviet Bloc, while Russia has tried to retain influence, and where possible restore its dominance there, through the Eurasian Customs Union (ECU). The balance of power has long been in the West’s favour. Russia could do little or nothing as one by one Eastern European countries, including the Baltic states, signed up to the EU and NATO. By 2009 12 former communist states had joined NATO, 11 of them also joined the EU.

The rivalry of these regional economic blocs is an expression of the economic competition that exists between them. At stake are vast resources and markets. Each bloc is compelled to seek maximum competitive advantage against its rival in Russia’s “near abroad” to strengthen its competitive position in the world market. None of the states involved, however, fall neatly into one economic sphere of influence or the other. They all have conflicting interests in both Russia and its ECU partners, as well as in the EU. Most are heavily dependent on Russian gas and energy supplies. They are, like the principle rivals themselves, highly interdependent on one another.

Despite this the rules of both “partnerships” preclude membership of both blocs. The impact of the world economic crisis of 2008-9 on trade and rising deficits combined with rapidly depleting reserves greatly increased the pressure on the ruling classes of states outside the main trading blocs to seek “partnerships” deals or membership status, whatever the costs. Both Russia and the EU have attempted to use this to shape the economic, administrative and, to some extent, the political structures of these states, albeit by different means, and with differing degrees of success. In Marxist terms, we are back to the classic analysis of imperialism – the development of economic competition between blocs of capital – and military rivalry between states. Most people on the Left will agree with accusations of imperialism by the West, however, some would dispute the same accusation being made against Russia. I will, therefore, deal with this in some detail later in my talk when I look at the situation in Ukraine today. Ukraine gained its independence from the USSR in a strugglei, involving both western and eastern Ukrainians that lasted from 1989 to1991. In the subsequent referendum on independence the turnout was 84%. Even in the industrial regions in the east, such as Donetsk and Luhansk, where the majority were Russian speakers and which had the highest number of ethnic Russians, support for independence did not dip below 83%. The one exception was Crimea where support for it fell to 54%.

The hopes inspired by independence, however, were dashed on the rocks of the shock therapy and hyperinflation that followed it. Annual inflation for the period 1993-5 averaged 2,001% per year. The figure for Russia for the same period was 460% per year. Living standards plummeted and lifetime savings and pensions evaporated. Ukraine is the only Eastern European state whose level of production stands at pre-1993 levels. A minimal recovery was followed by the 2008 crisis: world steel prices fell; national debt on vast foreign loans mushroomed and reserves disappeared. The economy contracted by 15% and the currency lost 40% of its value. The per capita income of Ukrainians in 2013 was 3,900 (US dollar equivalent) compared to 13,432 in Poland and 14,612 in Russia. Male life expectancy was 63.78 (61.2 in east Ukraine) compared to 71.73 in Hungary; 72.74 in Poland and 64.37 in Russia. Faced with this crisis elements of the ruling class in both the east and the west of Ukraine used divide and rule tactics to maintain and build support. Russian speakers in Ukraine were portrayed by Ukrainian nationalists as colonisers, who belonged to a foreign fifth column bent on destroying Ukraine’s culture and its language and who were guilty by association with the famine and the purges of the 1930sii.

On the other hand the politicians who looked to Russia portrayed the Ukrainian speakers in the west as filthy Galician Nazi collaborators. The result of all this was a marked increase in the proportion of the population who were concerned about ethnic conflict. Between 2009 and 2014 it rose from 37% to 73%, having fallen from 50% in 2002 to 37% in 2009. All this helped the rise of Svoboda.

It is important, therefore, to remember that there are other factors that unite people across the ethnic divide. Between 2003 and 2010 the percentage of bilingual people has risen from 18.9% to 40.3%. Over a vast swathe of Ukraine, including the east, ethnic Ukrainians speak Russian, intermarry with ethnic Russians and converse in both languages at home, work and with friends and neighbours. Similarly, the most important issues for young Ukrainians were: the right to work; the right to education; freedom from arbitrary arrest; freedom of speech; freedom of movement and freedom of conscience; not ethnic divisions.

By the end of 2013 the Ukrainian ruling class was desperate. The Central Bank had two months of foreign reserves left and Ukraine was judged twice as likely as Greece to default. Ukraine desperately needed a bailout from the EU, the IMF or Russia. President Yanukovych had been trying to balance between the EU and the ECU. He had sought observer status in the ECU while at the same time negotiating the Association Agreement with the EU. The looming economic crisis, however, and the “take or leave it” terms presented by both Russia and the EU would not allow this balancing act to continue. After some hesitation Yanukovych turned to Russia and refused to sign the Association Agreement that had been negotiated with the EU.

It was this action that triggered the Maiden protests, which began in the autumn of 2013. The students who made up the initial protests looked to the market, Europe and the West for an alternative to the corruption of the Ukrainian elite and a way out of the economic collapse of Ukraine. However, the protests could never develop into a national movement involving eastern Ukrainians as long as their demands were hitched to the EU and the West. By the end of November the protests were on the wane. Yanukovch’s decision, however, on 30 November to use the Berkutiii to clear the square, rather than ending the protests, had the opposite effect, Demonstrations of tens of thousands were transformed into ones of hundreds of thousands and more, By early December up to half a million demonstrated. As the demonstrations got bigger the motivation of the demonstrators changed. When asked to choose which three political demands they most supported, signing the EU Agreement came fourth, with less than half the protestors including it as a demand. First, by a significant margin, was the release of those arrested on the Maiden and an end to repression; second was the dismissal of the government and third came the resignation of Yanukovych and early presidential electionsiv.

Confrontations and demonstrations continued through the winter. Rather than backing down the government on 16 January passed a series of anti-protest measures which became known as “the dictatorship laws”v. These triggered a further wave of mass protests against which the Berkut launched its most murderous onslaught. Over 100 protestors were killed. The protests, however, continued, in the end Yakunovych fled and the ruling Party of the Regions all but collapsed as its oligarch supporters and deputies deserted it. The beneficiaries of this were the pro-Western politicians who brought the fascists of Svoboda and the Right Sectorvi on board, appointing them to key ministerial positions. It is, of course, extremely worrying that the far right has played such a prominent part in the Ukrainian crisis, but this does not mean that events in Ukraine were a right-wing putsch from beginning to end as some on the left have argued. It was not Svoboda, the Right Sector or the pro-Western politicians who turned the early demonstrations into mass protests. The decision by Yanukovych and his supporters to use extreme force did this, and therefore he brought about his own downfall.

His flight left a vacuum that the pro-Western politicians stepped into. The West threw its support behind these politicians and disgracefully ignored the reactionary character of the regime and the role of Svoboda and the Right Sector. This support continued through the massacre of anti-Kiev nationalists in Odessa on 2 May and also ignored the over 3,000 people killed and the million displaced in eastern Ukraine as a result of the so-called “Anti Terrorist Operation”. In the struggle with the separatists in the east the Kiev Government was forced to use the Right Sector and other nationalist military forces because of the disaffection within the Ukrainian military and their families, and the delapidated state of the Ukrainian armed forces. In June 2014, for example, one of these groups, the Azov batallion, was assigned by the Interior Ministry to keep control of Mariupol after it captured the city from Russian-backed insurgents. The nature of the Azov battalion is clearly shown by the fact that their base in Mariupol was covered with swastikas.

Nevertheless it would be a mistake to see the struggle of the separatists or Russia’s involvement as anti-fascist, or any less reactionary than its counterpart in the west. We only have to think about the character of Putin and the people around him to realise that this view is difficult to sustain in reality. Anti-fascist rhetoric by Russia has a long Stalinist and reactionary pedigree. It had been used: to condemn men, like Bukharin, in the ‘Show Trials’; to discredit the East German Uprising of 1953 and the Hungarian Revolution of 1956; and to justify the invasion of Czechoslovakia in 1968.

Since the end of the 1980s the government has used the charge of “national fascism” to whip up Russian antagonism towards the independence movements in the former Soviet Republics. When Yanukovych fell and Ukraine turned West Putin was forced to use Russia’s geopolitical advantage and military resources to destabilise Ukraine, in order at the very least, to prevent it from integrating fully into a Western economic and military alliance. Russia has always drawn red lines around its bordering states: Ukraine, Belarus, Moldova, Georgia, Armenia, Azerbaijan and Kazachistan. Ukrainevii is, by far, the most important of these and it joining the ECU was essential to Putin’s regional economic project. Without Ukraine the ECU would just consist of Russia, Belarus and Kazachistan, an altogether reduced project, and one that other states would have less incentive to join. If Ukraine were to slip out of Russia’s orbit altogether, Russia’s regional and global position would be immeasurably weakened. Russia’s strategy over Ukraine followed the pattern of intervention it had adopted since the 1990s.

Apart from the invasion of Chechnya after it declared its independence, Russia has avoided becoming militarily involved in neighbouring statesviii. Instead Russia has fostered national and ethnic conflicts that destabilised these neighbouring states and made them dependent on Russia’s goodwill. This policy led to a series of bloody conflicts across Russia’s near abroad in which Russia played a key role. These included the separatist conflicts between Georgia and the breakaway regions of Abkhazia and South Ossetia; Moldova and its pro-Russian breakaway Transnistria and the conflict between Armenia and Azerbaijan over the enclave of Nogorno-Karabakh. Rather than committing large number of troops and armour in these areas, Russia relied on volunteers, often highly trained, experienced middle ranking military and intelligence officers, to lead and direct local forces on the ground and to provide a conduit for Russian arms and logistical supplies. The strategy enjoyed great success in 2008 when Russia humiliated the West in a short five day war to prevent Georgia from joining NATO.

In the course of these conflicts there emerged a layer of deeply reactionary Russians who were motivated by dreams of restoring the Russian/Soviet Empire. Many of these figures gravitated around the far-right “Eurasianist” movement led by the fascist Alasandr Duginix, the anti-Semitic newspaper Zavtra (Tomorrow) and the news network Den (the Day) led by the far right reactionary Alekdandr Prokhanov. They were part of an alliance of Stalinists, great Russian chauvinists and outright fascists whose leading figures were cultivated at arms length by the Kremlin. Dugin is seen as the driving conceptual force behind Putin’s decision to annex Crimea. Crimea houses Sebastopol which is Russia’s vital naval base on the Black Sea, but is leased from Ukraine. It had been the touchstone for Great Russian chauvinists since the 1980s. Year after year there have been demands, including from within the Kremlin and the Russian parliament, to annex it. This has never had anything to do with the right to self determination of an oppressed minority. It has only ever been about exerting Russian dominance, not only over Ukraine, but across Russia’s entire periphery. The networks who had earned their military spurs in previous proxy conflicts helped to build a political bridgehead for Russia in Crimea. These included the deeply reactionary Sergei Aksyonovx who took the post of Crimean prime minister, despite his party only getting 4% in the 2010 election: and Igor Girkinxi, Alexander Borodaixii, Igor Bezierxiii and Vladimir Antyufevxiv. They were all veterans of previous conflicts, particularly in Transnistria. Antyufev, the lesser known, but possibly the most significant figure served as security chief in Transnistria and he was involved in a failed coup in Latvia in 1991. Girkin, Borodai, Bezler and Antyufev have all been active in eastern Ukraine. Their connections were critical in ensuring a flow of arms, supplies and volunteer fighters from Russia.

There is no doubt that the separatists have won an important level of support because of their political opposition to the government in Kiev and the slaughter initiated by Kiev in the east. This does not alter the fact, however, that they can only exist as a proxy for Russian interests in Ukraine. In fact while the separatists secured substantial passive support against Kiev they were never able to mobilise a mass uprising or sustain their occupations beyond some towns and cities in the two regions where the ethnic Russian population is highest. Active support for the fighters has been limited. Girkin, himself, complained vehemently of this, accusing the east of being cowards. In fact a few weeks before the NATO summit in Newport during September 2014 the separatists of eastern Ukraine had appeared to be on the verge of defeat and Putin faced humiliation in Russia’s “near abroad”. He was unable to intervene because he was afraid that the fantasies of the mainly Russian leadership of the separatists of restoring the Russian empire were dragging Russia into becoming a permanent occupying force in eastern Ukraine. He managed, however, to reassert his authority over his own proxies, e.g. Borodai stepped down as P.M. of the DPR and was replaced by Plotnisky.

With a leadership more compliant to Moscow Putin committed the logistical support and the detachments of Russian troops necessary to turn the tide. In mid-August the separatists were able to mount a successful counter offensive, equipped with Russian weaponry and supplies. The Ukrainian government claimed that Russian soldiers spearheaded the attack. Whatever the precise combination of forces the Ukrainian army and its militias were thrown into retreat. Newly elected Ukrainian president Petro Poroshenko was forced to agree to a ceasefire, the Minsk Protocol, on 5 September. Elections for Parliament followed in Octoberxv. By January 2015 the ceasefire had broken down. After heavy fighting, on 21 January, DPR forces captured the symbolically important Donetsk International Airport, and the last part of the city of Donetsk that had been under Ukrainian control. By late January the separatists were mounting an offensive on the important railway and road junction of Debaltseve, which they took control of on 15 February. Meanwhile after talks with Poroshenko and Putin, on 7 February Merkel and Hollande put forward a new peace plan. It was similar to the Minsk protocol and was agreed on 12 February. Under its terms Ukraine’s parliament was supposed to officially recognize a special status for the separatist controlled DPR and Luhansk People’s Republic. Disputesxvi about the implementation of these proposals now threaten the fragile peacexvii. The West has not been able to offer overt military support because of the strength of the anti-war movement there and NATO’s problems of overstretch. Russia also has difficulties of its own. The war in Afghanistan and the first war in Chechnya aroused massive opposition in Russia and the legacy continues to hang over Russian foreign policy today. Its military re-equipment is extremely uneven and beset with problems. Russian growth has stalled and however popular Putin’s warmongering in eastern Ukraine appears on the surface, this is deceptive for a number of reasons. It is true that when polled over 50% of Russians said Russia should give support to the separatist leadership and the fighters in Donetsk and Luhansk, with 20% opposed and 20% unsure, but while 40% supported sending troops 45% were opposed. Another indication of the potential opposition to Putin is the anger among families and relatives at the secrecy and intimidation surrounding the scores of deaths of Russian soldiers in Ukraine while “on holiday”. Some 50,000 people demonstrated in Moscow against war a day before the Crimean referendum. The demonstrators not only opposed war but many, possibly a majority, opposed the annexation of Crimea itself.

For these reasons, in spite of the continuing posturing of the West and Russia, we are not on the brink of war, but this is not a conflict that will blow over and the rivalry over Ukraine poses real dangers and presents a serious challenge to the left and the anti-war movement. Clearly the starting point for revolutionaries and anti-war activists in Britain is to oppose any intervention by NATO in Ukraine.

However socialists should not downplay the character of the conflict or Russia’s role in it. Opposition to our own imperialists does not rest on having to disguise the role of its rivals. It is essential not to confuse inter-imperialist conflicts between rival imperialist powers with conflicts between major powers and subordinate and oppressed states. Russia is not Iraq or Afghanistan. It is a contender, albeit a weaker one than the US, in the imperialist world system. Russia occupies a vast territory and is still the world’s second nuclear power. It has its own imperialist interests, both in its own region and in other parts of the world including the Middle East. The solution to the Ukraine crisis lies not only on the anti-war movement in the West preventing military intervention by the West, but also on the reconciliation of western and eastern Ukrainians and the growth of opposition to Putin stopping further interference by Russia. It is only by insisting on the imperial nature of the conflict that there can be any chance of achieving all three things.

The working classes in those countries have to be convinced that the real enemy is their own government. The ultimate aim for socialists is not only to oppose war, but to turn the war between nations into a civil war between classes and to unite the workers of every country against the international “gang of robbers”. We obviously cannot do this by supporting our own government, but we equally cannot do this by supporting the government of the opposing side in any conflict between major imperialist powers.

NOTES
(i) The struggles began with strikes by miners who occupied their town squares, including in Donetsk. They were joined by miners in the heartlands of western Ukrainian nationalism. This inspired students who occupied the Maiden in 1990. Independence was secured when a large column of workers from Kiev’s largest factory, a core part of the Soviet military industrial complex, employing 10,000s marched on Parliament in support of the students. This forced the Soviets to hold a referendum on independence in 1991.

(ii) Svoboda’s rise had been helped by the predecessors of the current pro-Western politicians who had come to power after the Orange Revolution of 2004. When faced with the crisis of 2008 they employed a divide and rule strategy with a vengeance. The President Viktor Yushchenko promoted an ultra-nationalist reworking of history. The Nazi collaborators of Stephen Bandra were rehabilitated and Bandra himself was awarded the title of “Hero of Ukraine in 2010. Meanwhile the mainstream media gave increasing coverage to the Nazis of Svoboda. None of this helped Yushchenko. Totally discredited he got only 5% in the Presidential elections of 2010. It did however help Svoboba, who won 37 parliamentary seats in 2012.

(iii) The Berkut (Golden Eagles), the notorious interior ministry troops, were paid double the wages of the ordinary police and had a deeply anti-Semitic culture. Their roots lay in the Soviet OMON, which was formed at the end of the 1980s, to take on the miners and the independence movements.

(iv) In a poll of 1037 demonstrators in and around Maiden square on 7-8 December, 70% said they had come to protest against the police brutality on 30 November; 53,5% in favour of the EU Association Agreement; 59% to change life in Ukraine and 40% to change the power in the country. Only 17% said they were protesting against Ukraine entering Russia’s Customs Union or against the possibility of a turn back towards Russia. A negligible 5.4% said they had answered the calls of opposition leaders.

(v) The “Dictatorship Laws” included ten year jail terms for blockading government buildings, one year for slandering government officials or “group violations of public order”, amnesty from prosecution for the Berkut and law enforcement officials, and a host of other measures.

(vi) The Right Sector is a coalition of far right nationalist parties. It originated in November 2013 as a paramilitary confederation at the Euromaiden protests in Kiev, where its street fighters fought against riot police. The coalition became a political party on 22 March 2014, at which time it was estimated to have perhaps 10,000 members. It sees itself as continuing the tradition of Ukrainian partisans, such as the Ukrainian Insurgent Army, which fought in the Second World War against the Soviet Union and both for and against the Axis. Yarosh, Right Sector's leader, has trained armed nationalists in military exercises since the collapse of the Soviet Union. Right Sector has received some financing from the Ukrainian diaspora.

(vii) It is no accident that competition between the EU and Russia came to a head over Ukraine. Ukraine is the largest country entirely in Europe. It shares borders with Hungary, Slovakia and Poland in the west; Belarus to the north; Russia to the north and east and Romania and Moldova and its pro-Russian breakaway Transnistria to the south. As the annexation of Crimea highlighted, Ukraine has a key strategic coastline on the Black Sea and the Sea of Azov, across which lie Turkey and the Caucasian states of Georgia, Armenia and Azerbaijan (all subject to their own rivalries and conflicts). Beyond this area lie the Caspian Sea, Central Asia and China.

(viii) Even in Chechnya Putin took great care to foster a strong local Chechen regime under a former rebel, the brutal Kadyrov who was succeeded after his assassination in 2004 by his equally brutal and corrupt son.

(ix) Dugin is a Russian political scientist known for his fascist views and calls to hasten the “end of times” with all out war. He has close ties with the Kremlim and the Russian military having served as an advisor to the State Duma speaker Sergei Naryshkin a key member of the ruling United Russia party. Dugin was the leading organiser of the National Bolshevik Front and Eurasia Party. He wants the restoration of the Russian Empire through the unification of Russian speaking territories. In the Kremlin Dugin represents the “war party”. He believes war between Russia and Ukraine is inevitable and that a fifth column has been working for two decades to destroy Russia’s sovereignty. In 2014 he proposed that all dissidents should be stripped of their citizenship and be deported from the country.

(x) Aksyonov was suspected of criminal activities before he became involved in Crimean politics in 2008. In that year he became a member of “Russian Community of Crimea” and a member of the organisation “Civic Asset of Crimea”. He then borrowed almost $5 million from Kirilchuk, a former Crimean minister of industry, to develop the ‘Russian Unity’ party. Since 2009 he has been co-president of the Coordinating Council “For Russian Unity in Crimea” and leader of the political movement ‘Russian Unity’. In 2010 he became a deputy of the Supreme Council of Crimea as a member of Russian Unity which gained 4% of the vote giving it three seats in the Crimean parliament. On seizing power Aksyonov has promised that Ukrainian would cease to be an official language if Crimea joined Russia. He has led efforts to stamp out dissent among Crimean Tatars over annexation saying, “All activities aimed at non-recognition of Crimea’s joining to Russia and non-recognition of the leadership of the country will face prosecution under the law and we will take a very tough stance on this. He has also said that homosexuals, “have no chance” in Crimea and that “we in Crimea do not need such people,” He also promised that if gays tried to hold public gatherings “our police and defence forces will react immediately and in three minutes explain to them what kind of sexual orientation they should stick to.”

(xi) Girkin’s political views are close to Russian nationalism, monarchism and the White Movement. They are strongly influenced by the Russian Orthodox Church. He believes that Russia is driven by spirituality and in fact is “the only big, Christian country left in the world that is able to resurrect Christianity”. Girkin thinks that foreign conspirators have made attempts to destroy the Russian Empire. These included the Russian Revolution in 1917 and the dissolution of the Soviet Union in 1991. They were made because the West needed Russian natural and human resources to continue its “age of hedonism”. These attempts will continue and so currently Russia is “at state of war with the whole Western civilisation attempting to destroy it”.

(xii) Boradai is a Russian citzen. In the 1990s he edited the Russian newspaper Zavtra run by Alexander Prokhanov. On 7 August 2014 he announced his resignation and was succeeded by Alexander Zakharchenko. Together they co-founded the “patriotic” Web TV channel Den-TV. Den-TV’s programming has regularly included Konstantin Dushenov, who has been imprisoned for anti-Semitic incitement. He worked as an adviser to Aksyonov, the prime minister of the Republic of Crimea. Boradai claims to have worked as a “political Strategist” during the annexation of Crimea and has stated that the political forces that facilitated the takeover are the same as those active in the Dontetsk Republic: “Naturally the people who set up these popular movements … are the same people, they are connected to each other … So when I finished the work in Crimea I automatically … came here to work in southeast Ukraine. On 16 May he was appointed Prime Minister of the Donetsk People’s Republic. He resigned as P.M. on 7 August 2014. He said, “I came here as a crisis manager, a start-upper if you want. I’ve managed a lot in the past several months, the DPR has been estblished as a state”.

(xiii) According to ‘Reuters’ Igor Bezler is one of the leaders of Horlivka - a self proclaimed militia. He was born in Simferopol in Crimea in 1965. He served in Afghanistan and was awarded the Order of the Red Star. Until 2002 he was a Lieutenant Colonel in the Russian intelligence agency GRU, but a few years ago he retired and settled in the Gortovka region of Donetsk. He became active in the Self Defence forces that took over Crimea. He has been prominently involved in the separatist movement, particularly in the People’s Republic of Donestsk.

(xiv) Antyufeyez is a former OMON major and Riga police deputy chief of criminal investigation. He served as Riga OMON commander in 1990-1. He was heavily involved in the KGB failed pro-unity coup attempt in Latvia. After its failure Antufeyev fled to Moscow. In September 1991 he travelled to Tiraspol to take part in the Transnistrian independence movement. Adopting the new name of Vadim Shevstov, he played a key role in forming the internal and security organisations of the Transnistarian government, especially the Ministry of State Security. In 2012 he was dismissed by the president and a criminal investigation was launched against him, alleging abuse of power, misappropriation of funds and destruction of documents. He returned to Moscow. He said he worked on security in South Ossetia, Abkhazia and Crimea. In July 2014, he appeared in eastern Ukraine as the ‘deputy prime minister’ of the Donetsk People’s Republic. The DPR head Alexander Boradai had met him in Moscow. He was put in charge of the rebel security forces, internal affairs, and courts of justice.

(xv) In the late October 2014 Ukrainian parliamentary election Yarosh the Right Sector’s leader won a parliamentary seat by winning a single-member district with 29.76% of the votes. In the same election Right Sector spokesperson Boryslav Bereza standing as an independent candidate also won a seat with 29.44% of the votes. Svoboda, however, lost 31 of their 37 seats. The decline in support was due to the negative assessments of the activities of the local governments that included Svoboda members. In its former stronghold Lviv Oblast Svoboda won no constituencies. On 12 November 2014 the party's ministers in the Yatsenyuk Government resigned (they became acting ministers till a new Government was formed). The parties governors of Poltava Oblast. Temmopil Oblast and Ravine Oblast also resighned and were formally dismissed by President Poroshenkom on 18 November 2014.

(xvi) On 13 March the leaders of the DPR and the LPR, Alelsandr Zakharchenko and Igor Plotnisky respectively, jointly called on Hollande and Merkel to “put pressure” on Kiev to implement the deal agreed in Minsk, Poroskenko submitted a draft law that outlines the boundaries of particular areas under separatist control which was registered late on 14 March. But a Russian Foreign Ministry statement said the proposals put before Ukrainian MPs included “additional terms never previously discussed”, and that Poroshenko had “totally ignored” the Minsk provisions calling for dialogue with the separatists on arrangements for local elections and the regions”. The main issue seems to be the demand that the elections should take place before the granting of special status which means they would be controlled by the Ukrainians.

(xvii) In the wake of the Ukraine crisis NATO is establishing a “rapid reaction force” in the Baltic States and Eastern Europe. The Baltic states and Poland have demanded permanent NATO bases as opposed to the current temporary ones. Russia for its part has announced large-scale strategic exercises this September and has reminded the West that “Russia is one of the most powerful nuclear nations. This is a reality not just words”.

Sunday, 2 March 2014

An Introduction to Marxist Economics

This week's meeting was on the subject of Marxist economics. We had a very lively discussion afterwards, but here is, more or less, the speech that was given. Enjoy!


An introduction to Marxist economics



Marxist economics differs significantly from mainstream economics. Mainstream economics tends to focus on the amount of money people have. At first, this may seem like common sense. After all, the more money people have, the richer they are. A lot of mainstream economics tends to focus on things like deficits, surpluses, interest rates and inflation. All of this is about how much money there is about, who owns it and in the case of inflation, whether the amount of money you have will buy you the same things today as it did yesterday.
Mainstream economics is good at understanding how money moves and flows, grows and shrinks. Marxist economics is more interested in the driving factor that makes money worth something in the first place – value. In this talk I want to give a brief outline of Marx’s economic perspective, how it works in practise, and how Marxist economics informs our political perspective.


Marx and economics

Marxist economics is about value: how it is created in a capitalist society and what that means for social organisation. Marx did not get this idea from scratch. He was building on the work of earlier economists like Adam Smith and Ricardo, but with a few insights of his own. His theory did not spring into being fully-formed, but developed over the course of several decades. The most complete version is to be found in what is possibly his most famous work, Capital.

Volume I of Capital begins not with the working class, or the factory, or money. It begins with the commodity. The commodity is the heart of capitalism, its distinctive product, that which differentiates it from other forms of economic and social organisation. The commodity is any product created not for use but for trade. One criticism that is often heard when Marx’s theories are brought up in polite company is that of course Marx was all very well in his day but of course the system has changed now so it is no longer valid. And when you think about Marx’s starting point, of course they must be right. In Marx’s day commodities tended to be things like coats, but of course today none of us use such items. Commodities today are all services like Facebooks and suchlike.

Facetiousness aside, commodities are a really useful way of looking at capitalism. In every bottle of Coke we see the same process as in every TV, car and copy of GTA 5. It is the finished product of the system, and yet it is not produced because it is useful. Yes, every commodity satisfies some want or need, but that is not why it is made. It is made so that it can be sold. The sole purpose of production is to make a profit for the producer.

This is not the same as making money. Money is another kind of commodity. It is produced for exchange, just like a coat. The unique thing about it is that it is a universal form of exchange. All commodities are produced to be traded for something else, yet in capitalism we do not exchange coke for coats, but for the money commodity.


Value

So if everything is produced for exchange, what is being exchanged? When I buy my new 3D flatscreen TV for £1,000, what is it that makes my TV worth £1,000 – and more importantly, a thousand pounds of what?

This is where one of Marx’s key concepts comes in – value. What is embodied in every commodity made by capitalism is the one thing that all commodities have in common – human labour. When a worker sells their labour power to a capitalist, they do work on the production of commodities. It is this common feature which allows the commodities to be exchanged at all. If labour were not expended on them there would be nothing to exchange.

However, if exchanging £1,000 for a TV is really just an exchange of one item that embodies a certain amount of labour power for another, there would be no profit. If I exchange one orange for one orange, I have no more than I started with. Yet profit is at the heart of capitalism. It is the reason that businesses produce. Where does this profit come from?

The source of profit is the same as the source of exchange value: human labour power. It is also one of Marx’s key insights into the nature of economics. It is also very straightforward, once you think about the way businesses which you are familiar with actually work. One job I had once was working in a caravan handbrake factory. I was paid just over £5 an hour to work on a small production line for 7.5 hours a day. On the line we had to make hundreds of handbrakes per day between the four of us. Needless to say, the number of handbrakes we produced was worth far more to the company when sold on than it paid us in wages. This difference between the cost of human labour and the cost of the plant needed for us to produce the handbrakes is the profit that the company makes.

You may be thinking that the machinery is a source of profit – after all without it we could not have made any handbrakes at all, but it cannot be. No matter how much more efficient it makes the process of production, it cannot make more profit for the manufacturer. This comes down to the question of what is being exchanged when a commodity is bought and sold – a quantity of human labour power – and to what the machinery is really doing in the production process, which we will come onto shortly.

So the ability of the employer to pay their workers less than the value of the goods they produce is crucial to profit-making. Labour power is the source of value but by exchanging a lower value of the money commodity for each worker’s labour power than is congealed in the commodities they have created, an employer can profit. This is a necessarily exploitative relationship – and a worker can be well-paid and this will not affect the fundamental relationship between the employer and the worker. In fact a well-paid worker in a high-technology industry in the West can be more exploited in absolute terms than a sweatshop worker in Bangladesh in terms of their ability to generate more value from their work for their employer. Of course, this is not to make light of the poverty created by the system, but it does highlight one of the odder features of capitalism. It’s interesting that the very terminology adopted by capitalists unconsciously reflects this situation. In Engels’ book on the working class in England he reports how factory owners would refer to their workers as ‘hands’ – a term which accurately reflects what a worker means to an employer: not people, but a device for doing work.


Socially Necessary Labour Time

So what generates profits for an individual employer is the exploitation of the labour power that they purchase from their workers. But in capitalism all employers are in competition with others. If they are to survive, they must make more profits than their competitors or go bust. I will explain why shortly.

One way to do this is to lengthen the working day and decrease wages. Both of these make more profits by increasing the rate at which workers are exploited. Labour power is made cheaper but the number of commodities produced is higher so the profits of the capitalist rise. However, this cannot be extended indefinitely: workers need a certain minimum in order to survive, they physically can only work for so long. In addition, workers under sustained attack have a tendency to fight back – capitalists do not always get away with attacks on pay and conditions by employers. There is a limit to how much you can increase your profits this way.

This is where machinery comes in. Investing in new machinery can help make production more efficient and increase the amount of production. However, the machinery is purchased for an amount of money that reflects the labour congealed in it, just like any other commodity. Once purchased it is not a new source of value, but a way of extracting more value from the labour power of the workers involved in the production of the employer’s commodities. This is what Marx called ‘dead labour’, as opposed to the ‘living labour’ of workers.

However, the first employer to do this has a huge advantage over their competitors – with fewer workers they can produce more commodities and therefore make more profits when they sell them.

The reason that they can make more profits is that the money price of a commodity reflects the socially necessary labour time required to produce it. When the first manufacturer invests in new machinery, the price they can charge for their products is the same as the price of the old labour-intensive price that the rest of the industry is still using. However, all the manufacturers are in competition, so if they are not to go under they must invest in new machinery too. As everyone invests in the new machinery and the companies compete with each other, the money price they charge will drop to reflect the new lower labour time cost that is now socially necessary. This is a key difference between Marx’s understanding of economy and earlier thinkers like Smith.

This also shows one way in which the money price of a commodity does not directly reflect the amount of value created by the labour power congealed in it. The price, under normal conditions of capitalist production, is primarily affected by the socially necessary labour time required to produce the commodity – that is to say the average labour power used at average intensity in particular social conditions. However there are a range of other conditions in which the price of an object may differ significantly from the amount of labour invested in it. One major issue is crisis, which we will look at shortly.


The long-term tendency of the rate of profit to fall

What this shows about capitalism is its dynamism. It is constantly in motion, constantly changing. Nothing stays the same for long, and means of production are constantly being revolutionised as competing capitalists try to increase their profits. However, as you can see from the way that they have to increase their profits, there are limits to their ability to do this, and over time the rate of profit – the rate by which they can extract value from their workers – will fall as the socially necessary labour time for production falls. As the rate of profit falls, the profitability of the system as a whole falls. Capital accumulates – which is to say that there is more and more dead labour compared to living labour and it is harder and harder for capitalists to squeeze increased value from their workforce.

Crisis

The long-term tendency of the rate of profit to fall is at the heart of another key feature of the capitalist system: crisis. We are currently still in one of the longest crises in the history of capitalism, more than seven years after it began. Crisis has been a frequent visitor to the system, both as a whole and in its various parts. Mainstream economics often refers to crisis as ‘recession’ because it is interested in the growth of economies and thinks in terms of how much money is in them, so it sees recession as a setback on the path to growth. However, the real cause of crisis in the system is an accumulation. Because capitalists don’t extract profits just so that they can consume more, but so that they can create more profit, they reinvest a lot of the value that they extract in more production. This goes back into creating more commodities for sale and therefore more profit. Eventually, however, there comes a point where too much has been produced. Warehouses lie full of commodities that cannot be sold. Profit falls everywhere. Capitalists cannot just store up their profits indefinitely. Unless there are fresh profits being generated, the value of the money commodity will fall, as it only gains its apparent value through its use as a medium of exchange.

Meanwhile, as capitalists are unable to invest because they will not receive profits from their investments, workers are laid off because they are no longer generating profit. As workers are laid off or their pay is reduced, their consumption falls, leading to further and further reductions in profitability and still more workers losing their jobs. This is what happened in the great depression of the 1930s, and what we began to see again in 2007, as the financial crisis meant that workers, whose real wages have not increased since the early 1980s, were unable to secure further credit with which to maintain or increase levels of consumption. Demand and production fell and has not recovered fully to the levels reached before the crisis, which means that capitalists have yet to see a renewed increase in profits and investments are still low.


Destruction of capital

If crisis is a constant feature of the system, you would expect it to have collapsed long ago, but unfortunately it has not. The reason for this is that crisis destroys much of the accumulated capital that is clogging up the system. Unprofitable firms close down, its machinery is bought up by profitable parts of the system at a fraction of its value. The prices of unsold commodities fall. Workers’ conditions can be attacked more easily because of the higher unemployment, and profits begin to rise again as the cost of investment for the profitable parts of the system decrease (buying up cheap machinery from collapsed competitors) and more value is extracted from the workforce.

All of this means that capitalism goes through constant cycles of boom and bust, and must continue to do so. It also means that those who pay the cost of crises are the working class. Anyone who has seen the way in which austerity policies have been introduced can see this for themselves. The wealthy have continued to accumulate capital yet find few opportunities to reinvest it, and workers have paid through lower wages and reduced public services. Further, in the next crisis the managers of capitalism in the developed world will find it extremely difficult to resolve the crisis in the same way. Workers' living standards can only be cut so far without serious resistance, and capital can only sit idle for so long.


Fictitious Capital

Fictitious capital is basically finance capitalism. This is a system that runs alongside the productive processes of capitalism, that often supports capitalist production either through investment of the money commodity into production or the provision of credit to allow commodities to be purchased. Fundamentally it is an industry which deals in only one commodity – the money commodity, and has a huge influence on where that commodity goes and how much of it is manufactured. The current crisis within the capitalist system has its roots in the tendency of the system to seek new forms of profit – in this case by commodifying specific amounts of the money commodity into a series of transferable betting slips with names like Collateralised Debt Obligations and Credit Default Swaps. The interaction between the system of fictitious capital and the productive system is necessarily complex and headache-inducing, and probably deserves a talk all of its own.


Why socialism?

Our understanding of capitalist economy leads us to certain conclusions. Firstly, the working class are necessarily exploited by capitalist modes of production. Secondly, the working class is the class with the power to change the system.

By concentrating workers in large companies, workers understand their common interests and their ability to act together. Workers are the only source of profits for capitalists. By withholding their labour, workers can bring the system to a halt. This is why in the Socialist Workers’ Party we emphasise workers’ action over other forms of action. Direct action, demonstrations, protests can all have an impact, but only workers can stop the system. This is why 2 million people could march against the war, and yet it still went ahead. On the other hand, a general strike would have made war impossible to conduct.

Mainstream economists will tell you all about money. Marxist economics can teach us the value both of money and of the class of people that make it valuable.

Further Reading
This introduction is necessarily brief and glosses over much detailed analysis - much of which we were able to bring up in our discussion after the speech, especially on the nature of the financial crisis of the last 7 years. If you are interested in learning more about Marxist economics, one way is to come and meet us! Another way is to read some of these:

Bookmarks, the socialist bookshop also has a whole range of books on the subject of economics
Marx's oeuvre can be found online at the Marxists Internet Archive, but if attempting Capital itself, I would strongly recommend Marxist academic David Harvey's free accompanying lecture series and/or his book A Companion to Capital.

Wednesday, 19 February 2014

Weekly Update #18

Hello everyone :) This week's brief update is:

SWP Branch Meetings
A reminder that our guest speaker for this week's meeting tomorrow will be introducing a no doubt lively discussion with Nelson Mandela, 1918-2013. Anti-Apartheid Hero: The Struggle Continues.
Thursday 20th February 7 pm West End Community Centre, Derby
Next week, we have An Introduction to Marxist Economics, which should be a refreshing change from what we're fed by the Beeb!
Thursday 27th February, 7 pm, West End Community Centre.

Anti-Racism, Anti-Fascism National Demonstration

A reminder that on Saturday 22nd March there will be a national demonstration in London against the fascism of groups like the BNP and EDL and the racism of parties like UKIP to mark the UN's Anti-Racism Day. Unite Against Fascism supporters want to get a coachload of anti-racists from Derby - further details as we have them.

This is an event that all socialists should support, as the ruling class, the racists and the fascists once again try to divide working people from each other.

Sunday, 24 November 2013

Weekly Update #13

Branch Meetings
 
This Thursday's meeting is a must for anyone interested in industrial action: After Grangemouth.
 
 Workers and supporters protest at Grangemouth last Sunday
 
Anyone who has heard of Grangemouth will know about the terrible deal that workers were sold by their union recently. What does this mean for the confidence of workers elsewhere, and the wider struggles against austerity? What should the response of socialists be? Come along for a talk and what is sure to be a lively discussion!
 
Thursday 28th November 2013, 7 pm, West End Community Centre
 
Staying topical, next week's meeting will be on the prospects for revolution in Britain, after Russell Brand's recent spat with Paxo (see video here).
 
That's Thursday 5th December, 7 pm, West End Community Centre.
 
 
 
Hands Off Our Unions
 
The People's Assembly have a statement in response to Tory attacks on trades unions. Sign it here: http://thepeoplesassembly.org.uk/handsoffunions/
 
 
SOS NHS
 
There is an organising meeting of the SOS NHS campaign on Thursday 28th November.

Sunday, 3 November 2013

Weekly Update #11

Hello everyone, just a short one this week!
  
 
SWP Branch Meeting - Privatisation is Not the Answer 
This week we think about one of the biggest fallacies that we have been told for the last 30 years, that privatisation can deliver better public services. Just how wrong is this idea?
 
Come along for .a lively talk and discussion!
 
Thursday November 7th, West End Community Centre, 7pm All welcome!