The following article is based on a speech delivered by marxist.com editor, Alan Woods, at the recent, hugely successful, International Marxist University. The world situation is characterised by war, chaos and crisis at all levels, leading some to draw the most pessimistic conclusions. In reality, an old order is dying and a new one is struggling to be born. We see that with the revolutionary eruptions in Sri Lanka and elsewhere. What is missing is a clear, revolutionary leadership to lead the working class to victory and to the overthrow of this decaying capitalist system.
When we come to analyse the present situation, it first appears to be a complicated web of contradictory processes. Superficially, the main tendencies are moving in the very opposite of a revolutionary direction.
Impressionistic minds will draw the most pessimistic conclusions. But that would be a fundamental mistake. In analysing events, we must not base ourselves on appearances, but penetrate deeper to understand the underlying processes.
The strategists of Capital are incapable of understanding the real processes taking place in society because they are hopeless empirics who only see the surface of events.
They constantly appeal to the ‘facts’ but are incapable of seeing the deeper processes that are quietly maturing beneath the surface. In a quite literal sense, they cannot see the wood for the trees.
Dialectical thinking for them is a book sealed with seven seals. But occasionally – very occasionally – they arrive at a correct idea. Allow me to quote from the Financial Times of 28 June:
“This new epoch of the world is creating huge challenges. It is possible — perhaps even probable — that the world system will shatter.”
If we just look at the surface, this prediction seems improbable. But if we dig deeper, it is quite correct. And that is precisely our task: to dig deeper, using the scientific method of dialectics.
One of the basic laws of dialectics is the transformation of quantity to quality, in which a series of small, apparently insignificant changes eventually reach a critical point in which there is a qualitative leap. At a certain point, things change into their opposite.
True, the objective conditions vary from one country to another. Events can move quickly or at a slower pace. But everywhere events are moving in the same direction: towards greater instability and an enormous intensification of the contradictions at all levels: economic, social, political.
Most importantly, significant changes are taking place in the psychology of the masses that are preparing the way for great social and political explosions.
And one thing is absolutely certain. Sharp and sudden changes are implicit in the whole situation. We saw this at the beginning of the year in Kazakhstan, and we are seeing it again now in Ecuador and Sri Lanka.
These are not isolated events. They resemble the heat lightning that announces the coming of a storm.
The war in Ukraine
At all times we must keep a firm grasp on the fundamental processes. That is above all necessary when we are dealing with war.
The dominant element in the world situation at the present time is the war in Ukraine. There is an old saying: if you play with fire, you are likely to get your fingers burned.
This excellent advice seems to have been forgotten by the bourgeoisie and its strategists. Now they are learning this lesson the hard way.
What attitude should Marxists adopt towards war? In the first place, we cannot have a sentimental or moralistic attitude, as the pacifists do when they complain that wars are very cruel, that people are killed, and so on and so forth.
These are undeniable facts. But whether one likes it or not, it is equally undeniable that wars are a fact of life, that they occur at regular intervals in human history, and express the fact that certain contradictions have reached a critical point where they cannot be resolved by ‘normal’ means, but only by force of arms.
That is just as true for the war between the classes as it is for war between nations. To cite the brilliant and profound words of Clausewitz: war is only the continuation of politics by other means.
Yes, wars are bloody and brutal affairs. But they are sometimes inevitable. And they also serve to accelerate processes, bringing all the contradictions to a critical point. The present situation is no exception. The Ukrainian conflict has served to define sharply all existing tendencies.
As one might expect, the Social Democrats immediately embraced the cause of Ukraine – that is, of NATO and US imperialism. That will surprise nobody.
The right-wing reformists are merely the agents of the ruling class in the ranks of the workers’ movement. They faithfully reflect the interests of the bankers and capitalists, whether in peacetime or in wartime.
But what can one say about the ‘Left’? Although they may talk ‘left’, the left reformists have no independent position as opposed to the right reformists. That is because, in the last analysis, they have also accepted the capitalist system – only they foolishly believe it can be made to serve the interests of the working class.
They believe in conciliation between the classes, not class struggle. Consequently, they also defend unity with the right-wing agents of Capital. That is particularly true in the context of war.
As usual, the spineless left reformists have been dragged behind the right wing. They have fallen for the hypocritical propaganda of the imperialists, weeping crocodile tears for the poor Ukrainians.
They do not grasp the self-evident fact that in this war, the Ukrainians are merely pawns in the hands of US imperialism – and in the case of the Kyiv government, reactionary pawns, at that.
In Germany, the most rabid supporters of the war are the Greens, the SPD’s coalition partners in government, who were strongly identified with the peace movement of the 1980s.
Now those petty-bourgeois pacifists have become the most rabid war mongers and have immediately jumped into the camp of imperialist reaction.
Oh yes, things do change into their opposite!
And many of the so-called Trotskyist sects have likewise surrendered to the pressure of imperialism and the hysterical propaganda of the media.
We are told that Putin is our enemy. Yes, Putin is our enemy. But the task of settling accounts with Putin lies with the Russian working class, and only with them.
Our task is to fight against our own bourgeoisie and our own imperialist ruling class, not to be pushed – directly or indirectly – into an alliance with them, on the grounds that we must fight the evil Putin.
However evil he may be, the gentlemen in Washington and London are a thousand times more evil and counter-revolutionary. Their hands are stained with far more blood.
Yes indeed! War is very useful in laying bare all the contradictions and mercilessly exposing all the weaknesses of those who falsely claim to stand for the ideas of Lenin and Trotsky.
We can be proud of the fact that the IMT has kept its head and stood firm against the hysterical warmongering barrage. We have maintained a firm class position. There is absolutely no room in our ranks for weak elements who bend under pressure in wartime.
We must always stand firmly for class politics and uphold the basic Leninist principle: the real enemy is at home! That is the essential point, and we must not lose sight of it for a single second.
It is quite amusing to note that although everybody knows that NATO is entirely controlled by US imperialism, its public face is never that of an American.
It is always a nice Scandinavian gentleman, because everyone knows that the Scandinavians are a nice, peaceful folk who abhor war or violence of any kind.
Jens Stoltenberg, the flint-faced Norwegian who pretends to be the general secretary of that organisation, could scarcely conceal his glee when he announced that Sweden and Finland would now be joining NATO, after Turkey had withdrawn its objections.
But he did not say why Turkey had withdrawn its objections.
In reality, this was the result of a sordid deal with Erdogan.
He presented NATO with an ultimatum: throw the Kurds to the wolves, or forget about Sweden and Finland joining NATO.
President Erdogan’s office said it “got what it wanted”.
A few days later, Turkish artillery bombarded a tourist resort in northern Iraq, often used by Kurdish people to escape from the heat in summer. The unprovoked attack on a civilian target killed innocent men, women and children.
Now, if these had been the actions of Russians in Ukraine, just imagine the outcry: Butchers! Monsters! Murderers of women and children! Atrocity! Genocide! War crime! And all the rest of it.
But where was the condemnation of Sweden and Finland, or Washington and London? There was absolutely nothing. Not a word of condemnation. Just a deafening silence: the cynical silence of brazen complicity in cold-blooded murder.
This action, in and of itself, exposes the complete cynicism and hypocrisy of both of the main imperialist powers and the snivelling Scandinavian bourgeois who hide behind a fake façade of ‘democracy’, ‘neutrality’ and ‘pacifism’ to cover their crimes.
On the war
Of course, it is impossible to be precise about the timing of events. There are too many variables in this equation. Not for nothing did Napoleon describe war as the most complicated equation of all.
It is certainly true that Putin made the mistake, at the beginning of the war, of believing that he would take Kyiv in a very short space of time. I myself thought the same thing, and I was not the only one.
The CIA and the Pentagon had exactly the same perspective, which they showed when they offered Zelensky a helicopter to fly him out of the country.
But things turned out differently. The Ukrainian army – armed and trained by NATO – proved to be a far more serious fighting force than what it had been in the past. The Russians had to abandon their original aims and operate on the basis of a more realistic plan, namely, to take over the Donbas.
This they have done, advancing slowly but surely, conquering one strategic point after another and inflicting very heavy losses on the Ukrainians, which the latter cannot sustain indefinitely.
A recent report by Ukrainian and Western intelligence officials reveals that the Ukrainians are facing huge difficulties. Ukrainian troops are suffering massive losses as they are outgunned 20-to-one in artillery and 40-to-one in ammunition by Russian forces.
According to Ukrainian sources, around 200 Ukrainian soldiers are now being killed every day, up from 100 late last month. That means that as many as 1,000 Ukrainians are being taken out of the fight every day, including those who are injured.
That is an unsustainable position, particularly as the losses consist mainly of experienced, battle-hardened troops, who are being replaced by untrained and poorly armed conscripts.
According to the report, the worsening situation in the Donbas is having “a seriously demoralising effect on Ukrainian forces.” For the first time since the war began, there is now concern over desertion, and Ukrainian soldiers refusing to obey orders to go into battle.
The Russians have meanwhile adapted their tactics in ways that have let them take full advantage of their firepower by remaining at a distance from Ukrainian positions, pounding them relentlessly, then taking territory once the Ukrainians have been forced to retreat.
More weapons, please!
The same intelligence report states:
“The tactical situation on the Eastern front is as follows… the Ukrainian side has almost completely run out of stocks of missiles, which made it possible to effectively deter Russian offensives in the first months of the war at distances of [37 to 50 miles].
“Today, the maximum range of fire of the Armed Forces of Ukraine is [15.5 miles].
Zelensky shouts all the louder for more weapons and money.
Ukrainian Defence Minister Oleksiy Reznikov insists that US weapons will change the course of the war. He claims they will allow Ukraine to seize back Russian-occupied territory, including not only Donbas but Crimea as well.
Reznikov said Western defence officials told him their military support for Ukraine “will never stop.”
But that remains to be seen!
The USA has given billions of dollars in aid to Ukraine. But this represents a very serious drain of resources, even for the wealthiest country on earth. All the big talk about supplying new weapons is not matched by delivery. The men in Kyiv have been unable to conceal their frustration and disappointment.
Ukrainian officials complain they need much more to halt the Russian advance, let alone reclaim lost territory, and that it will take time to deploy new systems, such as 12 American-made M142 HIMARS, to the frontline, while the Kremlin continues its fierce offensive in the Donbas.
“We are, of course, very grateful to our allies for their support,” said one Ukrainian official. “The new weapons are welcome, but when they announce they are sending military aid to Ukraine, the Western government should perhaps clarify to their public the quantities involved.”
The newly promised Western weapons systems are arriving, but too slowly and in insufficient quantities to prevent inexorable Russian gains in the eastern Donbas region of Ukraine.
The cracks begin to emerge
In military terms, Kyiv is losing ground. Meanwhile, the US and its allies cannot even agree on the real aims of the war. A recent article by President Biden defined America’s main goal as the preservation of a free and independent Ukraine. But that aim is not shared by its main European allies, France and Germany.
Those who worry most about war between Russia and the West will talk only about Moscow not winning. They fear that pushing for outright Ukrainian victory could lead to direct conflict between Russia and the West, or the use of Russian nuclear weapons.
France and Germany are in this camp. Olaf Scholz, Germany’s chancellor, has often said that Russia must not win – but has never said that Ukraine must achieve victory. The US, crucially, is somewhere in the middle – trying to balance its response to both threats, as it provides the bulk of the military aid to Ukraine.
The Americans decided not to send artillery that can strike well into Russia because that might look too much like a direct US attack. (Meanwhile, the delivery of heavy weapons from Germany keeps being delayed.)
Splits are opening up both within the USA and between the USA and its European allies.
Meanwhile, everyone, including Scholz and French President Emmanuel Macron, agrees (at least in public) that there will be no peace deal imposed on Ukraine.
But the Ukrainian concern is that they will, de facto, be forced to concede territory because they will not be given powerful enough weaponry to prevent Russia advancing on the battlefield.
Even as the Biden administration announced further assistance to Ukraine, doubts were being voiced in the White House about the perspectives for the war.
According to CNN: “Advisers to Biden have begun debating internally how and whether Zelensky should modify his definition of a Ukrainian ‘victory’ – adjusting for the possibility that his country has shrunk irreversibly.”
And that is not the end of Kyiv’s troubles. According to the Financial Times: “Ukraine’s fiscal crisis is getting worse because of the collapse in economic activity. The central bank burnt through 9.3 percent of its foreign exchange reserves in June alone.”
“Oleg Ustenko, an economic adviser to Zelenskyy, says the country now needs $9bn a month from the west to plug its budget shortfall. It had previously pleaded for between $5bn and $6bn.“
“Without financial support from our allies,” adds Ustenko, “it will be not [just] difficult to do, it will be next to impossible to do.”
The FT further reports that “the US has handed over $4bn in economic aid to Kyiv and expects to distribute a further $6.2bn by September.” But when this runs out, it is not at all clear that this generosity will be repeated. And the European bourgeois are even less enthusiastic about giving money to fill a black hole.
Kyiv claims it needs $5bn a month in aid to prevent a Ukrainian default on a €900m foreign debt maturity in September. But that now seems inevitable.
Back in April, the EU pledged €9bn, although there was friction within the bloc over whether the money should be provided as grants or loans.
But to date, the EU has managed to find only €1bn of its pledge, and does not seem in any hurry to send the rest. That is hardly surprising. Germany, the main economic powerhouse of the EU, is opposed to it.
Zelensky is constantly demanding more weapons and more cash. No doubt western weaponry – especially the HIMARS rocket systems – are having some impact. They are said to have blown up some Russian arms dumps and assisted a Ukrainian offensive on Kherson by blowing up bridges.
That may be so. It remains to be seen to what extent these claims are exaggerated for the sake of propaganda. In any event, the Ukrainian push against Kherson is clearly a feint to draw Russian forces away from the main front in Donbas. In this, they are unlikely to succeed.
The presence of a few new weapons from the Pentagon may cause the Russians some unwanted headaches. But they cannot change the well-established fact of Russia’s crushing superiority in firepower, or stop them from continuing to advance, slowly but inexorably, towards winning control of the important Donbas region.
Disquiet in the USA
Already, there are signs that the US Congress may be showing a weakened appetite for supporting Ukraine, after months of lavish military spending. Quite a few people in Washington are already becoming suspicious of the whole business. And doubts are being openly expressed at a high level.
In an article published on 13 June, titled, ‘With Billions Going to Ukraine, Officials Warn of Potential for Fraud, Waste’ The Wall Street Journal reports:
“While no instances of malfeasance have emerged, current and former officials say it is likely a matter of time.”
And public opinion is turning against the war, as it is turning against the Biden administration in general. A new poll finds more Americans believe:
- Sanctions hurt the US more than Russia (56 percent to 42 percent )
- It’s “okay for the US to let Ukraine lose to Russia” (45 percent to 40 percent)
- And, it'd “be better” to get Biden out of the White House than Putin out of the Kremlin (56 percent to 43 percent)
In fact, only about a third of Americans support Biden’s Ukraine policy.
Additionally, a recent survey found that 58 percent of voters disapprove of Biden’s performance and 39 percent approve.
Are sanctions working?
It is now four months since the west launched its economic war against Russia, and it is not going according to plan. In fact, according to Reuters, “Russia may be getting more revenue from its fossil fuels now than shortly before its invasion of Ukraine [because]... Global price increases offset the impact of Western efforts to restrict its sales.”
In any case, Western sanctions have not succeeded in preventing Russia from selling oil and gas. To cite just one example: Italy received about 400,000 barrels of Russian oil a day in May. That is four times the pre-invasion level.
“At the same time,” according to Reuters, “Russia has been able to sell more cargoes to other buyers, including major energy consumers, notably China and India, by offering it at a discount to oil from other origins. [...] India's purchases of Russian oil more than doubled in May from the previous month to hit a record high above 840,000 barrels per day,” and it will likely rise further.
At the same time, “Russia has restricted the export of gases (Helium, Neon etc.) necessary for the production of microchips and this could adversely impact firms in the USA, Japan, South Korea and Netherlands among others,” writes The Economic Times.
The article explains that:
“The world markets are highly dependent on Russian supplies — they provide up to 30 percent of neon consumption.” And without Russian neon, argon and helium, “it will be more difficult for some countries to produce electronics”, meaning Russia will be able to export these gases in exchange for importing semiconductors.
The USA And China
A very important effect of the war has been to push China into a closer alliance with Russia. In the past, the tensions between the USA and China would have already led to war. This is ruled out by the actual balance of forces. But the tensions between the USA and China are destined to increase continuously.
Now the world’s second-largest economy, China accounts for roughly a half of America’s net trade deficit. Trump imposed punitive tariffs on Chinese goods, but this has proved counterproductive. Now Biden wants to remove them. But both Democrats and Republicans still see China as the main enemy.
In total, according to Harvard Business Review, “the Chinese state and its subsidiaries have lent about $1.5tn in direct loans and trade credits to more than 150 countries around the globe.
“This has turned China into the world’s largest official creditor — surpassing traditional, official lenders such as the World Bank, the IMF, or all OECD creditor governments combined… Most Chinese loans have helped finance large-scale investments in infrastructure, energy, and mining.”
The rising power of China manifests itself in an attempt to bolster its position as the dominant power in Asia. Washington has warned that the US would be prepared to send troops to Taiwan to prevent a Chinese takeover – a statement that Beijing will see as a provocation, since it regards Taiwan as part of China.
Now that America’s attention is fixed on Russia, fears are growing that China may be tempted to make a move on Taiwan. That has provoked a nervous reaction in Washington, which found an expression in the NATO Summit in Madrid.
The most significant element was its declared attitude to China. NATO has listed China as one of its strategic priorities for the first time, saying Beijing’s ambitions and its “coercive policies” challenge the Western bloc’s “interests, security and values”.
“China is substantially building up its military forces, including nuclear weapons, bullying its neighbours, threatening Taiwan… monitoring and controlling its own citizens through advanced technology, and spreading Russian lies and disinformation,” NATO’s Secretary General Jens Stoltenberg told reporters.
But he hastened to add: “China is not our adversary… but we must be clear-eyed about the serious challenges it represents.”
And he did not even laugh.
National unity turns into its opposite
As the crisis deepens, the Ukrainian question, far from being a unifying national endeavour, will turn into a divisive political issue, exacerbating social and political tensions, both within and between different countries.
The initial support for Ukraine’s cause, which fostered a drive for national unity will inevitably turn into its opposite.
The imperialists do not wish to be seen in public to be putting pressure on Zelensky to do a deal with Moscow. But we can be sure that behind the scenes, frantic negotiations are taking place.
Sooner or later, Russia will win full control of the Donbas. At that point, Putin could declare victory and sue for peace on terms favourable to Moscow. The European bourgeois are under pressure from Russia’s energy squeeze, and they will be pushing Kyiv to reach a deal.
But Kyiv has already rejected the idea of a potential peace plan brokered by France and Germany. This proposal set nerves jangling in Kyiv. A government spokesman warned of a sell-out: “They will say that we have to stop the war that is causing food problems and economic problems”.
That is just what they will say. In private, they are saying it already. And in the end, that is what will happen.
Just look at the facts. The Americans can afford to talk big about boycotting Russian oil and gas. But they have their own supplies. Europe does not.
Germany is heavily dependent on Russian gas. So, the Russians decided to squeeze them a little to show who is boss: the man in the Kremlin is having a good laugh at Germany, where the government is wriggling like a fish on a hook.
If the Russians cut off gas supplies to Germany this winter, the result will be an economic catastrophe. A sudden stop in gas supplies from Russia would lead to a 12.5 percent slump in the German economy.
5.6 million jobs would be affected across Germany. In many sectors, such as steel, but also the important glass industry, if the furnaces are shut down for any length of time, the installations will be severely damaged and it will take months to restart them.
Taken together, this would mean losses of €193bn in just six months. No wonder they want a deal! The social and political consequences of not getting one would be enormous – and not just for Germany.
To quote the words of Scholz: “Rising energy prices are endangering security and stability in many countries”.
What is to be done?
We have pointed out that this is a reactionary war on both sides. We cannot support either. Nor can we have any meaningful influence on the course of events.
Our task, to use Lenin’s slogan, is to patiently explain to the most advanced workers and youth, to ruthlessly expose the lying propaganda of the warmongers and to attack and denounce our own ruling class.
It is not possible to predict the precise outcome of the war. Various scenarios are possible. But the result will inevitably signify more instability and a deepening crisis. If Russia loses, it will mean the collapse of Putin and the beginning of a revolution in Russia. But if Russia wins it will be a body blow to imperialism and the right wing in the West.
Either outcome would have revolutionary consequences.
The headlines are painting a gloomy picture. The nervousness of the bourgeoisie finds its expression in the volatility of world stock markets.
The turbulence in world politics is accompanied by turbulence in the market. Rate rises have sent American stocks spiralling. The S&P 500 has fallen by a fifth since the start of the year. It hasn’t seen such poor trading since 1962. The wild swings in stock exchanges demonstrate precisely how out of control the situation has become for central banks.The most likely consequence will be a global recession.
In the USA, inflation has hit a 40-year record and remains stubbornly high. In the eurozone, inflation has risen to more than 8 percent, with much of that driven by high gas prices. The British economy is already heading for a recession before the end of the year.
Other European countries face the same, if not worse, problems since most of them are more dependent on Russian gas than the UK. As a result, factories will close, businesses will go bankrupt, investment will be choked off, and unemployment will rise sharply.
Private and public debt levels are much higher today than in the past as a percentage of global GDP, having risen from 200 percent in 1999 to 350 percent today. A combination of tightening monetary policy and rising interest rates will drive indebted households, companies, financial institutions, and governments into bankruptcy and default.
Nouriel Roubini, a well-known bourgeois economist, sums up the situation quite nicely:
“The space for fiscal expansion will also be more limited this time. Most of the fiscal ammunition has been used, and public debts are becoming unsustainable…
“Things will get much worse before they get better.”
The ‘Third World’
The war in Ukraine has sent economic shockwaves across not only Europe but also the poor countries of the Middle East, Asia and Latin America. For these countries, the perspective is a nightmare.
Prices of major food crops on world markets have increased by nearly 40 percent in the last five months. As a result, “44 million people in 38 countries are at emergency levels of hunger,” according to the UN. Faced with the choice of feeding their populations or paying their international creditors, governments will opt for the former.
Terrified of the social and political consequences of food shortages, the imperialists had to intervene, brokering a shaky deal through the UN and Turkey to permit the export of both Ukrainian and Russian grain. This will provide some help for Ukraine, but is much more useful to Russia.
It remains to be seen if this deal will work, and if so, for how long. But in any case, the social and political turmoil related to food shortages and rising prices has already begun to provoke revolutionary developments.
The economic crisis has created colossal social and political turmoil in Sri Lanka. This shows us how quickly a revolutionary situation can develop.
The mass movement had already succeeded in forcing the departure of the president Gotabaya Rajapaksa, who was forced to flee to Singapore. But when the masses learned of a plot to install the prime minister, Ranil Wickremesinghe, as acting president, it provoked an insurrection.
The acting president declared a state of emergency and ordered the army to put down the people. They were met with a barrage of tear gas and water cannon. But nothing could stop that human tsunami.
If you wish to see what a revolution is like, just look at the marvellous insurrection in Sri Lanka. Here we see the colossal potential power of the masses. If anyone doubted the ability of the masses to make a revolution, this was a resounding answer.
The events in Sri Lanka deserve the closest examination. What they show is that, when the masses lose their fear, no amount of repression can stop them.
With no leadership, no organisation and no clear programme, the masses took to the streets and overthrew the government. But Sri Lanka also shows us something else.
Without correct leadership, the revolution cannot succeed. Power was in the hands of the masses, but it was allowed to slip through their fingers.
The failure to overthrow the government has allowed Ranil Wickremesinghe to manoeuvre in parliament to regain the initiative, cracking down on the protests in an attempt to restore order.
Power was lying in the streets, waiting for somebody to pick it up. It would have been sufficient for the leaders of the protests to say: “We have the power now. We are the government.” But those words were never spoken.
The masses quietly left the presidential palace and the old power was allowed to return. The fruits of victory were handed back to the old oppressors and the parliamentary charlatans. That is an unpalatable truth. But it is the truth.
However, that does not mean the revolution is finished. The upheaval in Sri Lanka is not over. The underlying economic and social problems that provoked the masses into action have not been removed.
The revolution will re-emerge on an even higher level. But it will face a far more difficult and painful period with many more sacrifices.
“A cascade of defaults”
Sri Lanka was the first country since the start of the war in Ukraine to default on its debts, but is unlikely to be the last. Bloomberg warns that a “historic cascade of defaults is coming for emerging markets”.
More than 19 countries, with a population of more than 900 million people, have debt levels that mean there is a real possibility of default. The list of countries includes El Salvador, Ghana, Tunisia, Egypt, Pakistan, Argentina and Ukraine. Their combined debt comes to $237bn.
Pakistan is an extreme case. According to a report by Michael Rubin, a senior fellow at the Washington-based magazine, National Interest: “While many countries are dependent upon Ukrainian or Russian wheat or foreign energy imports, Pakistan requires both. Between July 2020 and January 2021, for example, Pakistan was the third-largest consumer of Ukrainian wheat exports after Indonesia and Egypt.”
The report continues:
“The price spike in oil prices has hit Pakistan hard, driving up the cost of its imports by more than 85 percent, to almost $5bn, just between 2020 and 2021. At the end of Pakistan’s fiscal year on 30 June 2022, its trade deficit neared $50bn, a 57 percent increase over the previous year.”
This is a catastrophic situation. It has produced an open split in the ruling class and the fall of Imran Khan’s government. The desperate position of the masses is preparing the way for a social explosion on the lines of Sri Lanka. This is a finished recipe for class struggle and even a revolutionary explosion on the lines of 1969.
This gives us a very accurate picture of what will occur in one country after another. We will see an enormous intensification of the class war and a situation pregnant with revolutionary possibilities.
That, and that alone, is the most important thing from a Marxist perspective.
The crisis affects every country, from the poorest to the wealthiest. Inflation in the USA is now running at approximately 9 percent. That is the highest in 40 years. And there is a powerful undercurrent of discontent. Biden has attempted to use Ukraine as a distraction. But it has failed. 85 percent of Americans say the country is on the wrong track.
The problem is the absence of a coherent point of reference. Given this absence, the only such point is Donald Trump. The Financial Times presents a glum picture: “The Democrats face likely decimation in this year’s midterm elections in November, which will set up a crushingly depressing 2024 rematch between Biden and Trump.”
But the experience of a Trump administration under conditions of capitalist crisis will finish him for good. It will serve to deepen all the contradictions, as we have already seen when the Supreme Court ruling on Roe v. Wade, at the stroke of a pen, brought about an effective ban on the right to abortion in many states, and threatens the prohibition of abortion rights altogether.
The spectacle of an unelected body of reactionary judges deciding the fate of millions of women provoked a wave of street protests and demonstrations. That is just one more example of the fact that there is no shortage of combustible material in US society, just waiting for a spark to set off a conflagration.
The working class is beginning to awaken after a more or less dormant period. It will have to relearn many lessons, even such elementary lessons as the need to organise in unions. Marx said that the working class without organisation is only raw material for exploitation.
As a result of the failure of the union leaders to organise, the new generation of young workers find themselves as little more than that. They find themselves working in modern sweatshops called call centres, or in Amazon, where they are subjected to brutal exploitation, long hours and bad pay.
The recent move to unionise Amazon and Starbucks workers is therefore a huge step forward. There has been a spate of strikes in the USA, which indicates the early beginning of a revival on the industrial front. And there is the beginning of a change in the unions too: among the Teamsters and the Auto Workers.
All this is beginning to worry the strategists of Capital. The question is being asked openly: can there be a new civil war in the USA? Indeed, there have been several books on this subject, such as How Civil Wars Start: And How to Stop Them by Barbara F Walter.
A recent poll by the University of Chicago showed that 28 percent of Americans say they have such little faith in their government that it may “soon be necessary to take up arms” against the government.
37 percent of gun owners are prepared to revolt, and the majority say the system is “corrupt and rigged” against them. What this shows is the growing sense of alienation of ordinary people from the status quo and hatred and distrust of the establishment – both Democrats and Republicans.
Whether or not this ends in civil war any time soon seems to be rather an impressionistic appraisal, that is more the reflection of an overheated brain, motivated by panic, rather than a rational analysis.
But that the seeds of a future civil war are being sown at this moment in time is entirely possible. More correctly, the seeds of an almighty social explosion are being sown and will inevitably come to fruition at a given stage.
The conditions are being created for the emergence of a whole new generation of revolutionary fighters. And I predict that some of the most determined revolutionaries will come from the ranks of disillusioned Trump supporters.
The main feature of the present situation is an extreme polarisation between rich and poor. This has never been greater in the whole of history.
There are powerful centrifugal forces that are pulling the existing consensus apart and threatening the very fabric of social life. But there are also powerful forces that are pulling in the opposite direction.
The tendency known as the political centre acts as a kind of glue that holds the fabric together. But this centre is now coming under pressure like never before. The main fear of the ruling class is that this tremendous conflict will end in the destruction of the centre ground.
And there are clear symptoms that indicate that this destructive process has already begun in the USA. We see exactly the same process in Europe.
In the face of all these problems, the last thing Europe needs is political upheaval and disunity. But that is the picture we see everywhere. We used to say that Greece was the weakest link in the chain of European capitalism. But that honour is now reserved for Italy.
Greece’s public debt is now 186 percent of GDP. This is exactly the same crisis as before reemerging, except the ECB can no longer print money to escape it, with inflation skyrocketing.
But Italy is not Greece. The crisis in Italy poses a deadly threat to one of the eurozone’s bigger economies.
Italy’s public debt now stands at about 150 percent of its GDP. This is unsustainable. But in order to reduce it, deep cuts in public spending will be necessary. The Italian bourgeois needs a strong government to carry through an attack on the working class. But a stable coalition government is impossible to achieve.
The downfall of Draghi in Italy is a further indication of political instability. A financial collapse in Italy would pose a serious threat for the eurozone at a time when rising interest rates make it more difficult to finance the debts.
Similar processes are at work in France. Emmanuel Macron, the very embodiment of the ‘Centre’, is losing his grip on power. The French people dealt Macron a bloody nose, taking away his majority in the legislative elections.
Less than two months after he was re-elected president, Macron has lost control of the National Assembly. He had called on voters to deliver a solid majority. But his centrist coalition suffered a total rout in an election that has left French politics sharply polarised.
Marine Le Pen of National Rally gained ground at the expense of the Centre. But it was Jean-Luc Mélenchon’s Left Bloc (Nupes), which includes what is left of the Socialist Party, Communists and Greens, that made the biggest gains. What he does with his victory remains to be seen. But what is clear is that the political centre in France is collapsing before our very eyes.
The Macron government is weak. It will be faced with enormous pressure from both the left and the right. It will be a government of crisis from the very start. The most significant fact was the high level of abstention: 53 percent in the first round and 56 percent in the second. This is a clear indication of the collapse of support for the existing parties, an extreme alienation from the status quo.
Marx said that France was the country where the class struggle is always fought to the finish. The stage is set for an explosion of the class struggle in France, where the workers have a long tradition of taking to the streets.
The present situation is quite unprecedented. Some talk of a revival of the Gilets Jaunes movement. But such is the colossal anger that is built up, and the hatred of Macron that a new edition of 1968 is entirely possible.
One big difference with 1968 is the complete collapse of the Communist Party. The Stalinists do not possess anything remotely resembling the authority they had in the past. They will not be able to put the brakes on the movement once it gets underway.
And like 1968, it can happen without any warning. We must be prepared.
The demise of the Boris Johnson government was simply a part of this fact; a reflection of the deepening crisis of British capitalism. Britain, once the most stable country in Europe, has become possibly the most unstable. The situation has become increasingly convulsive – politically, economically, and socially.
There is a clear process of radicalisation – and not just in the youth, which remains our main field of work. The inevitable attacks will be expressed in a reactivation of struggles on the industrial front.
In Britain, where the level of strikes was historically low, we now have the first national rail strike for 30 years, in which 40,000 rail workers went on strike. And the teachers and other low-paid public sector workers are threatening to follow their example.
Alongside rail workers, we have seen moves towards industrial action by bus workers, refuse workers, airport workers, construction workers, and postal workers. Civil servants, teachers, lecturers, and even barristers are on the move.
The British ruling class is becoming concerned that the combination of low pay and inflation will cause an explosion of strikes, particularly in the public sector, and are preparing for a battle with the railway workers, a traditionally militant union.
The fears of the bourgeois were expressed in a recent article in the Financial Times on 18 June:
One cabinet minister said the government was walking a “delicate tightrope” of keeping pay down and avoiding an inflationary wage spiral without forcing multiple sectors on strike:
“If we get this wrong, we risk going into a de facto general strike that will create further turmoil that risks grinding the whole economy to a halt.”
This will open up big possibilities for the work of the Marxist tendency in the trade unions.
In Germany too, there is the perspective of a recovery on the industrial front.
Three major collective bargaining rounds are set to take place over the next six months – in the metal and electrical industries, the chemical sector and the public sector – affecting a total of around 7 million workers.
The rising cost of living and the threat of a social collapse raises the spectre of widespread mass protests on the streets.
I have said many times, of Russia, that if the Communist Party was a real Communist Party, there would be no problem. That is true. But under Zyuganov, the CPRF plays a similar role to that of the reformist Social Democrats in the West: His Majesty’s Loyal Opposition. They are the main prop that is holding Putin in power.
In the early stage of the war, there were a number of anti-war protests. But the main weakness of the anti-war movement in Russia is that it is controlled by the bourgeois liberals.
The Russian workers may not like Putin, but they hate US imperialism and NATO, which they rightly see as a threat. The workers took one look at the bourgeois pro-western elements on the demonstrations, and immediately turned away in disgust.
The anti-war movement cannot succeed in gaining the trust of the Russian working class unless it breaks from the liberals.
Our comrades have stood firm against the social patriotic position of the CPRF leadership. But we must also take into consideration the mood of the working class, which at this time is mainly in favour of the war. The essence of tactics is to make use of timely transitional demands that can get an echo in the working class at a particular time.
There is not yet a revolutionary situation in Russia, but that can change. We must avoid using slogans that would fall on deaf ears and merely isolate us from the Russian workers. It would be a very serious mistake to confuse the attitude of the workers with the reactionary social chauvinism of Putin and the CPRF leaders.
Lenin pointed out in 1917 that the masses adopted what he called “honest defensism”, and that fact must be taken into consideration by the Bolsheviks:
“The slogan ‘Down with the War!’ is, of course, correct. But it fails to take into account the specific nature of the tasks of the present moment and the necessity of approaching the broad mass of the people in a different way. It reminds me of the slogan ‘Down with the Tsar!’ with which the inexperienced agitator of the ‘good old days’ went simply and directly to the countryside – and got a beating for his pains. The mass believers in revolutionary Defensism are honest, not in the personal, but in the class sense, i.e., they belong to classes (workers and the peasant poor) which in actual fact have nothing to gain from annexations and the subjugation of other peoples. This is nothing like the bourgeois and the ‘intellectual’ fraternity, who know very well that you cannot renounce annexations without renouncing the rule of capital, and who unscrupulously deceive the people with fine phrases, with unlimited promises and endless assurances.” (Lenin: Revolutionary Defensism and its class significance, from The Tasks of the Proletariat in Our Revolution)
The workers see the war as a defensive war against the aggressive actions of NATO and US imperialism. Therefore, they will be prepared to tolerate Putin and put up with the negative consequences of the war for a time.
But the patience of the masses has definite limits. At a given moment, especially if the war drags on for too long, that will change into its opposite, creating a far more receptive audience for anti-government and revolutionary slogans.
Latin America as a whole faces a major economic and social crisis. Those living in conditions of extreme poverty, have risen from 11.4 percent of the population to nearly 15 percent! Another 7.8 million people will join the ranks of those suffering from what CEPAL described as “food insecurity”, arriving at a total of 86.4 million people.
This will aggravate all the social tensions in one country after another. We see this tendency already in Colombia and Ecuador.
In Colombia, the victory of Gustavo Petro represents an important turning point, with big implications for the rest of Latin America. Petro won because of voters in the big cities, voting against corruption, poverty, inequality and violence, and for a change.
But what kind of change can be expected from Petro is another matter. I actually debated with him in Caracas some years ago and had a most unfavourable impression. He confirmed my suspicion that the ex-guerrillas always turn out to be the worst reformists.
It is significant that the US has welcomed Petro’s win. The Biden administration sees him as the best way of keeping the masses under control, since decades of repression have exhausted that route.
The masses will have to go through the school of Petro and it will be a very hard school. But the patience of the masses is not unlimited. When the deficiencies of Petro become clear, the way will be prepared for a new period of massive revolutionary movements on an even higher plane.
Then we have a big movement on the streets in Ecuador, and now there are indications of a similar movement beginning in Peru. I am pleased to inform you that our first comrades in that country participated actively in the movement.
The national strike raised the question of who rules society. But this question has not been resolved. This impasse can cause fatigue and demobilisation, and lead to a defeat. And that is the central problem.
For a long time, the working class has been subjected to intolerable impositions. These were quite sufficient to have provoked a chain of revolutionary explosions. Now in one country after another, we see the existence of a great ferment. In other words, the objective conditions are ripe for revolution.
But the essential factor – the subjective factor – does not correspond to the objective conditions at all.
Bankruptcy of the ‘left’
The real explanation for this delay is the complete absence of leadership, the utter bankruptcy of the leaders of the workers. In particular the so-called ‘Left’, who have everywhere revealed themselves to be spineless.
The Lefts sneer at the Marxists, who they regard as hopeless utopians. In reality they have long ago abandoned any idea of changing society and have made their peace with the capitalist system.
For some reason they regard themselves as great realists. But this is the realism of the man who wishes to persuade a tiger to eat salad instead of human flesh. In other words, they are the worst kind of utopians.
Having lost all confidence in the power of the working class to change society, they act constantly as a brake on the movement, doing everything in their power to hold it back and search for compromises with the class enemy.
But weakness invites aggression. For every step back the reformists make, the ruling class will demand ten more.
The old parties and leaders will be put to the test, and one by one they will be rejected, preparing the way for the rise of a genuine Marxist opposition. Therefore, the crisis of capitalism also signifies the crisis of reformism.
The perspectives of the Marxists will be shown to be correct. That is our main strength: not numbers or money or a powerful apparatus but the power of ideas. That is something the stupid reformists will never understand.
In 1938, Trotsky said that the world crisis can be reduced to one thing: the crisis of leadership of the working class. And this is still true today. We have seen the decisive role of leadership in Sri Lanka. And the same tragedy will be repeated time and time again, until the working class is armed with the only programme that can guarantee its ultimate success.
The working class will only be able to triumph when it is armed with a revolutionary socialist programme. This programme is defended today by the International Marxist Tendency.
“Darkening economic skies”
The Economist warns of “darkening economic skies, and the coming threat of a bitter winter of discontent… look in almost any direction and there are reasons to be concerned about chilling threats to the world economy.”
The outlook of the bourgeois economists is pessimistic.
Their entire system is collapsing about their ears. Yet the working class, through its labour, has created immense wealth, which, if it was properly used, could solve all the problems of humanity.
The global GDP figure of $94tn may seem massive to us today, but such a total will seem extremely modest in the future. In 1970, the world economy was only about $3 trillion in GDP – or 30 times smaller than it is today.
Over the next 30 years, the global economy is expected to more or less double again. By 2050, global GDP could come close to $180tn. That is on a capitalist basis. Under a planned socialist economy, it would be far greater.
What do these figures mean? They mean that there is absolutely nothing utopian about the perspectives for socialism. In reality, the material basis for a socialist world already exists. We have in our hands all that is necessary to build a paradise on Earth.
But the prior condition is the overthrow of the capitalist system. Big opportunities can present themselves before us far more quickly than we imagine. But we must be prepared! That preparation must take place now, and it can be summed up in one word: growth.
We have the best ideas, but this alone is not enough. We have to work so that these ideas become militant numbers, so that quality becomes quantity, and quantity will turn into quality. It is not the same to enter the new situation with an organisation of one hundred compared to an organisation of one thousand.
We must not allow ourselves to be distracted by this or that detail, but concentrate all our energies on the main objective, which is the building of the revolutionary International.
That is the challenge before us. It is a race against time. Nothing must be allowed to stand in our way.