The power of the 'velvet revolution' lives on

On this day 20 years ago, 100,000 people gathered in Prague to demand political freedoms denied them for 40 years by the country’s Stalinist dictatorship. It was the first mobilisation in Czechoslovakia’s “Velvet Revolution”, which brought students, cultural workers and factory workers together in an unstoppable mass movement.

Coming hard on the heels of the crumbling of the Berlin Wall and the collapse of Stalinist regimes in Hungary and Poland, the revolution in Czechoslovakia ended on December 29 with playwright and dissident Vaclav Havel, jailed many times by the regime, installed as president.

Alexander Dubcek, the former Communist Party leader of the Prague Spring of 1968, which was suppressed by Soviet tanks, was made Speaker of the country’s Parliament. On this occasion, the Red Army was confined to barracks on the orders of the Soviet president, Mikhail Gorbachev, making the Velvet Revolution not only possible but relatively peaceful.

This decision was bound up with Gorbachev’s attempts to democratise the Soviet Union itself through the process of glasnost (openness) and perestroika (reconstruction) which had been going in earnest since 1987 to the dismay of the hard-line Stalinists who still retained many levers of power within the state and party bureaucracy.

Now the media has one simple shorthand characterisation of the revolutions of 1989. They amounted to, we are informed, “the fall/end of Communism”. That was the tenor, for example, of John Simpson report for the BBC this week. Historian Timothy Garton Ash says more or less the same thing in The Guardian.

The rest of the media parrots the same “official” line, which is remarkably how the regimes of Eastern Europe used to function. This superficial reading of history naturally enough reinforces the status quo in Britain and other capitalist countries. If 1989 was truly “the end of communism”, then that “proves” that there is no sustainable, alternative to capitalism. All attempts to replace capitalism will inevitably end in dictatorship. So don’t even bother. It’s as simple as that. Or is it?

Of course the regime in Prague was a dictatorship. Parachuted into power as the Red Army swept the Nazis out of the country, it purged the country of political opponents and in 1952 staged the notorious Slansky show, dramatised in the 1970 film L'Aveu ("The Confession"), directed by Constantinos Costa-Gavras.

To characterise the regime as “communist” is, however, nonsense, even if that is how it described itself. For Karl Marx, who had something to say on the matter, the communist period of history was classless and, above all, a society without a state. Here was a free association of self-governing people, a society so advanced that everyone’s needs could be met by releasing the productive forces from the grip of private property. The Communist Manifesto insists: “In place of the old bourgeois society, with its classes and class antagonisms, we shall have an association, in which the free development of each is the condition for the free development of all.”

Does this sound anything like the Czechoslovakia of 1989? Or East Germany? To ask the question is to answer it.

The origin of the East European dictatorships lay in a deal cut between Stalin and Roosevelt to allocate “spheres of influence” after World War II. The USSR had by the early 1930s become a totalitarian dictatorship. What took place was a counter-revolution, in essence an anti-communist, destructive process in which the leaders of the 1917 Revolution themselves were consumed. Over a period, political power was assumed by an all-powerful bureaucracy. Millions and millions perished in the purges and in repelling the Nazis. The most coherent explanation of Stalinism’s origins remains Trotsky’s, outlined in his book The Revolution Betrayed.

In the end, neither the Soviet Union nor the Eastern Europe buffer states reached the level of socialism, let alone communism. The economies were far less productive than the advanced capitalist countries and the standard of living remained low. The rule of Stalinist bureaucracies proved incompatible with historical progress and democracy and that is what Gorbachev addressed.

In August 1991, the Stalinist old guard staged a short-lived military coup in Moscow and precipitated the collapse of the Soviet Union itself by the end of the year. Stalinism’s demise led to the imposition of brutal market capitalist economies – the Czech republic is now viewed by the corporations as a source of cheaper labour – and the rule of the oligarchs in Russia under a Putin dictatorship in which Stalin is flavour of the month.

In 1989, the irresistible power of the masses when they embarked on profound change proved decisive. Rather than seeing these events as “the end of communism”, we should acknowledge them as a significant milestone in the revolutionary history of the modern world which should inspire us to deal with our own oppressive dictatorship of capitalists and bankers. Come and discuss these issues at our Whitechapel Art Gallery event on December 2.

Paul Feldman

Communications editor

Profit hunger driving world famine

The unchecked surge in the power of global agri-business is bringing the world to the brink of an unprecedented famine. At a world summit on food and agriculture which ended in Rome yesterday, the onus was placed firmly on the governments of developing nations to deliver food security to their people. The G8 countries did not even bother to send representatives.

If they had been there, they might have had to explain why it is that governments in developing countries are consistently unable to feed their populations, even when they are doing everything they can to follow the capitalist, free market development model proposed by the G8, World Bank and IMF.

Take Ethiopia, which is once again in the midst of a famine, in spite of a dramatic economic surge which has transformed the country’s economy. Over the past few years infrastructure development and industry have expanded dramatically. The nostrum is that this kind of profit-driven growth will in the end benefit the population as a whole – and yet people go on starving.

This is the country where the Blue Nile rises, and fertile land is plentiful. The government is now exploiting it according to the capitalist growth model. There is a booming government-backed industry growing flowers for export, with extensive irrigation and application of nitrates. And 300,000 acres of fertile land were sold to an Indian corporation this year for around $1 dollar an acre.

GRAIN, an organisation which campaigns with small farmers has exposed this global land grab. "We're seeing over 40 million hectares of prime farm land being taken over by financial investors and rich states. We're talking about $100 billion that's being mobilised. Essentially financial investors have seen that in the food crisis there's money to be made in farmland and they're buying it up very cheap," says Devlin Kuyek of GRAIN.

The issue faced by the peoples of the world is not food shortages, but the intense commodification of food and land which is taking place alongside changes brought about by climate change.

Countries which have previously been able to feed their populations, such as Uganda and Paraguay, are now facing hunger. China is buying up land in other countries to try and deal with their own food shortages, caused by climate change and by the capitalist model of development now dominating the Chinese economy.

The food processing industry threatens the existence of farming even in wealthy countries such as the US and Britain. Farmers are no longer producing food, but raw materials which the global food industries process into “alue added” commodities, expanding the potential for profit. For an excellent example of how this process is being presented to people click here to see the latest McCain advert.

The raw materials producers – we call them farmers – are consistently driven down on price, and the global corporations stand between them and their potential market, ensuring that we have to buy our food from supermarkets and not from the producer.

Now this has been extended to the point where the food processing businesses are simply cutting farmers out of the process altogether and taking over the land, so that every scrap of profit goes their way. And the industrial methods they use are creating deserts and intensifying climate change.

While people in developing countries suffer from famine, their exported calories are being consumed in the west, in the form of cheap, high-fat, high-calorie diets, leading to a massive health crisis.

The movement for local food and grow-your-own may be on the right track in addressing an aspect of the problem, but it is viable only in small patches and does nothing to assist people who have no land, no economic resources and no power. That is concentrated in the hands of a handful of agri-corporations and client governments. How to overturn this obscene staten of affairs is what we need to address to prevent a global famine.

Penny Cole
Environment editor

GM wields the big stick

Nick Reilly, head of General Motor's international operations, is touring Europe on a mission. He's been to Poland and Belgium. Yesterday in England he met New Labour's august Lord Mandelson, the UK's First Secretary of State, Secretary of State for Business, Innovation and Skills, President of the Board of Trade and Lord President of the Council, and Tony Woodley, deputy leader of trade union Unite. Today Reilly is in Spain.

Reilly is using the big stick of closure to threaten governments and unions. With massive overcapacity globally and car scrappage schemes ending, production cannot continue without huge additional bail-outs, reduction of capacity equivalent to three of the eight plants in Europe, and up to 10,000 job losses.

Reilly's mission is to extract the best deal he can as part of the restructuring of one of the now bankrupt behemoths of capitalist system of production and finance. GM was one of the biggest and most powerful of the global corporations that grew to dominate the world economy during the credit-induced boom of the second half of the 20^th century.

Together their power grew to the extent that it changed the role of government. To keep itself afloat, the sales of GM the vehicle producer, became increasingly dependent on the success of its own finance company GMAC – a hugely complicated operation providing insurance and mortgage services in around 40 countries as well as loans for vehicles purchased via its network of dealers.

As the 2008 financial crisis swept the world, sending banks into a spiral of decline, GMAC was given permission to join their ranks as a bank holding company so that it could access funds from the US government's Troubled Assets Relief Programme, which it promptly did. In May this year GMAC was rebranded as the Ally Bank, because according to Sanjay Gupta, GMAC's chief marketing officer “it gives the sense of a trusted partner, the attributes we are trying to convey".

Really? Operating in Britain as mortgage lender GMAC-RFC, the company was fined £2.8m by the Financial Services Authority (FSA) last month for mistreating customers who fell into arrears. It has also been told to repay £7.7m, plus interest, to 46,000 of its borrowers.

After setting up as a mortgage business in the UK in 1998, GMAC-RFC grew rapidly to become one of the UK's largest mortgage lenders, but it stopped making new loans last year. The FSA's investigation of the company's lending practices between October 2004 and October 2008 found that charges for dealing with people in arrears were "excessive and unfair"; repossession proceedings were started before all other alternatives had been considered; GMAC staff were not properly trained in dealing with arrears cases and repossessions.

Workers in plants throughout Europe and the rest of the world should not be reassured by the failure of the deal to sell Opel and Vauxhall to the consortium of Canadian parts dealer Magna and Russian finance interests. Neither should they place any faith in the ability of union leaders like Woodley to secure their future.

The logic of capital is ruthless. The downward spiral into recession and slump cannot be reversed by low interest rates or injections of invented cash. GM's 25% production cuts will soon look small. GM workers should be preparing their own plans. They should discuss how to take over their industry, and convert their workplaces to production of zero-carbon vehicles as part of a massive expansion of public transport.

Gerry Gold
Economics editor

Morals, corporations and capitalism

Arguments are flying to and fro between the experts, as the fallout continues from capitalism’s biggest crisis in living memory. The greatest issue preoccupying them is this: is it possible to tame or control today’s global economy and its financial markets by forms of legal regulation?

Most critics and politicians from establishment figures such as Bank of England governor Mervyn King to Financial Services Authority Lord Adair Turner on the one side, to left-wing critics like Graham Turner and Prem Sika on the other – are united by the notion that further crises can only be avoided if “excesses” of one kind or another are curbed.

But it is not only the economists and politicians who have ventured into the fray. Enter the keepers of business morals. People like Church of England priest George Pitcher of St Bride’s church in the City of London (also of the Daily Telegraph) and Roger Steare, Corporate Philosopher in Residence at the Cass Business School in East London. He also works as a consultant for the accountancy and financial services giant PricewaterhouseCoopers.

Professor Steare occupies a special role in that “he manages to combine the hard world of commercialism with business ethics”, as a fellow consultant notes on Steare’s personal website by way of an endorsement. As the inventor and author of “ethicability®: How to decide what’s right and find the courage to do it” (note the registered trademark) he is well qualified for this position. Not only does he teach at the Cass Business School but he also helped prepare recommendations on rights and humanity for last April’s G20 summit in London.

Steare has added his pennyworth in a letter to the Financial Times. His research has shown, he says, that many people make moral decisions using a variety of philosophical and moral perspectives. He believes that “we have seen these moral philosophies working well for thousands of years”.

This rather serene view of human history (which conveniently ignores countless wars, colonialism etc) is then suddenly interrupted by “Frankenstein’s monster” – the corporation. He denounces the corporation as a “dysfunctional social construct invented during the Industrial Revolution by lawyers and politicians to further economic growth”.

Steare concludes that: “We must therefore dismantle the legal protections of corporations and reinstate full legal and financial liability for company directors and shareholders.” But is that a viable proposition? And is that really the problem? I think not.

In reality, corporations (or chartered companies) arose in 17th century Netherlands and England not as bizarre social aberrations, but as societies of merchants inseparable from the growth of capitalism as a national and international system, which both countries pioneered. As such, the corporation acquired a special status in law.

It is nonetheless true, as Steare says, that “like Frankenstein’s monster, the corporation and the artificial marketplaces created by lawyers and politicians have no persona, no soul and no conscience”. But is that not true of the capitalist system as a whole? Since when has capital had a conscience?

What society is oppressed by is not the brutal logic of the power of the corporation per se, but of corporations as the dominant part of a profit-driven capitalist system that is brought together by a state that reflects the predominant interests of the ruling classes.

The undiluted powers of the corporation therefore mirror existing class relations in society and cannot be changed or challenged in any significant way without overturning these. Paradoxically, Steare’s justified horror of the lawless nature of capitalism and its corporations – and his plaintive call for liability – is a powerful argument for putting an end to the system as a whole.

Corinna Lotz
Secretary, A World to Win

The grapes of wrath are back

President Obama’s tour of Asia may have plenty of celebrity star status about it but cannot disguise the reality that the United States is on its knees economically and financially and needs all the help it can get, particularly from China. The Chinese have their own agenda, however, and helping out its former adversary is not exactly top of Beijing’s list of priorities.

Despite the multi-trillion bank bail-outs and stimulus packages introduced by the Obama White House and his predecessor, the US economy hangs by a thread and the social toll is mounting.

For example, in what must be one of the most embarrassing United Nations reports ever written, a special envoy has accused America of “shameful neglect” of its homeless. UN special rapporteur Raquel Rolnik for the right to adequate housing has just completed a seven-city tour of America.

“The housing crisis is invisible for many in the US," she said. "I learned through this visit that real affordable housing and poverty is something that hasn't been dealt with as an issue. Even if we talk about the financial crisis and government stepping in order to promote economic recovery, there is no such help for the homeless."

She added: "I think those who are suffering the most in this whole situation are the very poor, the low-income population. The burden is disproportionately on them and it's of course disproportionately on African-Americans, on Latinos and immigrant communities, and on Native Americans."

The US government compiles statistics galore – but none on homelessness. Campaign groups say that more than 3 million people were homeless at some point over the past year. Los Angeles is no city of angels, with 17,000 households a night without shelter.

RealtyTrac describes itself as “the leading online marketplace of foreclosure properties”, with more than 1.5 million default, auction and bank-owned listings from over 2,200 US counties, along with detailed property, loan and home sales data. Its October report showed that 332,000 properties were claimed back last month alone.

More Americans have lost their homes this year than during the entire decade of the Great Depression. California, of course, was where many workers migrated to during the 1930s, their experiences captured in John Steinbeck’s great Novel, The Grapes of Wrath. The state posted the nation’s second highest state foreclosure rate for the second month in a row, with 85,420 properties seized in October.

With unemployment in the America up to 16% on some measures, the slide towards another Great Depression continues. Calls are now going out for measures to protect the US economy from the Chinese, who have used the last 12 months to extend their industrial capacity at a phenomenal rate and to produce goods at rock bottom prices for export to you know where. Respected economists like Paul Krugman have accused China of dumping its employment abroad and “stealing American jobs”.

So the scene is set for a new phase of the global crisis, one where trade wars and protectionism take centre stage. Obama may be feted in China, but the country’s leaders have no intention of raising the yuan’s value against the dollar to make exports more expensive, as the White House wants. Obama will return to Washington empty handed as the combined social crisis of homelessness and unemployment reaches tipping point.

Paul Feldman
Communications editor

Don't let New Labour divide and rule

If you can’t beat them, you can always imitate them. That was the message yesterday from prime minister Gordon Brown when he returned to his “British Jobs for British workers” theme in a speech on immigration.

New Labour is clearly intending to oppose the neo-fascist British National Party by stealing some of their rhetoric and policies. That’s the only explanation for Brown’s “get tough” speech on immigration– his first on the subject since becoming prime minister – and home secretary Alan Johnson’s “admission” that the government has “got it wrong” on the issue.

Not that New Labour has been soft on asylum seekers, refugees and people wanting to work in Britain. Since 1997 there have been no fewer than seven major pieces of legislation that one way or another target immigrants, legal or otherwise.

Only last month the government implemented significant cuts to the amount of money it currently gives to asylum seekers awaiting a decision on their claim. Rates were set at 70% of income support. But from October 5, single destitute asylum seekers over 25, received even less, with rates falling from £42.16 to £35.13 per week. Asylum seekers are not allowed to work, so are restricted to the amount set by the government.

Yesterday Brown announced that more than 250,000 skilled engineering, care and catering jobs are to be closed to non-European overseas workers next year and that local vacancies should as far as possible go to local recruits. Foreign students will also find it tougher to get into Britain.

A draft immigration bill published after Brown’s speech included proposals to replace the deportation process with a general power to expel failed asylum seekers and illegal migrants. Families who have been told to leave but who are unable to be returned will have cash welfare payments replaced with a plastic pre-paid card while others will lose benefits altogether.

Refuge and Migrant Justice said that buried in the bill was provision to give ministers the power to overrule bail decisions made by judges in immigration and asylum cases.

Donna Covey, Chief Executive of the Refugee Council and Chair of the Asylum Support Partnership said: “We are appalled that the government has moved to cut support to asylum seekers, who are some of the most vulnerable people in our society. Of course, these are hard times for everybody and no-one should receive preferential treatment, but we must remember that many of these people have experienced torture, persecution, war and human rights abuses and most live in already deeply impoverished circumstances.”

Unlike bankers, asylum seekers and refugees have no clout and are easy targets for unscrupulous politicians who are queuing up to play the race card during the run-up to the general election. The money the state will save is miniscule compared to the vast sums spent on bail-outs. Cynically, New Labour is playing to the right-wing press and trying to win voters away from the BNP by showing it can “get tough” on the most vulnerable. This is nothing but scapegoating in search of votes.

Meanwhile, thousands of people continue to lose their jobs in the banking sector while BT is axing 15,000 from its payroll. The merger between British Airways and Iberia will undoubtedly lead to a jobs massacre. Millions have been forced into part-time working or taken pay cuts to avoid joining the dole queue. None of this is to do with immigration and everything to do with the global crisis of capitalism. The old trick of divide and rule is being used by New Labour to divert attention away from our common enemy – the bankers and corporations who between them have produced the greatest economic disaster in history.

Paul Feldman
Communications editor

New Labour's nuclear nightmare

Nothing shows more clearly that capitalism has reached a dead end in its historical development than the plans for nuclear and coal announced this week by New Labour energy secretary Ed Miliband.

Nuclear power is the embodiment of the reckless nature of capitalism; the fact that it is the state that is imposing this development on society shows the extent to which democracy is dead.

The 10 sites for new nuclear power stations are at Braystones, Sellafield and Kirksanton, all in Cumbria, Heysham in Lancashire, Hartlepool, Co Durham, Sizewell in Suffolk, Bradwell in Essex, Hinkley Point in Somerset, Oldbury in Gloucestershire and Wylfa in Anglesey. Dungeness in Kent was ruled out because of fears of rising sea levels.

To prevent any opposition – which Miliband describes as a “barrier” to progress - new planning laws prevent people affected by these developments from using any remnant of democracy to halt them. The Infrastructure Planning Commission has been given the power to take applications from power company developers and make decisions within a year.

To class nuclear as a “clean” technology is simply madness. The government is no further forward on making plans to deal with the radioactive waste product because there is no safe way of storing it. Their only plan is to bribe some local authority to agree to offer deep storage. The area around Sellafield – already devastated economically by that development – is a prime candidate. The cost to the taxpayer will be in the billions.

Nor is nuclear energy renewable. Miliband claims his plans will deliver “energy security”, yet there is no fissile material in the UK – it must all be imported. And as the rest of the capitalist world also turns to nuclear, uranium wars may join the oil wars.

Miliband’s claim that new nuclear power stations will be built without public subsidy is quite simply a lie. Building a nuclear power station is beyond the means of an energy company and corporations are already pressuring the government to offer subsidies, suggesting a carbon tax that could cost the average household more than £200 extra per year.

Subsidies are already on offer to companies who fit carbon capture and storage to coal-fired stations, and that will cost the average household between £11 and £15 from 2020. Apparently, the hand-outs are not enough and overall, private sector investment in the energy sector has collapsed as a result of the recession.

The world's energy systems will need an extra $10.5 trillion (£6.3trn) in investment between now and 2030 to reduce dependence on fossil fuels and avoid "irreparable damage to the planet", the International Energy Agency (IEA) estimates.

Sounds massive? But even in a no-change scenario, energy across the world will require $26 trillion investment from now until 2030 to meet growing energy demands in the developing world.

Why not ensure that this investment is in renewables? According to the United Nations Intergovernmental Panel on Climate Change, current renewable energy technology could reduce emissions to pre 2000 levels while making a profit on at least 50% of implemented technologies.

But the problem is that the kind of investment required does not in any way fit the fast buck model which brought the financial sector to its knees last year, and which is now once again picking up speed. And that is the only investment model that 21st century capitalism has to offer.

The giant energy corporations are not looking to invest in reducing global warming – and nor are crisis-hit governments. All they can do is to go on offering subsidies of our money to ruthless corporations. What Miliband is proposing is peanuts compared to the billions of dollars annually in tax breaks and other funding that the US government gives the oil corporations.

Only by revolutionising the energy sector and placing it in democratically-controlled public ownership, can we bring about the transformation needed. Then we can start reducing carbon emissions and find ways to deliver clean, safe, affordable energy for all.

Penny Cole
Environment editor