Gold soars: Dollar crashes

The price of gold and other precious metals is fast approaching record levels. The continued weakening of the dollar against other currencies – the lowest ever against the euro, together with spiralling prices for oil and other key commodities point to a deepening crisis for the global economy.

Crude-oil futures have reached a record $93.20 a barrel. Mexico has shut a fifth of its production. In the Middle East tensions involving Iran, the world's second-largest holder of oil reserves, and Iraq, the third-biggest, are building up. US central bank, the Federal Reserve is expected to make a further interest rate cut today, following the first cut in four years on September 18th, to 4.75%, as it attempts to lessen the impact of the deepening recession. Its action risks adding to the already rampant inflation resulting from the period of too-easy credit that ended in the sub-prime mortgage crash.

Investors looking for an inflation-proof home for their money have been turning to gold and other precious metals, thus driving prices to record levels. Though its use as the measure of all paper currencies was ended in 1971, gold continues to be used as a reliable defence against the falling value of paper money. At $798.30 an ounce, yesterday’s speculative price of gold for delivery in December is 24% higher than at the beginning of this year. This is the highest since the 1970s when huge inflation and deep recession produced the all-time record of $830 in 1980.

“The momentum in gold is building as the bleak outlook for the dollar becomes more apparent,” said James Turk, founder of GoldMoney.com, which had $214 million of gold and silver in storage for investors at the end of September. Investment bank Credit Suisse forecasts that the gold price will soar to more than $1,000 per ounce over the next five years as dwindling supply of the precious metal combines with increased demand. New sources are being opened up at a far lower rate than older mines are dying.

The increasing price of gold on global markets has encouraged workers to push for higher wages. Walkouts and strikes have occurred this year at mines in Papua New Guinea, in Tanzania and in Peru, a leading global metals producer. A nationwide strike in Peru is set for next week with 22 of 74 unions in the federation starting action on November 5. Over the weekend, the government set a new wage for union workers of Southern Copper in Peru after negotiating an end to an eight-day strike earlier this month. Meanwhile, union leaders from Barrick Gold’s Pierina mine in Peru and company officials said on Tuesday they reached a deal to raise wages and avert a strike. In the company’s Bulyanhulu gold mine in Tanzania work has been halted due to what it termed an “illegal” strike, and it has fired about half of the mine's work force.

The labour conflicts in the mining industry will add to growing uncertainties in global commodity markets, already destabilised by the banking crisis and concerns over rising food prices.

Gerry Gold
AWTW economics editor

Saudi Arabia: an inconvenient truth

So, according to a New Labour foreign office minister, Britain and Saudi Arabia’s feudal absolute monarchy should work more closely together on the basis of “shared values”. Kim Howells declined to elaborate whether these might include routine torture, imprisonment without trial, amputations, beheadings, stoning, endemic corruption, discrimination against women and gay people as well as support for those who attack Shia Muslims on the basis that they are not “true believers”. Amnesty International says that at least 124 people have been executed in Saudi so far this year, the majority by beheading.

You can be sure that none of these issues will be raised at Buckingham Palace today when the Saudi entourage dine with the Queen or tomorrow when King Abdullah meets Gordon Brown, the man who declared at his party conference that human rights were “universal”. If he wasn’t such a hypocrite, Brown might have added: “There are, of course, exceptions. Our allies like Saudi Arabia, Israel, Egypt have special problems in this regard.” But, let’s face it, Brown is like any other Western leader when it comes to turning a blind eye to human rights abuses when it is politically (or economically) inconvenient.

The inconvenience in this case revolves around oil and weapons. Britain’s relationship with the feudal tyranny is a simple one. You sell us the oil and we will give you as many fighter planes and weapons as you want. And if, along the way, companies like BAE have to pay serious bribes to members of the royal family to win a £40bn contract, we will make sure the British police don’t investigate on grounds of “national security”. Only last month Britain and Saudi Arabia announced a deal for the sale of 72 Eurofighter Typhoon aircraft to the desert kingdom for £4.4bn. Whitehall officials said the potential total value of the contract would be much higher. As always, the contract details are secret.

So the “shared values” Howells talks about are simply a variation on the theme of blood for oil – except in this case it is Saudi blood that is spilled when people try and gain some democratic rights. Apart from John McDonnell – who denounced Howells’ statement – there is a noticeable silence from government benches, which is a further indication of the political degeneration of New Labour into a party of big business that will do anything in the name trade and commerce. It was left to the Liberal Democrats' acting leader Vince Cable to denounce the state visit, while Chris Huhne, a leadership candidate, said: "The accolade of a full state visit is quite wrong. We are feting the reactionary leader of a society that discriminates against women, tortures prisoners, conducts public executions, amputates limbs as a punishment, and bans freedom of expression, assembly and religion. Saudi Arabia's human rights record is atrocious."

But a Foreign Office spokesman said: "Saudi Arabia is one of the UK's most important international partners. King Abdullah's visit will further deepen and broaden that relationship." The message is clear: the greasing of palms will continue. So will the beheadings and the torture. In Downing Street, the hypocrite will continue to prattle on about human rights. Meanwhile, the cries of the victims of the despotic Saudi regime will be drowned out by the sound of British-made fighter planes soaring overhead.

Paul Feldman
AWTW communcations editor

Renewables target ditched

On the day scientists announced that the Earth’s ability to soak up carbon emissions has dramatically declined, while at the same time we are seeing an acceleration in the rise of atmospheric carbon levels, it was revealed that the government is about to ditch a commitment to expand renewable energy generation.

A secret government document published by The Guardian makes it plain that New Labour is abandoning European Union agreements to increase renewables to provide 20% of all energy by 2020. As you would expect from this government, this suggestion doesn’t come from a climate scientist but from the Secretary of State for Business, John Hutton. Despite the cries of betrayal by environmental campaigners, the government’s Energy Minister, Malcolm Wicks, is already trying his Orwellian best to re-write history by saying that the EU target was not specific to the UK.

Providing this amount of renewable energy “costs too much” complains the Department for Business Enterprise and Regulatory Reform (it has forecast that it would cost £4bn a year to achieve 9% of energy being produced from renewable sources). Even if it was going to cost £10bn a year to achieve 20% of energy generated from renewable sources this would only be 1% of the UK’s Gross National Product. One would think this represents a good investment in the future of the planet. Alternatively, the profits from an oil company or two could be expropriated to finance the required investment. Following the privatisation of energy industries this type of planning is now impossible.

Another reason for this change of heart is the government’s fear that providing so much renewable energy will undermine the EU’s carbon trading scheme, which has already been exposed as a fraud and which has no impact on overall levels of carbon emissions. Clearly New Labour’s market state cannot countenance any disruption to new opportunities for profit generation through the trading scheme’s commodification of carbon emissions. The government is quite prepared to change any policy at the drop of a hat to allow global capital to carry on carbon trading rather than trying to save the planet.

While the government is conspiring to set lower targets for renewable energy, a new study published in the journal Proceedings of the National Academy of Sciences, shows that the efficiency of forests and oceans to absorb carbon has fallen significantly over the last 50 years (as carbon emissions have accelerated with the expansion of global capitalism) and they are no longer able to absorb as much carbon as they previously did. The effect of this is that climate “feedback” mechanisms, which scientist thought were decades away from happening, are already starting to happen.

The Brown government has no answers whatsoever to the climate change crisis because it is locked into the status quo of the market economy. There is now a desperate need to move society beyond this failing system and create new social structures in which we can establish sustainable energy industries, owned and operated by its own workers and the communities they serve. These should be run on a not-for-profit basis, rather than relying on markets fueled by profits. This approach would be part of a plan to solve the eco-crisis we are facing through a planned transition to the use of a range of renewable energy sources for all our needs.

Stuart Barlow

Simply not sustainable

Twenty years ago, a commission convened by the United Nations put forward the concept of “sustainable development” as a way that capitalism, growth and protection of the environment could live in perfect harmony. The World Commission on Environment and Development (the Brundtland Commission) called its report Our Common Future. Yesterday the UN’s Environment Programme (UNEP) had to admit failure as it painted a bleak picture in an assessment of the two decades since the original report.

The Bruntland Commission, far from offering a way to defend the environment, offered global corporations a green light. They could on growing at a rapacious rate, ripping out resources and burning fossil fuels as long as they could demonstrate they were doing their bit for “sustainability”. Twenty years later the bill has come in. UNEP, in a report prepared by about 390 experts and reviewed by more than 1 000 others across the world, admits: "There are no major issues raised in Our Common Future for which the foreseeable trends are favourable." The critical findings of the GEO-4 report include:

Atmosphere
A best estimate for this century's rise is expected to be between a further 1.8°C and °C. Ice cores show that the levels of carbon dioxide (CO2) and methane are now far outside their ranges of natural variability over the last 500,000 years: the Earth's climate has entered a state unparalleled in recent prehistory. The average temperatures in the Arctic are rising twice as rapidly as in the rest of the world. Sea-level rise caused by thermal expansion of water and the melting of glaciers and ice sheets will continue for the foreseeable future.

Pollution
More than 50 000 compounds are used commercially, hundreds more are added annually, and global chemical production is projected to increase by 85% over the next 20 years. Environmental exposure causes almost a quarter of all diseases. More than two million people worldwide are estimated to die prematurely every year from indoor and outdoor air pollution.

Food
Losses in total global farm production, due to insect pests, have been estimated at about 1%. Since 1987 the expansion of cropland has slackened, but land use intensity has increased dramatically. Unsustainable land use is causing degradation, a threat as serious as climate change and biodiversity loss. It affects up to a third of the world's people.

Biodiversity
About 60% of the ecosystem services that have been assessed are degraded or used unsustainably; populations of freshwater vertebrates declined on average by nearly 50% from 1987 to 2003, much faster than terrestrial or marine species. Over half the world's 6,000 languages are endangered, and some believe up to 90% of all languages may not survive this century.

Water
Of the world's major rivers, 10% fail to reach the sea for part of each year because of irrigation demands. In developing countries some 3 million people die annually from water-borne diseases, most of them under-five-year-olds. An estimated 2.6 billion people lack improved sanitation services.

There is absolutely no sign that the warnings contained in the UNEP report, as well as the conclusions on global warming reached by other UN groups, will have any impact on the way business is conducted. The report admits, for example, that while climate change is a "global priority", demanding political will and leadership, it finds "a remarkable lack of urgency", and a "woefully inadequate" global response. GEO-4 even acknowledges that "... some industrial sectors that were unfavourable to the...[Kyoto] Protocol managed successfully to undermine the political will to ratify it”.

Given this muted indictment of corporate power, GEO-4’s call for "fundamental changes in social and economic structures, including lifestyle changes” if rapid progress is to be achieved are simply hot air. What the UNEP report inadvertently does is to demonstrate conclusively that sustainability and global capitalism are incompatible. An economic system where nature is exploited as just another source of profit in the name of growth, is the problem and not the solution.

Paul Feldman
AWTW communications editor

Let them eat cake

In the popular imagination, Queen Marie Antoinette is believed to have sparked the French Revolution when she said of the starving poor, “Let them eat cake”. True or not, the price of food is again a dangerous political issue. Warning signs are coming from around the world that food price increases will cause major social unrest in the poorest as well as the richest nations.

Yesterday the Russian government signed an agreement with food producers and retailers to freeze the price of bread, cheese, milk, eggs and vegetable oil until the end of the year. The Kremlin pretended that the controls were a voluntary measure by the food industry, but it is known that “they were told to fix prices voluntarily – or else”, according to observers in Moscow. Putin’s move is clearly an attempt to keep the electorate quiet in advance of December’s elections. Nevertheless, the move shocked many in the ruling oligarchy who have got rich from the free market capitalism introduced after the end of the Soviet Union in 1991 and who thought price controls were a thing of the past.

But it is not only Russia which is faced with a crisis. Speaking in London yesterday, United Nations Food and Agricultural Organisation (FAO) chief Jacques Diouf said that rocketing food and energy prices could trigger political upheaval and riots in developing countries. The FAO’s food price index in July stood at its highest level since it was begun in 1990, and is almost 70% higher than in 2000.“If food prices continue to be high, there are risks of riots. If you combine the increase of oil prices and the increase of food prices, then you have the element of a very serious crisis in the future,” he said.

Food costs account for the bulk of people’s income in the world’s poorest countries, including Niger, Guinea, Burkina Faso, Yemen and Mexico. Diouf estimates that 854 million people around the world are severely malnourished, most of them in Africa and Asia. Soaring prices are also causing hardship in North Korea, where the cost of rice has doubled from this time last year.

But wealthy food producing countries like the UK and Canada are also affected. This week, the leading Canadian economist Jeff Rubin warned that America’s policy of subsidising ethanol has led to a 60% rise in corn prices in the past two years. A bushel of corn now sells at nearly $4. High corn prices are disastrous for poor Latin Americans who use corn for tortillas. Corn is also a major animal feed so its price affects meat prices and derivatives like corn syrup used in processed foods. Nonetheless the Bush administration plans to raise US ethanol production from one billion gallons in 2000 to 35 billion in 2017 and the Canadian government has pledged a $1.5 billion investment over seven years to promote fuels like ethanol.

In Britain, the price of a loaf has gone up from 80p on average to 91p in the last year, while minced beef has increased from £1.08 a pound to £2.21 amidst warnings that the era of cheap food is over. The Department for Environment, Food and Rural Affairs admits that food security was becoming a “matter of concern”. The looming food crisis is the clearest indicator that unbridled capitalist globalisation under the free trade system enforced by the WTO and other global bodies is an unmitigated disaster.


Corinna Lotz
AWTW secretary

Global push for rice ‘suicide seed’

The seed industry will do whatever it takes to stop farmers saving seeds. The only way it can make big money from seeds is to force farmers to buy from seed companies every year. With rice, one of the world’s most important crops, it is no wonder that there is a relentless push for a hybrid variety that is essentially sterile. Suicide seeds, so to speak. At the heart of this race for hybrid rice are the transnational corporations as well as the Chinese government, according to a new assessment by GRAIN, which promotes sustainable development and agricultural biodiversity based on people’s control of genetic resources and local knowledge.

The seed industry talks of higher yields and big profits for farmers to try and sell hybrid rice. But the situation in the fields is quite the reverse. In 2005, GRAIN released a report documenting the dismal performance of hybrid rice in Asia. The only country that was said to be reaping success from it was China, the birthplace of the hybrid rice “miracle”. But on a return visit, farmers in China confirmed that a wide gap existed between the yield projections made by scientists in the laboratory and farmers’ experiences in the field. Some farmers reported no increase at all in yields and, in areas where there were rises, they were modest and owed much to the liberal use of chemical fertilisers and pesticides and steady irrigation. The Chinese peasants GRAIN met said that after three decades of hybrid rice development they were as poor as ever.

In some Asian countries where farmers are still growing hybrid rice, it is often only because of government programmes that heavily subsidise it or, as in the case of China and Burma, that leave farmers no other option. “Yet governments continue unperturbed with their ambitious projects to promote hybrid rice. In Asia and Africa, it is hailed as key to meeting the millennium development goal of food security. Packed within broad co-operation agreements that include oil exploration or agrofuel production, it is also seen as an important component of addressing the impending energy crisis,” says GRAIN. Field trials are also under way in Spain and Italy.

China is at the centre of this emergent transnational rice seed industry. Some of the corporates moving in on rice seeds are well-known transnationals, such as the pesticide and seed giants Bayer, DuPont and Monsanto or the agribusiness titan Charoen Pokphand. GRAIN says: “The Chinese corporations, operating inside and outside China, may be less well known, but they are pursuing the same path as these larger seed corporations, perhaps even more aggressively. Hybrid rice is indeed their entry point on to the stage of the global seed industry, and they have the backing of the Chinese government’s growing international presence to help things along.” Chinese companies and the country’s top public agricultural research system, has deals with Malaysia, Indonesia, Burma, Madagascar and a number of African countries, including Sierra Leone, Mozambique, Ghana, Egypt and Nigeria.

GRAIN concludes: “The threat that hybrid rice is posing to farmers’ agricultural biodiversity is no longer confined to genetic erosion. Many of the companies involved in this current hybrid rice explosion are also developing GM rice, and are involved in various incidents of contamination. They are taking control of the rapidly changing seed system. This undermines farmers’ livelihoods and food sovereignty, and eats at the very core of sustainable farming.”

Paul Feldman
AWTW communications editor

Free Lovinsky Pierre-Antoine

October is Black History month and it should be a time to celebrate the achievements of black heroes during the 200th anniversary of the Abolition of the Slave Trade. And yet in Haiti, the small country that did more than any other to defeat slavery, a notable human rights campaigner, Lovinsky Pierre-Antoine, has vanished since August 12. Supporters, and even the UN mission on the island, are concerned that Pierre-Antoine has been kidnapped because of his outspoken criticisms of the occupying forces on the island and their association with the Haitian military.

This Friday campaigners from Global Women’s Strike will gather for the third week running at the foot of the Edith Cavell statue near Trafalgar Square as part of an international series of vigils. They are demanding the return of Pierre-Antoine, who was a leader of the pro-Aristide September 30 Foundation and critic of both U.N. and U.S. involvement in Haiti. He was last seen leaving his Port-au-Prince home shortly before midnight, according to Ronald Saint-Jean, leader of a coalition called the Group Initiative to Save Lovinsky Pierre-Antoine.

Pierre-Antoine is a high-profile member of the ousted President Jean-Betrand Aristide’s Fanmi Lavalas Party. He is co-founder of the Fondasyon Trant Septanm, which works with victims of the 1991 and 2004 coups d’etat in Haiti. A trained psychologist, he created organisations to support street children in the country’s capital, Port au Prince, a centre for teenage mothers and Map Vivre, “(“I live”) a programme to help victims of the 1991 coup against Aristide. He had to flee Haiti in 2004 fearing persecution by the former military, supported by the US army.

The case of Lovinsky also highlights the continuing crisis faced by the government of René Preval. It is part and parcel of a destabilisation campaign aimed at overthrowing his democratically elected government. The February 2006 election was an extraordinary victory for the Haitian people in the face of an oppressive occupying UN force which provides a cover for the armed thugs of Guy Philippe who overthrew Aristide. Preval is supported by Aristide, even though he was still the democratically elected president when kidnapped by US forces in the 1991 coup.

Haiti occupies a unique place in the hearts and minds of those seeking black and human liberation. It is the world's oldest black republic and the second-oldest republic in the Western Hemisphere, after the United States. At the time of the French Revolution of 1789, there were 790,000 slaves - one third of the entire African slave trade – working on the plantations of Hispaniola, the island of which Haiti forms a part. A decade before Abolition, a freed slave, Toussaint-Louverture, inspired by the French revolution, led a massive army of blacks to victory over the whites and free coloureds, securing native control over the colony in 1797. He defeated a massive British force, freed the slaves and tried to re-build Haiti's economy, but was eventually kidnapped and imprisoned by French forces.

Ever since that time, Haiti’s inhabitants have been singled out for punishment, by despotic leaders supported from the outside by former colonial masters. As Stephen Lendman writes, “Nothing is ever simple in Haiti, a country that for over 500 years has had very few periods of stability free from the oppressive heel of a foreign occupier or oppressive dictatorship.” Lendman has exposed how the Haiti Democracy Project (HDP) is “umbilically linked to the US State Department, backed by the corporate media tried to stop Preval from winning the election. It is now engaged in a demonisation and destabilisation campaign to undermine his administration”.

Haiti is presently the least developed country in the Western Hemisphere. Over half its people are unemployed, with many bordering on starvation. Aids is rife, especially amongst pregnant women. Seventy per cent rely on the land for their living. Eighty years ago forests covered nearly 60% of Haiti, now reduced to 2%. During Hurricane Dean last summer, Haiti was excluded from relief flights to the Caribbean because of “civil unrest”.

A World to Win joins with the millions of Haitians in their demand that Lovinsky should be brought home. We also call for the withdrawal of the UN forces from the island. Former Prime Minister Yvon Neptune must be released, should he still be in jail. Haiti must not rely on the IMF and the World Bank’s privatisation and “structural adjustment” programmes to rebuild its economy.

Corinna Lotz
Secretary, A World to Win

IMF paralysed as crisis grows

The mass of red covering the trading screens of stock markets from Asia to Europe this morning confirms that attempts to wish away the credit crisis by marking up share prices in the last few weeks has come to grief. Adding to the uncertainty was the total failure of the International Monetary Fund’s annual meeting in Washington to offer anything but platitudes. The IMF is increasingly seen as an irrelevance, with events far beyond its reach and control.

In today’s Financial Times, Chris Giles comments: “Many of the fund’s most powerful members were angry that the IMF was so feeble just at the time it should be centre stage. The global credit squeeze was, after all, truly transnational, having its roots in the US sub-prime mortgage sector, but its consequences spreading worldwide. The fear, privately expressed by central bankers, is that the credit squeeze is the first of many disorderly episodes that will result from the huge global trade imbalances that have emerged over the past decade. These have kept interest rates artificially low worldwide and encouraged reckless lending.”

At the epicentre of the global economic and financial storm is the United States, where Wall Street fell a dramatic 367 points last Friday amid growing fears that the sub-prime housing market mortgage crisis was far from over and that the economy was heading for recession. Selling on Wall Street started when the building equipment firm Caterpillar cut its profit forecast, blaming the state of the economy, and lower-than-expected earnings from Wachovia, the fourth largest bank in the US. This is against the background of a dollar that is in freefall - the consequence of massive trade and government deficits - and the refusal of countries like China to revalue their currencies.

The IMF was supposed to discuss the dollar’s crisis but failed to do so. It was planning to make proposals about what countries like China and Saudi Arabia could do with their massive dollar holdings and came up with with nothing. David Dodge, the outgoing Canadian central bank governor, was disappointed. “This is precisely the time we need the fund’s ability and skills to deal with global imbalances,” said and warned: “The longer the imbalances go on, the greater risk that we will end with a rather messy denouement.”

This is a banker’s way of talking about a crash and global slump. All the signs point in that direction. The globalisation process was fuelled by credit which has now turned into totals of debt that are impossible to calculate. This debt itself has been sold and resold by banks using fantastically complex derivative packages that hardly anyone understands. In Britain, large parts of economic growth have become utterly dependent on house price inflation, with people remortgaging to buy goods like cars. Others have borrowed up to 10 or more times their income to buy homes at prices way beyond their financial means. People are in some cases reportedly using credit cards to pay their monthly mortgages. A collapse in house prices in Britain is entirely likely as the credit crunch continues to unravel. Meanwhile, at the IMF the US Treasury Secretary Henry Paulson declared: "Fortunately, the global economy's underlying strengths should limit the negative effects that the turmoil might have on global activity.” So that’s alright then!

Paul Feldman
AWTW communications editor

Empty gestures in the face of climate change

Latest warnings from the Intergovernmental Panel on Climate Change show the extent of damage already done to our planet through the excesses of global capitalism. The IPCC have confirmed that it is now very unlikely (which means they are 90% certain) that the rise in average global temperatures can be kept below 2⁰C. If temperatures rise by more than 2⁰C we will hit the threshold when catastrophic climate change starts to kick in, with millions facing the dangers of drought, hunger and flooding. This is the shocking point we have reached and yet the major economic powers continue to squabble about a few targets as if there was plenty of time to play around with.

The IPCC’s warning only highlight New Labour’s puerile gestures of trying to make people think they are doing something when all along their market-state policies promote greater commodification to open up new opportunities for profit at the expense of the environment. This is typified by Gordon Brown’s recent announcement at New Labour’s sad excuse of a conference to “make Britain a world leader in tackling climate change”.

The implications of this support for global capitalism can be seen in the New Economics Foundation’s Chinadependence: The second UK interdependence report, which shows the UK second only to the United States in the consumption of natural resources and goods. Not only does it repeat the well-know fact that if everyone consumed resources at the rate of the United States we would need five planets to support this, it also implies (without using the actual words) that global capitalism’s unrestrained drive for growth is responsible for accelerated climate change.

This is indelibly linked to the corporations moving production to countries like China as they are motivated to cut production costs and increase profits (by extracting greater surplus value from a cheaper workforce). This is driving China’s growth in carbon emissions, although its per capita emissions are still well below those of Europe. But with one coal-fired power station opening each week, China will soon catch up and overtake the rest of the world.

Expert/pundit Jonathon Porritt (chair of the government’s own Sustainability Development Commission) seems happy to criticise Brown and his glove-puppet Chancellor Alistair Darling’s pre-budget statement as “crabby incrementalism”. Darling announced small changes in climate taxes and an “environmental transformation fund”. But what Porritt - a great believer that capitalism can provide a future of wealth, equity and ecological integrity - doesn’t want to acknowledge is that these proposals reflect what’s in the Climate Change Bill – hot air plus smoke and mirrors!

In Running a Temperature: an action plan for the eco-crisis, A World to Win shows that capitalism and climate change are inextricably linked and provides a clear and alternative framework for human existence beyond capitalism. To meet the deadlock we find ourselves in we need to move on in history, from a globalised world capitalist system, to a concept of local stewardship acting in a not-for-profit way in the interests of global society.

Stuart Barlow

Underwater imperialism

The results of melting ice caps may terrify the rest of us but for the oil corporations and their client governments there is a silver lining – the opportunity to drill for deposits previously inaccessible below the permafrost. This summer’s Arctic ice cover was the thinnest ever recorded. Researchers say there could be ice-free Arctic summers by 2040.

The result is an obscene rush by countries to secure rights to new fisheries, transport routes, oil, gas and mineral resources which have become accessible as a result. The US Geological Survey estimates that a quarter of the world's unexploited fossil fuels lie in Arctic areas. In a ludicrous stunt in August the Russian government sent two mini-subs and a group of intrepid explorers to plant a rust-proof titanium flag on the seabed 14,000ft below the North Pole to “claim the territory”. Then they released a video claiming to show the event, which turned out to be a scene from the film Titanic!

"This isn't the 15th Century," said Canadian Foreign Minister Peter MacKay. "You can't go around the world and just plant flags and say 'We're claiming this territory'” Yet his government is in dispute with the USA over rights in the North-west Passage. Norway and Russia are in dispute over the Barents Sea. Canada and Denmark are competing for ownership of a small island off Greenland, and Denmark is claiming the North Pole for itself.

Down at the other end of the planet, New Labour is joining this underwater imperialism. It emerged this week that the government is planning to claim sovereign rights over a vast area of seabed off Antarctica. The Foreign Office is preparing a submission to the United Nations covering more than a million square kilometres of seabed around Ascension Island, off the British Antarctic Territory, and around the Falkland Islands and South Georgia. Britain is actually one of 39 signatories to a 1991 treaty that established Antarctica as a world park, with a 50-year minimum prohibition on mineral exploitation. And Britain is also not beneath a little nationalistic stunt. The British Antarctic Territory, first claimed in 1908 (on what basis it is hard to imagine) is a triangle of land covering 666,000 miles from the south pole. It plans to mark its centenary next year by issuing its own legal tender coin.

Flags, coins – if it wasn’t so dangerous it would be funny as this great little video from Greenpeace shows. But the terrible reality of the economic system that dominates planet earth is that the melting ice is actually seen as a positive benefit, as a new area for profit making. What we need to do is to save the planet not so much from climate change as the social system that is driving a whole series of inter-related crises. Territorial wars, hunger, species extinction, the destruction of habitats and the lives of indigenous people – the list is of threats produced by global capitalism is endless. We need to get shot of them before they get rid of us with their mad cap plans.

Penny Cole
AWTW Environment editor

No fun being young in Brown’s Britain

A conference at the TUC today will hear that there are 3.8 million children in Britain living in poverty, 100,000 more than last year. Ending child poverty in a generation was Gordon Brown’s own special pledge as Chancellor, but last week’s spending review put just an extra 50p in the pocket of the poorest parents. Kate Green, of Child Poverty Action Group, says that to reach Brown’s own target of halving child poverty by 2010, a further 900,000 children must be lifted above the poverty line. which would cost around £4 billion. “It is an affordable amount for a government that can make a priority of cutting inheritance tax,” she adds.

Being a child in Brown’s Britain is a miserable experience. Education is replaced by testing which has led to levels of stress among primary school pupils. There is less physical education, and the food sold by market-dominant supermarkets is leading to obesity and malnutrition. Children no longer play outside as cars dominate the streets, and the absence of social interaction means behavioural problems are commonplace. Asthma and allergies are epidemic.

Nursery classes start formal education at age 4 and 5 year olds are being tested, when in most other European countries they would be making plasticine pies and tumbling over climbing frames. For the children of the poorest families, the situation is even worse. The death rate for children of parents who have never worked or are long-term unemployed is 13 times that for the children of professionals. The number of children who die from accidents in the home is falling overall, but not for children in families where no adult is employed. Children who grow up in poor families are the most likely to leave school with no qualifications, and to end up in the lowest-paid jobs.

Peter Hain, the Secretary of State for Work and Pensions, will tell the conference that the answer is to get people off benefits and into work. Single mothers in particular are the focus for ferocious government coercion. But what Hain won’t report is that the number of people out of work and claiming benefits has risen to almost five million and the wages for the lowest-paid jobs have fallen to their lowest level relative to other work.

The system of tax credits, designed to get people to take the lowest paid jobs, was dubbed both “harsh” and “unfair” in a recent report from the Parliamentary Ombudsman. The tax authorities (HMRC) have pushed 363,000 families into debt when recovering overpayments made through mistakes in administration. The report singled out the “reasonable belief test”, whereby revenue staff decide if a person knew they had been overpaid, as creating a cruel Catch 22 situation.

Ann Abrahams, the Ombudsman, explained: "The claimant will receive an award, think that it looks a bit high, ring up, and be told it is fine; subsequently HMRC will say they have made a mistake and add "you rang up and said it was a bit odd, so you can't reasonably believe it was yours". Abraham's report coincided with a survey from Citizens Advice, which found problems with the tax credit system had put almost half of claimants off making claims in future.

In his speech to New Labour’s annual stage-managed, Union Jack-draped rally, Brown said that no child should end up on the scrap heap – but in poverty Britain, the size of the scrap heap is growing every day. A truly democratic government, representative of the people, would restructure work, education and communities to support a childhood that creates a society of well-rounded and happy adults – the kind of people that wouldn’t get into Brown’s cabinet!

Penny Cole

A crisis of leadership

The sudden resignation of the Lib Dem leader Menzies Campbell is another indication of the turmoil at the top of British politics as the main parties struggle to occupy the same small piece of territory – the so-called “middle ground”. While all parties claim to have the interests of the “whole nation” at heart, all they are really interested in is garnering the votes of a few crucial voters in key marginal seats who determine the outcome of general elections.

This is made more difficult by changes in the political landscape. One of the indelible features of the recent globalisation period is the convergence of the existing political parties to the point where voters find it difficult to separate their policies and outlooks.

In their 10 years in office, the Blair-Brown axis have taken up and deepened Thatcherite policies on a whole range of policies and issues, from privatisation to competition in the public sector and being tough with the trade unions.

Not to be outdone, the Tories have welcomed many of the government’s policies – including the invasion of Iraq – but have struggled to find an idea they can call their own. New Labour has, for example, in recent weeks stolen Tory policies on inheritance tax, crime and the family. Now Tory leader Cameron is forced to attack New Labour for not doing enough to tackle poverty just to make himself heard.He himself is the leader of a deeply divided party.

Under these conditions, the Lib Dems find it difficult to get any attention, especially with a leader whose charisma rating – deemed so crucial in these days of image and spin – was off the radar. So he had to go. Which brings us to another leader with a personality problem, according to the bourgeois media. Gordon Brown is clearly a control freak with an authoritarian streak whose heavy handed approach has dismayed many New Labour MPs - especially those in marginal seats. Now the knives are out in his own party, with Blarites and assorted disgruntled former ministers putting the boot in.

Some of those who have backed New Labour – like the Murdoch News International empire – are also having second thoughts. Irwin Stelzer, the economist and a close adviser to Murdoch, told The Guardian this week that the media tycoon recognises the resurgence of the Tories under Cameron. "You'd have to think that Murdoch is a closed minded dunce not to think that he recognises that something is happening here in Britain, that the political landscape has been shaken up and he has to look at it," Stelzer said. He described Brown’s decision not to call an election as "an appalling blunder".

What might finally swing Murdoch papers like The Sun behind Cameron is the European Union treaty issue, where the Tories are demanding a referendum and Brown is resisting. The paper’s political editor Trevor Kavanagh even suggested this week that the New Labour project was in danger of being revealed as nothing more than an illusionist’s trick and could easily fall apart. That’s the sort of comment that would reflect the thinking of the paper’s owners. The Lib Dems are not the only party with problems.

Paul Feldman
AWTW communications editor

Writing on the wall for China's leaders

One thing is certain as the Chinese Communist Party gathers in Beijing for its 17th Congress – a political earthquake is inevitable that will in time sweep the delegates away. The political and social contradictions in the country are glaring and unbearable, starting with the name of the organisation under whose banner the delegates meet. The party is communist in name only, representing as it now does capitalism with Chinese characteristics. For example, present in the hall are the chief executives of state owned enterprises (SOEs).

Some SOEs are privatised and owned by foreign investors and others by local capitalists. In the 1990s, the major SOEs were restructured into joint-stock companies and listed on overseas and domestic stock markets. Then in 1994, China began to allow the big SOEs to retain all their profits. Hence over the past 13 years, none of these SOEs has contributed a single penny to the state coffers for public expenditure. According to official statistics, China's state sector made a total 1.22 trillion yuan (US$157 billion) of profits in 2006, of which 754.7 billion yuan or 62% came from the 155 central SOEs. Not surprisingly, the management have enriched themselves, paying themselves handsome bonuses and buying lavish luxury goods.

So the SOEs’ executives must have smiled to themselves today when President Hu Jintao told the congress that "socialist core values will prevail among the people..." These words are meaningless, Stalinist rhetoric from a leadership that has presided over the transformation of the country into a sweatshop for the transnational corporations. Hu was forced to acknowledge that growing social tensions threatened the country’s future.
"Resolutely punishing and effectively preventing corruption bears on the popular support for the party and on its very survival, and is therefore a major political task the Party must attend to at all times," he said. The reality is quite different.

In a new report from the Carnegie Endowment, Minxin Pei, an expert on economic reform and governance in China, paints a picture of corruption in China, where 10% of government spending, contracts, and transactions is estimated to be used as kickbacks and bribes, or simply stolen. Though the Chinese government has more than 1,200 laws, rules, and directives against corruption, the odds of a corrupt official going to jail are less than 3%, making corruption a high-return, low-risk activity, he finds. Even low-level officials have the opportunity to amass an illicit fortune of tens of millions of yuan. Corruption in China is concentrated in sectors with extensive state involvement. The direct costs of corruption could be as much as $86 billion each year, his report claims.

Significantly, Pei’s report says that corruption sparks tens of thousands of protests each year and contributes to China’s environmental degradation - up to 750,000 people a year die of air pollution - deterioration of social services, and the rising cost of health care, housing, and education. “Corruption has not yet derailed China’s economic rise, sparked a social revolution, or deterred Western investors. But it would be foolish to conclude that the Chinese system has an infinite capacity to absorb the mounting costs of corruption,” writes Pei.

Police were out in force in Beijing for the congress. Dissidents have been detained and thousands of petitioners rounded up to prevent them lobbying officials. One protester was dragged away by security and bundled into a police van in front of a clock on Tiananmen Square counting down to the 2008 Olympics. In 1989, the democracy movement was savagely suppressed by tanks and soldiers in the same square. The leadership’s attempts to impose a brutal form of corrupt capitalism on China since then has only deepened the anger of the masses and ensured that the writing is really on the wall for the delegates inside the Great Hall of the People.

Paul Feldman
AWTW communications editor

50 years of nuclear cover ups

Fifty years ago this week, scientists at Windscale nuclear fuel plant in Cumbria finally brought under control a fire in a stack of fuel rods that had been raging for days. By then the fire had already pumped out an estimated 20,000 curies of radioactive iodine, plutonium, caesium and polonium, sending a toxic cloud over the north of England and Ireland. It was an accident waiting to happen and occurred as a direct result of speeding up production of tritium needed for Britain’s nuclear bomb. Warnings that production methods were unsafe were ignored by a government desperate to stay in the arms race.

A similar plant at Chapelcross in Dumfriesshire suffered a meltdown in 1967. The public was told that the Windscale and Chapelcross plants were producing electricity but both were primarily manufacturing weapons grade nuclear fuel. At one point Windscale was actually drawing power from the national grid. These are just the highlights of a long history of leaks, accidents and cover-ups by the nuclear industry and the state. Only last month, the Douneray site in Scotland imported seven tonnes of irradiated uranium oxide from France without getting proper permission.

At Chapelcross, Windscale, Douneray and across the country the clean up operations for Britain’s first generation nuclear facilities continues. The overall cost of decommissioning is estimated at £37bn, a figure that is frequently revised upwards. Every one of Britain's current nuclear installations is on a site threatened with flooding as sea levels rise. Yet later this month the New Labour government plans to give the go-ahead for a new generation of privately-run nuclear power stations in the UK.

They will use the results of a phoney consultation to support their decision. On one Saturday in September, nine groups of people met in Belfast, Cardiff, Edinburgh, Exeter, Leicester, Liverpool, London, Newcastle and Norwich to “input their views”. Background materials did not mention any of the facts set out here. There was no reference to costs and it was implied that, apart from Windscale, nuclear accidents are a sort of foreign thing.
At the end of the day, people were asked to balance the potential benefits, risks and implications of continuing nuclear energy in the UK. On balance, 44% agreed that, in the context of tackling climate change and ensuring energy security, it would be in the public interest to give energy companies the option of investing in new nuclear power stations. Some 37% disagreed while 18% neither agreed nor disagreed.

Over half (51%) of those who took part were either dissatisfied or very dissatisfied with the government’s proposal to manage new nuclear waste and 83% were either concerned or very concerned about safety and security issues associated with nuclear power. And “there was general agreement that renewable sources should feature strongly in the UK’s energy mix” and for that nuclear should play even less of a role than it does currently” and “whilst recognising the risks, the public who took part believed that, if the UK continues to have nuclear energy, this should be an interim measure only”. Not exactly the ringing endorsement the government was hoping for.

Energy policy is now dealt with by the Department for Business and Enterprise. These new power stations will only happen if they can generate profits for the big energy companies. Anyone like to put a bet on who will be paying for cleaning up the waste at the end of the day? Or on the strong possibility of a devastating accident and/or cover-up?

Penny Cole

AWTW environment editor

Brown delivers the message

The leaders of the CWU postal workers’ union have waited and waited for the intervention of the government in their pay and jobs dispute with Royal Mail. Yesterday it finally arrived. But it was not what the CWU leadership wanted to hear. New Labour broke its silence – and came down firmly on the side of the employers. Prime Minister Brown and business secretary Hutton denounced the strikes as “unjustifiable”. Brown told postal workers to “get back to work” while Hutton said the union should accept what he described as a “perfectly fair and reasonable offer”.

The postal workers have so far stood steady and firm in their series of strikes for jobs, pay and pensions in the face of an arrogant employer. Yesterday, after the official two-day strike had ended, a management provocation was answered by unofficial walk-outs in Glasgow, Liverpool, London and other parts of the country. The postal workers are up for a fight and have forced their leaders into some fighting talk and a limited strike action.

But the main (and only) strategy of the leadership of their union, the CWU, has been try to get the government to intervene and enforce a “fair” settlement. This was always an entirely hopeless and forlorn perspective. Far from being some kind of arbitrator (as governments were sometimes up until 1980), this government has a different agenda entirely. Not only does the government stand four-square behind the belligerent Royal Mail management, but, behind the scenes, it is dictating and determining the policy and direction of the company. To what purpose? To make it fit to compete with UPS and the other private carriers of mail and parcels, and then to privatise it.

It has become the tried and tested method of governments, Tory and Labour, since the great Miners Strike of 1984-5 to lie about their real intentions and then to rely on the trade union leadership to “believe” those lies and to confine any action to the perspectives and agenda laid down by the government. Behind the statements of Royal Mail about “flexibility”, the “need to modernise” and so forth is the plan to break it up and sell it. They offer below-inflation pay rises and refuse to guarantee jobs in order to streamline and rationalise the business for privatisation.

This all stems from the very nature of New Labour as an outfit that no longer even pretends to protect the interest of workers or their unions, but rather gives total support to the corporations, the banks and the speculators. It is not just the postal service that is facing break-up and the threat of privatisation, leading inevitably to lower wages, pensions and unemployment, but all public services including health, education, local government, the BBC and the civil service. This is not a popular policy. At a rally earlier this week for the postal workers, Mark Serwotka , general secretary of the PCS said the New Labour governments had privatised “more of our work than the Major and Thatcher Governments combined”. He said his union was gearing up for a full-scale battle with the government.

The CWU is now in a fight to the finish with New Labour. This is a political struggle against a capitalist government. If the union leaders were blinded to this harsh reality before yesterday’s statements by Brown and Hutton, their members are certainly aware of it today. The CWU has to mobilise the entire membership in all-out action, asking for the support of other trade unionists in the privatisation firing line. And they should also recommend to the membership that the union should end its financial support and affiliation to New Labour.


Peter Arkell

Israel's harsh 'reality on the ground'

Creating “realities on the ground” is the speciality of the Israeli government. This week Israel has implemented a major land-grab around four Palestinian West Bank villages, precisely in order to create “realities” that will be the starting point for the talks to be held in Maryland in November. The land seized from Palestinian farmers will be used to expand illegal Jewish settlements, split the West Bank in two and create an apartheid road. Palestinian drivers would have to drive deep into the desert to get from Bethlehem to Ramallah, effectively barring them from the central part of the West Bank.

Jeff Halper, an Israeli geographer who specialises in Israel's development of the West Bank, said: "They want to push everything as far as possible before the November meeting…. Anything done before that meeting will be set in stone… part of a timeline in which Israel wants to get all its development of the West Bank finished before Bush leaves office."

Any Palestinian opposing these facts will be branded a terrorist; any opponents outside the Middle East will be branded an anti-Semite. Because the other “reality on the ground” that Zionist supporters are trying to create is that it is unacceptable, unlawful - or at the least career suicide - for anyone to criticise Israel and its brutal treatment of the Palestinians.

For example the UK’s University and College Union recently caved in to pressure and informed its members that it has legal advice that it would be unlawful even to discuss a boycott of Israeli Academic Institutions. Members voted at their conference that the union should carry out a regional discussion about implementing a boycott to highlight the failure of Israeli institutions to support Palestinian academic life and institutions, destroyed by the Israeli army’s actions. Many Israeli academics also signed the call for a boycott.

In a very confused statement, the UCU’s Strategy and Finance Committee has told members that discussion cannot go ahead because a boycott call would be unlawful and could not be implemented. A regional debate could “infringe discrimination legislation”. Of course it would only take five minutes to find another lawyer to show that to have a discussion is not in any way unlawful.

Zionist pressure to block debate in the United States has claimed other victims too. Nobel peace prize winner Archbishop Desmond Tutu has just had an invitation to speak to the Peace and Justice group at St. Thomas University in St. Paul, Minnesota withdrawn after the university’s president spoke with the local Jewish Community Relations Council and two rabbis. Tutu’s crime? He has dared to suggest that Israel is pursuing apartheid policies. The chair of the Justice and Peace Studies program, Prof. Cris Toffolo has been removed from her post as head of department.

Fortunately she has tenure or she would no doubt have met the same fate as Professor Norman Finkelstein of the De Paul University in Chicago. He finally agreed to resign this week, after a long campaign to deny him tenure, orchestrated by pro-Zionists from outside the university. Finkelstein, himself Jewish, was targeted because of his book “Beyond Chutzpah” which argued that it was wrong to say any criticism of Israel is anti-Semitic.

Back in the UK, Danny Rubinstein, Arab affairs editor of Haaretz newspaper was also in trouble when the Zionist Federation withdrew its sponsorship of a meeting he was addressing in London. This leading journalist had dared to state at a United Nations event, something his Israeli readers can read in his column any day of the week, that “Israel is an apartheid state with different status for different communities”. That simple home truth is the actual reality on the ground.

Penny Cole
October 10, 2007

Next stop Iran

One door closes another opens. Having failed abysmally to achieve their objectives in Iraq, the British government is preparing to move on to Iran. British troops may be preparing to leave Iraq – although not for some time – but they will stay in the Middle East. The reason is not hard to fathom. Preparations for an American-led attack on Iran are well advanced, according to those who should know. And the New Labour government is right behind the United States – as it was in the illegal invasion and occupation of Iraq in 2003.

The Bush administration is desperate to get a Republican into the White House in a year’s time and calculates that an air assault on Iran will go down well with American voters. According to The Sunday Telegraph, Brown has been informed of US plans to launch limited air and special forces raids against Revolutionary Guard bases. After talks with Bush during his visit in July, Brown indicated that Britain was "on board" for a military response. The proviso was that Iran had to be shown to be behind a big militant attack or another stunt similar to the kidnapping of British sailors in March. That shouldn’t be too difficult to concoct. America, after all, once invented an entire attack on their forces as a pretext for launching a bombing campaign against North Vietnam.

The report says that the US wants Britain's Special Air Service Regiment to take part in raids inside Iran and had requested help from the Royal Navy to combat Iranian retaliation in the Gulf. "The British understand there's a possible need to strike - not strategic bombing of nuclear sites but facilities in Iran in support of Iraqi elements. This understanding was reached shortly after Brown took office," said Vincent Cannistraro, a former White House intelligence chief in close contact with senior Pentagon officials. "The British have to be a major auxiliary to this plan," Cannistraro continued. "It's not just for political reasons: the US doesn't have a lot of mine clearing capability in the Gulf. The Dutch and the British do."

While the Americans talk of “surgical” strikes, the Iranians will clearly not sit back and do nothing. So the scene is set for a major war, with some US officials even talking about the use of nuclear weapons. These are desperate plans drawn up by a demented regime and will reinforce the position of the reactionary Iranian President Mahmoud Ahmadinejad. Yesterday, he was denounced by Teheran students when he visited their university. To chants of "death to the dictator", hundreds of Iranian students mounted a vociferous protest against his presence. Some students compared Ahmadinejad to the Chilean dictator Pinochet. Iran suffers high unemployment and rising inflation, which many blame on Ahmadinejad's economic policies. Hundreds of thousands of Iranian students graduate every year and many are left jobless. Last December, some students burned the president’s portrait in front of him. On that occasion, Ahmadinejad defended their right to demonstrate, saying that it proved Iran's devotion to freedom. But many of the students were arrested later. Some are still believed to be in detention.

Paul Feldman
AWTW communications editor

Running to stand still

So Gordon Brown’s plans to cut and run before the storm of the economic crisis turns into a hurricane have fallen victim to New Labour’s own arrogance and grubby desire for perpetual political power. The self-appointed Leader of The Party of All People (PAP) thought he just had to think the word election and the voters would be overwhelmed with joy. In fact, they were so under whelmed by the prospect of a Brown government that they deserted the PAP in droves.

It’s not difficult to see why. Today, a report reveals that disposable income is at its lowest level in 10 years. While tax on corporate profits (those that are not held offshore) is now at just 28% thanks to Brown’s continuous reductions, wage earners have been hit hard. Taxes, housing costs, phone bills and travel expenses have eaten into salaries, researchers says. In 1997, when New Labour came to power, people were left with 34.5% of their gross income once they had paid taxes, national insurance, mortgage or rent. Now they are left with 32.6%, says a report by uSwitch, a price comparison website. Earlier this year, Ernst & Young, the accountants, calculated this year that the average family had £838 left to spend each month, compared to £899 four years ago.

In the past 10 years, petrol — often the biggest cost for a family after their housing — has increased by 55% and phone and internet bills have risen 77%. The cost of getting on to the housing ladder has more than tripled. Council tax rose from an average of £688 a year to £1,321 — an increase of 92%, or three times the rate of inflation. The cost of food — which for the past decade has risen slower than inflation — is on the increase again and an estimated two million households are about to be hit by increased mortgage payments as they come off fixed-rate deals taken out two years ago. Mike Naylor, at uSwitch, said: "We are working harder, but we are not getting any wealthier — we are just running to stand still."

Under New Labour, inequality has soared while exploitation at work has intensified dramatically. These are the joys of the market economy so enthusiastically championed by Brown. Problems are then reinforced by more market-led “solutions”. House prices are out of the reach of most new households. So what does the government propose? State help to take on a mortgage that would otherwise be beyond people’s means! What lunacy.

While Brown dithered and lost his nerve about calling an election, the economic news goes from bad to worse. Rodrigo Rato, outgoing managing director of the International Monetary Fund has warned that the seizure in world financial markets will make substantial inroads into forecasts for economic growth. In an interview in today’s Financial Times he says: “Policymakers should not think that the problems will stay at the desk of the bankers. Problems are going to come to the real sector, come to the budgets – that is something we keep telling people.” The credit crisis was “not a storm in a teacup,” he added. Its impact would be felt “more quickly” in the US and to some extent in Europe and Japan rather than in the rest of the world. No wonder Brown wanted an election sooner rather than later. Now his wounded regime will have to face the music.

Paul Feldman
AWTW communications editor

South African workers fight back

As 3,000 miners emerged from three days underground at the Harmony mine at Elandsrand, it was clear that behind the growing number of accidents and deaths in South African mines is the desperate drive for profit. To take advantage of the current high gold price, the global mining corporations have pushed the pace of deeper mining; miners say an attempt to sink a 2.2 mile deep shaft miles was to blame for this latest incident.

Gold output has decreased by over 50 per cent over the past decade but South Africa still has the world’s largest remaining deposits: getting at them grows more and more perilous with 200 miners killed last year. And where was the ANC government while this was happening? A bland statement on health and safety was all they offered. When two miners were killed in July at the AngloGold Ashanti mine, the government imposed nothing more than a brief closure. Far from challenging the global corporations’ plundering of South Africa’s wealth, the ANC is their enthusiastic client government.

Meanwhile, daily life for millions of black South Africans is actually worse than under the hated apartheid regime. As well as the devastation caused by the HIV epidemic, worsened by the ANC government’s refusal to deliver drugs and health programmes, conditions in the townships are deteriorating. The Thabo Mbeki government’s aggressive privatisation programme, and its failure to deliver even basic housing, water, sanitation, and education, has brought a wave of protests across the country, led by new opposition movements.

On September 28, Anti-Privatisation Front protestors in Soweto were attacked by police with water cannon and rubber bullets and one person died. On the same day supporters of the Kwa-Zulu Natal-based Abahlali baseMjondolo opposition movement marched in Durban, and were attacked with batons and rubber bullets with 15 arrests. In his blog, ’bu Zikode of the AbM writes that as people take to the streets in protest against the government’s market-driven policies, there has been “an unprecedented escalation of state violence, repression and the criminalisation of protest”.

The government is violently forcing out residents of long-term city centre squats where real estate is valuable in order to present a slick image in time for the football World Cup to be held in South Africa in 2010. And in June this year they sacked thousands of health workers who took strike action against privatisation, and used riot police to break up demonstrations by public sector workers.

The ANC is currently engaged in a vicious internal battle over Mbeki’s successor, but to the vast majority of South Africans this is simply an argument over the spoils. At the end of apartheid in 1994, 87 percent of South Africa's land was in white hands; 13 years later, the figure is 82 percent. More than 40 percent of the South African workforce is without a job and nearly 60 percent of those who are jobless have never had a job. The people are facing a new political struggle to transform the ownership of land and resources and create a new economic and political democracy. As ’bu Zikode writes: “As long as democracy is used to further the political scores of the minority and as long as there is great inequality in our society Abahlali will stand together for the dawn of true democracy where everyone matters.”

Penny Cole

How to fight the export of jobs

In the end, it doesn’t matter whether a firm has a Quaker tradition with close links to the local community. The bottom line is entirely about profit margins under conditions of global competition, as Cadbury Schweppes showed yesterday by announcing the switching of its chocolate production to Poland. Cadbury said it planned to shut its factory in Keynsham, near Bristol, by 2010, with the loss of 500 jobs, while 200 further posts would go in Bournville, in the Midlands, at the plant where it has been producing chocolate for almost 130 years. Cadbury Schweppes is also attempting to sell its US drinks business and plans to cut 7,500 jobs worldwide over the next few years, with the closure of about 15% of its manufacturing plants. Labour and manufacturing costs would be much lower in Poland, the firm confirmed. Company profit margins would rise to around 15% up from 10% currently.

To anyone who has even a passing interest in the way the global capitalist market economy works, the news comes as no surprise. Driving down costs through outsourcing or switching production is a key feature of corporate-driven globalisation. Since New Labour came to power in 1997, over one million manufacturing jobs have gone from Britain, many ending up in sweatshop factories in China and India. While this has happened, the trade union leaders have wailed and moaned – but done nothing. Reaction to the Cadbury closure was no different.

Brian Revell, national organiser for Unite, said: "This is the sort of behaviour we expect from the short-term, quick-strip private equity firm, not Britain's most respected chocolate manufacturer." He accused Cadbury of planning to sell its site at Keynsham in order to generate a windfall for the company. Union leaders have spent a decade in a futile attempt to persuade New Labour to protect domestic manufacturing jobs. But the government is absolutely in favour of global competition in jobs and production and in any case is barred from protecting industry by European Union and World Trade Organisation rules. At the time of the 2005 general election, MG Rover collapsed and the government refused to intervene. Union leaders helped the government out by defusing any possible fight-back. Earlier this year, research showed that almost a quarter of former MG Rover workers still had no regular job.

A fight-back by the unions at Cadbury-Schweppes would win massive local and national support. Unite could always live up to its name and bring the workforce and communities together to block the transfer of jobs. They should reject the closures outright and work up plans to occupy the plants and keep production going. This would promote a challenge to the ownership of the factories by shareholders intent on one thing – maximising profits at whatever cost to jobs and communities. In the end, pleading to government to intervene is a complete waste of time. New Labour is hand in glove with the corporations and stands in awe of the market economy. A campaign against the Cadbury-Schweppes closures could expose the complicity of the government and help create the conditions for alternative economic not-for-profit models and a new democratic political system to go with it.

Paul Feldman
AWTW communications editor

Midnight of a surveillance society

In the week that new laws requiring phone companies to keep records of ALL calls and make them available to a range of agencies came into force in Britain, a report from the United States gives a chilling account of the destruction of civil liberties in that other great “democracy”.

In 2003 and 2003, the American Civil Liberties Union (ACLU) described in separate reports how new technology was feeding a surveillance “monster” and how the government and private sector were increasingly “mining” data about individuals. In a further report, the ACLU says the situation has worsened dramatically and warns: “We are far too close to the midnight of a genuine surveillance society, and the second hand has not stopped sweeping around the dial.”

The state is engaged in a series of illegal activities. The National Security Agency and the Central Intelligence Agency have departed from their supposedly exclusive focus on overseas spying, and have “turned their eyes and ears inward upon the American people” in violation of existing laws and the Constitution. The ACLU report shows that:

• the NSA has gained direct access to the telecommunications infrastructure through some of America’s largest companies. It is using broad data mining techniques to evaluate the communications of millions of people within the United States


• some of the major telecom companies have granted the NSA direct, wholesale access to their customers’ calling records – once again, outside the law – and that the NSA is compiling a giant database of those records


• the Treasury Department and the CIA is secretly sifting through the records of the global financial cooperative SWIFT, without Congressional authorisation or judicial oversight


• The NSA is sifting through the sea of communications using keyword searches, link analysis or other techniques such as voice pattern analysis


• A system for tracking cargo, also generated terrorist ratings on tens of millions of travellers, including American citizens


• the FBI’s “Investigative Data Warehouse” appears to be soaking up a broad array of data on innocent individuals


• a national ID system scheduled for 2008 will take state-issued documents such as a driver’s licence and turning them into nationally controlled, full-fledged national identity papers


• a radical shift in the use of CCTV, in which private cameras are actually tapped into by centralised government systems is under construction. New York City police plan to link together thousands of police and private video cameras combined with licence plate readers and a central police monitoring centre


• in August 2007 it was reported that the Department of Homeland Security was planning to deploy the nation’s spy satellites for domestic security purposes


• the government is claiming sweeping new powers to check the results of people’s Internet searches.

The ACLU report concludes: “In August 2007, the Bush Administration pressured Congress into enacting a misnamed Protect America Act. While the NSA can already engage in mass untargeted eavesdropping overseas, this legislation for the first time allows the government to engage in mass, untargeted collection of Americans’ communications (specifically, any conversations between people in the United States and overseas)… It cuts the courts out of the process, and permits the U.S. Attorney General to unilaterally issue a new legal order… in which entire programmes of electronic surveillance would be authorised in one sweep.”

Many of the practices described in the ACLU report take place in Britain too. New Labour has spent a decade building its own version of the surveillance society. The Brown government is constructing an authoritarian, one-party state and should it win the forthcoming election, it will press ahead with the destruction of what remains of our basic rights and civil liberties. One more reason to withhold your vote whenever the election is called.

Paul Feldman
AWTW communications editor

Britain’s very own sub-prime housing crisis

The credit crunch in the global financial system is now beginning to interact with the British housing market. Lax credit conditions that allowed prices to spiral are drawing to an end and many home owners are staring at sharp increases in their mortgage repayments. Record outstanding debts of £1,400 billion and low savings rates all weigh heavily on the property market. Experts are warning of a dramatic fall in house prices ahead.

Britain has its very own sub-prime crisis, which has already wrecked the US houing market and sparked the credit crunch. Large but unknown numbers of people have fallen prey to commission-based “financial advisers” and mortgage brokers who lured them into loans on properties far beyond their means. Using self-certification of income, these middlemen encouraged people to grossly overstate their income so as to qualify for the massive loans secured on over-valued property.

Rapidly rising house prices gave the impression of higher values, enabling people to borrow against the market price of their homes, increasing their existing loan. Now tens of thousands have sunk into even greater debt, overwhelmed by repayment demands. As the small print says, your home is in danger if you do not keep up the payments and repossessions are rising.

That is not the end of this particular story. An estimated 2 million poorer borrowers are on lower, introductory fixed-rate mortgages which were an extra inducement. These are drawing to a close and people with this kind of a mortgage face a staggering 60% rise in housing costs in the coming months as interest rates are readjusted, according to the credit ratings agency Standard and Poor.

The buy-to-let business has also boomed in the past five years. The number of such mortgages more than quadrupled as increasing numbers of people came to regard it as the dependable alternative to uncertain savings and pensions. In this speculative market, reckless profiteering combined with loose credit for mortgages has led to such drastic overvaluation of property that, as interest rates have risen, repayments on loans in many cases far exceed rental income.

At the heart of this problem is "creative financing", enabling buy-to-let investors to borrow 100% of the cost of their new properties - not the 85% maximum most lenders permit. With 85% loans, investors have to come up with money of their own, and so are limited in how much they can buy. But with 100% mortgages, the brakes are off and there's effectively no limit.

The "creative financing" was made possible by discounts - typically 15% or more - which property developers offered to buy-to-let investors who bought flats in bulk. It helped power a construction boom as new blocks of flats and apartments mushroomed in city centres for the buy-to-let market. With interest rates up, and the market oversupplied, prices are starting to fall sharply outside London, leaving property owners and their loan companies in deep trouble.

The more than £8 billion that Northern Rock has borrowed of the unlimited support provided by the Bank of England since its crisis erupted two weeks ago, will soon look like the summit of a much larger mountain of unrepayable debt. Meanwhile, with New Labour’s financial support, the bank continues to offer 125% mortgage and personal loan packages, whilst refusing to support applications for personal bankruptcy from its overstretched customers.

Decades of persuasion to “get on the property ladder”, declining social housing, the sale of council housing and a decline in affordable private rented accommodation together with historically unprecedented, impossibly easy credit have lured millions into levels of debt that can’t be repaid within their lifetime.
Gerry Gold

AWTW economics editor

Biofuels increase emissions - and profits

Straight from a most unlikely source comes news of another eco-scandal. The Organisation for Economic Co-operation and Development (OECD) has exposed the fact that the European Commission is colluding with renewable energy corporations and investors. The aim is to ensure that environmental standards are not allowed to interfere with profitability and investment opportunities in biofuel production. The OECD says that Europe has adopted ambitious targets for switching to biofuels “without an in-depth understanding of a sustainable production level and from where this biofuel could be supplied”. It warns that there is “a serious risk that biofuel quotas are higher than potential sustainable supply, creating a strong incentive to ‘cheat’ in the system”.

And this cheating is already well under way. Biofuel corporations are actively opposing the introduction of mandatory sustainability standards by the EC, as a new report published by the Transnational Institute explains. Most “renewable energy” businesses responding to an EC consultation rejected the idea of safeguards that would ensure that biofuels sold in Europe would have lower greenhouse gas emissions than the petrol or diesel they replace. They proposed voluntary regulation, and stressed that nothing should be done to interfere with market growth.

British Sugar, for example, stated that: “We fully support minimum environmental standards for biofuels in the European Union, but do not think a certificate system is the best method. In introducing these standards, there is always the danger of slowing development in the market.” The Renewable Energy Association (UK), whose members include BP Alternative Fuels, British Sugar and Shell International, said that minimum environmental standards would be “an ill-considered approach, which... will risk undermining future investment in the European biofuels market and could blight existing investment”.

British Sugar, BP, Du Pont and Associated British Foods are partners in two joint ventures to establish multi-million pound biofuel production plants in Norfolk and Hull. The European Investment Bank is finalising its approval for the provision of £120m of project financing for both ventures, at attractive interest rates - the first direct financing provided by the EIB for a biofuel project.

Targets are now being set, and subsidies and loans are being granted, without addressing fundamental sustainability issues. When asked whether the 10% target for switching to bio-fuels would be dropped or adjusted if negative impacts were demonstrated, the European Commission responded that this would not happen, as it would create too much uncertainty for investors. They propose that in future they will look at just two issues to measure sustainability: greenhouse gas balance and impact on high biodiversity values. Excluded from consideration are social impacts such as food security, land conflicts and water and soil degradation. The EC is hiding behind World Trade Organisation market competition rules to avoid including such social criteria.

To meet EU and US biofuel targets means clearing virgin forest and grassland, bush and jungle, in the world’s poorest areas, releasing carbon stored in earth and vegetation that will outweigh any reduction in emissions achieved. The planned large-scale monoculture of palm oil, soya and other crops needs massive inputs of fertilisers, releasing NO₂ - a greenhouse gas more potent than CO₂. The reality is that the global rush to biofuels will actually increase emissions of greenhouse gases. But as long as it also increases emissions of profit, that’s fine by the European Commission and the new biofuel corporations.

Penny Cole
AWTW environment editor