Hitherto philosophers have interpreted the world in various ways. The point however is to change it. Karl Marx
Economic & Philosophic Science Review
Subscriptions - £20 p.a. [P&P Bulletin Publications PO BOX SO, London SW17 9NL] [Post Office Regd]
No 953 Tuesday 9th June 1998                                                                                                                10p

Atomic-bomb signal to international working class: Get ready for all-out imperialist conflict, and then revolution. US 'New World Order' is just a chaotic, slump-ridden, arms-race joke, now treated with contempt, except by the Trot stooges for petty-bourgeois anti-communism. Abolishing capitalism is the only way forward. Ban-the-bomb protesting will not stop inter-imperialist war. A revolutionary end to such disaster is the only serious perspective. The bourgeois press admits that economic turmoil is now completely out of control, and insoluble.

The dominant crisis-situation facing civilisation because of the break-up of the imperialist economic order could not have been made more dramatically obvious than by the renewed open nuclear arms competition.

And it is the very social poverty and unstable state structures in India and Pakistan which precisely make this message of world capitalist-system catastrophe all the more telling.

As Marxist science has consistently explained, it is the 'free market' itself, – so historically creative for 500 years in spreading advanced technologically-productive culture to the whole planet together with political and organisational enlightenment, - which finally turns development into disaster.

The cut-throat conflict for supremacy, inseparable from monopoly-capitalism's structures, literally turns into just that during imperialism's regularly-recurring slump-collapses.

Twice this century already, all-out trade war to try to escape the revolutionary turmoil of economic depression has led to all-out shooting war, on an international scale.

Inevitably therefore, the inter-imperialist arms race has always remained an integral part of the capitalist system, and must always do so, — unavoidably, no choice.
Frequent total national conflict, and total class conflict, are inseparable from a monopolising market system which can only ever offer bigger and bigger rewards for those who 'succeed', or who get lucky, or who cheat the best, or who play the dirtiest, - but only resentment, frustration, and often humiliating suffering and poverty for those that do not triumph in class conflict or international conflict.

The nuclear arms race, - supposedly a thing of the past with the "defeat of communism", — sums up this ultimate flawed insanity of the capitalist system once it has dialectically turned into its opposite and outlived its historical usefulness. 

And it is the laughable incongruity, supposedly, of impoverished India and Pakistan developing prohibitively expensive nuclear-weapons programmes which precisely makes so real this threat of atomic destruction which the 'free market' capitalist system has now produced.

It is posing the wrong question to ask 'How can such ramshackle states contemplate going to nuclear war with anyone?' The only relevant investigation is into 'What in the free-market system has permanently obliged the imperialist powers to lead the world in a relentless never-ending arms-race, frequently spilling over into barbaric wars for international supremacy, and obliging all capitalist regimes everywhere to invariably follow suit, resulting in tens of thousands more local wars in the capitalist epoch, dozens going on at this very moment?'.

The great joke of the Cold War period, – one of the greatest jokes played on civilisation in all history, – namely that 'evil communism' was responsible for the arms race, – – is now well and truly exposed. The arrogant fraud of the joke 'Non-Proliferation Treaty' is now held in universal contempt. 

The leading Western imperialist powers have kept their nuclear arsenals up-to-date. The Chinese workers state has wisely followed suit. The USA has refused to sign the Test-Ban Treaty. Washington has turned a blind eye to the nuclear-weapons capability acquired by its armed thugs in the Middle East, the Zionist imperialists. Only the great Arab nation has been seriously pressured to prevent atomic know-how, – with vicious sanctions, bombing raids, and fullscale destructive invasions against Libya or Iraq. But that hypocritical imperialist discrimination will not last long now in the face of the tremendous humiliating put-downs that India, and especially Pakistan, have now delivered to the USA's degenerately bogus 'New World Order'.

The fake-'left' press in Britain has been stressing entirely the wrong point in urging workers in India and Pakistan to denounce their bourgeois states' accession to the imperialist nuclear arms race.

Of course that must remain the policy of all communists everywhere, and it is routine to maintain this Leninist policy of preparing to turn imperialist war into revolutionary civil war.

But mass consciousness worldwide has not even begun to grasp yet that inter-imperialist war is even remotely on the cards again. The message to hammer home to the international working class from this nuclear arms-race sport, first and foremost, is 'Look what the capitalist free market is preparing for everyone'.

The Trots deliberately don't get this because 
a), they live only for their anti-communism ("anti-Stalinism"); and
b), therefore have never grasped, and don't want to grasp, the dominant driving force of modern history as being imperialist crisis.

How else to explain Pakistan, for example, risking even worse bankruptcy than it has always suffered by biting the hand of its crucial main aid-donor, the USA, in refusing to heed Washington's dire warning of the most crippling economic sanctions if it did not hold back from nuclear weapons tests to rival India's.

How else to explain, similarly, India's decision to risk major imperialist condemnation and sanctions in the first place in order to demonstrate its atom bomb prowess.

The 'threat from China' is just an obscene Cold War joke, knowingly echoed by the Indian bourgeoisie to stir trade-war chauvinism and to exonerate their own monopoly-capitalist system which is as much into the arms race as any imperialist state anywhere.

The 'threat from Pakistan' is almost as obscene since the power conflicts on the Indian subcontinent spring directly out of capitalist ruling-class rivalry and jingoistic scapegoating rather than any inevitable Indian-Pakistani enmity, – routine tricks of any bourgeois establishment wishing to hang onto power at all costs, and springing directly out of the whole ethos of the capitalist 'free market'.

The fake-'left' response to the imperialist-crisis arms-race reality in South Asia still carries with it the heroic but ultimately disarming baggage of reformist disarmament illusions, believing that the capitalist system can be shamed or protested into banning the bomb.

The working class needs to avoid being crippled by such naïveté. While capitalism lasts, no bombs or destructive systems of any kind will be completely banned. Research will always go on into everything, and the more secure imperialist powers will quietly get on with test-producing anything that looks advantageous in the great inter-imperialist conflict for world supremacy, no matter how destructive. 

It is a certainty that Japan and Germany, for example, have made all the necessary preparations for the most rapid catching-up in advanced weapons research, including nuclear weapons, in all history, in getting ready for the shattering international trade-war conflict and slump to come. They already have the most formidable armed forces developments and technological training outside of the USA, and already even pressing America close in some departments.

The point is simply this; the inter-imperialist trade war just has NO OTHER POSSIBLE OUTCOME than political conflict eventually, because the essence of the cut-throat economic competition is to wipe-out the rivals on the international market place, or to be wiped out. And no ruling-class establishment on earth, having built up powerful armed—state machinery for its own protection, both internally and externally, is going to just lie back and accept humiliating and impoverishing DEFEAT in the international trade war. 

EVERY bourgeois regime will use every chauvinist propaganda trick in the book to promote 'national survival' at all costs, – basically fighting a dirtier and dirtier trade war until it comes to blows.

By all means fight 100% NOW to denounce the capitalist—bourgeois arms race and try to get it stopped. But ALSO give workers realistic warnings that history so far has only known revolutionary success in overthrowing warmongering imperialist ruling classes AFTER their nationalist-jingoism has managed to get into war to 'defend the country's honour but has then been beaten or humiliated.

Imperialist CRISIS is the dominant force moving history forward, and WAR DEFEATS or DISASTERS, – which can potentially apply to ALL the participants, – have most frequently been the turning point towards revolutionary upheaval.

One of the features of this grotesque new scandal for the 'free-market' system of an openly renewed nuclear arms race has been the shamefaced humbug of the lesser nuclear powers like Britain and France, who know what a hypocritical racket it is for them to keep an atomic-bomb advantage over monopoly-imperialist trade-war rivals based on nothing but phony 'world disarmament' hypocrisy.

They remain lukewarm about economic sanctions for fear of retaliation by even bigger market forces than they can command.

And beyond that, their greatest paralysis is the numbing thought of DEFEAT should all-out world conflict return again. US imperialism still boasts, threatens, and throws its weight around a bit. But the lesser imperialist powers are much more cautious these days about where they brandish their muscles, – after more than a century of either experiencing or watching the catastrophic disasters in all directions of tasting humiliating defeat or setback in international conflict.

And for all its bluster, US imperialism has also begun to learn these bitter lessons fast in recent years, beginning with their shaming humiliation in Vietnam, and in Indo-China generally, – either being defeated or being caught out imposing criminally-needless suffering illegally, and all to no purpose anyway. Korea saw similar failure and disaster, and near-setbacks in many smaller engagements since have begun to make the American imperialist bourgeoisie look very vulnerable indeed, – fat and ponderous. More US imperialist defeats could be the precise key to the world's future.

All the more strange, then, that the sinister Trots should still continue to harp on 'New World Order' domination by which US imperialism is allegedly "imposing imperialist resolutions on all 'hot spots' and damping down the worldwide struggle against injustice." 

What, – as in solving the Far East economic crash and halting the Indonesian revolution? Or forcibly stopping the spread of nuclear weapons? Or overthrowing Castro, and bringing down Gaddafi and Saddam Hussein? Or quelling the Palestinian revolution? Or preventing revolutionary 'terrorism' from forcing British imperialism to give up its 'Northern Ireland' colony? Only in fantasy-lands of Trot petty-bourgeois fears and imaginings are these defeatist nightmares a 'reality'.

The capitalist press itself admits much more of the truth, even if it is against its own interests:

MISSILES against Ethiopian MiG fighters and new Serbian fusillades punch holes in a tattered flag of American foreign policy.

So, too, does the new nuclear ball-game between Pakistan and India and the gall of Binyamin Netanyahu as the Middle East peace process drains into the sand.

Suddenly the United States — sole superpower in the aftermath of the Cold War. victor in the 1991 Gulf War, bringer of peace to Bosnia, Haiti and elsewhere — seems a little like the Emperor and his new clothes.

As Washington Post columnist Jim Hoagland puts it, minor players are calling into question the nature and durability of American leadership in world affairs a few years after the US appeared as an 'unprecedented colossus'.

Michael Ledeen, of the right-wing American Enterprise Institute, says: 'Six years ago, we were the world's only superpower. The whole world looked to us to set the rules of the new post-Cold War era. Now, it's generally a shambles'.

Walter Russel Mead, the doyen of foreign policy and senior fellow at the Council on Foreign Relations, adds: 'US policy is becoming unglued around the world... Even the tiny "Turkish Republic of Northern Cyprus" has thumbed its nose at the latest US attempt to mediate its long-running quarrel... What a change from the recent past.'

Within the administration, National Security Adviser Sandy Berger even makes a virtue of incoherence, shunning what he dismisses as grand strategies'. As world policeman, the US has turned in its badge. The world, it seems, has decided to pursue a multi-polar or regional disorder.

• India and Pakistan: The CIA failed to spot preparations for five Indian nuclear tests; diplomats were amply warned President Clinton's pleas for Pakistani moderation were ignored. Presidential spokesman Mike McCurry admitted that   the  episode ' says that the US, despite all of its wealth and its might, cannot control every event.... in the world'.

• Yugoslavia: After three bloody years of spinning like a weathercock in a hurricane." the Clinton administration closed down the Bosnian war. Now the US role is being tested in Kosovo.

• Ethiopia: Even as the top US official on African affairs headed to the area to try, unsuccessfully, to talk them out of war. the Ethiopians and the Eritreans were waging war on land and in the air.

• The Middle East: Successive entreaties to Netanyahu to withdraw additional troops from the West Bank, stop provocative settlements and to restart the peace process have been thrown back in the administration's face, particularly that of US Secretary of State Madeleine Albright. She misjudged the internal pressures of Netanyahu when she delivered her ultimatum on troop withdrawals. 

The appearance—if not the reality — was that US orders were simply ignored. Pessimism in Washington became so deep that the hosting of what officials knew would be an unsuccessful peace summit was deliberately delegated to Tony Blair. Last week Speaker Newt Gingrich ignited Israel's defiance of Clinton by riding roughshod over the entreaties saying that no 'non-Israeli' should be able to dictate security priorities — to the fury of the State Department and White House.

• Sanctions: This is the response that comes most naturally to the US when dealing with the disobedient. Sanctions are epicentral to the American foreign policy mindset, and particular favourite tactic of the right on Capitol Hill. Cuba, Libya, South Africa, Iran, Iraq, Serbia; now India and Pakistan are all on the receiving end. 

But the US has failed to secure consensus even among its closest allies. Yet even here the US is failing. Fred Eckhardt, spokesman for the UN Secretary-General Kofi Annan, wonders 'how long the world will accept this increasingly, unpopular and apparently ineffective' — and commercially undesirable — way of drilling rogue nations into line.

• China: The right-wing in Congress had one foreign policy issue on its mind above all others last week — China, the prime abuser of human rights, purveyor of poison gas to Iran, and nuclear technology to... Pakistan. So what is the world to make of Clinton's renewal of its trade privileges and his decision to enter Tiananmen Square during his visit later this month? As he never tires of saying; it's the economy, stupid.

This bleat from the British imperialist press had another added slant which simplistically tried to blame Clinton personally for Washington's helplessness, but this is pure bile from imperialist has-beens, half-wanting the usurpers in Washington to fail but not wanting to say that it is the imperialist system which is failing.

But the 'free market' is by definition a system of terrifying caprice, anarchy, and treachery once boom turns inevitably to bust, and today's latest capitalist press admissions on the rampaging crisis are just a thinly-veiled acknowledgement that NO ONE has a clue about what disaster will happen next, or, – even more degenerately,–  – about what action can be taken to avert total catastrophe.  And, of course, there is none:

THE Asian financial crisis was on the brink of a potentially more dangerous phase last night after currency dealers made a fresh assault on the Japanese yen and widened their attack to the Australian dollar.

Leading bankers in the City warned that the pressure on the yen could spark a second round of devaluations in the Pacific rim and cause new problems for Western banks with loans to the region.

They also fear that the contagion will spread to Latin America and Eastern Europe where Anglo-Saxon banks are heavily exposed.

Officials from the Group of Seven industrial countries are meeting in Paris today for an emergency session on Russia.

Fears that the G7 would not act to shore up the yen were one factor behind yesterday's rush to sell the currency, and some dealers were still hopeful last night that the West's central banks would try to cap the US dollar's rise. They said it was inconceivable that the G7 would not discuss the worsening plight of the world's second biggest economy.

On the foreign exchanges yesterday, gloom over recession-hit Japan sent the yen to a seven-year-low against the dollar. It has fallen from 80 to the dollar three years ago to more than 140 at close of trading in London yesterday.

Meanwhile, Australia was being sucked into the wave of devaluations, with its currency sliding to a 12-year low against the US dollar. Sixty per cent of Australia's exports go to Asia, with Japan the No. 1 destination.

Gerard Lyons, chief economist at the Japanese bank DKB, said the fear in the markets was that a weaker yen would make life even more difficult for other crisis-hit countries in Asia, which are trying to export their way out of trouble by using cheap currencies.

"This is a key week for the yen. A fall could trigger a new round of currency depreciation, which could involve China and Hong Kong. Asia is currently in a regional recession that risks becoming a regional depression."

Dr Lyons added that the yen had been relatively stable last week amid hopes of a G7 support package, but had come under renewed fire as this possibility had waned.

An indication of the concern felt in the West came from Hans Tietmeyer, president of the German Bundesbank, who said that he hoped the yen did not fall "all that much".

In Tokyo, finance minister Hikaru Matsunaga went through the motions of threatening "decisive measures" to combat the dollar's "excessive strength," but there was no public sign yesterday of intervention by Japanese monetary authorities to defend the currency. Prime minister Ryutaro Hashimoto appeared to be resigned to a further decline. The Jiji news agency quoted him: "The market moves on complicated factors. All we can do is closely monitor it".

Asia's economic woes helped push the Australian dollar below 60 US cents yesterday in the most serious fall-out yet of the collapse for Australians. With Indonesia also affecting confidence, dealers in Sydney stressed there was a risk that the currency could fall further.

THE collapse of the yen against the US currency is a serious new blow to the Asia strategy of the West. At the point at which one dollar buys more than 140 yen, with some speculation that it could eventually get to 150 yen, the whole basis on which Asia has been stabilised by the International Monetary Fund starts to unravel.  The risk is that it will provoke another series of devaluations across the region and require a further round of provisions by Western lenders against bad debts.

The contagion from Asia is already being felt across the emerging market economies. In Brazil, market interest rates have had to go to 22 per cent to stabilise the capital markets, even though inflation is just one-third of that. In Russia, last week, satisfaction was being expressed that government bills were being taken up in the money markets at 60 per cent, a clearly impossible figure, if better than the 150 per cent rates seen only a week earlier. The rising panic about the yen was detectable when the Bundesbank president, Hans Tietmeyer, emerged from the monthly Bank for International Settlements gathering in Basle to suggest the fall in the yen was not in anyone's interest.

For someone who has recently emerged from BIS meetings reassuring the world that Asia was unlikely to affect global growth, this was the equivalent of manning the barricades.

Germany, in particular its banking system, has genuine reasons to be concerned about events in both Asia and Russia — in the former, the commercial banks already have taken huge hits (some $1.5 billion, or £980million, at Deutsche Bank alone) and the German banks are also the biggest creditors to Russia.

Given the potential for knock-on effects, the G7 deputies meeting in Paris today will no doubt contrive to voice support for the yen, although their main task is to shore up the rouble and the Russian economy.

But it is a hopeless task. It is the overproduction of capital itself, all of it greedily seeking profits, which always finally chokes an imperialist-system boom, as Marxist science alone has explained.

Yet even more credit-creation is the only 'cure' that the deliberately irrational and philistine 'free market' system can think of. It is more insane than trying to cure an alcoholic with endless drink.

But the imperialist system is now on the horns of an impossible dilemma. It is damned if it puts more fuel on the fire by churning out yet more credits to add to the tidal waves of 'surplus' capital now sloshing around the planet in panic, wrecking one market after another in the desperate search for profitability or even just a safe haven.

But it is equally damned if it fails to rush to the rescue of collapsing economies with yet more credits, – risking communist revolution in these circumstances, as is clear from the following capitalist-press admissions:

Some have compared the effects of unfettered global capital flows during the Asian crisis to a nuclear attack. Nuclear winter seems more appropriate — after the initial explosion, a chill sweeping slowly but inexorably across the world.

Last week it reached Russia. Yeltsin's new government, led by the youthfully self-confident Sergei Kiriyenko, stopped the rouble's collapse, but at enormous cost. The privatisation of a large oil company ended in ignominy when no one made a bid; the stock market plunged; a potential flight of foreign capital out of GKOs threatened to drag down the currency and commercial banks with it; interest rates were trebled.

For a time there was panic.

'Russia is at the front line in the global fight against market turmoil,' said Charles Maynes, president of the Eurasia foundation and former editor of the American magazine Foreign Policy.

But despite the optimism and the government's progress in bringing spending and income into line, the Asian cloud hangs thick over Russia. The crisis has shrunk world demand for oil and metals, the country's two biggest currency-earners.

If cheap Asian exports begin to hurt the US and Europe, Russia's friendly creditors will start taking a harder line, and there will be even fewer Western players on the GKO market. That is the price for relying on hot money for short-term local currency funding.

RUSSIA'S TROUBLES had a swift effect on its neighbours. The Polish and Czech currencies fell sharply. Ukraine, a country almost as big as Poland, Hungary and the Czech Republic combined, has short-term debt mountains of its own.

Inside Russia, it remains to be seen how long the economy can tolerate interest rates at 150 per cent, 10 times higher than inflation. Russians don't have mortgages or overdrafts — few have bank accounts, one of the reasons for the dire shortage of money in circulation — but no business can survive indefinitely without credit.

Striking coalminers, who had blocked railways across the country in the run-up to the crisis, went quietly back to work before it began, although it seems unlikely they will be paid all they are owed. The fact that people work for months on end without pay is less irrational than it seems. Workers know that a major strike could expose their companies to bankruptcy and closure. Yet it only took a few thousand miners and their families to paralyse the railway system. Moscow is terrified of using force against industrial discontent—indeed it is questionable what force it could use, and this weakness has heightened the sense of political vulnerability. 'Next time we'll not be blockading ourselves, it'll be Moscow. We'll cut off their oxygen,' said one Siberian miner last week. 'Let them find out the kind of people we are.'

A relatively small number of militant workers just beginning to sense their power could be far more dangerous to the political establishment than a large number of truculent but cowed ones, particularly if they are joined by students and health workers.

A plummeting rouble could trigger such pressure through inflation, rising food prices and collapsing banks. 'The strong rouble is, for the establishment, the sole achievement of seven years of reform.' said political commentator Andrei  Piontkowski. 'If it collapses, it's a political catastrophe for the ruling class.'

This is not the first time the rouble has teetered on the edge, and it will not be the last. Each time the central bank has to step in, billions of dollars are shaved off its gold and hard currency reserves. Those now stand at $14.5 billion (a third in not very useful gold), against foreign-held GKO-bonds of $20bn, with a peak of redemption in June obliging the government to pay back $1 billion or more each week.

Gaidar said Russia was in better financial shape than Brazil

These are not sentiments to pacify unpaid Siberian miners who can barely feed their children.

But propping up other states' irresponsible credit-creation (GKOs in the above instance) is just what the harder-line imperialists in Washington are now determined to take a stand against! - as this capitalist press report struggles to comprehend, summing up the dilemma of imperialism being damned if it does bail out, but equally damned if it doesn't:

Indonesia and Russia happen to be the two economies that are currently at the top of the International Monetary Fund's firefighting agenda. Their cases both throw up searching questions about the IMF's role in the Mexican wave of financial instability currently rolling around the globe.

In both cases, there is an ingrained assumption that only handouts from the IMF will save the day and that, because of the strategic interests of America, the IMF's largest shareholder, the Fund will be found willing to dip once more into its rapidly depleting reserves of cash.

Both cases highlight the issue of moral hazard that has been most vociferously aired on Capitol Hill. Nationalist voices in both the Democratic and Republican parties have been blocking extra US funds to replenish IMF reserves, arguing that the American budget should not contribute to rescuing far-off countries that have mismanaged their affairs. Many argue that the very existence of the IMF and its bail-out billions is an incentive to bad behaviour.

Indonesia was supposed to be different The IMF was determined to make private sector lenders pay for ill-judged loans, having failed to punish them in Korea and Thailand because the sheer speed of events dictated an indiscriminate rescue. 

David Folkerts-Landau, former head of capital, markets surveillance at the Fund, now head of emerging, markets at Deutsche Bank, told The Times in February: "If the multilateral institutions and the G7 directly or indirectly support bailing-out of private creditors in Indonesia, I would say that they have lost a very significant opportunity to impose discipline on the system."

The IMF has tried to play hardball with Indonesia but this tactic blew up in its face. 

Its insistence on cutting subsidies as a condition for loans has been widely blamed for sparking punitive price rises and the street protests that led to the toppling of President Suharto. It seems inevitable now that the IMF will swiftly resume payments to Indonesia, and on soft conditions, to reinforce a return to relative political stability.

This brings us to Russia. Strange as it may seem to a Moscow teacher, recent events in Indonesia virtually guarantee that Russia will be bailed out of its current difficulties, which include Moscow being flooded with demonstrators complaining that they have not been paid. Far from being to blame for Russia's problems, Indonesia may come to be seen as its saviour.

If political stability in Indonesia is deemed worth paying billions for, how much more money would the IMF and its American backers be prepared to spend on Russia, in whose reform process the West has invested so much capital and which is still, after all a nuclear power? Even the most diehard congressional critics of IMF rescues will find it hard to argue against help for Russia. 

Its politicians were clearly milking their special status last week. On the day of Mr Odling-Smee's arrival, Oleg Yyugin. Deputy Finance Minister, said that the next $670 million tranche would not be enough to solve the country's economic problems. He said that effective support would have to be on quite a different scale.

Speculation raged in the financial markets all last week about whether packages of new loans might be forthcoming. Figures of $5 billion, $10 billion or even $20 billion were mentioned. Rudolf Edlinger, Austria's Finance Minister, said that his country, for one, would be prepared to back new IMF money. The IMF was not alone in the frame. Rumours abounded that Western governments may be prepared to lend Russia a financial lifeline directly.

On Thursday the IMF was still insisting that no new money was on the table and that the release of the $670 million tranche still depended on satisfactory progress in Moscow on measures to boost its tax revenues, including improved tax collection.

However, as Korea. Thailand and eventually Indonesia demonstrated, the IMF will have little choice but to come up with the money and very soon, whether or not Russia commits itself to the reforms being demanded. Moral hazard be damned, the IMF has come to be seen as the only answer to financial crises and. at minimum, it must disburse its next tranche of money for the markets to stabilise.

But the markets cannot possibly 'stabilise'. With even more footloose credit now sloshing anarchically around the planet via the totally uncontrollable 'free market', the 'instability' can only get steadily and relentlessly worse. 

In the long term, as the entire evidence of modern history shows conclusively, instability is the only natural condition of capitalism. Lengthy periods of calm and boom are entirely artificial stage-managed interludes for a more pressing political purpose, such as the anti-communist Cold War period. But even that was curtailed in the end by the system's uncontrollable cutthroat competitive anarchy as the EPSR alone has been able to explain.

So IMF imperialist turmoil can only carry on getting worse. And meanwhile, the working class internationally is beginning to re-learn its Marxist-Leninist science, as the Siberian miners, and the Indonesian masses, and hundreds of millions more all round the planet, are starting to show. Build Leninism. Build the SLP. Roy Bull

Imperialist 'New World Order' farce now visibly in tatters everywhere.

No amount of imperialist bluster from the USA or its British poodle Tony Blair, threatening "armed intervention" in Kosova, is going to solve any problems in the Balkans, or anywhere else, for the capitalist system.

Even if tub-thumping turns into some kind of activity – and there are plenty of precedents for seeing such threats fall apart from Baghdad to Mogadishu – it will only make worse the mess of petty nationalisms stirred up by the imperialist crisis and the murky behind the scenes interventions in the region this decade. 

Yugoslavia was torn apart by the imperialist provoked breakaways of Slovenia and rampantly fascist Ustashe-reviving Croatia: the motives, a general hatred of the Yugoslavian communist federation and a specific jostling for economic and political influence by various imperialist powers facing massively increasing competitive pressures, as the worldwide capitalist crisis really began to bite in the last ten years.

The large numbers of German tourists now enjoying holidays along the Adriatic coast give some obvious clues about who the imperialist "winners" were: the agitated Anglo-Saxon military bluster clues to who feels their grip slipping.

Imperialism's grip is not slipping simply in southern Serbia or the Balkans of course: this is merely one arena for expressing a worldwide loss of grasp and confidence: exactly the undermining and disintegration of the New World Order which the monstrous Trotskyites spend their lives talking up, to the damage and detriment of the working class and its fight.

As the EPSR has long understood and analysed, the fundamental driving force of the century continues to be the ever growing antagonism of capitalist competition and, in the late twentieth century, the clash between ever larger monopoly blocs: most sharply expressed in national and regional form, - in particularly those concentrated around Germany and Japan which have increasingly challenged the overwhelming post-2nd World War dominance of the USA dollar imperialism (and its pathetic sidekick, – decaying and moribund British imperialism).

But though German imperialism is making competitive leaps and strides at present particularly noticeably against American and British capitalism (buying Random House and Rolls-Royce, leading and prestige names in publishing, posing ever greater finance market challenges) the most significant impact of all is the destabilisation of all imperialism. There are no "winners" at all – but a system sliding rapidly into slump and bitter trade war, already becoming a whirlpool of collapsing currencies in Asia and looking increasingly threatened by what even the bourgeois press now routinely calls a financial "Asian Flu" because it is so contagious. 

It is this background and its deadly demoralising impact on imperialist morale which is leading to warmongering bluster: not just the Indian and Pakistan escalations, in themselves major signals of the relentless slide in collapse of the imperialist order, but the NATO strutting over the Balkans – just as the strutting about the Gulf and anti-Iraq threats last year were agitated signals of crisis and more significantly, confirmation of the ineffectuality of imperialism, and especially its leading US power.

Nothing will be achieved for sorting out peoples' lives in Serbia; - and imperialism's best result possible will be only some barbarism against Serbian nationalism which is hated more than most by imperialism for having been once associated with the defence of the communist federated state in the Balkans, which was the only time in history the region has seen decades of peace and development.

But even that outcome – i.e. one in which something at least appears to happen and some impression of "doing something is at least offered to try and convince the rest of the world that something is do-able, – is by no means guaranteed.

And deep fears underlie intervention and the escalation of local conflict as more regional elements of capitalism, - all shaken to the core by the deadly intensification of the crisis across all of capitalism, – also threaten to get involved, particularly Turkey and Greece, both NATO members too, but at each others throats and driven ever closer to warmongering too. 

The complications are potentially paralysing, exactly as the US 'capitalist press is now saying:

WASHINGTON — India and Pakistan have redrawn the map of global power and ambition with their competitive nuclear tests. Their defiant blasts call into question the nature and durability of American leadership in world affairs, a few years after the United States appeared as an unprecedented world colossus.

The Clinton administration has abruptly stopped fretting about the risks of becoming an overbearing global superpower. Instead it scrambles after a strategy to accommodate a set of foreign policy cases that have spun out of Washington's control in a matter of weeks.

The nuclear tests in South Asia arrive as Bill Clinton's Middle East diplomacy is dead in the water, as Russia's fledgling free market economy threatens to go under, and as Asia wrestles with the wrenching social and political consequences of the collapse of it second economic "miracle." The long U.S. confrontation with Iraq, on a back burner at the moment, has not gone away.

This state of affairs is not the stuff of successful legacy.

Inadvertently, President Clinton is helping bring into being a multipolar world in which the overwhelming American power displayed during the Gulf War is sharply diminished, as rival nations have hoped since 1991.

This is not wholly, as his Republican critics assert, the fault of Mr. Clinton's notorious ambivalence toward and neglect of a strategic approach to world affairs. It is also a consequence of the stalemated nature of power in the post-Cold War international system. Today power — military, economic and political — can be amassed and displayed as in the past.  But rarely can it be used with significant positive effect.

The checks and balances of the many interdependencies created by the global revolution in technology, finance, communications and transport frustrate the sustained unilateral use of power by a single actor.

The harsh economic sanctions imposed on India and Pakistan demonstrated that Washington possesses a global reach and power that no other nation can contest. But the Indians and Pakistanis did their nuclear thing, leaving Washington to sputter angrily about betrayal and folly and to watch as the punishments it has inflicted make the situation worse.

Elsewhere the CIA comes under attack for its incompetence, Clinton's Middle East mess-ups are attacked, and more.

All this is fed by the underlying crisis of the whole system, beginning with its economics.

There is every sign now that the ever-more inflated credit mountain – "globalised" and ever mere instantaneously shifted from "profit opportunity" to "profit opportunity" – has reached the limits in sustaining post-war capitalism, already stretched and extended beyond any previous experience. Marx's profound economic analysis of capitalism long ago demonstrated the absolutely unavoidable inbuilt tendency of capitalism to collapse into a crisis of "overproduction", - when capital can no longer find anywhere to make a profit, when the working class can be squeezed no further to increase the profit rate, and when in capitalist terms some of the capital-chasing profit must be destroyed (namely that of rivals) in order for the rest to make a percentage at all.  

Repeated proof of this scientific analysis of capitalism has come in the late nineteenth and twentieth century's collapses into trade war and eventually all-out destructive shooting wars on a scale of escalating horrors.

Despite the capacity of capitalism to draw pragmatic lessons about slumps and crashes and to develop new mechanisms to extend the credit system (while further squeezing isolated pockets of the working class) - the bottom 20% in Britain under Thatcher e.g. – (or whole continents like Africa in the 80s e.g.), it cannot ultimately escape its own contradictory nature, and plunges into the biggest slump in history, made all the worse because of the absurd limits to which production has been stretched, (in capitalist terms anyway). 

There is enormous scope for increased production for human need under socialism of course — without the ludicrous over-consumption by some sectors that has led to nearly ALL Americans now being designated as “overweight" while Indonesians riot for a handful of rice. (Over-eating American workers are sad victims of production for profit also of course).

All the signals continue to show that the Asian crisis is unstoppably unravelling the worldwide capitalist economic network, as the capitalist press continues to report:

JAKARTA — A top official of the International Monetary Fund has said that the economic situation in Indonesia is far worse than earlier estimated and that the Fund, will relax its deadlines for the imposition of austerity measures.

The official, Hubert Neiss, who heads the Asia office of the fund, said Saturday that the economy could contract by double the amount the IMF estimated this year as soaring inflation and unemployment take their toll. 

“It seems most think the economy could contract this year as much as 10 percent, possibly even more," Mr. Neiss said as he ended a five-day visit here to assess the situation following the resignation of President Suharto. Some private economists say the shrinkage could be as much as 20 percent.  Halting this deterioration, Mr Neiss said, will be "an enormous task."

"The Indonesian economy is in a serious state and it has deteriorated further," be said, "and the first priority is to stop this deterioration."

KUALA LUMPUR — Malaysia's economy is almost certainly heading for recession, economists said Sunday after the central bank released data showing a 1.8 percent contraction in first-quarter gross domestic product against the first quarter of 1997. 

Bank Negara Malaysia said Saturday that the contraction was led by a severe slump in the construction industry, which shrank 10 percent from a year earlier. 

Manufacturing contracted by 2.4 percent and agriculture by 2.8 percent. The overall 1.8 percent contraction was the first quarterly con traction in 13 years. I think we are already in a recession," a senior analyst with a foreign brokerage said Sunday. 

"There is nothing to show that anything has changed in the second quarter."

Sani Hamid, an economist at MMS International in Singapore, said the question now was not whether the economy was in recession but "how long and deep it will it be."

It may be that imperialism can pull one or two more stunts to stave off the day of its total disintegration, as it has in the past. But it is looking increasingly unlikely, and the loss of nerve is itself a major sign of the depth of the difficulties. Trouble is brewing everywhere and imperialism's interventions are not keeping the lid on any of it. Japan teeters on the brink of collapse as it is sucked into the Asian vortex; Indonesia is a cauldron of social and inevitably growing political upheaval; Pakistan and India are rattling very nasty nuclear sabres.

These are all huge problems for imperialism about which the dominant USA either has nothing to say or is failing to keep the lid on.

So much for the Trotskyite theories about a newly re-invigorated imperialist New World Order calmly and confidently stepping in to "resolve hotspots" – a huge stupidity if it was not so sinister in its deliberate demoralising of the working class.

The reality of the decade is of the skids being more clearly under the world capitalist order than ever before; and even under the great windfall gain of the late 1980s, the unbelievable capitulation of the Soviet leadership at just the moment when the capitalist trade war was hotting up.

Ironically it was the turning down of the Cold War heat by Reagan, to allow the USA to face its Japanese, German and other trade rivals more squarely that led Moscow revisionism to let go of the last remnants of its understanding of the need to maintain the dictatorship of the proletariat, and fully open the door to supposedly more efficient "market forces" of consumerism. 

But the West's huge political and partial economic gain is falling apart, demanding ever huger bolstering by an IMF severely under pressure from Asia, Mexico and potentially much more. The "flu" is spreading. And with it political upheaval and conflict. 

There are even stirrings in Europe. Strikes are bubbling in France for the World Cup; there is movement in Britain. Germany tells Europe that in future it can whistle for the kind of contributions it has made in the past as part of the EC reformist structure that has kept the lid on the brutal realities of capitalist life. No more subsidy, and the weak to the wall – that is the hint, – exactly the real nature of capitalism forced to the surface by the massively intensifying competition.

Like India and Pakistan, this could rapidly turn nasty. It will turn nasty. The jump from economic turmoil and problems into political conflict is sudden and surprising, but only to those who reject the systematic and careful study of contradictorily evolving world events; the living dialectical Marxist development of a scientific world picture, starting with new events understood in the context of past development and theory, and in turn allowing further development of overall grasp.

The emergence of nuclear weapons testing and increased aggressive posturing by capitalist states on the edge of the Asian crisis is no surprise; – the exact form of the escalated warmongering atmosphere in capitalism, in detail, is important material for grasping the world crisis and as confirmation of how deeply and how quickly the Asian turmoil is developing. India and Pakistan both are prime candidates for the kind of social explosion which has ripped up Indonesia: warmongering chauvinism as a diversion has always been one of capitalism's basic weapons for heading off the development of revolutionary feeling in the masses.

The more the masses can be warned of such diversions and given a leadership pointing to the real culprit, capitalism – the more chance there is of developing the inevitably necessary struggle to overthrow this disgusting and destructive system with a minimum of bloody and pointless intervening warmongering chaos – the only destination worldwide for capitalism. including in the most "advanced" "successful" "winning" "enterprising" and "cultured" countries (remember Germany was the moat cultured country in the world in 1933).

Such analysis is the essence of leadership, and the best way to build a struggle to end capitalism, – in fact, the only way of guiding the struggle and understanding its strengths (and their weaknesses). Taking Leninism forwards is the vital necessity in the workers movement, and a crucial weapon for a party such as the SLP – which is being looked at carefully by more and more workers as the crisis deepens and the fraud of Labourism and reformism becomes daily, more obvious. Don Hoskins.

Letters

New Labour means more capitalism but it is capitalism which is failing.

Blair's Labour was voted in to end the basic unfairness of things in this country.

But New Labour is just a giant con trick. The voters are being fooled. The B1air government is just jeering at ordinary working-class people.

The Tories created the nastiest spivocracy ever suffered. Crooks and charlatans of all kinds made millions out of one racket or another.

But Blair & Co are in cahoots with exactly the same class of rotten exploitation.

In fact, New Labour are determinedly making things even worse.

The privatisation fraud is still being encouraged to extend its rip-off activities in all directions, – continuing to pocket huge public subsidies, for example, for deepening the expensive mess it is making of the railway network, – with more billions to come from carving up the London Underground and from further high-coat but dubiously worthwhile showpieces around the Channel rail link.

Hospital-building is being put out to private profiteering, with huge leaseback rentals to be paid for years to come to the millionaire speculators. And road-building is next to go.

But Tory Britain was a by-word for scandalous injustice, sleaze, and ultimately for incompetence. Handing everything over to the capitalist class is what the people of Britain decisively voted AGAINST on May 1 1997.

Yet on jobs and housing, – the most crucial questions in everyone's lives, – exploitation is more blatant and rampant than ever before.

And the situation looks just as harsh as far as the whole of education, health services, and care of the elderly are concerned.

The wealthy, the opportunists, and the corrupt continue to get the best of everything. Ordinary people are facing more and more struggle and uncertainty.

So what is going on??

New Labour is just a party of posturing middle-class careerists who will do absolutely NOTHING to challenge or upset the capitalist profiteering which actually runs this country.

And it is that crooked system which is actually in trouble, and not just the Tory or Labour (or Lib-Dem) governments and councils which administer it.

A world capitalist economic crisis is brewing which is cowing capitalist governments everywhere, – New Labour included. The anarchic greed of the system has over-reached itself for the third time this century, and a devastating major international slump plus destructive trade-war is now on the cards.

Labour will once again claim it has been "blown off course", which was Wilson's excuse for this hit-or-miss, unjust way of running things.

But the truth is that Labour is just a stooge of big business and ruling-class privilege whatever the economy is doing.

The 'Welfare to Work' stunt proves it. It was supposed to revolutionise the work situation and abolish unemployment. It is a complete joke.

All it is doing is further entrenching cheap labour conditions and the hire-and-fire principle so crucial for maintaining the profiteering ethic as the dominant question in employment.

All that this 'Welfare to Work' gimmick will do is enable the bosses to keep wages down, increase the supply of casualised labour which can be hired and fired at a moment's notice to suit order-books, and make trade-union organisation more difficult than ever for protecting workers' rights.

New Labour has kept ALL Thatcher's anti-union laws in place, and the 'Fairness at Work' pose could see more DE-recognition than increased bargaining rights because of the 40%-support hurdle (which neither New Labour nor any other government has ever got from the total electorate, such is their hypocrisy). And the derisory 'Minimum Wage' will change nothing either.

The jobs problem is symbolic of the whole capitalist crisis. 

Society will continue to break down until guaranteed PERMANENT CAREER opportunities, - with continuous full training and retraining opportunities, — are available FOR EVERYONE, - all the time.

And only a complete change of system to planned socialism can achieve that.

But that is what is now required as the 'free market' plunges into ever-greater collapse-anarchy and slump, and as the renewed nuclear arms-race, plus conflicts breaking out everywhere, proves that capitalism is eventually just a recipe for war, as it has always been.  

R LIST

Letters

Crisis is the issue

Far from taking a lead for the working class in rejecting totally, Blairism, shallow Blairite gimmicks like the "new mayor", – and, behind all that, capitalism itself, –the SLP put forward an indifferent and unsure "boycott" line, which at best was a shallow compromise and at worst simply confusing for workers. 

Campaigning itself was limited to local issues in the main for candidates – the emphasis being wholly on being "better" at fighting for resources.

But while it is important to build up the strongest local connections for the SLP, and responsiveness to working class preoccupations, – to do so without urgently presenting the broadest description and warning about the imminent capitalist slump crisis - and with it the strongest denunciation of New Labour's toadying stooge role for that system – is to waste crucial opportunities to develop class understanding. 

It can even be worse, – a misleading of workers.

To what purpose do we promise any "better" local services when the scale of the coming slump could wipe out whole areas of service wholesale overnight? Or limit criticism of New Labour to such issues when the real problem is Blair's prostituting of politics to service the big bourgeoisie and its increasing need to impose the most grotesque dump burdens on the working class.

New Labour's constitutional reforms do nothing to solve the deadly realities of the coming slump – for Londoners or for workers in any other place. Nor are they intended to: the whole game with its fascist-referendum populist undertones is meant to be a shallow "soundbite" glitz distraction – with a sinister potential to turn into something much more authoritarian and nasty as slump accelerates.

The stunning social explosions in Indonesia should alert everyone to the titanic scale of the coming slump collapse – which have devastated lives economically in Asia: and next will devastate and transform the entire political landscape. What use are half-hearted reforms or even the most sincere promises to be a better local representative in such conditions?

In Indonesia now, promising a "better system" – as many of Suharto's immediate past loyal supporters are suddenly deciding is the "right thing" in denouncing Suharto – is to try and head off the huge revolt which wants, inarticulately, to end all past exploitation i.e. capitalism – if only it knew it. 

And it wants to throw out all of that system, — Suharto's henchmen with it. Wo betide anyone who did not warn of the problems or who limits the revolt.

The duty of socialists is to warn the working class of the dangers,– and of their capacities to fight it; to NAME capitalism as the enemy,– and to LEAD the working class's fight against it by analysing it and its crisis.

And only by making it clear that the ending of capitalism is going to give workers the solution, - and only the ending of capitalism, – is a party going to begin giving the kind of leadership now required.

The tide of counter revolutionary anti-communist garbage pouring daily out of capitalism,–falsifying history, and the achievements of the working class and socialism, worldwide, and successful anti-imperialism too,–cannot be stopped or countered successfully by the workers movement and the SLP. But what the party of the working class can do is to point at the degenerate catastrophe of the imperialist crisis and its rapid acceleration into the biggest slump and trade war in history.

This is not "over-the-top" or "crisis-ism" but the very essence of what threatens the working class and indeed all human existence;- this is a system whose slumps degenerate into war (- why are India and Pakistan upping the nuclear ante?).

To take a half-hearted or even agnostic stand on this question is to fail to lead, at best, and to mislead the working class at worst. It is possible for us to understand all these questions by using the powerful tools of Marxist analysis – which were able to say at conference last year, – and for years prior to that, – that the scale of capitalism's crisis is unprecedented. Against that was counter-posed the fake left and posturing view that "it is not clear yet". Only to those influenced by the nonsenses and defeatism of Trotskyism and other post-war rejections of Marxism, is it "not clear”.

And this MISLEADERSHIP is dangerous for the working class which needs, above all, the understanding of the depth of the crisis it faces. It is a sad day when the working class party is behind the capitalist press in saying what is happening (see stories already analysing the global nature of the Asian collapse and the threat to even the mighty dollar.)

The working class party also needs to be able to show the working class the triumphs of its struggle such as the now devastating anti-imperialist Irish fight which has routed British imperialism's monstrous partitioned Occupied Zone of "Northern Ireland"; and more generally the upsurge of the fight worldwide from Palestine to Indonesia to South Africa to – now brewing –  Russia.

Sadly on Ireland the party is currently telling workers the exact opposite; that imperialism is imposing some New World Order settlement on the bold revolutionary struggle there. One look at how much the 'New World Order' has managed to impose in Jakarta demonstrates what a nonsense such a perspective is. Imperialism is in trouble. To suggest the opposite is playing into its hands. 

The SLP will not make any impact on the London working class, or the working class generally, that is of lasting value unless it takes on these major theoretical questions which give the full context to show how disgustingly criminal is New Labour's collaboration with capitalism and refusal to tackle it at the point when it is becoming more threatening than at any time in history. 

Tinkering with constitutions – in London or anywhere else – is a fraudulent diversion from the real issues, and made worse if a party (the SLP even) suggests boycotting could mean "a real choice". There is only one real choice – to fight against capitalism, – or not; and to fail to start with that – and the perspective of the crisis – is to throw away the working class's most vital weapon, understanding of where it stands and what it is up against.

More theory – and correct theory is what the SLP should be giving to workers; - not tinkering around with structures.  D.H.