'Devil's excrement' has its revenge

The revolutionary upsurge in North Africa and the Middle East is having a direct impact on the global crisis of capitalism.

Oil prices have surged as much as 6% since Monday, rising to their highest since the collapse of demand in the global crash of 2008. If this rise is maintained, it is certain to trigger a renewed slowdown in global production.

Oil companies in Libya are in the process of shutting down the 2% of the world’s production that come from the country. Western oil companies have suspended oil production and BP has started evacuating workers from Libya.

The Libyan mission to the UN is in disarray, the country’s generals are resigning along with many ministers. As in Egypt, the army is going over to the side of the revolution

Every part of the transnational capitalist class – global corporations, capitalist governments, unaccountable global agencies - is watching events with a mounting horror. They were horrified by the revolution that brought Gadaffi to power in 1969, now they are horrified by the revolution that will end his rule.

Mostly they are desperate to find a way of halting the contagion of revolt against autocratic governments which have provided safe haven for the global oil corporations and built their family fortunes from the proceeds. Nervously they assess the risk of the infection spreading to Saudi Arabia, which is the source of close to 10% of current oil supplies.

Interviewed on Al Jazeera, a former UN official spoke for the capitalists. Now they don’t mind people having rights, they’re even in favour of them having the same “democratic”, “human” rights enjoyed by people in the West. But above all they want stability, they want to see investment, they want people to keep their jobs, they want to see economic growth. They fear a revolution that could end the for-profit system. They are wondering what they can do to stop it.

Any disruption in oil supplies increases the power of the Organisation of Petrol Exporting Countries (OPEC) consisting of Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela. As of November 2010, OPEC members collectively hold 79% of world crude oil reserves and 44% of the world’s crude oil production, giving them major influence over the global market.

Juan Pablo Pérez Alfonso was a prominent Venezuelan diplomat, politician and lawyer primarily responsible for the inception and creation of OPEC. In 1975 he warned that “oil will bring us ruin… Oil is the Devil's excrement” – “the devil’s. He wasn’t far off.

In the 1970s, the inflationary printing of dollars to buy its way out of a historic economic crisis forced the US to abandon the relationship between the paper currency and gold established in 1944. The value of the dollar crashed from $42 for an ounce of gold in 1971 to $800 in 1979. OPEC acted to defend the value of its commodity which was emerging as the essential, cheap and plentiful foundation of the post-war economy. The price of oil quadrupled by 1973.

Four decades later, the situation is very different.

Exponential growth – the global success story of credit-funded huge corporations pouring previously unimaginable torrents of products into the hands of debt-burdened consumers has ensured that the world’s oil is half gone.

Much of it has been used to transform agriculture from a system of food production by millions of small farmers to a global business controlled by small number of corporations whose hunger for profit puts food prices beyond the reach of billions.

Industrialised agribusiness like the rest of capitalist manufacturing is addicted to oil. The burning of oil to fuel the capitalist growth mania has brought the planet to the limits of its ability to sustain life. The revolutionary upheaval now under way brings the possibility of a different future. We have to grasp it.

Gerry Gold

Economics editor

'Slavery' behind the food on your table

In the two years since the global crisis erupted, conditions in Spain for migrant workers from Morocco, West Africa and Eastern Europe that were already appalling have deteriorated further.

The crisis has driven unemployment in Spain to 20%, forcing Spanish workers to compete for work in the huge plastic-covered farms which grow salad and vegetables destined for sale in all the major supermarkets in Britain and other parts of Europe.

As the recession and inflation bites into living standards across the world, and the cost of competition amongst the supermarkets like Tesco and Sainsbury drives their buyers to put the squeeze on the price they pay to farmers, payments to the workers have been reduced to less than half of the legal minimum wage.

Research by investigative journalist Felicity Lawrence and charities reveals that migrants in Almeria, adjacent to the main tourist destination of the Costa del Sol, with families left at home dependent on their wages are now living in unbelievable squalor.

They live in “chabolas”, shelters made from used vegetable boxes covered in plastic, without food, water or work. Increasing numbers are reduced to taking handouts from charities like the Red Cross and groups of nuns just to stay alive.

Spitou Mendy, who was himself an illegal migrant from Senegal until he gained his papers in an amnesty, now helps run Sindicato de Obreros del Campo (SOC), a small union for migrants. He thinks the numbers have swollen to more than 100,000 due to the recession.

In Mendy's eyes the conditions are slavery. "You don't find the sons of Spain in the hothouses, only the blacks and people from former colonies," he says. "The farmers only want an unqualified, malleable workforce, which costs absolutely nothing. Only one part of the business is benefiting from this. It's the big agribusiness that wins. It's the capitalists that win. And humanity is killed that way. This is slavery in Europe. At the door to Europe, there is slavery as if we were in the 16th century."

Farmers argue that the supermarkets have squeezed their margins even harder during the downturn, while costs for fuel and fertiliser have gone up. They have no choice but to cut wages, which is the one element of their production costs they can control. Farmers trying to employ people legally and at the proper rate find it hard to compete or make a profit.

Wages approaching zero, and declining profits shine a bright light on the unsustainable character of food production using capitalist methods.

Rather than weep for the supermarkets, or try to find solutions to their problems, there has to be another way. Food production is undergoing a dramatic turnaround in Venezuala. The Bolivarian revolution led by Hugo Chavez is establishing a food system free of corporate control, rejecting the free market, capitalist ideology and developing alternative systems of international trade and co-operation.

With a state controlled system, cheap agricultural credit has increased from $164 million in 1999 to $7.6 billion in 2008. In a new system of particaptory democracy, more than 35,000 community councils as well as councils of farmers and fishermen are enabling communities to monitor their food needs, shape food policies and take control of their local food systems.
These, and other examples, have to be the way forward.

Gerry Gold
Economics editor