Category Archives: UNCTAD

Do Not Reach for the Sky Just to Surrender

Greta Acosta Reyes (Cuba), Neoliberalism, 2020.
Greta Acosta Reyes (Cuba), Neoliberalism, 2020.

Dear Friends,

Greetings from the desk of the Tricontinental: Institute for Social Research.

Beirut, mon amour.

Those shattered mirrors once were
The smiling eyes of children,
Now are star-lit.
This city’s nights are bright.
and luminous is Lebanon.
Beirut, ornament of our world.
Faces decorated with blood
Dazzling, beyond beauty.
Their elegant splendor
Lights up the city’s lanes.
And radiant is Lebanon.
Beirut, ornament of our world.
Every charred house, every ruin
Is equal to Darius’ citadels.
Every warrior brings envy to Alexander.
Every daughter is like Laila.
This city stands at time’s creation.
This city will stand at time’s end.

– Faiz Ahmed Faiz (1911-1984).

The novel coronavirus continues its march through the world, with 18 million confirmed cases and at least 685,000 deaths. Of these, the United States of America, Brazil, and India are the worst-hit, harbouring about half of the world’s cases. US President Donald Trump’s claim that these numbers are high because of higher rates of testing is not borne out by the facts, which show that it is not testing that has ballooned the numbers but the paralysis of the governments of Trump, Brazil’s Jair Bolsonaro, and India’s Narendra Modi and their failure to control the contagion. In these three countries, testing has been hard to access, and the test results have been unreliably reported.

Trump, Bolsonaro, and Modi share a broad political orientation – one that leans so heavily towards the far right that it cannot walk upright. But beneath their buffoonish statements about the virus, and their reluctance to take it seriously, lies a much deeper problem that is shared by a range of countries. This problem goes by the name of neoliberalism, a policy orientation that emerged in the 1970s to stabilise a deep crisis of stagnation and inflation (‘stagflation’) in global capitalism. We define neoliberalism plainly in the image below:

Vikas Thakur (India), Neoliberalism, 2020.
Vikas Thakur (India), Neoliberalism, 2020.

The tax strike by the very rich, the liberalisation of finance, the deregulation of labour laws, and the evisceration of welfare provisions deepened social inequality and reduced the role of the vast mass of the world’s population in politics. The demand that ‘technocrats’ – especially bankers – run the world produced an anti-political sentiment amongst large sections of the world, who became increasingly alienated from their governments and from political activity.

Institutions of society that emerged to protect us from catastrophes of one kind or another were undermined. Public health systems were dismantled in countries such as the United States and India, while associated social services for childcare and eldercare were cut back or destroyed. In 2018, a United Nations study found that only 29% of the global population has access to social protection systems (including income security, access to health care, unemployment insurance, disability benefits, old-age pensions, cash and in-kind transfers, and other tax-financed schemes). A consequence of ending even meagre social protection for workers (such as sick leave) and of failing to provide public universal healthcare is that in the case of a pandemic, workers can neither afford to remain at home nor can they access healthcare: they are left to the wolves of the ‘free market’, which is really a world designed around profit and not the well-being of people.

Choo Chon Kai (Malaysia), Freedom of choice, 2020.
Choo Chon Kai (Malaysia), Freedom of choice, 2020.

It is not as if there have not been warnings about the policy framework known as neoliberalism and the austerity project that it has driven. In September 2019, the World Health Organization (WHO) warned about the deep cuts in public health spending – including the lack of hiring of public health workers – and the impact this would have if a pandemic were to break out. That was on the verge of this pandemic, although earlier epidemics (H1N1, Ebola, SARS, MERS) already showed the weakness of the public health systems to manage an outbreak.

From the onset of neoliberalism, political parties and social movements warned about the threats posed by these cuts; as social institutions are whittled away, society’s ability to withstand any crisis – be it economic or epidemiological – is damaged. But these warnings were dismissed, the callousness remarkable.

Kelana Destin (Indonesia), Water, 2020.
Kelana Destin (Indonesia), Water, 2020.

The United Nations Conference on Trade and Development (UNCTAD), founded in 1964, lit the red light of caution from the publication of its first Trade and Development Report (TDR) in 1981; this UN body tracked the new economic agenda premised on liberalised trade, debt-driven investment in the developing world, and the slow emergence of a broad slate of austerity policies pushed by the IMF’s structural adjustment programmes. The austerity programmes imposed on countries by the IMF and by the wealthy bondholders negatively impacted GDP growth and produced large fiscal imbalances. Growth in Foreign Direct Investment (FDI) and exports did not necessarily mean an increase of the incomes for the people in the developing world. The TDR from 2002 explored the paradox that, while the developing countries were trading more, they were earning less; this meant that the trading system was rigged against these countries whose economies are largely reliant on exporting primary commodities.

The 2011 TDR looked closely at the after-effects of the 2007-08 credit crisis, which – it noted – ‘highlighted serious flaws in the pre-crisis belief in liberalisation and self-regulating markets. Liberalised financial markets have been encouraging excessive speculation (which amounts to gambling) and instability. And financial innovations have been serving their own industry rather than the greater social interest. Ignoring these flaws risk another, possibly even bigger, crisis’.

Lizzie Suarez (USA), Abolish Neoliberalism Resist Imperialism, 2020.>
Lizzie Suarez (USA), Abolish Neoliberalism Resist Imperialism, 2020.

After re-reading the 2011 TDR, I wrote to Heiner Flassbeck, who was the Chief of Microeconomics and Development at UNCTAD from 2003 to 2012, to ask him about that report and his feelings about it almost a decade later. Flassbeck re-read the report and wrote, ‘it seems to me that it is still a good guide into a new global order’. Last year, Flassbeck wrote a three-part series of articles titled ‘The Great Paradox: Liberalism Destroys the Market Economy’ in which he argues that neoliberalism destroyed the ability of economic activity to create jobs and wealth for the majority of the people. Now, Flassbeck wants to emphasise the importance of stagnant wages as an indicator of problems, as well as a place from which to develop solution.

The 2011 TDR argued that ‘the forces unleashed by globalisation have produced significant shifts in income distribution resulting in a falling share of wage income and a rising share of profits’. The Seoul Development Consensus of 2010 had advised that ‘for prosperity to be sustained it must be shared’. Apart from China, which developed a major scheme in 2013 to eradicate poverty and share growth, most countries saw wage growth fall short of productivity growth, which has meant that domestic demand grew slower than the supply of goods; nor were the possible solutions of relying on external demand or stimulating domestic demand with credit sustainable.

Pavel Pisklakov (Russia), Invisible Hand, 2020.
Pavel Pisklakov (Russia), Invisible Hand, 2020.

Flassbeck replied to Tricontinental: Institute of Social Research: ‘The core of the matter is wages. That was missing in the TRD 2011. All attempts to stabilise our economies and bring them back to strong investment growth are futile if the wage question is not fixed. To fix it means to implement in all countries of the world strong regulation to make sure that wage earners are fully participating in the productivity growth of their national economies. In the developing world, this is understood in Eastern Asia but nowhere else. You need strong government intervention to force companies, national as well as international, to apply wage growth in line with productivity growth and the inflation target set by the government or the central bank. It can be pushed through by governments decisions about the increase of the minimum wage, as China did it, or by informal pressure on the companies, as Japan did it’.

In a recent report, Flassbeck argued that many developing countries – even in the midst of the coronavirus recession – look to the advanced capitalist countries, which are cutting wages, underspending, and pursuing failed policies of ‘labour market flexibility’; the IMF often forces along these policies, which are the ‘main hindrances to a better growth and development performance’.

Sinead L Uhle (Germany), También la lluvia (‘Also the rain’), 2020.
Sinead L Uhle (Germany), También la lluvia (‘Also the rain’), 2020.

This newsletter is illustrated by posters from our ongoing Anti-imperialist Poster Exhibition. The first set was on the theme of capitalism; the second set is on neoliberalism, for which we received submissions from 59 artists from 27 countries and 20 organisations. Please spend some time enjoying the inventiveness of the artists.

Their inventiveness gives us confidence to be inventive and bold in our demands for society, which reject the neoliberal capitalist framework. If we are to reach for the sky, there is no point in putting our hands up merely to surrender to the propertied and the powerful; we need to reach for the sky to lift up the world from the morass of despair.

May Day 2017: Trample All Forms of Sectarianism

One hundred years ago, the proletariat in Petrograd celebrated the historic May Day in jubilation and honor. “Thousands of people turned out for the 1917 May Day parade. They carried […] banners and posters, which became the main elements of the decorations in Petrograd.”1

“One of the leading artists of the World of Art movement, Mstislav Dobuzhinsky, wrote, ‘[W]e have witnessed the birth of a new era: on the First of May we artists finally took our revolutionary banners out onto the streets […]!’”2

That was a crucial hour of proletariat’s political struggle in Russia. The proletariat was positioning to attain an epoch-making victory within months. And, sectarian trends within politics were losing foothold as whirlwind of proletariat’s political fight was getting powerful although the bourgeoisie and tsarist elements were trying utmost to fan hatred and sectarianism among the working people.

Today, around the world, working people in millions are observing and celebrating the May Day. On streets and squares in cities, workers are struggling state with violent force, in industrial areas, work stoppages are declaring labor’s power, in towns and urban areas, toilers’ demonstrations are demanding rights, and city centers are turning vibrant with working people’s marches and celebrations. And today, capital is drawing lines of divisions among the working people in countries and societies.

And, yet, condition of the proletariat is precarious. Capital’s onslaught on labor is in full force now as capital is scrambling to get out of crises it has created. The onslaught has taken forms as capital struggles to socialize its burdens it is failing to bear and profit from: from austerity measures, budget cuts, re-locating of factories and manufacturing plant, so-called out-sourcing, espionage and demobilizations to wars and interventions with varying types, from spreading of sectarianism, Nazi ideas with different appearances, “democracy”- and “rights”- mongering, defending medieval ideas and practices to seeding of confusion in the ranks of the working people. To keep labor subjugated, ultra-advanced capital is forming alliance with backward forces. Advanced capitalist countries, matured bourgeois republics are in the forefront in their business of the hour. Media carry reports of these onslaughts every day.

A news report from Wheeling, US, said:

Almost 23,000 retired coal miners and their dependents [recently] received official notification that they could lose their health care benefits by April 30.” United Mine Workers of America president Cecil Roberts said: “They will now have to begin contemplating whether to continue to get medicines and treatments they need to live or to buy groceries. They will now have to wonder if they can go see a doctor for chronic conditions like black lung or cancer or pay the mortgage.” Senator Sherrod Brown (D-Ohio) said: “Ohio coal miners have spent decades underground to power our country, provide for their families and retire with dignity. But the promise they were made for their backbreaking work is in jeopardy, and thousands nationwide will lose the benefits they earned in weeks.3

An AP report said: “Congress is close to a deal to extend health benefits for more than 22,000 retired miners and widows whose medical coverage is set to expire Sunday”.4 There, political struggle is casting shade of cloud over the issue of miners.

There are many other similar cases of uncertainty with health care and other essentials of life in the same country. In another country, on the other side of the Atlantic, another news-report shows state’s role against labor.

A BBC report said:

Former miners in Wales are calling for a review of their pension fund, arguing they should be awarded a larger share of surplus money.

Currently, the UK government takes 50% of any surplus earned by the Mineworkers’ Pension Scheme (MPS) from its investments as part of a guarantee.

[….]

About 25,000 miners are thought to be in receipt of the MPS in Wales […]

When the coal industry was privatized in 1994, the UK government agreed to guarantee the total pension would not fall in cash terms, and that if there was a surplus it would be shared 50/50 with the scheme’s members.

[….]

Since the deal was struck, the UK government said it had received £3.35bn from the scheme.5

Isn’t the state gaining 50% of surplus capital appropriated from labor? The “seed money” – miners’ contribution – was part of necessary labor, which was miners’ bare necessity for survival, and the “seed money” invested somewhere gained more “money” to have surplus from some other source, which was originally appropriated from labor in somewhere else.

The BBC report said:

Ex-miner Ken Sullivan, 64, of Tredegar, Blaenau Gwent, claimed some miners are on less than £10 a week.

Less than £10 a week means slightly more than £1 or slightly less than £2 a day. How much demand is made by bread, potato and their “colleagues” daily? Forget about clothes and shoe. Theater, movie, sports, picnic? Toilers’ brains “can’t” consume those elegant “things” reserved only for the bourgeoisie! The miners, even, “don’t” possess that heart! Let them “get” lost!

Capital’s antagonistic role is evident in working people’s immediate survival areas. To capital, pensioners are not essential for regeneration of capital; so, capital likes to forget pensioners’ consumption: bread, tea, flask, shoe, blanket and some other “minor” items and expenditures including burial expenses.

There’s another story related to labor.

On June 18, 1984, a Thatcherite-time, thousands of police and striking miners clashed violently at the Orgreave coking plant in South Yorkshire, UK. It’s known as the Battle of Orgreave. On a page of The Guardian, historian Tristram Hunt characterized the clash as “a brutal example of legalized state violence.”6

A BBC report said:

The Thatcher government feared a ‘witch hunt’ if a public inquiry were held into policing of the 1984-5 miners’ strike, declassified files show.

Minutes of a meeting in 1985 show Leon Brittan, then home secretary, wanted to avoid ‘any form of enquiry’ into policing of the picket lines.

Miners say the files show successive governments ‘never wanted the truth to come out’ over the events.7

Eighteen files have been released after home secretary Amber Rudd promised that 30 unreleased files connected with the strike would be published. The files, as the BBC report said, show:

At a meeting held in 1985, […] Leon Brittan said he believed the ‘government should not encourage any form of enquiry into the behavior of the police’, as it would ‘turn into a witch hunt’ with an ‘anti-police bias’

The permanent secretary of the Home Office Sir Brian Cubbon, in 1984 wrote ‘internal questions’ needed to be asked about how ‘the Home Office relay(s) to the police service the political influence on operational policy which was wanted in the early days of the (miners) dispute’

“Local government representatives told the Police Advisory Board in 1986, that the Association of Chief Police Officers, ‘were concerned less with what actually happened during the miners dispute than with what might happen in the future’

[….]

Ex-miner Frank Arrowsmith, who was on the picket line during the year long strike, said ‘the suspicion is never going to go away that those in Number 10 [Downing Street, prime minister’s official residence] and the home secretary decided to use the police as a battering ram to defeat the miners’.

[….]

Nicholas Jones, who covered the strike as the BBC’s industrial correspondent, said: ‘These documents really open the window on what the government and the police were thinking in 1985.

‘There is no sign of any feeling of remorse in these files, in fact the police are quite dismissive about the event’.

[….]

‘I find it worrying that there were immediate efforts from the very top of government to shut down any enquiry into the miners’ strike’, said Labour MP Andy Burnham who has campaigned on behalf the Hillsborough families.

The files may unfold a part of the inner-working of that “legalized state violence”. State, yes, it’s state and state violence under the cover of law.

There’s the issue of transparency within the proud bourgeois democracy, a political question, part of an agenda capital considers a no-man’s land for the working masses. Capital and the democracy it practices are never transparent with exceptions of moments facing pressure either from its factional-fight, or in need of legitimacy and acceptability, or from the masses engaged in political action.

The sources of the information cited above are not the political literature of the proletariat, but the mainstream media; and at least a part of capital and its political power come out under sunlight from these reports.

Further look gives further findings.

On the shores of the Indian Ocean, labor’s condition is not good.

The South African mining sector has, for more than 100 years, been […] using physically demanding manual drilling methods with blasting and cleaning on a stop-start basis, predominantly in narrow reef, hard-rock mining for gold, platinum and chrome.

Working conditions are generally characterised by abrasive rock, steep gradients and seismicity. And with increasing depth, the virgin rock temperature continues to rise. On the Witwatersrand Basin, which is host to the world’s largest gold resource, the virgin rock temperature at depths of 2,000 meters below surface can be as high as 40ºC. On the Bushveld Complex, which is host to 80% of the world’s platinum reserves, these temperatures are even higher, reaching 70ºC.8

“Stupid” labor, with a “cursed” life, goes down to the hot-depth daily, works for hours throughout an entire working-life, and there pulls up riches from that depth. Labor has “no” way at the moment. It’s now chained by starvation and fear. Michael Yates, in his “Class: A personal story”9 essay explains in an excellent way the issue of fear in working people’s life.

What follows beastly toil in the mines?

In July 2016, UNCTAD report Trade Misinvoicing in Primary Commodities in Developing Countries: The Cases of Chile, Cote d’Ivoire, Nigeria, South Africa and Zambia pointed to a systematic practice of mis- and underinvoicing among mining companies in these countries. It alleged that the mining industry has been engaging in this practice with the direct objective of avoiding taxes, or at the very least reducing tax burdens in producing countries.

The report stated:

Mining and oil companies have misappropriated 67% of export revenue in the countries studied.

For South Africa, the report calculated cumulative underinvoicing over the period 2000-2014 to have amounted to US$ 102.8 billion (2014 US dollars): US$ 600 million for iron ore; US$ 24 billion for silver and platinum; and US$ 78.2 billion for gold.

Key conclusions of the report include “substantial export misinvoicing − both underinvoicing and overinvoicing – in all five countries, with a clear preponderance of export underinvoicing, except for copper exports from Chile”.

However, an “independent” review by a Johannesburg-based firm “narrowed the gap in measuring exports […] from USD 78.2 billion to USD 19.5 billion”, and found “most of the USD 19.5 billion discrepancy can very likely be attributed to errors in the reported gold imports of South Africa’s trading partners, not in South Africa’s reported gold exports.” (Letter of the managing director of the firm, February 7, 2017) The review claimed that the UNCTAD report’s methodology was flawed. [Findings of the report still stand even if it’s accepted that the entire S A-business was miscalculated as there are other countries.]

However, UNCTAD in an “Accompanying note for the revised version of the Report” said: “The revised report provides a more detailed exposition of the methodology and the concepts used while further stressing the main messages from the analysis.” (December 23, 2016)

The reality for labor appears in full “bloom” with the information cited above: hard labor in inhuman condition, uncertain life, deception, non-transparency, trick, a wage difficult to live on, in cases, less than £10 a week, and billions of dollars “miscalculated”, a “simple error”. Deep in mines workers have to option to err, as that’s a question of their life and death, which demand a small sum of dollar. It’s also a question of profit and loss for mine owners: amount of gold and size of diamond extracted at the cost of “cheaply expendable” lives to build up mountains of profit.

The reality that gets constructed makes labor perish here and there. A glimpse finds: how cheap is labor’s life! It’s like How Green was My Valley. Labor’s lost life is not always properly counted, even.

A methane gas explosion in a coal mine in Ukraine killed at least eight miners. There was confusion over the exact number of miners killed.10

In a collapsed coal mine in Jharkhand, death toll rose to 10. The cave in buried at least 23 miners.11

A gas explosion killed 18 coal miners in China.12

Similar death-news are many. Number of deaths increases as tomorrow replaces today, misinvoicing multiplies, profit proliferates.

The rate of fatalities, injuries, disease, and potential effects of acid mine drainage present the gruesome face of a killing industry. For example 69,000 mineworkers were killed due to mine incidents between 1900 [and] 1993 [while] one million had been injured in this period. [….] An Oxford led [study] suggested that the mining industry in Africa could possibly be linked to almost 760,000 new TB infections per year […].13

Sometimes capital needs dead bodies for political, propaganda, etc. purposes, but not always. Today’s Venezuela is a burning example. But, “confusion” with number of miners dead is a case of “error” with miners’ life as it was also an “error” with billions of dollars! The former is related to cost and investment while the later is related to profit. The fact is: with a “soft” touch of err minimum wage can’t reach the “dangerous” ceiling of $15, but billions of dollars are “erred” as the $15 is needed by a starving stomach of a disorganized laborer while the billions of dollars are demanded by powerful persons in Copenhagen and Zurich. Substantial amount of dollars still remain in chests of the misinvoicers even after subtracting the “erred” amount of dollars. It’s part of profit, and the profit was created by labor only to be appropriated by capitalists, the mine-owners, the bankers, and their cousins and nephews. So, the amount mirror a part of the size of surplus labor produced by working at depths of 2,000 meters below surface with 40ºC-70ºC temperature for hours, for days, for an entire working-life, for generations. It’s not only the story from mines in five countries the UNCTAD report mentioned; it’s the story of all mines, of all manufacturing plants, of all artisanal industries and the “loving” SME – small and medium enterprise – in all lands.

Average earnings of miners come out to $21.55 per hour in the US, a coal miner earns an average wage of $23.04 per hour. A miner in South Africa earns an average salary of R221,610 per year.14 The average salary for mining jobs in Wales, UK is £42,500.15 In countries in the periphery, the wage figures are unloveable and crude joke. Living wage? Minimum wage? All. In comparison to price index? Not comfortable. A harder life it’s. A life turned intolerable. Look at the wage laborers in India or Myanmar, in Indonesia or Pakistan, in Senegal or Jordan, Brazil or some other country tangled in the world capitalist system.

Are these figures related to wage comparable to the “erred” figures of billions of dollars? And, are both of these figures, of wage and of “error”, comparable to the figures related to death of laborers? Mainstream mentors have the answer, probably.

With this condition of labor, a wave of sectarianism in the name of opposing sectarianism is gaining ground. Certain “rights” activists are over-active in voicing “rights” of only one sect as if rights of the rest are not denied and violated. These sound like a South Africa-story, like a Nazi-story.

Luli Callinicos in her famous A People’s History of South Africa details:

The mine-owners were careful not to give the black and the white workers a chance to act together against management. One mine-owner wrote: “The combination of the working classes will become so strong as to be able more or less to dictate, not only on the question of wages, but also on political questions by the power of the vote.” Mine-owners felt it was important to distance white miners from the black workers, and to place one above the other. Most white South Africans were brought up to believe that they were better than another. Racism was used by the mine-owners. Few black workers felt any sympathy for the whites’ struggle for trade union rights. It was like “We are fighting our own battles and the white man is fighting his own battle. He does not consider us and we do not consider him in this respect.”16

These tactics were to safeguard profits and system of labor control, observes Luli Callinicos.

Who was gaining from this division among the toilers? The coterie of writers presenting sectarian, communal arguments with progressive-posture to facilitate capital’s divisive tact know answer to the question. Yet, they carry on their divisive propaganda. Capital needs pals in its days of crises. Concern of these chums of capital is not the entire working people, but only a single group as if no other people are facing onslaughts by capital and state. It’s a completely hatred-filled, divisive Nazi-tact.

Today, that divisive tact is being steamed. So, the present situation requires the task of trampling all forms of sectarianism as it harms working people’s struggle. On this May Day, toilers have to intensify this task as unity of all the working people crossing all types of delimiting lines is in their interest, as unity of the working people takes away all steam from engine of reactionary, factious politics, and the politics will lose the biggest chunk of its present constituency. So, the toilers are to trumpet: Workers of the World, Unite! You have nothing to lose but your chains!

  1. Natalia Murray, “Feast in a time of plague, May Day celebrations of 1917-1918”, Baltic Worlds, vol. VI, no. 1, April 2013, Sodertorn University, Sweden.
  2. Mstislav Dobuzhinsky, “Bomba ili khlopushka: Razgovor mezhdu dvumia khudozhnikami”, “A bomb or a firecracker: a conversation between two artists”, Novaia Zhizn, no. 83, 1918-05-04, quoted in Murray, op. cit.
  3. The Intelligencer & Wheeling News Register, “Nearly 23,000 coal miners to lose benefits, miners, families notified via letter”, April 26, 2017.
  4. The Pantagraph, IL, “The latest: White House blasts Dems on spending bill”, April 26, 2017.
  5. Miners’ pensions ‘should not be used as a cash cow’”, November 16, 2016.
  6. The charge of the heavy brigade”, September 4, 2006.
  7. “Miners’ strike policing inquiry ‘would have been witch hunt’”, March 9, 2017.
  8. Chamber of Mines of South Africa, Modernisation: Towards the Mines of Tomorrow, Fact sheet 2017.
  9. Monthly Review, vol. 58, issue 3, July-August 2006.
  10. AFP, “8 killed in gas explosion at Ukraine coal mine”, March 2, 2017.
  11. AFP, “10 Dead in Jharkhand mine cave-in, many still missing”, December 31, 2016.
  12. AP, “Rescuers try to find 15 still trapped by mine blast in China”, November 1, 2016.
  13. Mike Fafuli, Genocidal Effects of Dereliction of Duty by Mining in SA, National Union of Mine Workers, May 3, 2012.
  14. updated March 25 and 24, 2017 respectively, www.payscale.com.
  15. www.totaljobs.com.
  16. shortened, vol. I: Gold and Workers 1886 – 1924, chapter 17, “The Divided Workers”, Ravan Press, Johannesburg, 1980.