A world of extremes

December 15, 2010

It often takes time for the sparks of resistance to catch fire. But when they do, the political climate can change very quickly.

WHAT KIND of year has 2010 been? Consider this story from Wisconsin.

Scott Walker, the Republican governor-elect, says he wants immediate concessions worth more than $154 million from unions representing public-sector workers to help close a $3.3 billion budget shortfall over two years. And if the unions won't go along? Walker says he'll put forward legislation to get rid of collective bargaining for state workers, and effectively turn Wisconsin into an anti-union right-to-work state.

In other words: Hand over the money--or else.

It remains to be seen if Walker could get away with tearing up union contracts, either legally or politically, but his threat illustrates the scale of the assault on the U.S. working class at its sharpest edge--the drive for austerity at every level of government.

Wisconsin isn't alone, of course. In Arizona, Gov. Jan Brewer--who proudly championed the anti-immigrant SB 1070 law earlier this year--is defending the state Medicaid agency's decision to stop paying for certain life-saving transplant operations. Earlier this year, California Gov. Arnold Schwarzenegger threatened to slash pay for all state workers to the federal minimum wage unless the legislature went along with his budget demands. At the national level, President Barack Obama, after saving Wall Street and the banks with a no-strings-attached bailout, has declared a two-year pay freeze for nonmilitary federal workers.

A homeless man rests outside a Prada store

Elsewhere around the world--from Europe to Asia to Latin America and Africa--the attack is even harsher in many cases. In every country, the ruling class is determined that workers must pay the price for an economic crisis set off by the financial elite that has spread to every corner of the globe.

2010 will go down in history as a year of austerity, when political leaders pressed demands for cutbacks and other anti-worker measures on a shocking scale. Their aim everywhere is clear--a future in which the business and political elite have unquestioned power and greater wealth, while working people must make do with a lower standard of living.

But 2010 will also go down as a year when we saw the stirrings of resistance. Many of the struggles were small, brief and unheralded--others were big and explosive, and captured the attention of the world. They represent the anger building up in a world of extremes--and the feeling that something has to be done about it.

Even the largest and most militant struggles couldn't turn back the ruling-class assault in most cases. There are more ups and downs--victories, but also defeats--ahead before the resistance reaches a scale that matches the other side.

But it is now clear to millions and millions of people that the system doesn't work for them--and that if they want something different for themselves and their families and friends, they need to take action.

How the anger and desire for change will express itself in the months ahead can't be predicted in advance, but what we do know is we need more people--more socialists--organizing today to build up the networks of activists and political experience that can help in winning the struggles to come.

WHAT CAN we do to turn the tide? The first point is to recognize the scale of the ruling-class offensive and its purpose. Otherwise, it's easy to become confused or demoralized about the lack of response--and the inability, so far, of those struggles that have taken place to stop the attacks.

The drive for austerity is the centerpiece of a strategy for resolving the economic crisis. Capitalism's age-old solution in an economic slump is to restore profitability and stability by forcing through a decline in living standards for the working majority. Each aspect of the ruling-class attack--from private corporations making fewer workers work harder for less, to state attacks on social programs that working people and the poor depend on--is connected to this goal.

The drive for austerity is justified with the claim that everyone was living beyond their means during the boom, so it's time for all of us to tighten our belts and share the sacrifice. But the truth is that the wealthiest and most powerful section of the capitalist class caused this crisis--and now they're out to make working people pay for the economic devastation that followed.

Consider Ireland, which followed Greece earlier in the year as the next country in Europe to need a bailout from the European Union (EU) and International Monetary Fund (IMF).

Ireland was one of the success stories of the world economy in the 1990s and 2000s. The "Celtic Tiger" attracted international investment with low corporate tax rates and then enjoyed a real estate bonanza. But the boom was financed by massive international borrowing by Irish banks, and when the crisis hit, the banks were in big trouble.

As in the U.S., Ireland's government responded with a massive bailout that guaranteed all of the banks' debts. To pay for it, the government turned on working people, cutting social welfare spending by 4 percent and public-sector pay by 16 percent.

But the bailout didn't resolve the crisis, so in November, the government needed a $114 billion rescue from the EU and IMF. The price tag for saving the banks is, once again, savage austerity for workers. Ireland's agreement with the EU and IMF came with a promise to slash the social welfare budget by 15 percent. The government is planning to cut nearly 25,000 public jobs, a huge number in a country of 4 million people. That's the equivalent of the U.S. government announcing it will lay off 1.9 million public-sector workers.

Ireland's minimum wage is to be reduced by 11.6 percent. But guess what won't be touched? The low corporate tax rate of 12.5 percent that lured multinationals like Microsoft and Pfizer to Ireland won't go up.

The same priorities--of saving the banks and big business, and making workers pay for it--is evident in Greece and Portugal, in Britain, France and Germany, in Asia and Latin America, and in the U.S. as well.

The scale of austerity in the U.S. isn't always as clear because the cuts are coming at the most intensive pace at the state level--and therefore don't get the same kind of attention as a nationwide attack. But they are every bit as devastating.

In California, for example, the state government is expecting its budget shortfall to grow to $25.4 billion in the current fiscal year and the next, amounting to nearly 30 percent of the state's general spending. California has already resorted to unpaid furloughs for tens of thousands of state workers, increased regressive taxes and deep spending cuts in desperately needed programs like health care for the poor and public education.

Now, with Democrat Jerry Brown ready to return as governor, the situation will only grow worse--Brown is promising to make workers bear the burden. But the one solution to the crisis that California's political leaders won't consider is raising taxes on the rich or rescinding the corporate tax breaks handed out during the boom.

In California and around the U.S., the result in the near term will be greater misery and suffering for the most vulnerable and a tougher time for all working people.

In the long term, the austerity drive will permanently shrink government social programs--and with that, the overall living standards of the working class. As one official at a social service agency in Chicago told SocialistWorker.org earlier in the year, "You are seeing [social service provider] systems simply shut down...We will not be able to simply bring folks back, or organizations back, to provide this care. It's going to be altering our system for a very long time."

THE FOCUS of the ruling-class attack on U.S. workers' living standards is the public sector, but that doesn't mean private-sector workers are doing okay. Corporate America is using the recession to drive down wages, particularly in industries and sectors where unions were once strong and workers enjoyed a more stable lifestyle.

For example, new hires at General Motors and Chrysler--one-time citadels of power for the United Auto Workers--are making just $14.50 an hour at some grueling assembly-line jobs, and labor analyst Harley Shaiken reports that Toyota's goal for wages at its Kentucky assembly plant is $12.64 an hour, and $10.79 at a new plant in Alabama.

The result of this attack on autoworkers' wages is obvious: bigger profits for automakers. General Motors, which declared bankruptcy last year after a rescue by the Obama administration, is now posting positive earnings again, and expects to report at the end of 2010 its first full year of profit since 2004.

In the economy overall, says Andrew Sum of Northeastern University's Center for Labor Market Studies, the last several years have produced "the most lopsided gains in corporate profits relative to real wages and salaries in our history." As Sum told New York Times columnist Bob Herbert:

Here's what happened: At the end of the fourth quarter in 2008, you see corporate profits begin to really take off, and they grow by the time you get to the first quarter of 2010 by $572 billion. And over that same time period, wage and salary payments go down by $122 billion.

As Herbert concludes, "That kind of disconnect...had never been seen before in all the decades since World War II. In short, the corporations are making out like bandits. Now they're sitting on mountains of cash and they still are not interested in hiring to any significant degree, or strengthening workers' paychecks."

The gap between the haves and have-nots has grown bigger during the Great Recession, and this is producing a world of outrageous extremes--of unbelievable displays of wealth by the Wall Street banksters and their partners in crime, while the vast majority of working people are told to make do with less, now and for the foreseeable future.

Every new attack by an emboldened ruling class is exposing the contradictions of capitalism and exaggerating them further. Even if the bitterness of growing numbers of people isn't expressed immediately in struggle, more and more are coming to the conclusion that capitalism doesn't work, except for the privileged few.

For socialists, the ideological alternative we present--the vision of a society run by workers in their own interests--is relevant to the ideas and experiences of millions in a way that it hasn't been in generations.

THE ANGER being stoked by this ruling-class offensive is explosive. We know this from the experience of European countries where the attack has been most intense. In Greece, the EU bailout last May came with the same demands for austerity as in Ireland, imposed without objection by Prime Minister George Papandreou, leader of the center-left party PASOK. The measures spurred weeks of strikes and mass protests and a revival of left-wing parties that saw partial expression in gains in recent elections.

But the high point of the struggle so far has been France, where President Nicolas Sarkozy's proposal to raise the retirement age for the country's pension system sparked a working-class revolt that paralyzed the country for much of October. By comparison to the measures carried out in Greece and Ireland, Sarkozy's pension "reform" was tamer. But the militant traditions of French workers and especially the confidence gained from more than a decade of struggle against similar proposals led to a stronger reaction.

Then there's the situation in the U.S., where protests against austerity have been at a much lower level--and short-lived when have they taken place.

California was the center of a struggle against huge tuition increases at state universities and cutbacks at every level of public education, beginning in the fall of last year and building up to a March 4 day of action that saw tens of thousands drawn into action on dozens of campuses and cities. The day of action was an inspiring sign of the potential for a resistance in the U.S., though the organization on campuses didn't take root and develop on a scale that would pressure forces like organized labor to join in.

From these differing examples, it's clear that the scale of austerity measures alone isn't responsible for the scale of the fightback. There are other factors that shape the resistance in crucial ways.

For one thing, one goal of driving through an assault at top speed is to intimidate workers from fighting back. Virtually everyone in working-class America knows someone who has been out of a job for months or forced to take low-wage, part-time work. This gives Corporate America the leverage to turn up the pressure on those who still have a job. The reaction in such circumstances is both anger--and fear of being thrown into the ranks of the jobless.

Another factor specific to the U.S. is the disillusionment with Barack Obama and the Democrats. Millions of people who supported Obama enthusiastically because they hoped he would provide relief after the disaster of the Bush years are now coming to terms with the fact that the Democrats have done little different from their Republican predecessors. This, too, has had a disorienting influence.

So it can take some time for the sparks of resistance to catch. But it's important to remember how quickly a mood of seeming passivity and pessimism can be turned around.

The example of Britain illustrates this point. Six months ago, the Conservative Party trounced the incumbent Labour Party in national elections, and took over the government in coalition with the Liberal Democrats. A confident Prime Minister David Cameron announced a dramatic assault--with plans, for example, to cut $28 billion from social welfare programs over four years, and raise the regressive value-added tax from 17.5 percent to 20 percent, while cutting corporate taxes from 28 percent to 24 percent.

It seemed at first that Cameron would get away with his agenda without a response. In October, as France was paralyzed by strikes and mass demonstrations, even long-time British leftists wondered what was different about their country that there could be so few protests in response to the attack.

Then came an early November student demonstration in London against the Tories' plan to nearly triple fees to attend university. It drew twice as many protesters as organizers expected--and culminated in an impromptu occupation of the Conservative Party's headquarters. Overnight, the mood changed. People throughout the country saw the students as speaking for them, while students felt, in the words of New Statesman journalist Laurie Penny, "the terrified exhilaration of a generation that's finally waking up to its own frantic power."

The student movement grew in strength in the weeks that followed. The demonstrations brought out larger numbers and spread across the country, and protesters confronted the heavy hand of police repression and developed new tactics to outmaneuver the authorities.

Even this struggle, as inspiring as it was, didn't succeed. The planned fee hike passed Britain's parliament, though with a significant section of the Conservative-Liberal Democrat majority defecting to vote against it. Similarly, Sarkozy got away with his plan to increase the retirement age in France, though he is now the least popular French president since polling data was taken.

But while it didn't stop the fee increase for now, the struggle of British students has galvanized a new layer of young people in opposition to the government, and equipped them with the experience of struggle that can guide them in the future. The shape of the movement now depends on how individuals and groups extend their organizing and carry out the political debate about what to do next.

There's no telling when the next stage of the struggle will come. But this much is also true: Britain's rulers won't be satisfied. They will continue pressing for more, adding to the anger among the victims of their austerity agenda.

And when the next fight does take place, it will be with the experience of the Day X student protests still fresh in the minds of everyone, and with networks and organizations already mobilized. So the struggles to come can start out from a higher level--and therefore with a better chance to win.

THE U.S. hasn't experienced struggle on this level, but there's no reason to believe that such an explosion can't take place.

In the meantime, those dedicated to the struggle against the ruling-class attack can attempt to spread the fights that do take place, and to build up the political knowledge and experience that can guide activists in the future. That means organizing for protests, but it also means making time for political discussions and education.

History tells us that when a breakthrough for our side comes, it's contagious.

The U.S. working-class movement of the 1930s had its breakthrough victory in early 1937 with the Flint sit-down strike against General Motors. The months that followed saw a sit-down strike wave, during which hundreds of thousands of factory workers, clerks, janitors, soldiers and secretaries occupied their workplaces to demand union recognition. The labor movement's victories in organizing basic industry followed very fast on the heels of the Flint success.

The speed with which change came is important to remember--but so is the period that set the stage for the victories, when it wasn't clear to anyone involved that success was just ahead.

The 1930s upheaval in the U.S. didn't begin in Flint--or with the three great labor triumphs in 1934 in Toledo, Minneapolis and San Francisco that signaled the victories to come. It began with long and bitter struggles in the 1920s and early 1930s, most them defeated as the Great Depression took its terrible toll.

The successes of the late 1930s were part of a process that began years before with a political radicalization that didn't automatically translate into activity, and then with people learning the lessons of defeated struggles that would help them win in the fights to come.

We face a similar situation today. We have to prepare for the battles of the future through the smaller struggles of the present, wherever they take place. Wherever we are today, we need to build up the organization of socialists who can participate in all the fights in society and look ahead to a new world of solidarity, democracy and freedom.

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