Category Archives: China

The West Really Hates China

It appears that the Western public, both relatively ‘educated’ and thoroughly ignorant, could, after some persuasion, agree on certain very basic facts – for instance that Russia has historically been a victim of countless European aggressions, or that countries like Venezuela, Cuba, Iran or North Korea (DPRK) have never in modern history crossed the borders of foreign nations in order to attack, plunder or to overthrow governments.

OK, certainly, it would take some ‘persuasion’, but at least in specific circles of the otherwise hopelessly indoctrinated Western society, certain limited dialogue is still occasionally possible.

China is different. There is no ‘mercy’ for China in the West. By many standards, the greatest and one of the oldest cultures on Earth, has been systematically smeared, insulted, ridiculed and arrogantly judged by the opinion-makers, propagandists, ‘academia’ and mainstream press with seats in London, New York, Paris and many other places which the West itself calls the centers of ‘erudition’ and ‘freedom of information’.

Anti-Chinese messages are sometimes overt, but mostly thinly veiled. They are almost always racist and based on ignorance. And the horrifying reality is: they work!

They work for many reasons. One of them is that while the North Asians in general, and the Chinese people in particular, have been learning with zeal all about the rest of the world, the West is thoroughly ignorant about almost everything Asian and Chinese.

I personally conducted a series of simple but revealing ‘experiments’ in China, Korea and Japan, as well as in several countries of the West: while almost every North Asian child can easily identify at least a few basic ‘icons’ of Western culture, including Shakespeare and Mozart, most of the European university professors with PhDs could not name one single Korean film director, Chinese classical music composer, or a Japanese poet.

Westerners know nothing about Asia! Not 50% of them, now even 90%, but most likely somewhere in the area of 99.9%.

And it goes without saying, that Korea is producing some of the best art films in the world, while China and Japan are renowned for their exquisite classical art, as well as modern masterpieces.

In the West, the same ignorance extends to Chinese philosophy, its political system and history. In both Europe and North America, there is absolute darkness, withering ignorance, regarding the Chinese vision of the world. In Paris or Berlin, China is being judged exclusively by Western logic, by Western ‘analysts’, with unsurpassable arrogance.

Racism is the only fundamental explanation, although there are many other, secondary reasons for this state of affairs.

Western racism, which used to humiliate, attack and ruin China for centuries, has gradually changed its tactics and strategies. From the openly and colorfully insulting and vulgar, it has steadily evolved into something much more ‘refined’ but consistently manipulative.

The spiteful nature of the Western lexicon of superiority has not disappeared.

In the past, the West used to depict Chinese people as dirty animals. Gradually, it began depicting the Chinese Revolution as animalistic, as well as the entire Chinese system, throwing into the battle against the PRC and the Communist Party of China, such concepts and slogans as “human rights”.

We are not talking about human rights that could and should be applicable and respected in all parts of the world (like the right to life) protection for all the people of the Planet. That’s because it is clear that the most blatant violators of such rights have been, for many centuries, the Western countries.

If all humans were to be respected as equal beings, all countries of the West would have to be tried and indicted, then occupied and harshly punished for countless genocides and holocausts committed in the past and present. The charges would be clear: barbarity, theft, torture as well as the slaughter of hundreds of millions of people in Africa, the Middle East, what is now called Latin America, and, of course, almost everywhere in Asia. Some of the most heinous crimes of the West were committed against China and its people.

The ‘human rights’ concept, which the West is constantly using against China is ‘targeted’. Most of the accusations and ‘facts’ have been taken out of the context of what has been occurring on the global scale (now and in the history). Exclusively, Eurocentric views and ‘analyses’ have been applied. Chinese philosophy and logic have been fully ignored; never taken seriously. No one in the West asks the Chinese people what they really want (only the so-called ‘dissidents’ are allowed to speak through the mass media to the Western public). Such an approach is not supposed to defend or to help anybody; instead it is degrading, designed to cause maximum damage to the most populous country on Earth, to its unique system, and increasingly, to its important global standing.

It is obvious that the Western academia and mass media are funded by hundreds of millions and billions of dollars to censor the mainstream Chinese voices, and to promote dark anticommunist and anti-PRC nihilism.

I know one Irish academic based in North Asia, who used to teach in China. He told me, with pride, that he used to provoke Chinese students: “Do you know that Mao was a pedophile?” And he ridiculed those who challenged him and found his discourses distasteful.

But such an approach is quite acceptable for the Western academia based in Asia. Reverse the tables and imagine a Chinese academic who comes to London to teach Chinese language and culture, beginning his classes by asking the students whether they know that Churchill used to have sex with animals? What would happen? Would he get fired right away or at the end of the day?

*****

The West has no shame, and it is time for the entire world to understand this simple fact.

In the past, I have often compared this situation to some medieval village, attacked and plundered by brigands (The West). Food stores were ransacked, houses burned, women raped and children forced into slavery, then subjected to thorough brainwashing.

Any resistance was crushed, brutally. People were told to spy on each other, to expose “terrorists” and “dangerous elements” in society, in order to protect the occupation regime.

Only two “economic systems” were allowed – feudalism and capitalism.

If the villagers elected a mayor who was ready to defend their interests, the brigands would murder him, unceremoniously. Murder or overthrow him, so there would always be a status quo.

But there had to be some notion of justice, right?

Once in a while, the council of the brigands would catch a thief who had stolen few cucumbers or tomatoes. And they would then brag that they protect the people and the village. While everything had already been burned to ashes by them

Given the history and present of China, given the horrid and genocidal nature of the Western past, ancient and modern, given the fact that China is by all definitions, the most peaceful large nation on Earth, how can anybody in the West even pronounce the words like ‘human rights’, let alone criticize China, Russia, Cuba or any other country that it put on its hit-list?

Of course, China, Russia or Cuba are not “perfect countries” (there are no perfect countries on Earth, and there never will be), but should a thief and mass murderer be allowed to judge anybody?

Obviously yes! It is happening, constantly.

The West is unapologetic. It is because it is ignorant, thoroughly uninformed about its own past and present deeds, or conditioned to be uninformed. It is also because the West is truly a fundamentalist society, unable to analyze and to compare. It cannot see anymore.

What is being offered by its politicians and replicated by the servile academia and mass media, is totally twisted.

Almost the entire world is in the same condition as the village that I just described.

But it is China (and also Russia, Cuba, Venezuela, Syria, Iran, and other nations) that is being portrayed as villains and tormentors of the people. Black becomes white. War is peace. Slavery is freedom. A mass rapist is a peacemaker and a cop.

*****

Once again: The West hates China. Let us be totally honest.

China has to understand it, and act accordingly. Sooner rather than later.

As we have already determined, the hatred towards China is irrational, illogical, purely racist; mainly based to the superiority complex of Western “thinkers”.

But also, it is based on the subconscious fear of the Westerners that Chinese culture and its socialist system (with all its ‘imperfections’) are greatly superior to the culture of terror and thuggery spread throughout our Planet by both Europeans and then North Americans.

Several years ago, I was interviewed by various Chinese media outlets, including the legendary People’s Daily, China Radio International and CCTV (now CGTN).

They all wanted to know why, despite all those great efforts of China to befriend the world, there is so much Sino phobia in Western countries. I had to face the same question, again and again: “What else could we do? We tried everything… What else?”

Because of its tremendous hereditary optimism, the Chinese nation could not grasp one simple but essential fact: the more China does for the world, the less aggressively it behaves, the more it will be hated and demonized in the West. It is precisely because China is, unlike the West, trying to improve the lives of the entire planet Earth, that it will never be left in peace, it will never be prized, admired or learned from in such places like London, Paris or New York.

I replied to those who were interviewing me:

“They hate you, therefore you are doing something right!”

My answer, perhaps, sounded too cynical to the Chinese people. However, I wasn’t trying to be cynical. I was just trying to answer, honestly, a question about the psyche of Western culture, which has already murdered hundreds of millions of human beings, worldwide. It was, after all, the greatest European psychologist of all time, Carl Gustav Jung, who diagnosed Western culture as “pathology”.

But Who Really Hates China and How Much?

But let’s get numbers: who hates China and how much? Mainly, the Westerners – Europeans and North Americans. And Japan, which actually murdered tens of millions of Chinese people, plus China’s main regional rival, Vietnam.

Only 13% of the Japanese see China favorably, according to a Pew Research Center Poll conducted in 2017. 83% of the Japanese, a country which is the main ally of the West in Asia, see China “unfavorably”. In Italy which is hysterically anti-Chinese and scandalously racist at that, the ratio is 31% favorably, 59% unfavorably. Shocking? Of course, it is. But Germany does not fare much better, with 34% – 53%. The United States – 44% – 47%. France 44% – 52%. Entire half of Spanish nation sees China unfavorably – 43% – 43%.

Now something really shocking: the “rest of the world”. The numbers are totally the opposite! South Africa: 45% see China favorably, 32% unfavorably. Argentina 41% – 26%. Even the Philippines which is being pushed constantly by the West into confrontation with China: 55% favorably – 40% unfavorably. Indonesia that perpetrated several anti-Chinese pogroms and even banned the Chinese language after the US-sponsored coup in 1965: 55% favorably – 36% unfavorably. Mexico 43% – 23%. Bolivarian Republic of Venezuela: 52% – 29%. Chile 51% – 28%.

Then it gets even more interesting: Lebanon: 63% – 33%. Kenya: 54% – 21%. Brazil 52% – 25%. Tunisia 63% – 22%. Russia: 70% – 24%. Tanzania 63% – 15%. Senegal 64% – 10%. And the most populous country in Sub Saharan Africa, Nigeria – 72% – 13%.

The 2017 BBC World Service poll, Views of China’s influence by country, gives even more shocking results:

At the two extremes, in Spain, only 15% see China’s influence as positive, while 68% see it as negative. In Nigeria, 83% as positive and only 9% as negative.

Now, think for a while what these numbers really say.

Who is really benefiting from China’s growing importance on the world scene? Of course – the wretched of the Earth; the majority of our Planet! Who are those who are trying to stop China from helping the colonized and oppressed people? The old and new colonialist powers!

China is predominantly hated by Western imperialist countries (and by their client states, like Japan and South Korea), while it is loved by the Africans), most Asians and Latin Americans, as well as Russians.

Tell an African what is being said to the Europeans – about the negative or even “neo-imperialist”, influence of China on the African continent – and he or she will die laughing.

Just before submitting this essay, I received a comment from Kenya, from my comrade Booker Ngesa Omole, National Organizing Secretary, SDP-Kenya (Socialist):

The relationship of China and Kenya particularly and Africa generally has not only led to tremendous development both in infrastructure but also a genuine cultural exchange among the Chinese and African people, it has also made African people understand the Chinese people firsthand, away from the daily half-truths and lies generated against China and the Chinese people and transmitted en masse globally through the lie factories like CNN. It’s has also shown that there is a different way to relate to the so called development partners and the international capital, the Chinese have developed a policy of non-interference in the internal affairs of a sovereign country as opposed to USA and Western Countries through IMF and World Bank who have imposed destructive policies on the continent that has led to the suffering and death of many African people, like that infamous Structural Adjustment Plan, that was a killer plan, after its implementation Kenyans unemployment skyrocketed, our country also became bankrupt .

Another comparison is the speed at which the projects are done, in the past we had a gruesome bureaucratic expensive process, which could take several years before any work could start on the ground. This has changed with the coming in of Chinese capital, we see the projects are being effected just in time, we see very high quality work contrary to what the western media want to portray that everything from China and Russia are fake before arrival.

*****

The Chinese system (Communism or socialism with Chinese characteristics), is in its essence truly internationalist.

As Chairman Mao Tse Tung wrote in his “Patriotism and Internationalism”:

Can a Communist, who is an internationalist, at the same time be a patriot? We hold that he not only can be but also must be… The victory of China and defeat of the invading imperialists will help the people of other countries…

Chairman Mao wrote this during the China’s liberation struggle against Japanese invaders. However, not much has really changed since then.

China is definitely willing and capable of putting much of the world devastated by Western imperialism, back onto its feet. It is big enough to do it, it is strong enough, it is determined and full of optimism.

The West produces, directly manufactures, crises and confrontations, like the one that took place in Beijing’s Tiananmen Square in 1989, or the one that never really managed to ‘take off’ (mainly due to the disgust of the majority of the local people with the selfish and pro-Western protesters) in Hong Kong, in 2014.

However, those Western implants and proxies are all that most Europeans and North Americans know about China (PRC): ‘Human Rights’, Falun Gong, Tibet, Dalai Lama, ‘Northwest of the Country’ (here, they don’t remember, or cannot pronounce the names, but they were told in the mainstream Western media that China is doing ‘something sinister’ there, so that’s what they are repeating), Tiananmen Square, Ai Wei-Wei and few other disconnected barks, ‘events’, and names.

This is how this colossus with thousands of years of history, culture and philosophy, is perceived, judged, and how it is (mis-) understood.

The entire situation would be laughable, if it were not so tragic, so thoroughly appalling and dangerous.

It is becoming clear who really hates China: it is not the “world”, and it is not those countries on all the continents that have been brutalized and enslaved by the Western imperialists. There, China is loved.

Those who hate China are the nations which are not ready to let go of their de facto colonies. The nations who are used to a good, too good and too easy life at the expense of others. To them, historically egalitarian and now for many decades socialist/Communist (with Chinese characteristics) China poses a truly great threat. Threat – not to their survival or peaceful existence, but threat to their looting and raping of the world.

China’s internationalist attitude towards the world, its egalitarianism and humanism, its emphasis on hard work and the tremendous optimism of its people, may soon, very soon, break the horrid inertia and the lethargy injected by Europe and the United States into the veins of all raped, plundered and humiliated nations.

China Has Already Suffered Enough!

In his ground-breaking book “China Is Communist, Damn It!” a prominent China expert, Jeff Brown (who is presently based in Shenzhen) writes about the dehumanizing treatment, which the Chinese people had been receiving from Westerners, for centuries:

…untold numbers in the 19th century… were pressganged and kidnapped, to be sent to the New World to work as coolie slaves.

The racism conducted on these Chinese coolies was instructive. On the ocean voyage from China to Vancouver, Canada, they were tightly packed and kept in dark, poorly ventilated holds for the three-week trip, so they would not have any contact with the Whites traveling aboveboard. No sunlight, no fresh air. The crew on the ships routinely talked about these Chinese allies in terms of “livestock” and they were handled and treated as such. Actually, they were treated worse than cattle, pigs, sheep and horses, as there are laws that require animals get so much open air and exercise per day, while in transit…

This kind of inhumane treatment of Chinese citizens is dispassionately captured in the diaries of a British officer, charged with overseeing them,

‘As children, we were taught that Cain and Coolies were murderers from the beginning; no Coolie was to be trusted; he was a yellow dog… The task of stowing away Coolies is a tiresome one. In orders, it is alluded to as “embarkation”. By those experienced in the job, it is known more as “packing”. The Coolies are not passengers capable of finding each his cabin. The Coolies are so much cargo, livestock, which has to be packed away. While experiences are ceaselessly pressing upon him, his attitude towards existence is the attitude of a domesticated animal.’

British 2nd Lieutenant Daryl Klein, from his memoir, “With the Chinks”, spoken like a true Western imperial racist. Of course, chinks is the worst slur word to be used against the Chinese. It’s the equivalent of yellow nigger. The term Coolie is not any better. It’s like calling someone from Latin America a wetback. At least Lt. Klein was honest in his total dehumanization of the Dreaded Other.

There are countless examples of discrimination against, and humiliation of, the Chinese people by the Western colonialists, on the territory of China. The Chinese were literally butchered and enslaved in their own territory, by the Westerners and the Japanese.

However, there were also despicable crimes committed against Chinese people on the territory of the United States, including lynching, and other types of killing.

Hard working, many Chinese men were brought as slave laborers to the United States and to Europe, where they were often treated worse than animals. For no other reason but for just being Chinese. No apologies or compensation were ever offered for such acts of barbarity; not even decades and centuries later. Until now, there is a silence surrounding the topic, although one has to wonder whether it is really simple ‘silence’ that grows from ignorance, or whether it is something much more sinister; perhaps defiance and conscious or subconscious refusal to condemn the fruits of Western culture, which are imperialism, racism and consequently – fascism.

Gwen Sharp, PhD, wrote on June 20, 2014 for Sociological Images in his essay ‘Old “Yellow-Peril” Anti-Chinese Propaganda’:

Chinese men were stereotyped as degenerate heroin addicts whose presence encouraged prostitution, gambling, and other immoral activities.  A number of cities on the West Coast experienced riots in which Whites attacked Asians and destroyed Chinese sections of town. Riots in Seattle in 1886 resulted in practically the entire Chinese population being rounded up and forcibly sent to San Francisco. Similar situations in other towns encouraged Chinese workers scattered throughout the West to relocate, leading to the growth of Chinatowns in a few larger cities on the West Coast.

Throughout history, China and its people have suffered at the hands of Westerners, both Europeans and North Americans alike.

According to several academic and other sources, including a publication “History And Headlines” (History: October 9, 1740: Chinezenmoord, The Batavia Massacre):

On October 9, 1740, Dutch colonial overlords on the Island of Java (now a main island in Indonesia) in the port city of Batavia (now Jakarta, capital of Indonesia) went on a mad killing spree of ethnic cleansing and murdered about 10,000 ethnic Chinese. The Dutch word, “Chinezenmoord,” literally means “Chinese Murder.

Anti-Chinese massacres were also repeatedly committed by the Spanish occupiers of the Philippines, and there were countless other cases of anti-Chinese ethnic cleansing and massacres committed by the European colonialist administrations, in various parts of the world.

The ransacking of Beijing’s Summer Palace by French and British forces was one of the most atrocious crimes committed by Westerners on the territory of China. An outraged French novelist, Victor Hugo, then wrote:

We call ourselves civilized and them barbarians. Here is what Civilization has done to Barbarity.

*****

The West cannot treat Chinese people this way, anymore, but if it could get away with it, it definitely still would.

The superiority complex in both Europe and North America is powerful and unapologetic. There is real great danger that if unchecked and unopposed, it may soon terminate all life on our Planet. The final holocaust would be accompanied by self-righteous speeches, unrestrained arrogance, gasping ignorance of the state of the world, and generally no regrets.

Chinese people cannot be beaten on the streets of Europe or North America, anymore; they cannot be, at least theoretically, insulted directly in the face just for being Chinese (although that is still happening).

But there are many different ways to hurt and deeply injure a human being or the country.

My close friend, a brilliant Chinese concert pianist, Yuan Sheng, once told me, right after he left a well-paid teaching position in New York, and moved permanently back to Beijing:

In the United States, I used to cry late into the night, almost every night… I felt so helpless. Things they were saying about my country… And it was impossible to convince them that they were totally wrong!

Several years later, at the “First World Cultural Forum” held in Beijing, an Egyptian-French fellow thinker Amin Said argued that we are all victims of capitalism. I strongly disagreed, and confronted him there, in Beijing, and later in Moscow where we spoke, again, side by side.

Western bigotry, brutality and imperialism are much older than capitalism. I believe that the things are precisely the opposite: Western violent culture is the core of the savage capitalism.

Recently, while addressing students and teachers at one of old alternative and officially progressive schools in Scandinavia, I finally understood the scope of the creeping anti-Chinese sentiments in Europe.

During my presentation about the global conflicts being fueled by the United States and Europe, the audience was silent and attentive. I spoke at a huge hall, addressing some 2 – 3 hundred people, most of them future educators.

There was some sort of standing ovation. Then questions. Then discussion over coffee. There, precisely then, things got very wrong.

A girl came and with an angelic smiled uttered: “Sorry, I know nothing about China…. But what about the Northwest of the country?”

The northwest of China is a few times bigger than Scandinavia. Could she be more specific? No, she couldn’t: “You know, the human rights… Minorities…”

An Italian girl approached me, saying she is studying philosophy. The same line of questions: “I don’t know much about China, but…” Then her questions got aggressive: “What do you mean when you talk about ‘China’s humanism?’”

She was not asking, she was attacking. I snapped at her: “You don’t want to listen, you simply want to hear yourself repeating what they brainwashed you with.”

One of the organizers of the conference hated my interaction with her spoiled, rude, self-centered and uneducated brats. I could not care less. I told her directly to her face.

“Then why did you accept the invitation to be a keynote speaker?” she asked. I answered, honestly: “To study the Europeans, anthropologically. To face your racism and ignorance.”

Next day, the same. I showed my shocking documentary film Rwanda Gambit about how the West created the totally false Rwanda narrative, and how it triggered real genocide, that in the Democratic Republic of Congo (DRC).

But all that the audience wanted to discuss was China!

One said: “I saw a Chinese government company building two sports stadiums in Zambia. Isn’t it strange?”

Really? Strange? The Chinese health system is mainly based on prevention and it is successful. Building stadiums is a crime?

Another one recalled that in West Africa, “China was planting cashew nuts.” That was supposed to match centuries of horrors of Western colonialism, the mass murder and slavery of hundreds of millions of Africans at the hands of the Brits, French, Germans, Belgians and others.

At the airport, leaving back for Asia, I wanted to throw up and simultaneously, to shout from joy. I was going home, leaving this brainwashed continent – this intellectual bordello behind.

The West was beyond salvation. It will not stop or repent.

It can only be stopped, and it has to be stopped.

*****

Jeff Brown in his book China Is Communist, Damn It! pointed out one essential difference between the Chinese and Western mindset:

China and the West could not be more different. Western civilization is founded on Greek philosophy, culture, politics and economy. Ancient Greece was composed of hundreds of relatively small, independent city-states, which on a daily basis, were comparatively isolated from each other. They were separated by water or mountain ranges, ensconced in bays and valleys. Each city-state’s population could usually be counted in the thousands, not millions. There were a number of different dialects, with varying degrees of mutual comprehension, from familiar to total misunderstanding. Contact with each other was based on commerce and trade, grounding Western economy in the precepts of capitalism. The notion of personal agency in the West is founded in this economic system, where farmers, landowners, merchants and craftsmen were able to work and make business decisions individually, between themselves. Each city-state had its own independent government and over the centuries, there were phases of monarchy, oligarchy, tyranny and democracy. Local wars were frequent, to settle disagreements. These battles happened steadily, as ancient Greece’s agricultural production was not abundant, due to poor soils and limited tillable land. When food became scarce with droughts, agricultural trade could be interrupted, due to shortages, thus stoking the need for war, to reclaim the lost purchases of food.

Ancient and modern China could not be more radically different. Life, the economy and development all revolved around a large central government, headed by the emperor. Instead of being based on trade and commerce, China’s economy has always been founded on agricultural production and the harvests were and still are largely sold to the state. Why? Because the government is expected to maintain the Heavenly Mandate, which means making sure that all of the citizens have enough to eat. Therefore, farmers always knew that the grain they grew could very easily end up in another part of China, because of distant droughts. This whole idea of central planning extended to flood control. Communities in one area of China would be tasked to build dams or canals, not to help reduce flood risk for themselves, but for other citizens far away, downstream, all for the collective good.

The idea of independent city-states is anathema in China, as it always signaled a breakdown in the central power’s cohesion and governance, from border to border, leading to warlordism, strife and hunger.

Chinese socialist (or call it Communist) system has clearly roots in China’s ancient history.

It is based on sharing and cooperation, on solidarity and harmony.

It is a much more suitable system for humanity, than what the West spread by force to all corners of the world.

When the West succeeds in something, it feels that it has “won”. It drives the banner pole into the earth, gets some fermented drink to celebrate, and feels superior, unique.

China thinks differently: “if our neighbors are doing well and are at peace, then China will prosper too, and will enjoy peace. We can trade, we can visit each other, exchange ideas.”

In the ancient days Chinese ships used to visit Africa, what is now Somalia and Kenya. The ships were huge. In those days, Europe had nothing so enormous at its disposal. Chinese ships were armed against the pirates, but they mainly travelled with scribes, scholars, doctors and researchers.

When they reached the African shore, they made contacts with the locals. They studied each other, exchanged gifts (some Chinese pottery and ceramics are still being found near the island of Lamu).

There was not much common ground between those two cultures, at that time. The Chinese scribes recorded: “This is not yet right time for permanent contact”. They left gifts on the shore, and sailed home. Nobody died. Nobody was “converted”. No one was raped. African land still belonged to Africans. African people were free to do what they chose.

A century or two later, the Westerners arrived…

*****

I know China, but even better, I know the world in which China operates.

The more I see, the more I am impressed – I actually want China to be everywhere, and as soon as possible!

I have worked in all the tiny and large nations of Oceania (Polynesia, Melanesia and Micronesia), except in Niue and Nauru. There, the West divided this gorgeous and once proud part of the world, created bizarre borders, literally forced people to eat shit (dumping animal food in local stores), burdened them with foreign loans and introduced a culture of dependency and destruction (nuclear experiments, and military bases). Due to global warming, RMI, Kiribati and Tuwalu began “sinking” (in reality, the water is rising).

China came, with real internationalist determination. It began doing everything right – planting mangroves, building sport facilities for people in countries where over half of the population has to often live with diabetes. It constructed government buildings, hospitals, schools. The response of the West? They encouraged Taiwan to come, bribe the local governments and to make them recognize Taipei as the capital of an independent country, forcing China to break diplomatic relationships.

In Africa, I saw Chinese people building roads, railroads, even city trams, schools, hospitals, fighting malaria. This continent was only plundered by the West. Europeans and North Americans built nothing there. China did, and still does, miracles. Out of solidarity, out of internationalist principles so clearly defined decades ago by Chairman Mao.

And I don’t really care what the Western propagandists and ideologues think about the Chinese Communist Party, about Mao and about President Xi Jinping. I see results! I see China, huge, compassionate and confident, rising, and with its close allies like Russia, ready to defend the world.

China saved Cuba. The Western “left-wing” intellectuals said nothing about it. I did. I was attacked. Then, Fidel personally confirmed that I was correct.

China helped Venezuela and it helped Syria. Not for profit, but because it was its internationalist duty.

Saw China in action in East Timor, (Timor Leste), a tiny poor country that the West sacrificed, delivering it on a silver platter to the murderous Indonesian dictator Suharto and his military cronies. 30% of the people were brutally massacred. After independence, Australia began robbing the weak new government of the natural gas in a disputed area. China came in, built the energy sector and an excellent modern hospital (public), staffed with top Chinese surgeons (while Cuba sent field doctors).

Afghanistan? After 16 years of monstrous NATO occupation, this once proud and progressive (before the West manufactured terrorist movements there, to fight socialism) country is one of the poorest on Earth. The West built walls, barbed wire fences, military bases and total misery. China? China built a huge modern hospital wing, actually the only decent and functioning public medical facility in the country.

These are just some of many examples that I have been witnessing during my work, all over the world.

When I lived in Africa (I was based in Nairobi for several years), across the floor was a flat housing four Chinese engineers.

While the Westerners in Africa are almost always secretive, snobbish and arrogant, this group of Chinese builders was loud, enthusiastic and always in a great mood. They power-walked downstairs, in the garden, they ate, joked together. They looked like a good old “socialist realism” poster. They were clearly on a mission. They were building, trying to save the continent. And it was so clear how confident they were.

They were building, and I was making documentary films about what the West did to Africa, including my above-mentioned Rwanda Gambit.

It was clear where I stood. It was clear where the Chinese engineers stood. We stood with the people of Africa. Firmly. No matter what the Western propaganda, academia and mass media keep inventing, that is where we stood, and that is where we are standing right now, although geographically far apart. Once comrades, always comrades. And if we fall, that is how we fall – with no regrets, building a much better world.

And the people of Africa, of Oceania, Latin America and increasingly of Asia, are beginning to realize, to understand.

They are learning what The Belt and Road Initiative (BRI) is. They are learning about “Ecological Civilization“. They are slowly learning that not everyone is the same; that each country has a different culture and goals. They are learning that not everything in life is a lie or for profit. Yes, of course, resources are not unlimited and expenses have to be sometimes covered, but there is much more to life than just cold calculations.

The West and its client states cannot understand this. Or they can, but do not want to. As a moral entity, they are finished. They can only fight for their own interests, as their workers in Paris are only fighting for their own benefits; definitely not for the world.

The West tries to smear everything that is pure and it repeats that “everyone in this world is essentially the same” (a thief).

Their (mainly Western, but also South Korean, Taiwanese, Hong Kong and Japanese) academia is deeply involved. It has already infiltrated the entire world, particularly Asia, including China itself. It teaches young Chinese people that their country is actually not what they think it is! At some point, Chinese students were travelling to the West, in order to study… about China!

North American and European universities are spreading funding and trying to manipulate the best Chinese minds.

In other parts of Asia, again through funding and scholarships, the local academics “get matched” with the anti-Communist and pro-Western counterparts that operate at the universities inside the PRC.

This problem has been, fortunately, identified in the PRC, and the shameless attacks against the Chinese education system are being dealt with.

Mass media and bookstores are not far behind. Anti-Chinese propaganda is everywhere. Anti-Communist propaganda is everywhere.

Yet, China is rising. It is rising despite racism, the lies, and fake news.

Socialist, internationalist China is slowly but confidently marching forward, without confronting anyone, without making too much noise about the unfair, aggressive treatment it receives in the West and from countries like Japan.

It appears that its leadership has nerves of steel. Or perhaps those long thousands of years of great culture are simply allowed to speak for themselves.

When a great Dragon flies, you can bark, shout insults, even shoot at it. It is too big, too ancient, too wise and determined: it will not stop, turn back or fall from the sky. And when the people on Earth have enough time to observe it in its full glory and in full flight, they may, just finally may understand that the creature is not only mighty, but also tremendously beautiful and kind.

*****

• Originally published by New Eastern Outlook (NEO)

Pushing Huawei Out: Australia, the Solomon Islands and the Internet

Be wary of the Chinese technological behemoth, goes the current cry from many circles in Australia’s parliament.  Cybersecurity issues are at stake, and the eyes of Beijing are getting beadier by the day.

The seedy involvement of Australia in the Solomon Islands, ostensibly to block the influence of a Chinese company’s investment venture, is simply testament to the old issues surrounding empire: If your interests are threatened, you are bound to flex some muscle, snort a bit, and, provided its not too costly, get your way.  Not that Canberra’s muscle is necessarily taut or formidable in any way.

The inspiration behind Canberra’s intervention was an initial contract between Huawei and the Solomon Islands involving the Chinese giant in a major role building the high-speed telecommunications cable between Sydney and Honiara. Even more disconcerting might be the prospects that it would work, supplying a cable that would enable the Chinese to peer into the Australia’s own fallible network.

What made this particular flexing odd was the spectacle of an Australian prime minister congratulating himself in securing tax payer funding for the building of a 4,000 kilometre internet cable even as the domestic National Broadband Network stutters and groans.  Another juicy point is that Huawei was banned from applying for tendering for the NBN in 2012.

As the world’s second largest maker of telecommunications equipment was told, “there is no role for Huawei in Australia’s NBN”. The then Attorney-General Nicola Roxon explained that the move was “consistent with the government’s practice for ensuring the security and resilience of Australia’s critical infrastructure more broadly.”  Better an incompetent local provider of appropriate “values” than a reliable foreign entity.

The move against Huawei has largely centered on fears voiced by the intelligence community in various states that Beijing might be getting a number up on their competitors.  In February this year, the FBI Director Chris Wray expressed the US government’s concern “about the risks of allowing any company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks.”  Doing so would enable them to “maliciously modify or steal information” and provide “the capacity to conduct undetected espionage.”

Such comments tend to suggest envy; the US intelligence community chiefs know all too well that they, not a foreign entity, should have the means to conduct their own variant of undetected espionage on the citizens of the Republic, not to mention the globe.

The concerns fomented by Huawei’s alleged profile are such to have featured in the telecommunications sector security reforms pushed by the Turnbull government.  When they come into effect in September, they would permit the government “to provide risk advice to mobile network operators or the relevant minister to issue a direction.”

Labor backbencher Michael Danby has also pushed the line that Huawei is materially compromised by its links to the Chinese Communist Party, a point that only becomes relevant because of its expertise in technology infrastructure.  By all means allow Chinese companies to “build a fruit and vegetable exporting empire in the Ord and Fitzroy River” but be wary of the electronic backdoor.

“On matters like the electronic spine of Australia, the new 5G network which will control the internet of things – automatically driven cars, lifts, medical technology – I don’t think it’s appropriate to sell or allow a company like Huawei to participate.”

Certain figures backing Australian intervention can be found, though they tend to take line of ignoble Chinese business instincts.  Robert Iroga of the Solomon Islands Business Magazine noted that no public tender was made, with Huawei getting “the right… this is where the big questions of governance comes.”

Ruth Liloqula of Transparency Solomon Islands spoke of “paying under the table to make sure that their applications and other things are top of the pile.”  None of these actions, however, are above the conduct of Australia’s own officials, who tend to assume that matters of purity seem to coincide with those of self-interest.

The message from Canberra has fallen on appropriate ears.  Penny Williams, Canberra’s Deputy Secretary of the Department of Foreign Affairs and Trade, told her counterparts in the Solomons that a study had been commissioned on the undersea cable project.  Miracle of miracles, it “found a number of solutions that would provide Solomon Islands with a high speed internet connection from Australia at a competitive price.”

DFAT’s head of the Undersea Cable Task Force Pablo Kang also had the necessary sweeteners for his target audience; the project, appropriately managed by Australia, would be cheaper than the Huawei alternative.

It will be a delightfully grotesque irony should the Internet speed on the Solomons be quicker than their Australian counterparts, who specialise in lagging behind other countries.  In May, the Speedtest Global Index, which provides monthly rankings of mobile and fixed broadband speeds across the globe, found Australia languishing at an inglorious 56 on the ladder.  (A relatively impoverished Romania comes in at an impressively kicking number 5.)  Should that happen, the political establishment in Honiara will feel they have gotten the steal of the decade.

North Korea Issue is Not De-nuclearization But De-Colonization

The critics had already signaled their strategy for derailing any meaningful move toward normalizing relations between the United States and North Korea. Right-wing neoliberals from CNN, MSNBC and NPR are in perfect alignment with the talking points issued by U.S. Sen. Chuck Schumer (D-NY) and the Democrat Party that took the position that anything short of the North Koreans surrendering their national interests and national dignity to the United States was a win for North Korea.

For much of the foreign policy community, corporate media pundits and leaders of the two imperialist parties, the issue is North Korean de-nuclearization. But for the people in Korea and throughout the global South, the real issue has always been the unfinished business of ending the war and beginning the de-colonization of the Korean peninsula.

The interrelated issues of respecting the dignity and sovereignty of the North Korean nation and engaging in an authentic process of de-colonization are precisely why the U.S.-North Korean initiative will fail without a major intervention on the part of the people in the United States demanding that their leaders commit to diplomacy and peace.

There should be no illusions about U.S. intentions. If U.S. policymakers were really concerned with putting a brake on the North Korean nuclear-weapons program, they would have pursued a different set of policies. Such policies would have created the necessary security conditions to convince the North Koreans that a nuclear deterrence to the United States was unnecessary.

The fact that those conditions were not created were less a result of the evil intentions of the North Koreans than it reflected the need to maintain the justification for continued U.S. military deployment in South Korea and in the region. Being able to point to North Korea as a threat to regional security has provided the justifications for U.S. power projection in the region and the ever-expanding U.S. military budget.

With the growing power of China over the last few decades, the threat of North Korea allowed the United States to continue a physical presence right at the underbelly of China. That is why the “agreed framework” under Clinton was not implemented and then jettisoned by the Bush administration. It is also why the Obama administration’s so-called strategic patience was really about a series of increasingly provocative military exercises and no negotiations.

Full Spectrum Dominance and the Psychopathology of White Supremacy

Korea has historically played a significant role for the U.S. imperial project since the end of the second World war. The emergent forces U.S. President Dwight Eisenhower identified as the military/industrial/complex are still present, but are now exercising hegemonic power, along with the financial sector within the U.S. state. Those forces are not interested in a diplomatic resolution of the Korean colonial question because their interests are more focused on China and maintaining U.S. regional hegemony in East Asia. The tensions in Korea have not only provided them the rationale for increased expenditures for various missile defense systems but also for bolstering public support for the obscene military budgets that are largely transferred straight to their pockets.

That is why the historic record is replete with the United States sabotaging negotiated settlements with the North, but then pointing to North Korean responses to those efforts as evidence of North Korean duplicity.

In addition to the material interests and hegemonic geopolitical objectives, the social-psychological phenomenon of inculcated white supremacy is also a factor and has buttressed imperial policies toward that nation for years.

For example, the psychopathology of white supremacy invisibilizes the absurdity and illegitimacy of the United States being in a position to negotiate the fate of millions of Koreans. The great “white father” and savior complex is not even a point of contestation because it is not even perceived — the rule of whiteness through the dominance of the Western capitalist elite has been naturalized.

Therefore, it is quite understandable that for many, the summit is the space where the North Koreans are essentially supposed to surrender to the United States. It is beyond the comprehension of most policymakers and large sectors of the public that North Koreans would have ever concluded it is not in their national interest to give up their defenses to a reckless and dangerously violent rogue state that sees itself beyond the law.

And it is that strange white-supremacist consciousness that buys into the racist trope that it was Trump’s pressure that brought North Korea to the table. The white-supremacist colonial mentality believes the natives will only respond to force and violence.

As U.S. Sen. Lindsey Graham (R-SC), the good old boy from South Carolina, argues “The only way North Korea will give up their nuclear program is if they believe military option is real.”\

But as Kim Kye Gwan, North Korea’s first vice minister for foreign affairs and former nuclear-program negotiator pointed out in relationship to the reasons why North Korea stayed with the process:

The U.S. is miscalculating the magnanimity and broad-minded initiatives of the DPRK as signs of weakness and trying to embellish and advertise as if these are the product of its sanctions and pressure.

Unfortunately, the white-supremacist world-view renders it almost impossible to apprehend reality in any other way. That is why it is inevitable that the Trump administration—like the Clinton, Bush, and Obama administrations—will mis-read the North Koreans.

The North Korea issue is a classic example of why it is impossible to separate a pro-peace, anti-war position from the issue of anti-imperialism. The concrete, geopolitical objectives of U.S. imperialist interests in the region drives the logic of regional dominance, which means peace, de-colonization and national reconciliation for Korea are counter to U.S. interests. And while we must support the U.S. state’s decision to halt military exercises, we must recognize that without vigorous pressure from the people to support an honest process, the possibility of conflict might be ever more alive now as a result of the purported attempt at diplomacy.

The nature of the North Korean state is not the issue. What is the issue is a process has begun between the two Korean nations that should be respected. Therefore, de-nuclearization should not be the focus—self-determination of the Korean peoples must be the center of our discussions. On that issue, it is time for activists in the United States to demand the United States get out of Korea. The peace and anti-war movement must support a process that will lead to the closure of U.S. military bases, the withdrawal of U.S. troops and the elimination of the nuclear threat.

In short, U.S. based activists must support an end to the Korean war and the start of the de-colonization of South Korea.

How Fascist Loot Funded US Anti-Communism

In Gold Warriors, by Sterling and Peggy Seagrave, the authors reveal one of the most shocking secrets of the 20th century. It is the story of the vast treasure Japan managed to loot across Asia, today worth billions or even trillions of dollars, the concealment of it in hundreds of sites, and the secret recovery of much of it by what would become America’s Central intelligence Agency. America helped Japan cover up this vast fortune, fooling the world into believing Japan was bankrupt after the war and was unable to pay reparations for their mass murder and material damage.

Most of Japan’s vast stolen fortune would remain in the hands of imperialist war criminals, and would for decades be used to prop up Japan’s corrupt one party democracy ruled by the Liberal Democratic Party, with the CIA and the Yakuza pulling the strings behind the scenes. It would be controlled by men like Allen Dulles and John J. McCloy through their Black Eagle Trust, which managed both Japanese and Nazi War loot. The Gold would be deposited in the Federal Reserve, the Bank of England, Union Banque Suisse (UBS) in Switzerland, Citibank, HSBC and other major banks who often stole it for themselves.  The gold was also used to manipulate the global economy, finance assassinations and covert ops, bribe politicians, and finance right wing political movements like the John Birch Society domestically.

Gold Warriors tells a compelling tale of secrecy, greed, treachery, murder and lies. The book offers a window into the vast and mysterious world of offshore banking and the Gold Cartel. The authors estimate that today, the ultra-rich are hoarding over 23 trillion dollars, mostly in offshore bank accounts. Meanwhile around the world, health and education are being cut, poverty and homelessness are on the rise, and the rest of us are constantly told to tighten our belts.

The Seagraves destroy the myth that America reformed Japan after the war, revealing the shocking story of the MacArthur occupation and its alliance with fascists along with Japan’s ruthless imperial family and their huge corporate backers like Mitsui, Mitsubishi, Kawasaki and Sumitomo. They used this loot to finance Japan’s postwar recovery and meteoric rise. Companies that have since become household names made their fortunes through looting Asia and employing slave labor, including that of American POWS. When the survivors tried to sue for reparations, State Department officials like Tom Foley with corrupt ties to these Japanese corporations compared these victims to terrorists.

The Seagraves begin their book with the brutal assassination of the Korean Queen Min on October 7 1895 by the imperialist Japanese. In Japan, like in America, big business, organized crime, and intelligence were strongly interrelated. The Japanese Empire, like all empires, were cynical liars and claimed that Queen Min had been murdered by Koreans. With the strong-willed Queen Min out of the way, her weak husband King Kojong quickly became a Japanese puppet and soon Korea was a Japanese colony, while China suffered a humiliating defeat at Japan’s hands when it tried to intervene.

Japan seized Taiwan and parts of Manchuria from China. Korea became Japanese property, and they began to loot the accumulated wealth of centuries, including gold silver and prized celadon porcelains. Japan employed an army of antiquarians to seize and catalog hundreds of ancient Korean manuscripts, sending them to Japan or burning them to destroy Korea’s cultural heritage.  The Japanese even resorted to grave robbery on a massive scale, targeting Korean Imperial tombs.

Japan targeted Taiwan, colonizing the island and setting up massive heroin laboratories. Taiwan would for decades become a center of the global drug trade. Japan launched a sneak attack on the Russian Empire in 1904 and Russia was forced to sign a humiliating peace deal giving Japan control of its possessions in Manchuria like the South Manchurian Railway it had built. To turn a quick profit, Japan set up a massive opium growing operation. They bribed warlords and began buying up Chinese industries and land. Manchuria became what the authors call the center of “carpetbaggers, spies, secret policemen, financial conspirators, fanatical gangsters, drug dealers and eccentric army officers.” The Mitsui and Mitsubishi Corporations ran everything, making a fortune from their cut of the illegal drug trade. Through a series of provocations involving the patriotic societies and Japanese intelligence, Japan was whipped into a war frenzy and more Chinese land was stolen. Japan unleashed an army of experts to steal as much art and priceless manuscripts as they could.

Around the same time Japan had been conquering Korea, America had conquered the Philippines while claiming they wanted to liberate it from Spain. With its usual cynical hypocrisy, once Spain surrendered, America crushed the Filipino independence movement with the brutal tactics it would later employ in Greece, Korea, Vietnam, Afghanistan, Iraq and a long list of other countries. Of course, it had been America itself which had forced Japan to end its long isolation setting into motion the chain of events that had led to Japan’s rapid modernization and imperialist adventures in the first place. When the Second World War began to go very badly by 1943, Japan was no longer able to ship its loot back to Japan, and so began to hide it all over the Philippines and Indonesia. Prisoners of war and the local Filipinos were forced to dig massive tunnels. These slave laborers were often massacred or buried alive to keep the tunnels secret. The Japanese often buried their loot near historical landmarks and hospitals because they were less likely to be bombed. They smuggled gold into the Philippines on phony hospital ships, since they would be less likely to be sunk by American submarines. They hid some of the gold by loading ships full of treasure and sinking them for later recovery, and huge underground chambers were filled with thousands of tons of gold.

The Americans managed to discover gold was being hidden during the war, thanks to one of their spies. There were at least 176 treasure sites in the Philippines. By the time the war ended, the Americans had found so much gold that if it became publicly known it would have destroyed the Bretton woods system which relied on gold being valued at 35 dollars an ounce. The Bretton Woods system was itself backed with the huge sums in Nazi gold the US had managed to seize and hide, the authors of Gold Warriors suggest.

Back in Washington, there was already a group dedicated to stealing and hiding Nazi gold: the Black Eagle Trust. With their massive off-the-books money, they would bribe politicians and finance coups, covert operations and psychological warfare. Soon, the Golden Lily loot was being managed by the same people. It was being moved across the world, being used to prop up banks around the world. UBS in Switzerland, HSBC in Hong Kong, the Bank of England, Chase Manhattan. Hidden in 42 countries between 1945-47, the gold was used to make huge loans to Britain, Egypt, and the Kuomintang in China. Politicians around the world were bribed with gold certificates. The intersection between Wall Street and intelligence involved vast sums completely unknown to the public. The notion that the CIA could ever be held in check once it had control of this vast fortune was a joke, and it perhaps led to events like the Kennedy assassination. A nearly 60-year cover-up after that event would not be surprising when one remembers that the entire mainstream American media was controlled by former Office of Strategic Services men, as discussed in Science of Coercion by Christopher Simpson. The CIA and Office of Policy Coordination controlled much of the media worldwide as part of Frank Wisner’s infamous Operation Mockingbird, putting out nonstop Cold War propaganda.

In Japan, criminal Yoshio Kodama made a deal to turn over $100 million to the CIA for his immunity (worth 1 billion dollars today). During the war, Kodama had managed to save 13 billion in gold, platinum, diamonds and other loot. America had not bombed Japanese industries, instead targeting workers’ homes. This was likely because American corporations were heavily invested in Japan, just as they were in Nazi Germany, where American-owned factories supplying the German war machine were spared during the war. In occupied West Germany, Denazification was a scam, and so too was the removal of imperialism in Japan. Trials targeting Japanese war criminals were fixed to prevent the Emperor’s role being known. The US set up a special fund to bribe witnesses. Kodama was put on the CIA payroll, and behind the scenes he created the misnamed Liberal Democratic Party headed by corrupt politicians. The Yatsuya fund was used to  control the Japanese underworld. The Keenan fund named after Joseph Keenan, the chief war crimes prosecutor, was used to bribe witnesses to protect the Emperor and his cronies.

The M-Fund was named after General William Frederic Marquat, who was in charge of restructuring the Japanese economy. Marquat was also entrusted to disband Japan’s infamous Unit 731 that ran bio-warfare research using prisoners as guinea pigs during the war, but instead of disbanding, they were recruited by the Pentagon and used to develop germ warfare against China and North Korea. The M-Fund was used to bribe politicians, and evolved into one of the most scandalous financial scams in history. Soon, it would corrupt American politicians as well. Nixon turned the M-Fund, which had been run by MacArthur’s cronies like General Marquat along with the CIA and the corrupt Liberal Democratic Party, over to the full control of Japan in exchange for illegal kickbacks funneled into the 1960 presidential Campaign he lost to Kennedy. Part of the deal was for Nixon to return Okinawa to Japan, which he later did once he finally got elected.

Golden Lily loot was funneled back to far right movements in the US, and would help finance Joseph McCarthy’s witch hunts. Another source of such wealth was the global drug trade, as the CIA would manage it in cooperation with the Chinese Kuomintang and Japanese and Korean organized crime. Together, these sources of wealth would be used to fund the World Anti-Communist League or WACL the global network of fascist drug dealers and terrorists loved by Ronald Reagan. In the final chapter of their book, the authors provide a brilliant summary of the politics of heroin, relying heavily on Doug Valentine’s classic The Strength of the Wolf. In Japan, McCarthyism took a much bloodier course with a massive assassination program combined with a COINTELPRO-style war on anyone who dared to dissent. Even American and British officials could be targeted for assassination if they threatened to expose MacArthur’s alliance with war criminals and gangsters. For assassinations that were even more sensitive, KOTOH was employed – an acronym formed from the names of five Japanese army officers who performed assassinations.

Much of Gold Warriors describes the hunt for treasure in the Philippines. The Japanese were the masters of this, quietly returning for decades to recover their loot. Future Philippines president Ferdinand Marcos learned of the gold by befriending Santa Romana and making deals with the Japanese to recover gold, becoming one of the richest men in the world through his discoveries. It was Marcos gold that paved the way for Nixon’s visit to China, with Marcos agreeing to deposit 72 billion in Gold in China’s Bank accounts. Marcos had long been used by the CIA to bribe Asian governments into supporting American policy, and in return they allowed him to get rich by selling his gold to Saudi princes or trading it for drugs from Asian or Latin American cartels. The golden Lily loot that led to his rise also led to his downfall, when he bargained too forcefully with the Reagan White House and the CIA who wanted him to use his fortune to back Reagan’s scheme to create Rainbow dollars. Marcos then became one of the first victims of a CIA color revolution. As CIA-backed NGOs flooded the streets with angry protestors, his American sponsors kidnapped him and airlifted his fortune out of the country.

Gold Warriors reveals that from the underworld to the military and intelligence agencies, to the corrupt politicians to the titans of finance we are ruled at every level by gangsters. After reading it, one may even wonder how much of the CIA’s gold is involved today in financing charlatans like Alex Jones and the rest of the US “patriot” movement, since their radio stations are heavily involved in selling gold and silver. It is a fantastic book that anyone with an interest in the CIA, drugs, or fascism should read, because it offers a window into the shadowy world of offshore banking, where around a trillion dollars is transferred around the world every day. It names some of the most powerful families in the world: the Krupps, the Rothschilds, the Oppenheimers, the Warburgs and the Rockefellers. All are tied to banking and the gold cartel, where fortunes are incalculable. In fact, the gold and diamond cartels are still looting the world today with the same greed and brutality as imperial Japan. In the Democratic Republic of the Congo alone, ten million people have been killed in a brutal war to loot the country of gold, diamonds, uranium, and rare earth elements. Furthermore, most of the world’s gold is hoarded today in the Swiss Alps, in secret bunkers and underground tunnels designed to survive a nuclear war. The hunt for the gold stolen by imperial Japan even resumed as recently as 2001, when George W. Bush sent navy seals on a secret mission to recover it.

G7 vs. G6+1: The War of Words

Background

The war of words has intensified between the U-S and G-7 allies after President Donald Trump retracted his endorsement of the communiqué of the once-united group.

The German chancellor called Trump’s abrupt revocation of support for a joint communiqué sobering and depressing. Angela Merkel, however, said that’s not the end. France also accused Trump of destroying trust and acting inconsistently. Trump pulled the U-S out of the group’s summit statement after Canada’s Prime Minister Justin Trudeau announced the imposition of retaliatory tariffs on the U-S.  The White House said Canada risked making the U-S president look weak ahead of his summit with the North Korean leader. But, Canada’s Foreign Minister Chrystia Freeland later reiterated that her country will retaliate against U-S tariffs in a measured and reciprocal way.

*****

PressTV: What do you make of Mr. Trump’s decision to renege on the G7’s final statement?

Peter Koenig: Trump pulling out from the final G7 statement is just show; the usual Trump show. He signed it, then he pulled out. We have seen it with the Iran Nuclear Deal, with the North Korea meeting, on and off, with the tariffs first. About two months ago the tariffs were on for Europe, Mexico and Canada, as well as China. Then they were off for all of them, and now they are on again…

How serious can that be? Trump just wants to make sure that he calls the shots. And he does. As everybody gets nervous and talks about retaliation instead of practicing the “politics of silence” strategy.

In the case of Europe, the tariffs, or the equivalent of sanctions, as Mr. Putin recently so aptly put it, may well serve as a means of blackmailing Europe, for example, to disregard as Trump did, the Iran Nuclear Deal, “step out of it – and we will relieve you from the tariffs.”

In the case of Canada and Mexico, it’s to make sure Americans realize that he, Mr. Trump, wants to make America Great again and provide jobs for Americans. These tariffs alone will not create one single job. But they create an illusion and that, he thinks, will help Republicans in the up-coming Mid-term Elections.

In China tariffs are perhaps thought as punishment for President Xi’s advising President Kim Jong-Un ahead of the June 12 summit and probably and more likely to discredit the Yuan as a world reserve currency, since the Chinese currency is gradually replacing the dollar in the world’s reserve coffers. But Trump knows that these tariffs are meaningless for China, as China has a huge trade surplus with the US and an easy replacement market like all of Asia.

PressTV:  How could the silence strategy by the 6 G7 partners have any impact on Trump’s decision on tariffs?

Peter Koenig: Well, the G6 – they are already now considered the G6+1, since Trump at the very onset of the summit announced that he was considering pulling out of the G7- so, the remaining 6 partners could get together alone and decide quietly what counter measures they want to take, then announce it in a joint communiqué to the media.

It does not have to be retaliation with reciprocal tariffs.  It could, for example, be pulling out of NATO.  Would they dare? That would get the world’s attention. That might be a much smarter chess move than copying the draw of one peon with the draw of another one. Because we are actually talking here about a mega-geopolitical chess game.

What we are actually witnessing is a slow but rapidly increasing disintegration of the West.

Let’s not forget, the G7 is a self-appointed Group of the “so-called” world’s greatest powers. How can that be when the only “eastern power”, Russia, and for that much more powerful than, for example, Canada or Italy, has been excluded in 2014 from the then G8?

And when the world’s largest economic power – measured by the real economic indicator, namely, purchasing power parity – China has never been considered being part of the G-Group of the greatest?

It is obvious that this Group is not sustainable.

We have to see whatever Trump does, as the result of some invisible forces behind the scene that direct him. Trump is a convenient patsy for them, and he plays his role quite well. He confuses, creates chaos, and on top of it, he, so far single-handedly wants to re-integrate Russia in the G-7; i.e., the remaking of the G-8.

So far the G6’s are all against it. Oddly, because it’s precisely the European Union that is now seeking closer ties with Russia. Maybe because they want to have Russia all for themselves?

If that is Trump’s strategy to pull Europe and Russia together, and thereby create a chasm between Russia and China, then he may succeed. Because the final prize of this Trump-directed mega political chess game is China.

Trump, or his handlers, know very well that they cannot conquer China as a close ally of Russia. So, the separation is one of the chess moves towards check-mate. But probably both Presidents Putin and Xi are well aware of it.

In fact, the SCO just finished their summit in China’s Qingdao on 9 June, about at the same time as the G7 in Canada’s Charlevoix, Quebec Province, and it was once more very clear that this alliance of the 8 SCO members is getting stronger, and Iran is going to be part of it. Therefore, a separation of Russia from the Association is virtually impossible. We are talking about half the world’s population and an economic strength of about one third of the world’s GDP, way exceeding the one of the G7 in terms of purchasing power.

This, I think is the Big Picture we have to see in these glorious G7 summits.

The Economist on Marx’s 200 years

The 200th anniversary of the birth of Marx has prompted The Economist to devote an article on Marx in its issue of May 5, 2018. Characteristically titled, “Reconsidering Marx. Second time farce. Two hundred years after his birth, Marx remains surprisingly relevant”!1 The article combines recognition that Marx was a genius with reactionary slandering that he was, after all, an evil genius and without him the world would certainly had been much better.

Naturally, one could not expect something different. Since the time Marx’s ideas gained recognition in the labor movement, the main concern of the apologists of capital has been to “refute” them as false, dogmatic and dangerous. Nor do, of course, The Economist’s journalists offer something new; they simply repeat the usual simplistic distortions and misunderstandings their predecessors have offered innumerable times in the past. However, their argument is nevertheless of a certain interest. On the one hand, the part of it in which they vilify Marx displays the rancor and hatred of the apologists of the ruling classes, who being unable to counter the great thinker, embrace all kinds of nonsense they come across to slander and debase him. On the other hand, when discussing Marx’s predictions, they openly confess their reactionary bourgeois fears regarding capitalism’s present deadlock and his vindication, at least in some important points. It is worthwhile, therefore, to take a look at both aspects; all the more because The Economist is not a minor journal but the semi-official voice of the markets and of the views of the liberal (and in our times neo-liberal) wing of the bourgeoisie.

Marx’s “failures”

“A good subtitle for a biography of Karl Marx”, The Economist’s gentlemen begin, “would be ‘a study in failure’… His ideas”, they continue, “were as much religious as scientific – you might even call them religion repackaged for a secular age. He was a late date prophet describing the march of God on Earth. The fall from grace is embodied in capitalism; man is redeemed as the proletariat rises up against its exploiters and creates a communist utopia” (p. 71, same in the following quotations).

The proofs are all very weighty:

Marx claimed that the point of philosophy was not to understand the world but to improve it. Yet his philosophy changed it largely for the worst: the 40% of humanity who lived under Marxist regimes for much of the 20th century endured famines, gulags and party dictatorships. Marx thought his new dialectical science would allow him to predict the future as well as understand the present. Yet he failed to anticipate two of the biggest developments of the 20th century –the rise of fascism and the welfare state– and wrongly believed communism would take root in the most advanced economies.

Whence, then, Marx’s influence, that makes even The Economist’s gentlemen confess that “for all his oversights, Marx remains a monumental figure” and that “interest in him is as lively as ever”? How do they explain the steadily increasing mass of publications, discussions and events about his work? How is it that in his 200 years even Jean-Claude Juncker, the in no way Marxist president of the EU, finds it necessary to visit Marx’s birthplace, Trier, and make a speech about the importance of his work? “Why”, as they themselves snobbishly ask, “does the world remain fixated on the ideas of a man who helped produce so much suffering?”

The answer, according to The Economist’s luminaries, will be found in the combination of genius with malice, which were Marx’s chief traits. His influence is due to the “sheer power of these ideas” and “the power of his personality”.

Marx was in many ways an awful human being. He spent his life sponging off Friedrich Engels. He was such an inveterate racist, including about his own group, the Jews, that even in the 1910s, when tolerance for such prejudices was higher, the editors of his letters felt obligated to censor them… Michael Bakunin described him as ‘ambitious and vain, quarrelsome, intolerant and absolute… vengeful at the point of madness’… But combine egomania with genius and you have a formidable power. He believed absolutely he was right; that he had discovered a key in history that had eluded earlier philosophers. He insisted on promoting his beliefs whatever obstacles fate (or the authorities) put in his way. His notion of happiness was ‘to fight.

The only conclusion to be drawn from all that is that if The Economist’s columnists lag far behind Marx with regard to genius, they certainly outweigh him vastly in egomania. In their attempt to prove their superiority –and the superiority of their beloved capitalism– to Marx’s predictions, they inevitably prove their inferiority, their inability to understand even Marx’s most basic positions, necessarily ending up to combine traces of truth with tons of falsehood and lies. Let us briefly bring out some points for their benefit.

First of all, there is nothing new in portraying Marx as a “religious” thinker and a “metaphysician”. This, in fact, was a beloved theme of all reactionaries of his time, who being unable to counter his theories and discoveries, resorted to such abuse and slander. For these of priests of capital and the “free markets”, of course, the “natural” was identical with capitalism, while everything going beyond it was anathematized as “religious” etc.

To limit ourselves to just one example, immediately after Marx’s death, Paul Boiteau, an official French economist, wrote in the conservative Journal des débats:

Karl Marx, who has just died, was in his lifetime one of the most listened prophets and theologians of the religion of social wrongs. He has had no difficulty in passing to the rank of its gods, and he will no doubt share in their fate, which is to disappear rather quickly into the void where socialism successively buried its divinities. But, for the moment, his memory receives the censers to which he was entitled, and, in both worlds, the meetings of the initiates declare that the Gospel of Marx must henceforth be the text par excellence of the preachings of international socialism.2

It would seem that The Economist’s folks have not advanced very far from Boiteau’s views. And, judging from the fact that everyone still knows Karl Marx while almost no one remembers Boiteau, it seems unlikely that they will get a better place in the hall of fame than he did.

Secondly, Marx never portrayed capitalism as a “fall from grace”, a hell that took the place of a previous earthly paradise, and the proletariat as the Messiah of our time. This was, in fact, the position of some Utopian communists of his time, whose primitivism he criticized. On the contrary, Marx acknowledged and stressed, at least after having laid the foundations of his theory, that capitalism represents a great advance in relation to feudalism, and that it substantially expanded the technological basis and horizons of human society. At the same time, however, he argued that by rapidly developing productive forces and socializing production, capitalism undermines its very foundation, makes unnecessary and anachronistic the exploitative relations on which it rests, and creates for the first time the possibility of a non-exploitative organization of the economy, based on the common ownership the means of production. The Economist’s journalists, lacking the courage to address the second point, blur and obscure the first, attributing to Marx things that are not part of his theory.

Thirdly, there is nothing in Marx’s works that contains even a trace of anti-Semitism or racism. Anti-Semites included, among others, Bakunin, whose slanderous criticism of Marx The Economist approvingly quotes, and Bruno Bauer, both of them Marx’s opponents. Bauer argued in particular that Jews would be unable to free themselves as long as they did not discard their religion and that until then they should be deprived of their political rights. Marx, answering him in his brochure on the Jewish question, which is frequently falsely presented by reactionaries as “anti-Semitic”, had rejected any idea of political, religious or other discrimination against the Jews. He countered that the partial liberation of the Jews was possible through their participation in the political struggles of the time, without presupposing any renunciation of their religion, and that their total liberation would take place when society was liberated from all kinds of slavery.

Marx’s perhaps only “anti-Jewish” comment appears in a letter he wrote to Engels, to which The Economist’s folks apparently allude, where he contemptuously labeled Lassalle a “Jewish nigger”.3 However, this letter was written under very special circumstances when Lassalle had stayed for some days at Marx’s home in London during 1862. Lassalle, as Marx mentions, besides his refusal to lend him an amount of money, had proposed him, as a means of getting rid of his financial problems, to hand over one of his daughters as a companion to a bourgeois family, and had unsettled his calmness and work. These things had enraged Marx and he wrote an aggressive letter to Engels, with all sorts of strong comments, which cannot be seen as an expression of his positions on racism or on any other matter. In order to seriously criticize Marx as a “racist”, one would have to point out some explicit or indirect support for racism in his works, which is impossible to do for him or any other serious Marxist.

Let us note by the way, as an example of how strongly prejudiced The Economist’s journalists, who imagine themselves “enlightened”, are, that even some neo-Nazis quote and comment more honestly Marx’s views on the Jews. In an article about Bruno Bauer posted on the National Vanguard, one of the key neo-Nazi websites in the United States, after speaking of Bauer as one of the forerunners of anti-Semitism, R. Pennington refers to Marx’s criticism of his views as a rejection of anti-Semitism: “Bauer’s anti-Semitism”, she writes, caused Marx a great deal of intellectual grief”; Marx’s critique was intended to “releasing the Jews from any intimidation by society or the state”.4 As an orthodox ultra-right, Pennington prefers, of course, to Bauer, honoring his anti-Semitism and condemning “Marxist obscurantism”, but at least she presents somewhat accurately Marx’s position.

Marx, they tell us further, failed to predict fascism and the welfare state. In the same way, one could say Darwin failed to predict (in 1871!) the discovery of DNA or that The Economist failed to predict, not 50 years, but not even 50 days beforehand, the outbreak of the global economic crisis in 2007. To blame Marx for things it was clearly impossible for him to predict, and for the analogue of which they would never blame, let us say, Darwin or themselves, isn’t that a manifestation of egomania and rancor?

Of course, Marx did not explicitly predict the above developments, but he identified the trends that made them possible. In many of his writings on the revolutions of 1848, in his criticisms of vulgar bourgeois political economy and in his analyses of the Commune, he showed and documented the bourgeoisie’s turn towards reaction, one of the ultimate consequences of which was fascism. In his The 18th Brumaire of Louis Bonaparte, he also referred to the development of reactionary petty bourgeois movements; i.e., peasants’ movements “who, in stupefied seclusion… want to see themselves and their small holdings saved”,5 thereby turning against the proletariat; a trend whose exacerbation in the imperialist era contributed decisively in the development of fascism. On the other hand, in his analysis of Malthus’s views in Theories of Surplus Value, Marx extensively referred to the bourgeoisie’s attempts to increase the intermediate strata between itself and the proletariat as a safety valve for its regime, considering that “this is the course taken by bourgeois society”.6 So here, too, he revealed the socio-economic basis of the developments that led to the so-called “welfare state”; i.e., the strengthening of the intermediate strata, which is possible within capitalism, as long as it does not radically contradict the falling tendency of the rate of profit.

Let’s turn now to The Economist’s main claim that Marx’s bad influence helped produce most of the 20th century’s misery, which could otherwise have been avoided. Putting the issue in this way is, of course, foolish; the true question to be asked and answered is: which tendencies in the 20th century have had positive results, those emerging from capitalism and contributing to its perpetuation, or the revolutionary tendencies that, finding their foundation in Marx, were promoting the overthrow of the capitalist system?

Capitalism was exclusively responsible for the first great war of the 20th century, the world imperialist war of 1914-18, with its more than ten million victims. Imperialist intervention was largely responsible for millions of victims in the initially almost bloodless Russian Revolution of 1917. The great crisis of 1929 and fascism were both children of capitalism, as was the case with World War II, an effort of the most reactionary wing of capital to eliminate the achievements of the Russian Revolution. It is true that the course of the USSR was marked, especially in Stalin’s years, by the negative phenomena The Economist points out; i.e., the 1932-33 famine, gulags, massive cleansing, terror and oppression, as was also the case in China during the Great Leap Forward. However, these phenomena have been explained by Marxists as a degeneration process, the result of the backwardness of the countries where the revolution first took place and of the rise of Stalinist bureaucracy, which did not promote but betrayed world revolution both in the USSR –its first victims there being the leaders of October– and abroad. In addition, they were not the only ones and did not characterize the whole experience of the USSR. During the 1920s and early ’30s there took place in the USSR a vast cultural revolution, whose achievements were undermined by Stalinism but nevertheless partly survived and developed in the later phases of the regime. The Soviet people took up the main burden of the anti-fascist struggle, which objectively was a continuation of October’s progressive legacy, while after 1956 the most odious aspects of Stalinist oppression were put aside.

The imperialist plunder of the Third World, interventions, establishment of dictatorships and the condemnation of entire peoples in starvation, continued on the contrary throughout the 20th century, before and after World War II. The concessions of the ruling classes in the capitalist centers after 1945 were prompted chiefly by their fear of the post-war ascend of communism and anti-fascist movements. Where it not for the USSR, who would have stopped Nazism and force these concessions to the ruling classes? Moreover, while the existence of the USSR checked the aggression of imperialism, after its dissolution its real tendencies have again been manifested openly and unimpeded, producing their true devastating effects. It took just 15 years to take world-wide inequality to unprecedented heights, start many local wars, exacerbate the great powers’ competition to a point threatening a hot conflict, trigger the global economic crisis of 2007, and revive fascism and far-right nationalism worldwide. Even the few positive elements of the latest period, such as the great capitalist development of China, are closely linked to the positive heritage of the 20th century’s revolutions. In China, the fact that a great popular revolution lasting two decades eroded feudalism and imperialist dependence, allowed capitalism to develop without internal and external obstacles and benefit a comparatively significant part of the population; in India, on the contrary, where there was no revolution, but only a bourgeois renovation from above, the growth of the last decades was much weaker and a much larger part of the population is stuck in extreme poverty. Capitalism prevailed in its competition with the USSR due to its higher level of development of the productive forces and the devastating effects of Stalinism, but experience shows that this did not allow capitalism to overcome its contradictions.

The Economist’s journalists make every effort to reject not only Marx himself, but the whole Communist movement and its eminent theorists after his death:

After Marx’s death in 1883 his followers –particularly Engels– worked hard to turn his theories into a closed system. The pursuit of purity involved vicious factional fights as the ‘real’ Marxists drove out renegades, revisionists and heretics. It eventually led to the monstrosity of Marxism-Leninism with its pretentions of infallibility (‘scientific socialism’), its delight in obfuscation (‘dialectical materialism’) and its cult of personality (those giant statues of Marx and Lenin).

Here again, the negative experiences of Stalinism, dogmatism and the necrosis of Marxism, are exploited to discard as nonsense the whole development of Marxism after Marx. However, Marxism in that period had important representatives such as Engels, Plekhanov, Lenin, Luxemburg, Kautsky, Mehring and, after Lenin’s death, Trotsky, Bukharin, Gramsci and Lukacs, who cannot be put aside so easily. These Marxists analyzed developments after Marx’s death, guided the October Revolution and developed Marxism further. That this development involved a clearing of Marxism from alien influences was not something special to Engels or Lenin: Marx had also fought fiercely against the pseudo-socialists of his time, such as Proudhon and the “true socialists”, and Marxists after Lenin, especially Trotsky and Lukacs, explained Stalinist dogmatism as an alien influence and distortion of Marxism.

Paradoxically, and while one would expect that after all these tirades, everything about Marx has been dismissed, The Economist’s gentlemen conclude their reference to his “failures” with a reservation that would seem to distinguish something fertile in his thought. But as it immediately becomes clear, they consider “fertile” only what they themselves want to read or think they can find in Marx.

The collapse of this petrified orthodoxy has revealed that Marx was a much more interesting man than his interpreters have implied. His grand certainties were a response to grand doubts. His sweeping theories were the results of endless reversals. Toward the end of his life he questioned many of his central convictions. He worried that he might have been wrong about the tendency of the rate of profit to fall. He puzzled over the fact that, far from immiserating the poor, Victorian England was providing them with growing prosperity. (ibid, p. 71-72).

Here The Economist’s gentlemen remarkably agree with the representatives of the so-called “New reading of Marx”, that is, representatives of professorial academic wisdom who falsify Marx, such as Michael Heinrich. Marx, of course, rethought and improved his assumptions constantly, but contrary to the claims of these scholars, there is no evidence that he had revised his analysis of the falling tendency of the rate of profit, or that Engels distorted his positions. Moreover, the entire evolution of capitalism in the 20th century has confirmed this fundamental to its historical fortunes law discovered by Marx. The main transformations and models of capitalism, Fordism, Keynesianism, neoliberalism, were, in fact, just ways of reacting to the downward rate of profit, and the fact that the bourgeoisie is forced to replace them after profitability crises proves that they can counteract it only temporarily and that their potential is always exhausted.

Engels was perhaps not as deep as Marx, and he occasionally made some mistakes. But to dismiss Engels for Heinrich’s sake means to read Marx in a systemic way, to make Engels’s mistakes an alibi in order to accept a total mistake. Marx’s concerns at the end of his life had to do with a better conceptualization of the complexity of capitalism’s tendencies, and hence of the revolutionary process, not with their general direction.

Marx’s successes and further “failures”

This brings us to Marx’s successes, some of which are so obvious, that even The Economist’s columnists cannot but recognize them, although still charging him with some other failures.

“The chief reason for the continuing interest in Marx, however”, we read further, “is that his ideas are more relevant than they have been for decades. The post-war consensus that shifted power from capital to labour and produced a ‘great compression’ in living standards is fading. Globalisation and the rise of a virtual economy are producing a version of capitalism that once more seems to be out of control. The backwards flow of power from labour to capital is finally beginning to produce a popular –and often populist– reaction. No wonder the most successful economics book of recent years, Thomas Piketty’s ‘Capital in the Twenty-First Century’, echoes the title of Marx’s most important work and his preoccupation with inequality” (p. 72, same in the following).

So, if inequality has once again become a central issue, to the extent that 1% of the world’s population owns over 50% of the world’s wealth, and 3.7 billion of the poorest account for just 2.7%7, how can “dogmatic” and “fanatical” Marx be confirmed after so many “reforms” and “advances” made by the ruling classes? Let’s see what The Economist’s gentlemen have to say about this as things become more interesting now.

Marx argued that capitalism is in essence a system of rent-seeking: rather than creating wealth from nothing, as they like to imagine, capitalists are in the business of expropriating the wealth of others. Marx was wrong about capitalism in the raw: great entrepreneurs do amass fortunes by dreaming up new products or new ways of organising production. But he had a point about capitalism in its bureaucratic form. A depressing number of today’s bosses are corporate bureaucrats rather than wealth-creators, who use convenient formulae to make sure their salaries go ever upwards. They work hand in glove with a growing crowd of other rent-seekers, such as management consultants… professional board members… and retired politicians…

By reading such passages, one gets convinced that The Economist’s “liberals” will never understand even Marx’s simplest positions, not due to lack of knowledge, but because they do not want to understand them, since this goes contrary to their class interests. Marx never defined capitalism as a rent-seeking system. This was also a feature of feudalism which knew various kinds of rent. The distinctive feature of capitalism, according to Marx, is expansion, the development of production for production’s sake, the accumulation of capital. And what capitalists accumulate is surplus value, the unpaid labor of the workers, which they usurp. Ideas could never create stocks and capitals; and it is absurd to base economic analysis on the difference between the good ideas of capitalists and the bad ideas of managers, etc. Moreover, if it was just a matter of good or bad ideas, one could perhaps solve many problems and save capitalism by imposing a negative rent for some obviously bad ideas of the capitalists and their ilk, such as weapons of mass destruction. The Economist’s gentlemen, distorting Marx in that way, shift the problem from the structure of capitalism to the behavior of the one or other of its agents, bureaucrats, managers, and so on. Yet, while rent is, of course, important –and Lenin, Hobson and others showed how rentiers multiply in the imperialist era with capitalism’s increasing parasitism– according to Marx, it is production and not distribution that defines the essence of capitalism, as of every other economic system.

However, just after that we find two better passages. One is about globalization, which, it is acknowledged, Marx had already foreseen:

Capitalism, Marx maintained, is by its nature a global system: ‘It must nestle everywhere, settle everywhere, establish connections everywhere’. That is as true today as it was in the Victorian era. The two most striking developments of the past 30 years are the progressive dismantling of barriers to the free movement of the factors of production—goods, capital and to some extent people—and the rise of the emerging world. Global firms plant their flags wherever it is most convenient… The World Economic Forum’s annual jamboree in Davos, Switzerland, might well be retitled ‘Marx was right’.

So Marx did predict something correctly after all. And it seems that he did not only predict this, but also something else too, the tendency of capitalism to create monopolies and, along with the accumulation of wealth on the one side, to produce an army of unemployed and occasionally employed in the other:

“He thought”, we read further, “capitalism had a tendency towards monopoly, as successful capitalists drive their weaker rivals out of business in a prelude to extracting monopoly rents. Again this seems to be a reasonable description of the commercial world that is being shaped by globalisation and the internet. The world’s biggest companies are not only getting bigger in absolute terms but are also turning huge numbers of smaller companies into mere appendages. New-economy behemoths are exercising a market dominance not seen since America’s robber barons. Facebook and Google suck up two-thirds of America’s online ad revenues. Amazon controls more than 40% of the country’s booming online-shopping market. In some countries Google processes over 90% of web searches. Not only is the medium the message but the platform is also the market.

In Marx’s view capitalism yielded an army of casual labourers who existed from one job to the other. During the long post-war boom this seemed like a nonsense. Far from having nothing to lose but their chains, the workers of the world—at least the rich world—had secure jobs, houses in the suburbs and a cornucopia of possessions… Yet once again Marx’s argument is gaining urgency. The gig economy is assembling a reserve force of atomised labourers who wait to be summoned, via electronic foremen, to deliver people’s food, clean their houses or act as their chauffeurs. In Britain house prices are so high that people under 45 have little hope of buying them. Most American workers say they have just a few hundred dollars in the bank. Marx’s proletariat is being reborn as the precariat.

The analysis perhaps is not flawless, but we may assume without much danger of error that had Marx read it, he would have rated The Economist’s analysts at least with a 5 (full marks being 10). Unfortunately, is not so with the immediately following argument, for which he would definitely make them repeat the same class:

Still, the rehabilitation ought not to go too far. Marx’s errors far outnumbered his insights. His insistence that capitalism drives workers’ living standards to subsistence level is absurd. The genius of capitalism is that it relentlessly reduces the price of regular consumer items: today’s workers have easy access to goods once considered the luxuries of monarchs… Marx’s vision of a post-capitalist future is both banal and dangerous: banal because it presents a picture of people essentially loafing about (hunting in the morning, fishing in the afternoon, raising cattle in the evening and criticising after dinner); dangerous because it provides a licence for the self-anointed vanguard to impose its vision on the masses.

It is tragic indeed to encounter such expositions of Marx’s views.

First of all, Marx never claimed that “capitalism drives workers’ living standards to subsistence level”. This was, in fact, Lassalle’s position, expressed in his famous “Iron Law of Wages”, which states precisely this thing. Marx criticized Lassalle’s law, showing that the workers, with their organization and struggles, could improve their position, and that there is a difference, historically defined in each country, between the wage corresponding to subsistence level and the real average wage.8

Secondly, it is funny to imply that a thinker of Marx’s level had not noticed and pointed out the ability of capitalism to limit the prices of consumer goods through technological progress, productivity gains, etc. In fact, Marx was the first economist to recognize and explain this possibility, as well as the historical movement of wages at the various stages of capitalism, with his distinction between absolute and relative surplus value. Let us explain this distinction, for the benefit of The Economist’s columnists.

Absolute surplus value, according to Marx, is the type of capitalist accumulation that dominated the early stages of capitalism, in the so-called period of primitive accumulation of capital. During that period, accumulation was promoted by increasing the working day – for example, the worker was forced to work 12 instead of 10 hours daily, his salary remaining the same. This means an increase in exploitation: if, for example, in the initial 10 hours, 6 hours correspond to the reproduction of the labor force and 4 hours to unpaid labor (i.e., production of surplus value), the final 12 will include 6 unpaid hours. Absolute surplus value goes hand in hand with absolute impoverishment, as pay per hour of work decreases. The brutal expropriation of the rural population and its relocation to the cities under wretched conditions, the deadly work of children and women, etc., were some of the misfortunes of this phase, described in novels by Dickens, Gorky and others.

However, when the development of capitalism, and hence its technological base, reaches a relatively high point –what Marx calls “the real subordination of labor to capital”– absolute surplus value is replaced by relative surplus value. The distinctive feature of the latter is that accumulation is now promoted not by the increase of the working day but by the limitation of the part of the working day devoted to the replacement of the worker’s labor power. In the previous example, if the time for the reproduction of labor power (the necessary labor) is reduced to 2 hours from 6, then even with a reduction of the working day from 10 to 8 hours, the worker will produce more surplus value than before, offering 6 hours of surplus labor instead of 4. Relative surplus value corresponds to relative impoverishment because the salary per hour of work increases. In addition, it is a constituent part of Marx’s analysis that the price of labor power in the latter case will correspond to a larger number of goods, since by the development of specialization, etc., the needs of the worker also grow. Of course, the great limitation of necessary labor is made possible because, due to technological progress, an hour of work in developed capitalism produces a much larger mass of commodities than what it produced in its earlier stages. The total value of these goods remains roughly the same, but the value per unit is drastically reduced.

In Marx’s time relative surplus value had progressed only in Britain, yet this did not prevent him from recognizing it as the main form for developed capitalism and assess its impact on the workers’ living standard. In an excerpt in Capital he sums it up quite clearly:

Under the conditions of accumulation… which conditions are those most favorable to the laborers, their relation of dependence upon capital takes on a form endurable or, as Eden says: ‘easy and liberal’. Instead of becoming more intensive with the growth of capital, this relation of dependence only becomes more extensive, i.e., the sphere of capital’s exploitation and rule merely extends with its own dimensions and the number of its subjects. A larger part of their own surplus-product, always increasing and continually transformed into additional capital, comes back to them in the shape of means of payment, so that they can extend the circle of their enjoyments; can make some additions to their consumption-fund of clothes, furniture, etc., and can lay by small reserve-funds of money.9

Of course, as Marx explains at various points, this improvement has certain limits defined by the needs of capitalist accumulation, and tends to take place in periods of economic growth, while in recessions wages are being pressed. But this is a far cry from presenting him as an advocate of the view that no improvement in the lot of the workers is possible under capitalism.

Marx’s position that in the post-capitalist society people will be able to hunt in the morning and go fishing in the evening was a poetic image of the many sided, cultivated man who will replace the disintegrated, individualistic human existence to which capitalism gives rise. Marx insisted that labor itself will always be “the realm of necessity”, but shorter working hours when everyone will work will give all members of society enough free time for a variety of other activities. It was Marx’s deep conviction that in the future society even The Economist’s journalists will find some better things to do than to exhort capitalism and abuse Marx.

For the time being, of course, no such thing is in sight, so they continue listing some more of Marx’s “failures”. “The World Bank”, we are told, “calculates that the number of people in ‘extreme poverty’ has declined from 1.85bn in 1970 to 767m in 2013, a figure that puts the regrettable stagnation of living standards for Western workers in perspective”. Marx, evidently, failed to anticipate that momentous progress too…

Here again it is a case of progresses existing in the apologists’ heads rather than in reality. Extreme poverty is defined at making less than 1.90$ per day, so that it would hardly look like a great advance to half the number of those caught in it. Moreover, the very definition of extreme poverty by the World Bank is under severe criticism, while if one puts aside China, the picture in the rest of the world is hardly encouraging.

In fact The Economist’s gentlemen are very close to repeating arguments regarding general welfare, which their predecessors advanced in Marx’s time. “Delightful is it thus to see”, one of them went, “under Free Trade, all classes flourishing; their energies are called forth by hope of reward; all improve their productions, and all and each are benefited” (The Economist, 2/1/1853). To which Marx replied by pointing to the numerous cases of starvation in this “generally beneficial” social order10. One has just to look at the thousands of peasants in India who commit suicide due to starvation –according to official estimates, more than 12,000 yearly after 201311 – to see that The Economist’s present attempt to paint a similar worldwide tranquility is not a bit better.

There follows Marx’s worst “mistake”:

Marx’s greatest failure, however, was that he underestimated the power of reform—the ability of people to solve the evident problems of capitalism through rational discussion and compromise. He believed history was a chariot thundering to a predetermined end and that the best that the charioteers can do is hang on. Liberal reformers, including his near contemporary William Gladstone, have repeatedly proved him wrong. They have not only saved capitalism from itself by introducing far-reaching reforms but have done so through the power of persuasion. The ‘superstructure’ has triumphed over the ‘base’, ‘parliamentary cretinism’ over the ‘dictatorship of the proletariat’.

So, what do The Economist’s geniuses tell us? To what does their wisdom end up?

They tell us that Marx was right in verifying those laws and trends of capitalism that bring them and their ilk to the foreground –globalization, monopolization, etc.– but that they, the “superstructure”, the various “think tanks” of capital, with their special astuteness and wisdom, succeeded in changing the action of these laws, making them produce different results than those predicted by Marx. Isn’t that a form of egomania?

We have already seen that Marx recognized the possibilities of reforming capitalism, ultimately based on relative surplus value. He himself refers to them in the Preface to the 1st edition of Capital, pointing out that “present society is not a solid crystal, but an organism capable of change, and is constantly changing”.12 Marx, however, showed at the same time the limits of these possibilities. To clarify this last, vital point, let us listen first to The Economist’s gentlemen final confessions:

The great theme of history in the advanced world since Marx’s death has been reform rather than revolution. Enlightened politicians extended the franchise so working-class people had a stake in the political system. They renewed the regulatory system so that great economic concentrations were broken up or regulated. They reformed economic management so economic cycles could be smoothed and panics contained… Today’s great question is whether those achievements can be repeated. The backlash against capitalism is mounting – if more often in the form of populist anger than of proletarian solidarity. So far liberal reformers are proving sadly inferior to their predecessors in terms of both their grasp of the crisis and their ability to generate solutions. They should use the 200th anniversary of Marx’s birth to reacquaint themselves with the great man – not only to understand the serious faults that he brilliantly identified in the system, but to remind themselves of the disaster that awaits if they fail to confront them.

Well, well, truth must be admitted after all! What we see during the last two decades is the decline of the liberal elites, their constant shift to intensified reaction, their failure to find any viable way out of the crisis and the deadlocks of capitalism, their –as The Economist itself aptly puts it– sad inferiority to the circumstances. However, their failure inexorably raises a relentless question that The Economist’s gentlemen fail to raise: Is this a chance, subjective failure or error of the leading circles of capital? Or does its cause lie in something more profound; i.e., that there exists no longer such a reformist way?

Can capitalism reform itself anew?

So, can capitalism reform itself anew, as it has done in the past, or is its present, self-destructive course definitive?

This question emerges from all modern developments and we can give at least some credit to The Economist’s journalists for posing it openly and sharply as a “life and death” question for capitalism. Yet it cannot be posed in a Shakespearean, “to be or not to be” philosophical way, as they pose it. It must be examined in relation to the whole of social experience, the directions of bourgeois governments and organizations, etc. And any such discussion will inexorably force answering it in the negative. A few concrete questions will clarify that.

If there is a real possibility of a new New Deal today, why do we nowhere see a significant portion of the ruling classes expressing and supporting it? In the 1930s there was a Roosevelt, after World War II there were representatives of the liberal bourgeoisie such as De Gaulle and the Kennedy brothers. Where is their current analogue? Why does the “liberal” wing, whose voice The Economist is, can only oppose Trump with a Hillary Clinton; i.e., something just a trifle better? Why do the few progressive representatives of the bourgeoisie like Sanders prove completely incapable of proposing any positive reform program and are forced, confusing others and themselves, to talk about “socialism”?

All these are sure indications that an internal reform of capitalism which would provide a real economic revival is no longer possible. We will understand why it is so by returning to Marx’s analysis of relative surplus value. The development of mature capitalism, as Marx has shown particularly in his Results of the Direct Production Process, consists essentially in generalizing relative surplus value, through its successive expansion to the various branches of economy. This was done in previous stages with the technological intensification of industry, agriculture and the state sector, services, etc. And the reason capitalism could at those stages have some able representatives was that there were still non-intensified sectors of the economy, whose reshaping, as well as the overall reshaping of the system based on this process, required certain abilities.

The distinctive feature of globalization, on the contrary, is that, at least in the developed countries, there is no longer a non-intensified economic sector. The service and public sectors, the last remaining ones, were intensified in the neoliberal era, this being its essential content. Things like “green economy” are aspirins, while the generalized automation futurists like Mason are dreaming of is inconceivable under capitalism as it would decisively hit the rate of profit. The very fact that capital is now forced to resort to absolute surplus value, increasing again the length of the working day in order to support the rate of profit (and thereby reviving again absolute impoverishment!), is a further proof of the exhaustion of its reformist margins. So at capitalist metropolises at least, there remains nothing else, nothing new to be done; there is no new model of accumulation and consequently no possibility of a new cycle. This makes globalization the last phase, the last moment of the imperialist era and capitalism in general, during which the capitalist system will necessarily leave the historical scene.

All this does not imply, of course, a complete impossibility of reforms, but any such possibilities refer to measures, changes, etc., which fulfill possibilities of the current stage, not of a hypothetical, non-existent future stage. Or to put it otherwise: there is no chance of capitalism presenting something radically new, a modern “New Deal”, but only –and this at a theoretical level– of normalizing and prolonging a bit globalization, by softening for some time its worst conflicts.

Two such possibilities are basically at hand. Relative surplus value has already exhausted its potential in the capitalist centers and is now fulfilling it in Asia and Latin America. But there is a continent where it has not yet been expanded; i.e., Africa. Africa’s participation in globalization could provide a growth momentum when China recedes, opening a further round. Of course, in order to bring this about, that participation should be on comparatively equal terms, not like that of Yemen, which picks up globalization’s bombs, but roughly that of China. Secondly, the North-South gap in the European Union suggests a similar, albeit proportionally smaller, possibility of capitalist progress for the European South, but this also presupposes a change in the EU structure towards true convergence.

Historical experience so far proves that the weakened liberal leaders of capitalism cannot implement these changes or even aid them. Obstacles on their way are more than obvious. Africa is already the field of competition between China and the West, and the great powers are not interested in its development, but in enhancing each one’s sphere of influence and plundering at the expense of the rest. In addition, American imperialism’s policies of past decades, interventions around the world, etc., have strengthened the worst, most adventurous forces in its protectorates, the consequence being that change stumbles not only on the directions of imperialism itself, but also on local cliques, “compradorial” segments, etc. Africa’s current growth rate of about 4% reflects these barriers, being extremely low for a continent with a population of 1.3 billion and less than one-third of US GDP.

It would be erroneous to imagine that when China’s momentum fades, capital will flow in Africa and start a new swift rise there. Firstly, China’s potential as capitalism’s steam engine has already been half-halted. Yet Africa’s development has not gained momentum, but has receded during the last years, from 5.5% in 2012 to 2.7 in 2016, and an anemic recovery in 201713 In the second place, China’s huge capitalist progress was made possible by the fact that the revolution had created a viable social order, a skillful and educated working class, etc. Only traces of these will be found in Africa, which is moreover divided in a multitude of small, unsustainable states, with extreme poverty increasing strongly during the last decades. In practice, moving these barriers aside will require at least some Chavez type revolutions in Africa, like those of Latin America during the last two decades. A key condition for a steady development in that continent will be that the leading circles of imperialism support these processes, yet wherever they have happened so far, either in Africa itself in the 1950s, ’60s and ’70s, or in Latin America recently, imperialism has constantly tried to stifle them.

On the other hand, the European Union, the only intensive global integration process, remains, as Mr. Juncker acknowledged in his recent Marx speech, extremely fragile. “The European Union”, he said, “is not a flawed, but an unstable construction. Unstable also because Europe’s social dimension until today remains the poor relation of the European integration. We have to change this”14 But of what change can one speak of, when, in a construct that its own leaders confess its instability, all the pressures of the crisis are directed to its weakest joints? It is not clear that the next crisis, which even according to them, is probably a short time away, will break it into pieces? And what will the consequences be then? Under the present circumstances, these can only be chaos, a fascist takeover of power in at least some European countries and war conflicts.

Of course, Trump’s election in the United States, the developing commercial wars and the existence of anachronistic regimes, such as Syria, Iran, and so on, belonging to Russian sphere of influence, obstruct economic progress even more at a world level. Add to this the whole parasitic raff of globalization, which in not limited to bureaucrats and politicians as The Economist would have it, but also includes all kinds of market speculators, lobbyists, mafias, etc, who loot world economy –movies like Gavras’s “Le Capital” and Hickenlooper’s “Casino Jack” depict their range– and you will see why it is utopian to expect something different from the ruling elites.

One last point that deserves some comment in The Economist’s arguments is their hints that Marx’s revolutionary forecast has been refuted in the capitalist centers. While Marx “believed communism would take hold in the most advanced economies… The only countries where Marx’s ideas took hold were backward autocracies such as Russia and China”. And even today, in period of severe crisis, opposition to capitalism appears “more often in the form of populist anger than of proletarian solidarity” (p. 71, 72).

These arguments are not new, yet there is a grain of truth in them, which has also been adequately dealt by Marxists. After Marx’s death, Engels, Lenin and Trotsky recognized the bourgeoisie’s ability to create a “working class aristocracy”, by sharing a small part of the booty of colonial exploitation, a fact allowing it to stabilize its hold in the capitalist centers. On the other hand, the obvious reason recent opposition to capitalism has so far been manifested chiefly by the rise of (often far-right) populism is that the crisis hit first the petty bourgeoisie, who tend to seek to restore their previous position at the expense of the working class15 All that, however, belongs to the kind of complications and difficulties with which Marx struggled in the last phase of his life, when he clearly envisaged some of them (e.g., the possibility of a revolution in Russia) and in no way counters his central claims. Doesn’t the fact of “the regrettable stagnation of living standards for Western workers” (p. 72), to which The Economist reluctantly refers, prove indeed that the main stabilizing factor in the capitalist centers belongs to the past?

Let us sum up in a graphic way. Capitalism is a Titanic that, due to the very materials and contradictions ingrained in its frame, is doomed to break up and sink. It is composed, of course, of several levels, each one of them having its own watertight parts which delay for a while flooding from incoming water. In the previous stages or levels, there was a difficult way out of Titanic to the new ship of socialism, but there were also higher levels to which one could move when the previous ones were flooded. The peculiarity of the current level is that there no more exists a level above. There is only a possibility of delaying the flooding of the current level either by increasing its space (a relatively equal participation of Africa in globalization) or by absorbing some of the pressures on the walls by channeling them to their strongest points (allocating part of the burdens of the EU crisis to Germany, France, etc.). We do not see any of these possibilities being realized today; on the contrary, the policies pursued are in the exactly opposite direction.

We have already explained why this is so and why a realization of the progressive possibilities of the current stage by the ruling classes is extremely unlikely, if not impossible. Moreover, if they were to be implemented, this should have been prepared during the past decades; e.g., by instituting a United Nations program to combat poverty in Africa and elsewhere, such as that proposed in the 1960s by the Kennedy brothers (who were murdered incidentally by their own class), rather than conducting military interventions in Iraq and Afghanistan. If, however, The Economist’s gentlemen are of another opinion and consider such a program possible, nothing prevents them from becoming its preachers, even if a little late.

In conclusion

Marx in his time never held The Economist in any high esteem. He called it, the “optimist conjurer of all things menacing the tranquil minds of the mercantile community”.16

The Economist’s article on Marx’s 200 years confirms his judgment. It is a mirror of the illusions of the condemned classes concerning their “eternity” and of their gaudy front, from which “superstitions and prejudices emerge like frogs”.17 How could Marx be a great thinker and a racist egomaniac at the same time? If he was a racist, why has he been an anathema for all reactionaries? Questions like these The Economist’s gentlemen are unable even to pose; prejudice blocks them from surfacing in their minds. And in this way, they unwittingly offer the best proof that Marx was right both in his opinion about The Economist, which has not advanced far since then, and in his overall predictions about capitalism’s fate.

However, The Economist’s journalists are wrong when they say that the practical implication of these predictions is to “hang on the chariot of history”. Such passivity was alien to Marx; on the contrary, he stressed that history presents active possibilities, the content of which, according to his famous statement, lies in “shortening the birth pangs”. It is on the contrary the “free market” apologists who hang on it and never prepare anything.

From this point of view; e.g., a capitalist development in Africa similar to that of China cannot be indifferent to Marxists as it would limit the sufferings of the next capitalist crisis and help realize the transition to socialism under better conditions. But herein lies the problem, that all such possibilities are hampered by the bourgeoisie itself, by the oligarchies of the developed countries. As Trotsky points out:

In the conditions of capitalist decline, backward countries are unable to attain that level which the old centers of capitalism have attained. Having themselves arrived in a blind alley, the more civilized nations block the road to those finding themselves in a process of civilizing themselves.18

Despite The Economist’s reformist optimism, all realities of our time cry in chorus that the necessary progressive reforms, even those in principle theoretically possible within capitalism, can only be fulfilled in a revolutionary way. And their fulfillment is only conceivable as a step, a starting point in the process of transition to socialism.

  1. See Readers of the World Read Karl Marx, The Economist, May 3, 2018. In the electronic edition the title is different, “Rulers of the world: read Karl Marx!” Roughly one year ago The Economist had published a similar item on Marx, expressing its “scorn” regarding John McDonnell’s praise of him but also admitting that Marx “becomes more relevant by the day”. The Economist, 11/5/2017.
  2. P. Boiteau, “Mort le Karl Marx”, Journal des débats, 25/3/1883.
  3. See K. Marx – F. Engels. Collected Works, Progress Publishers, vol. 41, p. 388-391.
  4. R. Pennington, “Bruno Bauer: Young Hegelian”. That article had appeared first at Instauration, an ultra-right periodical, in 1976. Of course, Pennington goes on to invent an antithesis between Marx and Engels, by presenting the latter as an anti-Semite. This is a lie, Engels had written an article against anti-Semitism, exposing it as an ultra-reactionary current: “anti-Semitism”, he said, “serves… reactionary ends under a purportedly socialist cloak; it is a degenerate form of feudal socialism and we can have nothing to do with that” (F. Engels, “On anti-Semitism”.

    The myth of Marx’s “anti-Semitism” is ably refuted by R. Fine in “Karl Marx and the Radical Critique of Anti-Semitism”.  Unfortunately Fine, in his otherwise excellent article, attributes wrongly the above quoted phrase of Engels to Marx.

  5. K. Marx, “The 18th Brumaire of Louis Bonaparte”, in K. Marx – F. Engels, Selected Works, Progress Publishers, Moscow 1977, vol. 1, p. 479-480.
  6. K. Marx, Theories of Surplus value, Progress Publishers, Moscow 1975, vol. 3, p. 63.
  7. See “World wealth increases, inequality rises“, Kathimerini, 15/11/2017.
  8. In a well-known passage in Capital, in the part on labor power, Marx emphasizes this point; see K. Marx, Capital, Progress Publishers, Moscow 1977, vol. 1, p. 168.
  9. K. Marx, ibid, p. 579.
  10. K. Marx, Dispatches for the New York Tribune. Selected Journalism of Karl Marx, Penguin Books, London 2007, p. 111-113.
  11. Dhananjay Mahapatra, “Over 12,000 farmer suicides per year, Centre tells Supreme Court”.
  12. K. Marx, ibid, p. 21.
  13. See “Economy of Africa”.
  14. See “EU president Juncker defends Karl Marx’s legacy”. Regarding predictions of a new crisis by EU and IMF officials see  “Juncker’s article on Europe in ‘Ta Nea”, C. Lagarde. “A new crisis is possible”,  and Lagarde. “The Eurozone must be ready for the next crisis”, .
  15. This, let us remark by the way, means that it will be necessary to overcome great difficulties in turning social protest to the left, which implies, among other things, a confrontation with neo-Stalinist, nationalist and other pseudo-socialist currents and the unification of the nowadays scattered revolutionary and oppositionist groups that do not share the above errors. But this requires time so that the ruling classes’ tendency to avoid any progressive reform, partly explained by their usual fear of opening up the appetite of the movement and triggering revolutionary developments, is not right presently.
  16. Κarl Marx. “Revolution in China and in Europe”, New York Daily Tribune, June 14th, 1853.
  17. Α. Arnellos, A Game of Chess, Tipothito Editions, Athens 2002, p. 77.
  18. L. Trotsky, Revolution Betrayed, Allagi Editions, Athens 1988, p. 15.

The Economist on Marx’s 200 years

The 200th anniversary of the birth of Marx has prompted The Economist to devote an article on Marx in its issue of May 5, 2018. Characteristically titled, “Reconsidering Marx. Second time farce. Two hundred years after his birth, Marx remains surprisingly relevant”!1 The article combines recognition that Marx was a genius with reactionary slandering that he was, after all, an evil genius and without him the world would certainly had been much better.

Naturally, one could not expect something different. Since the time Marx’s ideas gained recognition in the labor movement, the main concern of the apologists of capital has been to “refute” them as false, dogmatic and dangerous. Nor do, of course, The Economist’s journalists offer something new; they simply repeat the usual simplistic distortions and misunderstandings their predecessors have offered innumerable times in the past. However, their argument is nevertheless of a certain interest. On the one hand, the part of it in which they vilify Marx displays the rancor and hatred of the apologists of the ruling classes, who being unable to counter the great thinker, embrace all kinds of nonsense they come across to slander and debase him. On the other hand, when discussing Marx’s predictions, they openly confess their reactionary bourgeois fears regarding capitalism’s present deadlock and his vindication, at least in some important points. It is worthwhile, therefore, to take a look at both aspects; all the more because The Economist is not a minor journal but the semi-official voice of the markets and of the views of the liberal (and in our times neo-liberal) wing of the bourgeoisie.

Marx’s “failures”

“A good subtitle for a biography of Karl Marx”, The Economist’s gentlemen begin, “would be ‘a study in failure’… His ideas”, they continue, “were as much religious as scientific – you might even call them religion repackaged for a secular age. He was a late date prophet describing the march of God on Earth. The fall from grace is embodied in capitalism; man is redeemed as the proletariat rises up against its exploiters and creates a communist utopia” (p. 71, same in the following quotations).

The proofs are all very weighty:

Marx claimed that the point of philosophy was not to understand the world but to improve it. Yet his philosophy changed it largely for the worst: the 40% of humanity who lived under Marxist regimes for much of the 20th century endured famines, gulags and party dictatorships. Marx thought his new dialectical science would allow him to predict the future as well as understand the present. Yet he failed to anticipate two of the biggest developments of the 20th century –the rise of fascism and the welfare state– and wrongly believed communism would take root in the most advanced economies.

Whence, then, Marx’s influence, that makes even The Economist’s gentlemen confess that “for all his oversights, Marx remains a monumental figure” and that “interest in him is as lively as ever”? How do they explain the steadily increasing mass of publications, discussions and events about his work? How is it that in his 200 years even Jean-Claude Juncker, the in no way Marxist president of the EU, finds it necessary to visit Marx’s birthplace, Trier, and make a speech about the importance of his work? “Why”, as they themselves snobbishly ask, “does the world remain fixated on the ideas of a man who helped produce so much suffering?”

The answer, according to The Economist’s luminaries, will be found in the combination of genius with malice, which were Marx’s chief traits. His influence is due to the “sheer power of these ideas” and “the power of his personality”.

Marx was in many ways an awful human being. He spent his life sponging off Friedrich Engels. He was such an inveterate racist, including about his own group, the Jews, that even in the 1910s, when tolerance for such prejudices was higher, the editors of his letters felt obligated to censor them… Michael Bakunin described him as ‘ambitious and vain, quarrelsome, intolerant and absolute… vengeful at the point of madness’… But combine egomania with genius and you have a formidable power. He believed absolutely he was right; that he had discovered a key in history that had eluded earlier philosophers. He insisted on promoting his beliefs whatever obstacles fate (or the authorities) put in his way. His notion of happiness was ‘to fight.

The only conclusion to be drawn from all that is that if The Economist’s columnists lag far behind Marx with regard to genius, they certainly outweigh him vastly in egomania. In their attempt to prove their superiority –and the superiority of their beloved capitalism– to Marx’s predictions, they inevitably prove their inferiority, their inability to understand even Marx’s most basic positions, necessarily ending up to combine traces of truth with tons of falsehood and lies. Let us briefly bring out some points for their benefit.

First of all, there is nothing new in portraying Marx as a “religious” thinker and a “metaphysician”. This, in fact, was a beloved theme of all reactionaries of his time, who being unable to counter his theories and discoveries, resorted to such abuse and slander. For these of priests of capital and the “free markets”, of course, the “natural” was identical with capitalism, while everything going beyond it was anathematized as “religious” etc.

To limit ourselves to just one example, immediately after Marx’s death, Paul Boiteau, an official French economist, wrote in the conservative Journal des débats:

Karl Marx, who has just died, was in his lifetime one of the most listened prophets and theologians of the religion of social wrongs. He has had no difficulty in passing to the rank of its gods, and he will no doubt share in their fate, which is to disappear rather quickly into the void where socialism successively buried its divinities. But, for the moment, his memory receives the censers to which he was entitled, and, in both worlds, the meetings of the initiates declare that the Gospel of Marx must henceforth be the text par excellence of the preachings of international socialism.2

It would seem that The Economist’s folks have not advanced very far from Boiteau’s views. And, judging from the fact that everyone still knows Karl Marx while almost no one remembers Boiteau, it seems unlikely that they will get a better place in the hall of fame than he did.

Secondly, Marx never portrayed capitalism as a “fall from grace”, a hell that took the place of a previous earthly paradise, and the proletariat as the Messiah of our time. This was, in fact, the position of some Utopian communists of his time, whose primitivism he criticized. On the contrary, Marx acknowledged and stressed, at least after having laid the foundations of his theory, that capitalism represents a great advance in relation to feudalism, and that it substantially expanded the technological basis and horizons of human society. At the same time, however, he argued that by rapidly developing productive forces and socializing production, capitalism undermines its very foundation, makes unnecessary and anachronistic the exploitative relations on which it rests, and creates for the first time the possibility of a non-exploitative organization of the economy, based on the common ownership the means of production. The Economist’s journalists, lacking the courage to address the second point, blur and obscure the first, attributing to Marx things that are not part of his theory.

Thirdly, there is nothing in Marx’s works that contains even a trace of anti-Semitism or racism. Anti-Semites included, among others, Bakunin, whose slanderous criticism of Marx The Economist approvingly quotes, and Bruno Bauer, both of them Marx’s opponents. Bauer argued in particular that Jews would be unable to free themselves as long as they did not discard their religion and that until then they should be deprived of their political rights. Marx, answering him in his brochure on the Jewish question, which is frequently falsely presented by reactionaries as “anti-Semitic”, had rejected any idea of political, religious or other discrimination against the Jews. He countered that the partial liberation of the Jews was possible through their participation in the political struggles of the time, without presupposing any renunciation of their religion, and that their total liberation would take place when society was liberated from all kinds of slavery.

Marx’s perhaps only “anti-Jewish” comment appears in a letter he wrote to Engels, to which The Economist’s folks apparently allude, where he contemptuously labeled Lassalle a “Jewish nigger”.3 However, this letter was written under very special circumstances when Lassalle had stayed for some days at Marx’s home in London during 1862. Lassalle, as Marx mentions, besides his refusal to lend him an amount of money, had proposed him, as a means of getting rid of his financial problems, to hand over one of his daughters as a companion to a bourgeois family, and had unsettled his calmness and work. These things had enraged Marx and he wrote an aggressive letter to Engels, with all sorts of strong comments, which cannot be seen as an expression of his positions on racism or on any other matter. In order to seriously criticize Marx as a “racist”, one would have to point out some explicit or indirect support for racism in his works, which is impossible to do for him or any other serious Marxist.

Let us note by the way, as an example of how strongly prejudiced The Economist’s journalists, who imagine themselves “enlightened”, are, that even some neo-Nazis quote and comment more honestly Marx’s views on the Jews. In an article about Bruno Bauer posted on the National Vanguard, one of the key neo-Nazi websites in the United States, after speaking of Bauer as one of the forerunners of anti-Semitism, R. Pennington refers to Marx’s criticism of his views as a rejection of anti-Semitism: “Bauer’s anti-Semitism”, she writes, caused Marx a great deal of intellectual grief”; Marx’s critique was intended to “releasing the Jews from any intimidation by society or the state”.4 As an orthodox ultra-right, Pennington prefers, of course, to Bauer, honoring his anti-Semitism and condemning “Marxist obscurantism”, but at least she presents somewhat accurately Marx’s position.

Marx, they tell us further, failed to predict fascism and the welfare state. In the same way, one could say Darwin failed to predict (in 1871!) the discovery of DNA or that The Economist failed to predict, not 50 years, but not even 50 days beforehand, the outbreak of the global economic crisis in 2007. To blame Marx for things it was clearly impossible for him to predict, and for the analogue of which they would never blame, let us say, Darwin or themselves, isn’t that a manifestation of egomania and rancor?

Of course, Marx did not explicitly predict the above developments, but he identified the trends that made them possible. In many of his writings on the revolutions of 1848, in his criticisms of vulgar bourgeois political economy and in his analyses of the Commune, he showed and documented the bourgeoisie’s turn towards reaction, one of the ultimate consequences of which was fascism. In his The 18th Brumaire of Louis Bonaparte, he also referred to the development of reactionary petty bourgeois movements; i.e., peasants’ movements “who, in stupefied seclusion… want to see themselves and their small holdings saved”,5 thereby turning against the proletariat; a trend whose exacerbation in the imperialist era contributed decisively in the development of fascism. On the other hand, in his analysis of Malthus’s views in Theories of Surplus Value, Marx extensively referred to the bourgeoisie’s attempts to increase the intermediate strata between itself and the proletariat as a safety valve for its regime, considering that “this is the course taken by bourgeois society”.6 So here, too, he revealed the socio-economic basis of the developments that led to the so-called “welfare state”; i.e., the strengthening of the intermediate strata, which is possible within capitalism, as long as it does not radically contradict the falling tendency of the rate of profit.

Let’s turn now to The Economist’s main claim that Marx’s bad influence helped produce most of the 20th century’s misery, which could otherwise have been avoided. Putting the issue in this way is, of course, foolish; the true question to be asked and answered is: which tendencies in the 20th century have had positive results, those emerging from capitalism and contributing to its perpetuation, or the revolutionary tendencies that, finding their foundation in Marx, were promoting the overthrow of the capitalist system?

Capitalism was exclusively responsible for the first great war of the 20th century, the world imperialist war of 1914-18, with its more than ten million victims. Imperialist intervention was largely responsible for millions of victims in the initially almost bloodless Russian Revolution of 1917. The great crisis of 1929 and fascism were both children of capitalism, as was the case with World War II, an effort of the most reactionary wing of capital to eliminate the achievements of the Russian Revolution. It is true that the course of the USSR was marked, especially in Stalin’s years, by the negative phenomena The Economist points out; i.e., the 1932-33 famine, gulags, massive cleansing, terror and oppression, as was also the case in China during the Great Leap Forward. However, these phenomena have been explained by Marxists as a degeneration process, the result of the backwardness of the countries where the revolution first took place and of the rise of Stalinist bureaucracy, which did not promote but betrayed world revolution both in the USSR –its first victims there being the leaders of October– and abroad. In addition, they were not the only ones and did not characterize the whole experience of the USSR. During the 1920s and early ’30s there took place in the USSR a vast cultural revolution, whose achievements were undermined by Stalinism but nevertheless partly survived and developed in the later phases of the regime. The Soviet people took up the main burden of the anti-fascist struggle, which objectively was a continuation of October’s progressive legacy, while after 1956 the most odious aspects of Stalinist oppression were put aside.

The imperialist plunder of the Third World, interventions, establishment of dictatorships and the condemnation of entire peoples in starvation, continued on the contrary throughout the 20th century, before and after World War II. The concessions of the ruling classes in the capitalist centers after 1945 were prompted chiefly by their fear of the post-war ascend of communism and anti-fascist movements. Where it not for the USSR, who would have stopped Nazism and force these concessions to the ruling classes? Moreover, while the existence of the USSR checked the aggression of imperialism, after its dissolution its real tendencies have again been manifested openly and unimpeded, producing their true devastating effects. It took just 15 years to take world-wide inequality to unprecedented heights, start many local wars, exacerbate the great powers’ competition to a point threatening a hot conflict, trigger the global economic crisis of 2007, and revive fascism and far-right nationalism worldwide. Even the few positive elements of the latest period, such as the great capitalist development of China, are closely linked to the positive heritage of the 20th century’s revolutions. In China, the fact that a great popular revolution lasting two decades eroded feudalism and imperialist dependence, allowed capitalism to develop without internal and external obstacles and benefit a comparatively significant part of the population; in India, on the contrary, where there was no revolution, but only a bourgeois renovation from above, the growth of the last decades was much weaker and a much larger part of the population is stuck in extreme poverty. Capitalism prevailed in its competition with the USSR due to its higher level of development of the productive forces and the devastating effects of Stalinism, but experience shows that this did not allow capitalism to overcome its contradictions.

The Economist’s journalists make every effort to reject not only Marx himself, but the whole Communist movement and its eminent theorists after his death:

After Marx’s death in 1883 his followers –particularly Engels– worked hard to turn his theories into a closed system. The pursuit of purity involved vicious factional fights as the ‘real’ Marxists drove out renegades, revisionists and heretics. It eventually led to the monstrosity of Marxism-Leninism with its pretentions of infallibility (‘scientific socialism’), its delight in obfuscation (‘dialectical materialism’) and its cult of personality (those giant statues of Marx and Lenin).

Here again, the negative experiences of Stalinism, dogmatism and the necrosis of Marxism, are exploited to discard as nonsense the whole development of Marxism after Marx. However, Marxism in that period had important representatives such as Engels, Plekhanov, Lenin, Luxemburg, Kautsky, Mehring and, after Lenin’s death, Trotsky, Bukharin, Gramsci and Lukacs, who cannot be put aside so easily. These Marxists analyzed developments after Marx’s death, guided the October Revolution and developed Marxism further. That this development involved a clearing of Marxism from alien influences was not something special to Engels or Lenin: Marx had also fought fiercely against the pseudo-socialists of his time, such as Proudhon and the “true socialists”, and Marxists after Lenin, especially Trotsky and Lukacs, explained Stalinist dogmatism as an alien influence and distortion of Marxism.

Paradoxically, and while one would expect that after all these tirades, everything about Marx has been dismissed, The Economist’s gentlemen conclude their reference to his “failures” with a reservation that would seem to distinguish something fertile in his thought. But as it immediately becomes clear, they consider “fertile” only what they themselves want to read or think they can find in Marx.

The collapse of this petrified orthodoxy has revealed that Marx was a much more interesting man than his interpreters have implied. His grand certainties were a response to grand doubts. His sweeping theories were the results of endless reversals. Toward the end of his life he questioned many of his central convictions. He worried that he might have been wrong about the tendency of the rate of profit to fall. He puzzled over the fact that, far from immiserating the poor, Victorian England was providing them with growing prosperity. (ibid, p. 71-72).

Here The Economist’s gentlemen remarkably agree with the representatives of the so-called “New reading of Marx”, that is, representatives of professorial academic wisdom who falsify Marx, such as Michael Heinrich. Marx, of course, rethought and improved his assumptions constantly, but contrary to the claims of these scholars, there is no evidence that he had revised his analysis of the falling tendency of the rate of profit, or that Engels distorted his positions. Moreover, the entire evolution of capitalism in the 20th century has confirmed this fundamental to its historical fortunes law discovered by Marx. The main transformations and models of capitalism, Fordism, Keynesianism, neoliberalism, were, in fact, just ways of reacting to the downward rate of profit, and the fact that the bourgeoisie is forced to replace them after profitability crises proves that they can counteract it only temporarily and that their potential is always exhausted.

Engels was perhaps not as deep as Marx, and he occasionally made some mistakes. But to dismiss Engels for Heinrich’s sake means to read Marx in a systemic way, to make Engels’s mistakes an alibi in order to accept a total mistake. Marx’s concerns at the end of his life had to do with a better conceptualization of the complexity of capitalism’s tendencies, and hence of the revolutionary process, not with their general direction.

Marx’s successes and further “failures”

This brings us to Marx’s successes, some of which are so obvious, that even The Economist’s columnists cannot but recognize them, although still charging him with some other failures.

“The chief reason for the continuing interest in Marx, however”, we read further, “is that his ideas are more relevant than they have been for decades. The post-war consensus that shifted power from capital to labour and produced a ‘great compression’ in living standards is fading. Globalisation and the rise of a virtual economy are producing a version of capitalism that once more seems to be out of control. The backwards flow of power from labour to capital is finally beginning to produce a popular –and often populist– reaction. No wonder the most successful economics book of recent years, Thomas Piketty’s ‘Capital in the Twenty-First Century’, echoes the title of Marx’s most important work and his preoccupation with inequality” (p. 72, same in the following).

So, if inequality has once again become a central issue, to the extent that 1% of the world’s population owns over 50% of the world’s wealth, and 3.7 billion of the poorest account for just 2.7%7, how can “dogmatic” and “fanatical” Marx be confirmed after so many “reforms” and “advances” made by the ruling classes? Let’s see what The Economist’s gentlemen have to say about this as things become more interesting now.

Marx argued that capitalism is in essence a system of rent-seeking: rather than creating wealth from nothing, as they like to imagine, capitalists are in the business of expropriating the wealth of others. Marx was wrong about capitalism in the raw: great entrepreneurs do amass fortunes by dreaming up new products or new ways of organising production. But he had a point about capitalism in its bureaucratic form. A depressing number of today’s bosses are corporate bureaucrats rather than wealth-creators, who use convenient formulae to make sure their salaries go ever upwards. They work hand in glove with a growing crowd of other rent-seekers, such as management consultants… professional board members… and retired politicians…

By reading such passages, one gets convinced that The Economist’s “liberals” will never understand even Marx’s simplest positions, not due to lack of knowledge, but because they do not want to understand them, since this goes contrary to their class interests. Marx never defined capitalism as a rent-seeking system. This was also a feature of feudalism which knew various kinds of rent. The distinctive feature of capitalism, according to Marx, is expansion, the development of production for production’s sake, the accumulation of capital. And what capitalists accumulate is surplus value, the unpaid labor of the workers, which they usurp. Ideas could never create stocks and capitals; and it is absurd to base economic analysis on the difference between the good ideas of capitalists and the bad ideas of managers, etc. Moreover, if it was just a matter of good or bad ideas, one could perhaps solve many problems and save capitalism by imposing a negative rent for some obviously bad ideas of the capitalists and their ilk, such as weapons of mass destruction. The Economist’s gentlemen, distorting Marx in that way, shift the problem from the structure of capitalism to the behavior of the one or other of its agents, bureaucrats, managers, and so on. Yet, while rent is, of course, important –and Lenin, Hobson and others showed how rentiers multiply in the imperialist era with capitalism’s increasing parasitism– according to Marx, it is production and not distribution that defines the essence of capitalism, as of every other economic system.

However, just after that we find two better passages. One is about globalization, which, it is acknowledged, Marx had already foreseen:

Capitalism, Marx maintained, is by its nature a global system: ‘It must nestle everywhere, settle everywhere, establish connections everywhere’. That is as true today as it was in the Victorian era. The two most striking developments of the past 30 years are the progressive dismantling of barriers to the free movement of the factors of production—goods, capital and to some extent people—and the rise of the emerging world. Global firms plant their flags wherever it is most convenient… The World Economic Forum’s annual jamboree in Davos, Switzerland, might well be retitled ‘Marx was right’.

So Marx did predict something correctly after all. And it seems that he did not only predict this, but also something else too, the tendency of capitalism to create monopolies and, along with the accumulation of wealth on the one side, to produce an army of unemployed and occasionally employed in the other:

“He thought”, we read further, “capitalism had a tendency towards monopoly, as successful capitalists drive their weaker rivals out of business in a prelude to extracting monopoly rents. Again this seems to be a reasonable description of the commercial world that is being shaped by globalisation and the internet. The world’s biggest companies are not only getting bigger in absolute terms but are also turning huge numbers of smaller companies into mere appendages. New-economy behemoths are exercising a market dominance not seen since America’s robber barons. Facebook and Google suck up two-thirds of America’s online ad revenues. Amazon controls more than 40% of the country’s booming online-shopping market. In some countries Google processes over 90% of web searches. Not only is the medium the message but the platform is also the market.

In Marx’s view capitalism yielded an army of casual labourers who existed from one job to the other. During the long post-war boom this seemed like a nonsense. Far from having nothing to lose but their chains, the workers of the world—at least the rich world—had secure jobs, houses in the suburbs and a cornucopia of possessions… Yet once again Marx’s argument is gaining urgency. The gig economy is assembling a reserve force of atomised labourers who wait to be summoned, via electronic foremen, to deliver people’s food, clean their houses or act as their chauffeurs. In Britain house prices are so high that people under 45 have little hope of buying them. Most American workers say they have just a few hundred dollars in the bank. Marx’s proletariat is being reborn as the precariat.

The analysis perhaps is not flawless, but we may assume without much danger of error that had Marx read it, he would have rated The Economist’s analysts at least with a 5 (full marks being 10). Unfortunately, is not so with the immediately following argument, for which he would definitely make them repeat the same class:

Still, the rehabilitation ought not to go too far. Marx’s errors far outnumbered his insights. His insistence that capitalism drives workers’ living standards to subsistence level is absurd. The genius of capitalism is that it relentlessly reduces the price of regular consumer items: today’s workers have easy access to goods once considered the luxuries of monarchs… Marx’s vision of a post-capitalist future is both banal and dangerous: banal because it presents a picture of people essentially loafing about (hunting in the morning, fishing in the afternoon, raising cattle in the evening and criticising after dinner); dangerous because it provides a licence for the self-anointed vanguard to impose its vision on the masses.

It is tragic indeed to encounter such expositions of Marx’s views.

First of all, Marx never claimed that “capitalism drives workers’ living standards to subsistence level”. This was, in fact, Lassalle’s position, expressed in his famous “Iron Law of Wages”, which states precisely this thing. Marx criticized Lassalle’s law, showing that the workers, with their organization and struggles, could improve their position, and that there is a difference, historically defined in each country, between the wage corresponding to subsistence level and the real average wage.8

Secondly, it is funny to imply that a thinker of Marx’s level had not noticed and pointed out the ability of capitalism to limit the prices of consumer goods through technological progress, productivity gains, etc. In fact, Marx was the first economist to recognize and explain this possibility, as well as the historical movement of wages at the various stages of capitalism, with his distinction between absolute and relative surplus value. Let us explain this distinction, for the benefit of The Economist’s columnists.

Absolute surplus value, according to Marx, is the type of capitalist accumulation that dominated the early stages of capitalism, in the so-called period of primitive accumulation of capital. During that period, accumulation was promoted by increasing the working day – for example, the worker was forced to work 12 instead of 10 hours daily, his salary remaining the same. This means an increase in exploitation: if, for example, in the initial 10 hours, 6 hours correspond to the reproduction of the labor force and 4 hours to unpaid labor (i.e., production of surplus value), the final 12 will include 6 unpaid hours. Absolute surplus value goes hand in hand with absolute impoverishment, as pay per hour of work decreases. The brutal expropriation of the rural population and its relocation to the cities under wretched conditions, the deadly work of children and women, etc., were some of the misfortunes of this phase, described in novels by Dickens, Gorky and others.

However, when the development of capitalism, and hence its technological base, reaches a relatively high point –what Marx calls “the real subordination of labor to capital”– absolute surplus value is replaced by relative surplus value. The distinctive feature of the latter is that accumulation is now promoted not by the increase of the working day but by the limitation of the part of the working day devoted to the replacement of the worker’s labor power. In the previous example, if the time for the reproduction of labor power (the necessary labor) is reduced to 2 hours from 6, then even with a reduction of the working day from 10 to 8 hours, the worker will produce more surplus value than before, offering 6 hours of surplus labor instead of 4. Relative surplus value corresponds to relative impoverishment because the salary per hour of work increases. In addition, it is a constituent part of Marx’s analysis that the price of labor power in the latter case will correspond to a larger number of goods, since by the development of specialization, etc., the needs of the worker also grow. Of course, the great limitation of necessary labor is made possible because, due to technological progress, an hour of work in developed capitalism produces a much larger mass of commodities than what it produced in its earlier stages. The total value of these goods remains roughly the same, but the value per unit is drastically reduced.

In Marx’s time relative surplus value had progressed only in Britain, yet this did not prevent him from recognizing it as the main form for developed capitalism and assess its impact on the workers’ living standard. In an excerpt in Capital he sums it up quite clearly:

Under the conditions of accumulation… which conditions are those most favorable to the laborers, their relation of dependence upon capital takes on a form endurable or, as Eden says: ‘easy and liberal’. Instead of becoming more intensive with the growth of capital, this relation of dependence only becomes more extensive, i.e., the sphere of capital’s exploitation and rule merely extends with its own dimensions and the number of its subjects. A larger part of their own surplus-product, always increasing and continually transformed into additional capital, comes back to them in the shape of means of payment, so that they can extend the circle of their enjoyments; can make some additions to their consumption-fund of clothes, furniture, etc., and can lay by small reserve-funds of money.9

Of course, as Marx explains at various points, this improvement has certain limits defined by the needs of capitalist accumulation, and tends to take place in periods of economic growth, while in recessions wages are being pressed. But this is a far cry from presenting him as an advocate of the view that no improvement in the lot of the workers is possible under capitalism.

Marx’s position that in the post-capitalist society people will be able to hunt in the morning and go fishing in the evening was a poetic image of the many sided, cultivated man who will replace the disintegrated, individualistic human existence to which capitalism gives rise. Marx insisted that labor itself will always be “the realm of necessity”, but shorter working hours when everyone will work will give all members of society enough free time for a variety of other activities. It was Marx’s deep conviction that in the future society even The Economist’s journalists will find some better things to do than to exhort capitalism and abuse Marx.

For the time being, of course, no such thing is in sight, so they continue listing some more of Marx’s “failures”. “The World Bank”, we are told, “calculates that the number of people in ‘extreme poverty’ has declined from 1.85bn in 1970 to 767m in 2013, a figure that puts the regrettable stagnation of living standards for Western workers in perspective”. Marx, evidently, failed to anticipate that momentous progress too…

Here again it is a case of progresses existing in the apologists’ heads rather than in reality. Extreme poverty is defined at making less than 1.90$ per day, so that it would hardly look like a great advance to half the number of those caught in it. Moreover, the very definition of extreme poverty by the World Bank is under severe criticism, while if one puts aside China, the picture in the rest of the world is hardly encouraging.

In fact The Economist’s gentlemen are very close to repeating arguments regarding general welfare, which their predecessors advanced in Marx’s time. “Delightful is it thus to see”, one of them went, “under Free Trade, all classes flourishing; their energies are called forth by hope of reward; all improve their productions, and all and each are benefited” (The Economist, 2/1/1853). To which Marx replied by pointing to the numerous cases of starvation in this “generally beneficial” social order10. One has just to look at the thousands of peasants in India who commit suicide due to starvation –according to official estimates, more than 12,000 yearly after 201311 – to see that The Economist’s present attempt to paint a similar worldwide tranquility is not a bit better.

There follows Marx’s worst “mistake”:

Marx’s greatest failure, however, was that he underestimated the power of reform—the ability of people to solve the evident problems of capitalism through rational discussion and compromise. He believed history was a chariot thundering to a predetermined end and that the best that the charioteers can do is hang on. Liberal reformers, including his near contemporary William Gladstone, have repeatedly proved him wrong. They have not only saved capitalism from itself by introducing far-reaching reforms but have done so through the power of persuasion. The ‘superstructure’ has triumphed over the ‘base’, ‘parliamentary cretinism’ over the ‘dictatorship of the proletariat’.

So, what do The Economist’s geniuses tell us? To what does their wisdom end up?

They tell us that Marx was right in verifying those laws and trends of capitalism that bring them and their ilk to the foreground –globalization, monopolization, etc.– but that they, the “superstructure”, the various “think tanks” of capital, with their special astuteness and wisdom, succeeded in changing the action of these laws, making them produce different results than those predicted by Marx. Isn’t that a form of egomania?

We have already seen that Marx recognized the possibilities of reforming capitalism, ultimately based on relative surplus value. He himself refers to them in the Preface to the 1st edition of Capital, pointing out that “present society is not a solid crystal, but an organism capable of change, and is constantly changing”.12 Marx, however, showed at the same time the limits of these possibilities. To clarify this last, vital point, let us listen first to The Economist’s gentlemen final confessions:

The great theme of history in the advanced world since Marx’s death has been reform rather than revolution. Enlightened politicians extended the franchise so working-class people had a stake in the political system. They renewed the regulatory system so that great economic concentrations were broken up or regulated. They reformed economic management so economic cycles could be smoothed and panics contained… Today’s great question is whether those achievements can be repeated. The backlash against capitalism is mounting – if more often in the form of populist anger than of proletarian solidarity. So far liberal reformers are proving sadly inferior to their predecessors in terms of both their grasp of the crisis and their ability to generate solutions. They should use the 200th anniversary of Marx’s birth to reacquaint themselves with the great man – not only to understand the serious faults that he brilliantly identified in the system, but to remind themselves of the disaster that awaits if they fail to confront them.

Well, well, truth must be admitted after all! What we see during the last two decades is the decline of the liberal elites, their constant shift to intensified reaction, their failure to find any viable way out of the crisis and the deadlocks of capitalism, their –as The Economist itself aptly puts it– sad inferiority to the circumstances. However, their failure inexorably raises a relentless question that The Economist’s gentlemen fail to raise: Is this a chance, subjective failure or error of the leading circles of capital? Or does its cause lie in something more profound; i.e., that there exists no longer such a reformist way?

Can capitalism reform itself anew?

So, can capitalism reform itself anew, as it has done in the past, or is its present, self-destructive course definitive?

This question emerges from all modern developments and we can give at least some credit to The Economist’s journalists for posing it openly and sharply as a “life and death” question for capitalism. Yet it cannot be posed in a Shakespearean, “to be or not to be” philosophical way, as they pose it. It must be examined in relation to the whole of social experience, the directions of bourgeois governments and organizations, etc. And any such discussion will inexorably force answering it in the negative. A few concrete questions will clarify that.

If there is a real possibility of a new New Deal today, why do we nowhere see a significant portion of the ruling classes expressing and supporting it? In the 1930s there was a Roosevelt, after World War II there were representatives of the liberal bourgeoisie such as De Gaulle and the Kennedy brothers. Where is their current analogue? Why does the “liberal” wing, whose voice The Economist is, can only oppose Trump with a Hillary Clinton; i.e., something just a trifle better? Why do the few progressive representatives of the bourgeoisie like Sanders prove completely incapable of proposing any positive reform program and are forced, confusing others and themselves, to talk about “socialism”?

All these are sure indications that an internal reform of capitalism which would provide a real economic revival is no longer possible. We will understand why it is so by returning to Marx’s analysis of relative surplus value. The development of mature capitalism, as Marx has shown particularly in his Results of the Direct Production Process, consists essentially in generalizing relative surplus value, through its successive expansion to the various branches of economy. This was done in previous stages with the technological intensification of industry, agriculture and the state sector, services, etc. And the reason capitalism could at those stages have some able representatives was that there were still non-intensified sectors of the economy, whose reshaping, as well as the overall reshaping of the system based on this process, required certain abilities.

The distinctive feature of globalization, on the contrary, is that, at least in the developed countries, there is no longer a non-intensified economic sector. The service and public sectors, the last remaining ones, were intensified in the neoliberal era, this being its essential content. Things like “green economy” are aspirins, while the generalized automation futurists like Mason are dreaming of is inconceivable under capitalism as it would decisively hit the rate of profit. The very fact that capital is now forced to resort to absolute surplus value, increasing again the length of the working day in order to support the rate of profit (and thereby reviving again absolute impoverishment!), is a further proof of the exhaustion of its reformist margins. So at capitalist metropolises at least, there remains nothing else, nothing new to be done; there is no new model of accumulation and consequently no possibility of a new cycle. This makes globalization the last phase, the last moment of the imperialist era and capitalism in general, during which the capitalist system will necessarily leave the historical scene.

All this does not imply, of course, a complete impossibility of reforms, but any such possibilities refer to measures, changes, etc., which fulfill possibilities of the current stage, not of a hypothetical, non-existent future stage. Or to put it otherwise: there is no chance of capitalism presenting something radically new, a modern “New Deal”, but only –and this at a theoretical level– of normalizing and prolonging a bit globalization, by softening for some time its worst conflicts.

Two such possibilities are basically at hand. Relative surplus value has already exhausted its potential in the capitalist centers and is now fulfilling it in Asia and Latin America. But there is a continent where it has not yet been expanded; i.e., Africa. Africa’s participation in globalization could provide a growth momentum when China recedes, opening a further round. Of course, in order to bring this about, that participation should be on comparatively equal terms, not like that of Yemen, which picks up globalization’s bombs, but roughly that of China. Secondly, the North-South gap in the European Union suggests a similar, albeit proportionally smaller, possibility of capitalist progress for the European South, but this also presupposes a change in the EU structure towards true convergence.

Historical experience so far proves that the weakened liberal leaders of capitalism cannot implement these changes or even aid them. Obstacles on their way are more than obvious. Africa is already the field of competition between China and the West, and the great powers are not interested in its development, but in enhancing each one’s sphere of influence and plundering at the expense of the rest. In addition, American imperialism’s policies of past decades, interventions around the world, etc., have strengthened the worst, most adventurous forces in its protectorates, the consequence being that change stumbles not only on the directions of imperialism itself, but also on local cliques, “compradorial” segments, etc. Africa’s current growth rate of about 4% reflects these barriers, being extremely low for a continent with a population of 1.3 billion and less than one-third of US GDP.

It would be erroneous to imagine that when China’s momentum fades, capital will flow in Africa and start a new swift rise there. Firstly, China’s potential as capitalism’s steam engine has already been half-halted. Yet Africa’s development has not gained momentum, but has receded during the last years, from 5.5% in 2012 to 2.7 in 2016, and an anemic recovery in 201713 In the second place, China’s huge capitalist progress was made possible by the fact that the revolution had created a viable social order, a skillful and educated working class, etc. Only traces of these will be found in Africa, which is moreover divided in a multitude of small, unsustainable states, with extreme poverty increasing strongly during the last decades. In practice, moving these barriers aside will require at least some Chavez type revolutions in Africa, like those of Latin America during the last two decades. A key condition for a steady development in that continent will be that the leading circles of imperialism support these processes, yet wherever they have happened so far, either in Africa itself in the 1950s, ’60s and ’70s, or in Latin America recently, imperialism has constantly tried to stifle them.

On the other hand, the European Union, the only intensive global integration process, remains, as Mr. Juncker acknowledged in his recent Marx speech, extremely fragile. “The European Union”, he said, “is not a flawed, but an unstable construction. Unstable also because Europe’s social dimension until today remains the poor relation of the European integration. We have to change this”14 But of what change can one speak of, when, in a construct that its own leaders confess its instability, all the pressures of the crisis are directed to its weakest joints? It is not clear that the next crisis, which even according to them, is probably a short time away, will break it into pieces? And what will the consequences be then? Under the present circumstances, these can only be chaos, a fascist takeover of power in at least some European countries and war conflicts.

Of course, Trump’s election in the United States, the developing commercial wars and the existence of anachronistic regimes, such as Syria, Iran, and so on, belonging to Russian sphere of influence, obstruct economic progress even more at a world level. Add to this the whole parasitic raff of globalization, which in not limited to bureaucrats and politicians as The Economist would have it, but also includes all kinds of market speculators, lobbyists, mafias, etc, who loot world economy –movies like Gavras’s “Le Capital” and Hickenlooper’s “Casino Jack” depict their range– and you will see why it is utopian to expect something different from the ruling elites.

One last point that deserves some comment in The Economist’s arguments is their hints that Marx’s revolutionary forecast has been refuted in the capitalist centers. While Marx “believed communism would take hold in the most advanced economies… The only countries where Marx’s ideas took hold were backward autocracies such as Russia and China”. And even today, in period of severe crisis, opposition to capitalism appears “more often in the form of populist anger than of proletarian solidarity” (p. 71, 72).

These arguments are not new, yet there is a grain of truth in them, which has also been adequately dealt by Marxists. After Marx’s death, Engels, Lenin and Trotsky recognized the bourgeoisie’s ability to create a “working class aristocracy”, by sharing a small part of the booty of colonial exploitation, a fact allowing it to stabilize its hold in the capitalist centers. On the other hand, the obvious reason recent opposition to capitalism has so far been manifested chiefly by the rise of (often far-right) populism is that the crisis hit first the petty bourgeoisie, who tend to seek to restore their previous position at the expense of the working class15 All that, however, belongs to the kind of complications and difficulties with which Marx struggled in the last phase of his life, when he clearly envisaged some of them (e.g., the possibility of a revolution in Russia) and in no way counters his central claims. Doesn’t the fact of “the regrettable stagnation of living standards for Western workers” (p. 72), to which The Economist reluctantly refers, prove indeed that the main stabilizing factor in the capitalist centers belongs to the past?

Let us sum up in a graphic way. Capitalism is a Titanic that, due to the very materials and contradictions ingrained in its frame, is doomed to break up and sink. It is composed, of course, of several levels, each one of them having its own watertight parts which delay for a while flooding from incoming water. In the previous stages or levels, there was a difficult way out of Titanic to the new ship of socialism, but there were also higher levels to which one could move when the previous ones were flooded. The peculiarity of the current level is that there no more exists a level above. There is only a possibility of delaying the flooding of the current level either by increasing its space (a relatively equal participation of Africa in globalization) or by absorbing some of the pressures on the walls by channeling them to their strongest points (allocating part of the burdens of the EU crisis to Germany, France, etc.). We do not see any of these possibilities being realized today; on the contrary, the policies pursued are in the exactly opposite direction.

We have already explained why this is so and why a realization of the progressive possibilities of the current stage by the ruling classes is extremely unlikely, if not impossible. Moreover, if they were to be implemented, this should have been prepared during the past decades; e.g., by instituting a United Nations program to combat poverty in Africa and elsewhere, such as that proposed in the 1960s by the Kennedy brothers (who were murdered incidentally by their own class), rather than conducting military interventions in Iraq and Afghanistan. If, however, The Economist’s gentlemen are of another opinion and consider such a program possible, nothing prevents them from becoming its preachers, even if a little late.

In conclusion

Marx in his time never held The Economist in any high esteem. He called it, the “optimist conjurer of all things menacing the tranquil minds of the mercantile community”.16

The Economist’s article on Marx’s 200 years confirms his judgment. It is a mirror of the illusions of the condemned classes concerning their “eternity” and of their gaudy front, from which “superstitions and prejudices emerge like frogs”.17 How could Marx be a great thinker and a racist egomaniac at the same time? If he was a racist, why has he been an anathema for all reactionaries? Questions like these The Economist’s gentlemen are unable even to pose; prejudice blocks them from surfacing in their minds. And in this way, they unwittingly offer the best proof that Marx was right both in his opinion about The Economist, which has not advanced far since then, and in his overall predictions about capitalism’s fate.

However, The Economist’s journalists are wrong when they say that the practical implication of these predictions is to “hang on the chariot of history”. Such passivity was alien to Marx; on the contrary, he stressed that history presents active possibilities, the content of which, according to his famous statement, lies in “shortening the birth pangs”. It is on the contrary the “free market” apologists who hang on it and never prepare anything.

From this point of view; e.g., a capitalist development in Africa similar to that of China cannot be indifferent to Marxists as it would limit the sufferings of the next capitalist crisis and help realize the transition to socialism under better conditions. But herein lies the problem, that all such possibilities are hampered by the bourgeoisie itself, by the oligarchies of the developed countries. As Trotsky points out:

In the conditions of capitalist decline, backward countries are unable to attain that level which the old centers of capitalism have attained. Having themselves arrived in a blind alley, the more civilized nations block the road to those finding themselves in a process of civilizing themselves.18

Despite The Economist’s reformist optimism, all realities of our time cry in chorus that the necessary progressive reforms, even those in principle theoretically possible within capitalism, can only be fulfilled in a revolutionary way. And their fulfillment is only conceivable as a step, a starting point in the process of transition to socialism.

  1. See Readers of the World Read Karl Marx, The Economist, May 3, 2018. In the electronic edition the title is different, “Rulers of the world: read Karl Marx!” Roughly one year ago The Economist had published a similar item on Marx, expressing its “scorn” regarding John McDonnell’s praise of him but also admitting that Marx “becomes more relevant by the day”. The Economist, 11/5/2017.
  2. P. Boiteau, “Mort le Karl Marx”, Journal des débats, 25/3/1883.
  3. See K. Marx – F. Engels. Collected Works, Progress Publishers, vol. 41, p. 388-391.
  4. R. Pennington, “Bruno Bauer: Young Hegelian”. That article had appeared first at Instauration, an ultra-right periodical, in 1976. Of course, Pennington goes on to invent an antithesis between Marx and Engels, by presenting the latter as an anti-Semite. This is a lie, Engels had written an article against anti-Semitism, exposing it as an ultra-reactionary current: “anti-Semitism”, he said, “serves… reactionary ends under a purportedly socialist cloak; it is a degenerate form of feudal socialism and we can have nothing to do with that” (F. Engels, “On anti-Semitism”.

    The myth of Marx’s “anti-Semitism” is ably refuted by R. Fine in “Karl Marx and the Radical Critique of Anti-Semitism”.  Unfortunately Fine, in his otherwise excellent article, attributes wrongly the above quoted phrase of Engels to Marx.

  5. K. Marx, “The 18th Brumaire of Louis Bonaparte”, in K. Marx – F. Engels, Selected Works, Progress Publishers, Moscow 1977, vol. 1, p. 479-480.
  6. K. Marx, Theories of Surplus value, Progress Publishers, Moscow 1975, vol. 3, p. 63.
  7. See “World wealth increases, inequality rises“, Kathimerini, 15/11/2017.
  8. In a well-known passage in Capital, in the part on labor power, Marx emphasizes this point; see K. Marx, Capital, Progress Publishers, Moscow 1977, vol. 1, p. 168.
  9. K. Marx, ibid, p. 579.
  10. K. Marx, Dispatches for the New York Tribune. Selected Journalism of Karl Marx, Penguin Books, London 2007, p. 111-113.
  11. Dhananjay Mahapatra, “Over 12,000 farmer suicides per year, Centre tells Supreme Court”.
  12. K. Marx, ibid, p. 21.
  13. See “Economy of Africa”.
  14. See “EU president Juncker defends Karl Marx’s legacy”. Regarding predictions of a new crisis by EU and IMF officials see  “Juncker’s article on Europe in ‘Ta Nea”, C. Lagarde. “A new crisis is possible”,  and Lagarde. “The Eurozone must be ready for the next crisis”, .
  15. This, let us remark by the way, means that it will be necessary to overcome great difficulties in turning social protest to the left, which implies, among other things, a confrontation with neo-Stalinist, nationalist and other pseudo-socialist currents and the unification of the nowadays scattered revolutionary and oppositionist groups that do not share the above errors. But this requires time so that the ruling classes’ tendency to avoid any progressive reform, partly explained by their usual fear of opening up the appetite of the movement and triggering revolutionary developments, is not right presently.
  16. Κarl Marx. “Revolution in China and in Europe”, New York Daily Tribune, June 14th, 1853.
  17. Α. Arnellos, A Game of Chess, Tipothito Editions, Athens 2002, p. 77.
  18. L. Trotsky, Revolution Betrayed, Allagi Editions, Athens 1988, p. 15.

US Trade War with the European Union

Background

The EU on Wednesday said a raft of retaliatory tariffs, including on whiskey and motorcycles, against painful metals duties imposed by the US would be ready as early as July.

The European Commission, which handles trade matters for the 28-country bloc, “expects to conclude the relevant procedure in coordination with member states before the end of June,” said European Commission Vice-President Maros Sefcovic at a news briefing.

This would allow “that the new duties start applying in July,” he added.

“It is a measured and proportionate response to the unilateral and illegal decision taken by the US to impose tariffs on the European steel and aluminum exports which we regret,” said the former Slovak prime minister.

From blue jeans to motorbikes and whiskey, the EU’s hit-list of products targeted for tariffs with the US reads like a catalogue of emblematic American exports.

The European Union originally drew up the list in March but pledged not to activate it unless US President Donald Trump followed through on his threat to impose 25 percent tariffs on steel imports and 10 percent on aluminum.

The Trump tariffs came into effect on June 1 and the EU now joins Mexico and Canada and other close allies that have announced their own wave of counter-duties against Washington.

The EU commission must now take their proposal to be signed off by the bloc’s member states amid divisions over what path to take against Trump’s unpredictable policies.

France and the Netherlands back a tough line against the US, while export powerhouse Germany has urged caution towards Trump’s “America First” policies.

*****

PressTV: How do you think this will affect the US? Wouldn’t it create more unemployment in America?

Peter Koenig: First, I think we have to distinguish between the various trade blocks and trade wars, like China, Russia, the NAFTA partner countries, Mexico and Canada – and the European Union – the EU. They are all different in as much as they have different motives.

Second, there is much more behind the so-called trade wars than trade. Much of this trade war is propaganda, big style, for public consumption and public debate, whereas in reality there are other negotiations going on behind closed doors.

And thirdly, there are mid-term elections coming up in the US this fall, and Trump must satisfy his home base, all the workers to whom he promised “Let’s Make America Great Again” – meaning bring back jobs, use US-made metals. So, Trump is also addressing those Americans who wait for jobs. As you know the unofficial but real figure of unemployment in the US is about 22% – and that does not even include the large segment of underemployed people, mostly youth.

I think we have to see the Big Picture here. And Trump, or rather those who give him orders, may not see all the risks that this complex multi-polar tariff war implies.

But for now, let’s stick to Europe.

It is very well possible that the EU will also impose import duties on US goods. But if it stays at that, it is very likely that this so-called trade war with the US is pushing Europe even faster than is already happening towards the East, the natural trading partners – Russia and China. As I said, it’s already happening.

But the Big Picture, in the case of Europe, I believe is IRAN. With tariffs on steel and aluminum – quite sizable tariffs, European producers of these metals, the second largest after China, would hurt. There may not be an immediate replacement market for America.

So, Trump may want to blackmail Europe into accepting his new sanctions on Iran. In other words, “either tariffs or you follow my dictate – abandon the Nuclear Deal and impose sanctions”.

Frankly, I doubt very much that this will work, since EU corporations have already signed billions worth of contracts with Iran. On the other hand, Germany in particular, is keen in renewing political as well as trade relations with Russia.

And the recent remark of the new US Ambassador to Germany, Richard Grenell, that he will support conservative right-wing movements in Germany and in Europe did certainly not go down well in Germany, with already a Parliamentary movement to expulse him, which certainly doesn’t help US-German relations.

As we speak, most likely this type of “blackmail” negotiations, “either tariffs or you go with us against Iran”, are going on with the EU behind closed doors. Of course, nobody knows the outcome.  Trump is like a straw in the wind, bending to whatever seems to suit him best at the moment.

Remember, a couple of months ago he already imposed tariffs on Europe, along with everybody else, on steel and aluminum, then he lifted them again – and now we are on again. It’s like with most everything he does. It’s probably his business negotiation strategy.

But, this would just confirm that this trade war is much more than meets the eye, more than a trade war – it’s about geopolitics – like “show me your card – which camp are you in?”

Trump and those who manage him may still be under the illusion of the last 70 years, that the whole world, especially Europeans, have to bend over backwards to please the US of A, because they saved Europe – and the world – from the Nazi evil.

Not only is it time to stop the vassalage and become autonomous again, but also, many European start understanding that whom they really have to thank for liberating them from the Nazis – is Russia.

The Chinese Dream of Hegemony?

On 30 May, United States Admiral Harry Harris, slated to become the next US ambassador to South Korea, said: “China remains our biggest long-term challenge. Without focused involvement and engagement by the United States and our allies and partners China will realize its dream of hegemony in Asia.”

This is starkly at odds with how Chinese leaders describe the Chinese Dream. Chinese chairman Xi Jinping explained:

… the Chinese Dream of the rejuvenation of the Chinese nation means that we will make China prosperous and strong, rejuvenate the nation, and bring happiness to the Chinese people.1

Xi averred that it is through the cause of Chinese socialism – whose core vales are prosperity, democracy, civility, harmony, freedom, equality, justice, the rule of law, patriotism, dedication, integrity and friendliness – that the Chinese Dream will be attained.1

And the Chinese Dream is not exclusively for the benefit of Chinese people. Xi spoke of cooperation with other countries “on the path to realizing the great dream of development and prosperity.”1

To realize the Chinese Dream… We will both on China’s development and on our responsibilities and contributions to the world as a whole. We will bring benefits to the Chinese people and the rest of the world. The realization of the Chinese Dream will bring the world peace, not turmoil, opportunities, not threats.1

Admiral Harris presents a strictly militarist perspective. This is the perspective of a person who views the world in Manichean terms: ally or enemy.

That China is participating in the capitalist market-economy and performing far more spectacularly than the US is no reason to call China a hegemonic aspirant.2

Yet Harris’ opinions came on the heels of US warships entering the waters around Chinese-claimed territory in the South China Sea.3

The US frequently sends its warships through the region on so-called freedom of navigation patrols, and when the navigation steers provocatively near to islands/islets claimed by China, it causes consternation in Beijing. China abides by freedom of passage through the South China Sea, but as UNCLOS states such passage must be innocent. This should be understandable in Washington because it seems certain how the US would react to Chinese warships sailing through the Straits of Florida.4

Chinese Foreign Ministry spokeswoman Hua Chunying said admiral Harris was “obsessed with hegemony,” fearful that others might try to usurp it from the US.

In his book, The Governance of China, chairman Xi Jinping seven times mentions the Chinese aversion to hegemony. Among them:

We stand for peaceful resolution of all disputes, oppose all forms of hegemony and power politics, and never seek hegemonism nor engage in expansion. (location 594)

China has stood up. It will never again be bullied by any nation. Yet it will never follow in the footsteps of big powers, which seek hegemony once they grow strong. Our country is following a path of peaceful development. (loc 2675)

And we have made a solemn pledge to the whole world that we will never seek hegemony or commit any act of expansion… (loc 3664)

China does not subscribe to the outdated logic that a country will invariably seek hegemony when it grows strong. Are colonialism and hegemony viable today? Absolutely not. (loc 3956)

China would stick to a path of peaceable development, a mutually beneficial strategy and opening up, and the pledge of never seeking hegemony. China would pass its commitment from generation to generation. (loc 6490)

Given the words of the to-be US ambassador to South Korea, one can only assume that the Harris is either ignorant or he is implying that Xi is a liar. Hardly an auspicious start for a job posting that obviously calls for diplomatic skills.

Even if there is substance to what Harris states, it would at best be a case of the pot calling the kettle black.

Does China have the equivalent of a Monroe Doctrine (by which the US has granted itself preeminence — also referred to as hegemony — in the western hemisphere)? Are Chinese troops warring in Africa? Is China supporting a coup government in Honduras? Is China pursuing “regime change” in Venezuela? In Syria? Is China supporting the oppression and slaughter of Palestinians by Israeli Jews? Does Xi Jinping threaten North Korea with genocide? Has China ringed countries around the world with Chinese military bases?

If China does not engage in such imperialistic acts, then who is actually acting a like a hegemon?

Image from
The Daily Economist

  1. Xi Jinping, “The Chinese Dream” in The Governance of China (Beijing: Foreign Languages Press, 2014).
  2. I already addressed the topic of China as a hegemon, but Harris’ comments call for reply.
  3. Curtis Stone, “Washington provokes Beijing in the South China Sea at its own peril,” People.cn, 28 May 2018.
  4. For elaboration on the situation in the South China Sea, read “Who has Sovereignty in the South China Sea?

US Trade War with China

Background

Washington, May 29 (Reuters): The United States said on Tuesday that it will continue pursuing action on trade with China, days after Washington and Beijing announced a tentative solution to their dispute and suggested that tensions had cooled.  By June 15, Washington will release a list of some $50 billion worth of Chinese goods that will be subject to a 25 percent tariff, the White House said in a statement. The United States will also continue to pursue litigation against China at the World Trade Organization.

In addition, by the end of June, the United States will announce investment restrictions and “enhanced export controls” for Chinese individuals and entities “related to the acquisition of industrially significant technology,” it said.  In mid-May, China agreed to increase purchases of U.S. agriculture and energy products, and last week, the U.S. Commerce Department told lawmakers it had reached a deal to put Chinese telecommunications firm ZTE Corp back in business.  While the announcements eased worries about the possibility of a trade war between world’s two largest economies, U.S.President Donald Trump also said last week that any deal between Washington and Beijing would need “a different structure,” fueling uncertainty over the talks.

Trump has threatened to impose tariffs on up to $150 billion of Chinese goods to combat what he has labeled unfair trade practices on the part of Beijing. Meanwhile, China has warned of equal retaliation, including duties on some of its most significant U.S. imports, like aircraft, soybeans and vehicles.

PressTV: What do you make of this so-called Trade War between the US and China?

Peter Koenig: It’s like almost everything by Trump – “on again, off again…”  Will these threats be materialized or just remain threats for propaganda, for public consumption?

The same with the long-sought head-to-head meeting between Trump and Kim Jong-Un on 12 June in Singapore. It was on, then off and now – maybe.

Iran, after 9 years of hard negotiations, the 5+1 Nuclear Deal was signed in July 2015. Trump comes in, of course, highly influenced by Netanyahu, the deal is off. But he doesn’t like that the other four will stick to it.

Same with China and the so-called Trade War. China certainly will not like tariff “punishment”. But, I’m sure if it happens, China has many avenues to circumvent dealing and trading with the US. But once that happens, China may be lost for good for the US market. And Trump knows it – hence, a little bit the on-and-off game. He wants to test the waters; see who reacts how.

PressTV: You say China has many avenues to circumvent the US sanctions or retaliate. What can China do?

Peter Koenig: China can, of course, also levy import duties on US goods. China doesn’t depend on US imports. China is self-sufficient and has, as it is, a huge trade surplus vis-à-vis the US.

China also controls the Asian market, having over-taken the US already a couple of years ago.

But what I really suspect is that Trump wants to discourage the world from using the Yuan as a reserve currency, since as such, it lowers not only the value of the US dollar, but it replaces the US dollar as the de facto reserve currency in the world.

Only 20 years ago, or so, the US dollar figured to 90% as reserve currency in treasuries around the globe. Today that percentage has shrunk to below 60%.

As you know, the Yuan has become an official IMF reserve currency about a year ago. That established worldwide trust in the Chinese currency, especially since the Yuan is backed by the Chinese economy plus by gold. Whereas the US dollar has no backing whatsoever; it’s pure and simple FIAT money.

Plus, the US is broke. Everybody knows it. The US has a current debt of about 110% of her GDP, more than the Greek debt was in 2008.

And if counting what the US General Accounting Office calls, “unmet obligations” or “uncovered liabilities”, the US debt is about 7 ½ times the US GDP.

Of course, such figures do not go unnoticed by the treasurers of the world.

So, Trump’s trade war with China, or the Propaganda for a Trade war, might as well be a Propaganda against the Yuan, diminishing its reputation, so as to deflect from every country’s golden opportunity to use the Yuan to replace the dollar as reserve currency.