The Continuation of History: Future Societies in Fiction

As a long-time reader of Ursula K. Le Guin, I was saddened to hear of her passing. The following essay, originally written in 2001 for the literary magazine BigCityLit, examines Ms. Le Guin’s novel The Dispossessed in conjunction with Kim Stanley Robinson’s Mars trilogy. The ideas expressed and implied in these works continue to be highly relevant for activists wishing to find a path toward a better world.

History has proven it hasn’t ended. The concept should have been too laughable to even been contemplated; the very fact that ever shriller cacophonies of propaganda are hurled at us ought to prove the point, if it needed to be proved at all.

No matter how many times Margaret Thatcher’s “There is no alternative” is pompously declared; no matter how many times Francis Fukuyama is invoked to declare the end of history — a quote sure to be one of the 21st century’s reliable laugh lines — much of the world persists in refusing its assigned role. Unless we’re paying close attention, most of this is yet under the radar, save for the occasional spectacle when the World Bank or International Monetary Fund or a hemispheric “free trade” conference convenes, and we are shown a backdrop of protesters while a befuddled television talking head scratches his head and says “I don’t get it.” If the talking head is planning on a nice career as a media personality, he’d better not get it.

There is a subset of the “no alternative” grouping. Well, yes, maybe capitalism isn’t all wonderful, but look at how socialism failed. Actually, “socialism” did not fail; one distorted version did. The story of how that distortion, solidifying the incredible twists and turns taken by one country weighed down by the horrors of its absolutist history and further bent out of recognition by a single-minded dictator, is fascinating for those with much patience. That country, if we care to be precise, was never close to achieving socialism. Nonetheless, that country, which also faced relentless pressures from the West, including an invasion by 14 countries as soon as they could stop fighting World War I, had its uses. Western anti-Marxists didn’t want people to think there could be an alternative to capitalism. They still don’t.

We’ve begun the 21st century. Stalinism is dead. It will remain dead. Still, the desire for a better life remains. But what? It’s too easy to say “we don’t know.” We don’t. But whatever is next, it’ll have to be built on top of present-day society. It’ll have to be built, at least in some part, on a critique of capitalist society. We already possess that critique, and so it is bound to be at least a starting point. It is therefore not surprising that when we cross from the real world into the world of fiction, those starting points come with us.

There are as many socialisms, or potential future societies if socialism is too scary a word, as our imagination will allow us. It would be natural for those fiction writers of the future, science fiction specialists, to explore many of these potential futures. Oddly, despite the countless dystopian novels out there, this is actually highly rare. Science fiction is actually a genre that, when we take an overall sampling, is parched for ideas. I say this as a regular reader of science fiction. So much of the genre consists of fetishized military engagements and thinly veiled technology manuals masquerading as stories. Even the dystopias usually consist of the author taking a single idea and seeing how far she can run with it.

The rare exceptions, then, tower above the field. Rarer still are those who attempt to create a truly different society based on recognizable characters. Two of these authors are Ursula K. Le Guin and Kim Stanley Robinson. Both winningly attempt to work out new worlds, but in very different ways. Ms. Le Guin is an anarchist who sketches out societies either in the far future or someplace far from Earth. Mr. Robinson, who writes from a Marxist perspective, sets his stories on Earth or elsewhere in the solar system and in the near future. Whether or not it is agreed that the societies sketched out are plausible, these stories are the works of authors realistically wrestling with the full range of human emotion and human interaction with huge, impersonal forces, forces that nonetheless are human created. Both do this with a variety of vivid characters and subtle interplay that make much of their body of work flow well outside of the usual confines of science fiction.

Contrary to orthodox Soviet myopia that shrilly proclaimed the creation of a “workers’ paradise,” real life comes fully equipped with contradictions. If it is not a full-blown contradiction it is certainly an irony that an anarchist, Ms. Le Guin, understands this basic Marxist assumption while Soviet political leaders were unable. Ms. Le Guin’s The Dispossessed, published in 1974, wears this right on the cover; the novel’s subtitle calls it an “ambiguous utopia.”

An “ambiguous utopia”

The ambiguous utopia is the world of Anarres, the marginally habitable moon of the Earth-like planet Urras. Although Urras is not Earth and is not inhabited by humans (although they are very much like humans), its political, social and economic systems are very recognizable to the humans of present-day Earth. This “coincidence,” however, is quite forgivable. Urras is dominated by two countries, one an United States-style capitalist state consumed by greed and the other a secretive Soviet Union-style state. Urras is a world with technology and environmental awareness far beyond Earth’s 20th century, political development at the level of Earth’s 20th century and a social system of the 18th or early 19th century rooted in profound sexism; it is an utterly male-dominated society.

Urras’ hounded anarchists of the past were allowed to leave Urras and settle on the moon Anarres, used as a mining colony. Life on Anarres is life on the margins. A dry world that is desert except for small areas of moderate rainfall, the anarchists continually are on the verge of disaster. Only by being a completely collective society, by cooperating with each other, can they survive. With resources so limited, a competitive capitalist society would fail quickly — U.S.-style inequities would not simply create poverty, they would create mass starvation and rapidly deplete the limited natural resources. Such a place would shortly descend into hopeless chaos and implode.

Anarres is far from perfect, being an “ambiguous utopia.” It is an anarchist society without government, yet it must ensure resources are used where they are needed, that men and women with the right skills are sent where they are needed and that the basic necessities of life are available for everyone. There are no jails or coercion, yet peer pressure must be sufficient to deter the potentially uncooperative. Freedom of decision and personal life choices are paramount, yet people must be sent to new locations when emergencies occur.

One of the largest contradictions is in how people are to serve this society, in normal times and during crises. This problem is embodied in the main character, Shevek, a brilliant physicist. Can Shevek best serve Anarres by continuing his research? He is so far beyond other scientists that no one on Anarres can fully understand his work. Only a handful of physicists on Urras can, and they are interested in exploiting him for their own (national) interests. Although it is assumed that Shevek’s esoteric work will have applications some day, it has no practical use now. Or, particularly during the crisis of a severe drought that leads to deprivation around Anarres, is it in the dry world’s interest that Shevek drop his research and perform practical work that will help Anarres marshal its meager resources for survival? Can he go back and forth depending on conditions?

It is the very fact that Anarres is a collective society that enables individuals to flourish in a difficult physical environment. Yet can those individuals do what they want, or must that individuality be set aside for the greater good? There is no easy answer, or even single answer, to this question. Neither Shevek nor his society can formulate a solution. Yet the struggle over this question on Anarres is vastly different than the contradictions inherent on Urras, where the two dominant countries still regularly fight proxy wars in other countries against each other and where the “free” United States-style nation proves to be much less free than it appears. The tenuous relationship between Anarres and Urras has its own set of contradictions.

The society of Anarres, based on cooperation without even the concept of money, is so different from the modern neoliberal state built on pitiless competition with power rooted in economics as to be seemingly an impossible transition. And, indeed, Anarres is not the transformation of any society, even if it was conceived on Urras. The Anarres anarchist society is constructed in a place that was empty, except for a couple of mining settlements where nobody lived permanently. It is created out of nothing, not out of a pre-existing society. On Urras, from where the original Anarres settlers escaped, the traditional nation-state forms still exist, intact, two centuries after new Anarres settlement is closed.

Can a radically new society, based on values far different from existing society, be created in the same country? Are pre-existing societal pressures too powerful to be overcome? Can a radically new society only be created on a blank slate? Is a radically new society needed to be created somewhere else before it can supplant the existing order? And if so, does the lag period have to be decades, even centuries? Now we’ve leaped from contradictions on a personal scale to contradictions on a national or even global scale. The Dispossessed does not purport to attempt an answer to these questions and for the most part does not even ask these questions. But it does stimulate thinking about these questions, and this alone raises it into very select company.

How to organize in the absence of a state?

If we dig down into Anarres society, it is, theoretically, a world of “pure” anarchism, although some Marxists would argue that such a society would be the end result of communist development. Anarres is a world of true common ownership — there is no state, not even a government, to own productive property in the name of the people. The only global organization is a bureau that links people with jobs that need to be filled.

The bureau has no coercive powers; any man or woman is free to accept or decline a posting. But in times of crisis, such as the long drought Anarres goes through, peer pressure is very strong to accept a post, even if it is in a remote location and it requires the acceptee to be away from his/her partner for a long period of time. Housing, cafeterias and other needs are always available, wherever a posting takes a person. This also makes Anarres a mobile society, as there is no private property to be left behind, freeing men and women to move around the moon as they like. It is also a society totally without hierarchy, class distinctions or gender roles. Puritanism is also erased; a full sexual freedom exists with the elimination of sexism and gender roles.

These liberating social conditions are inseparable from the economic freedom of Anarres. It is, again, a place with true common ownership, different from an anarcho-syndicalist economy, in which the members of small collectives would together own their workshop or production facility. It is also distinct from the concept of the state owning property in the name of society as developed in Soviet Union. But even this concept is, in theory, a stage of development in which the end result is a withering away of the state which, again in theory, might result in an economic design not much different than the concepts of the anarchist society of Anarres.

Anarres is able to maintain its society through isolation. There is no contact between it and Urras, except for freight ships that mostly transport minerals to Urras, but also carry other goods, even books, in both directions. Anarres is completely closed to Urras, with nobody from the freight ships allowed to leave the small port. It is unthinkable for any Anarres citizen to go to Urras. Governments on Urras ruthlessly suppress any groups that wish to implement Anarres ideas, but the countries of Urras make no attempt to interfere with Anarres itself; Anarres continues to ship minerals to Urras and, from the Urras point of view, remains a mining colony.

The people of Anarres, who deeply believe in their project, are allowed to continue to develop their society with no interference thanks to the hundreds of thousands of miles that separate it from the warring nation-states of Urras. But what if there was no such separation; what if the capitalists of Urras saw a threat in Anarres? Would Anarres have the freedom to develop its egalitarian society? Can a radically new and different society exist next to or nearby societies that continue to use traditional, hierarchal forms? These questions do get raised in The Dispossessed, and of course asking these questions brings us back to Earth.

In our solar system, Earth’s moon is not capable of sustaining life; alternative societies will need to take root here on Earth. But is it possible for a radical society — an egalitarian society that provides an adequate standard of living, materially and in all the other ways — that, by its very existence, provides a superior alternative to capitalist society, to have the time to create itself? Is it even possible for such a society to take root with more powerful neighbors ready to suppress it?

Revolution when there is the (physical) space for it

Ursula Le Guin, the creator of an “ambiguous anarchist utopia,” is not optimistic on these questions. Neither is Kim Stanley Robinson, the creator of a Marxist-inspired revolution on Mars that succeeds against great odds. Unlike the anarchists of Anarres, who have a world essentially handed to them — authorities on Urras apparently decided this would be a way of getting rid of their troublemakers — the Martians of Mr. Robinson’s Mars trilogy (Red Mars, Green Mars and Blue Mars) have to overthrow oppressive colonial rule to create their better society.

But just as Anarres benefited from its distance from Urras, Mars’ distance from Earth is what gives the revolutionaries the space to create their new society. And the Martians, too, must compromise. Anarres must continue to supply Urras with minerals or face the possibility of an invasion; the revolutionary Martian government must continue to accept a continuous stream of colonists from Earth and maneuver its way around the colossal economic power of Earth’s biggest corporations and the puppet political institutions the corporations control.

In the years of the 21st and 22nd centuries, capitalism continues to develop; that is, economic power is concentrated into fewer and fewer hands. About 20 corporations have a stranglehold on the world’s economy and dominate Earth. The economies of all countries except the 11 comprising the G-11 grouping (expanded from the present-day G-7) are dwarfed by those 20 corporations; indeed, most countries of the world are directly controlled by one of the top corporations. The United Nations is the gendarme of this corporate domination. The UN organizes the colonization of Mars on behalf of its corporate masters; the intention is to exploit the resources of the Red Planet and to, over time, export some of Earth’s overpopulation.

Some colonists are willing to go along with this program; many others want to create a better world than what they left behind on Earth. This increasingly bitter divide is complicated by an environmental divide between “Reds” (those who wish to leave Mars as it is) and “Greens” (those who wish to terraform Mars into an Earth-like environment). The divide between willing colonists and independent-minded social builders does not coincide with the environmental divide; although there is wide support to break free of Earth’s grip and build a better society, there are more “Greens” than “Reds” on the environmental question. At any rate, during the colonial era, the decision is out of the Martians’ hands as the UN and the corporations behind it seek to create an Earth-like Mars. Terraforming begins with the first colonists and there is far too much economic muscle applied from Earth for the process to be slowed, much less stopped.

A further fracture in the developing Martian society, which ultimately adds to political tensions, is the huge social gap between the younger men and women who are born on Mars and the waves of colonists who continue to flood the planet. The intention of the independence-minded colonists is to create a better society, not only in terms of dispensing with the rapacious economic determinism of Earth, but in other realms as well. These colonists want to create a non-hierarchal society free not only of class distinctions but of ills such as sexism, racism, nationalism and cultural arrogance.

To the men and women who are born on Mars, this is not only natural, but easy to express because to them the hideous stratifications and exploitation of Earth are revolting and unimaginable. Counter-pressures come on economic and colonial questions from the colonists who see Mars as a natural colony of Earth and from the large number of colonists who come from more repressive cultures and seek to replicate the backwardness they left behind.

Creating the future when so much of the past is present

On this fictional Mars created by Mr. Robinson, we have something of a hybrid between a society trying to create itself next to existing, hostile societies and a society free to create itself out of nothing in isolation from hostile counter-pressures. Mars is of course barren of life before the arrival of the first trickle of colonists — the Martian population starts in the hundreds and rises to the tens of millions — so it has the potential to create itself out of nothing. But in reality, it is a colony controlled by Earth, regularly sent new colonists who don’t share the lofty ideals of the independence-minded or “native” Martians, and who act as forces to create a replication of Earth. Here we have a different contradiction, that between the huge distance between the planets that should provide the space for a new society to create itself and the very powerful forces that bind the new, and still developing, society to the old.

For a long time, those powerful forces overpower the native energy that seeks to create a new Martian society; a society that would be different and more advanced than what can currently exist on Mars. The Martians don’t have the option to isolate themselves — even if they could reach a consensus on that issue — because they aren’t strong enough to stop the UN from following whatever policies the UN wishes to follow. Gradually, repression is strengthened until the movement for independence is forced underground. During this time, underground resistors can create small hidden pockets where new societies can be created, but they are politically impotent.

Mars, still red (Image created by NASA via Hubble Space Telescope)

Unlike the “ambiguous utopia” of Anarres, where there was freedom to create something entirely new in a political vacuum, the Mars of Mr. Robinson’s Mars trilogy has real pressures acting on it, external and internal. Far from political, social or environment unity, this Mars has wide ranges of opinion on all questions, and vastly different, even irreconcilable, cultural experiences. It has to find a way to juggle and allow expression to all these forces, assuming it can even find a way out of its colonial status.

None of the other issues can be tackled until the first issue of independence can be solved. Even then, Mars will not have full freedom of action. A well-timed revolution, launched just as Earth enters into a sudden global environmental crisis, enables the Martians to overthrow the direct rule of the UN and Earth’s corporations, but does not remove the power that still exists on Earth. There are those on Mars opposed to the revolution; they are politically neutered now but won’t necessarily remain so. There are socially backward elements who can only cling to what they left behind on Earth. Among the majority pro-revolution opinion, there are a variety of conflicting interests and differing political ideas. The environmental split between “Reds” and “Greens” still exists; the Reds are losing that battle and know it, but still seek to at least slow down or somehow halt progress on terraforming.

At the start of a revolutionary period, all things are possible. How will the possibilities be sorted? How can all reasonable opinions be represented? How and who can decide what a reasonable opinion is? During this period of tremendous change, which will eventually come to a close, how radical a break from the old society can there be? How fast and how far can the revolution go in building a new society? Can an accommodation be made with many conflicting areas of opinion while retaining the revolutionary impulse to create a new society? Can competing interests co-exist long enough to build lasting institutions, or must one group begin to dominate other groups? Can the unique circumstance of tens of millions of miles of space between the planets allow a radical break from the past that would not be possible on Earth?

Other than the last question, these questions apply to all revolutionary situations. The uniqueness of revolting on a separate planet does give the Martian revolutionaries the space to create lasting institutions locking in a radically new society; but even here, Earth’s need to deal with its environmental catastrophe keeps it occupied. Otherwise, any attempt at revolution likely would have been doomed. Indeed, a first attempt is mercilessly crushed by the UN.

Freedom from economic coercion at the base

The political institutions the new Martian government creates are not necessarily a vast departure from previous government styles; but it is different enough to allow radical changes in other spheres of life, especially social and economic. The government is nominally a multi-party parliamentary system on a global scale; but government exists only at the city and global levels. There are no countries or subdivisions. Economic freedom and equality is enshrined in the new Martian constitution; all workplaces are collectively owned by the people who work there. The new society is stripped of inequality and all hierarchy; with full equality among all citizens, a full and exuberant sexual freedom for all genders blossoms with the elimination of sexism. Anything less is incomprehensible to those born on Mars free of the horrors of Earth.

Perhaps all this happens rather too easily, but the buildup to the revolution and the pre-revolutionary work of creating a new world lasts several decades and involves three generations, so it by no means is a sudden change. Unlike the “ambiguous utopia” of Anarres — rather conveniently allowed to happen on an empty moon — Mr. Robinson’s Mars trilogy takes the realistic approach that old hierarchies can only be removed with considerable effort. Along the way, the characters struggle with the weight of history, and argue history’s lessons.

There is no doubt that further lessons need to be learned from history, and it is clear that both Ms. Le Guin and Mr. Robinson have not only studied, but learned, history. Their fictional worlds, and the very real and interesting characters who inhabit them, are all the richer for this. But can these worlds — the stateless anarchism of Anarres and the Marxist egalitarianism governed through parliamentary consensus of Mars — be brought into existence on Earth? Would we want to, or would a better world be different that these ideals? Can a truly egalitarian society, allowing a full scope of economic as well as other freedoms, come into being, or would hostile capital-dominated countries inevitably overwhelm it, as the 20th century’s socialist experiments were overwhelmed?

What the planets created in these fictions have in common is that the inhabitants have full freedom — starting with economic freedom, without which most other freedoms are illusions. (Unless your idea of democracy is choosing what cola you can drink.) Whatever the future has in store for humanity, it will certainly be different from the future societies sketched in this review. But the future will have to include a full range of freedoms similar to that enjoyed by the books’ characters. That won’t happen under capitalism — by definition, it can’t — and it won’t happen under a monolithic party that doesn’t understand its own doctrine. It won’t come under an ephemeral “third way” that is just capitalism with a thin veneer of sweetener layered on the top.

Humanity will have to find a way forward, somehow, or face catastrophe. I won’t pretend to have the answer. But it is nice to have stimulating fiction that works not only as a fine read, but allows us to think about the possibilities along the way.

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Leaked Trump infrastructure plan is a plan for corporate subsidies

The Trump administration’s plans to rebuild infrastructure in the United States have been leaked, and it appears to be as bad as feared. At least three-quarters of intended funding will go toward corporate subsidies, not actual projects. It is possible that no funding will go directly toward projects.

There’s no real surprise here, given that President Donald Trump’s election promise to inject $1 trillion into infrastructure spending was a macabre joke. What is actually happening is that the Trump administration intends to push for more “public-private partnerships.” What these so-called partnerships actually are vehicles to shovel public money into private pockets. These have proven disastrous wherever they have been implemented, almost invariably making public services more expensive. Often, far more expensive. They are nothing more than a variation on straightforward schemes to sell off public assets below cost, with working people having to pay more for reduced quality of service.

That is no surprise, as corporations are only going to provide services or operate facilities if they can make a profit. And since public-private partnerships promise guaranteed big profits, at the expense of taxpayers, these are quite popular in corporate boardrooms. And when those promises don’t come true, it taxpayers who are on the hook for the failed privatization.

Panorama of Paris (photo by Benh Lieu Song)

The collapse earlier this month of Carillion PLC in Britain put 50,000 jobs at risk, both those directly employed and others working for subcontractors. The holder of a vast array of government contracts for construction, services and managing the operations of railways, hospitals, schools and much else, Carillion received contracts worth £5.7 billion just since 2011. Overall, an astonishing £120 billion was spent on outsourcing in Britain in 2015.

What did British taxpayers get for this corporate largesse? It certainly not was the promised savings. Parliament’s spending watchdog agency, the National Audit Office, found that privately financing public projects costs as much as 40 percent more than projects relying solely on government money. The office estimates that existing outsourcing contracts will cost taxpayers almost £200 billion for the next 25 years. (This report was issued before Carillion’s collapse.) In response, Labour leader Jeremy Corbyn said, “These corporations need to be shown the door. We need our public services provided by public employees with a public service ethos and a strong public oversight,” The Guardian reported.

Naturally, there was one group that did quite well from this privatization: Carillion’s shareholders, who reaped £500 billion in dividends in the past seven years. But it is the government that will have to pick up the tab if the company’s employees are to continue to be paid. On top of that, the company’s pension shortfall reached £900 billion, according to Reuters.

By no means is Carillion’s collapse the only privatization disaster in Britain. A bailout of the corporate-run East Coast rail system is expected to cost hundreds of millions of pounds. There are numerous other examples that have proven windfalls for corporate executives but expensive mistakes for the public.

Offer subsidies first, ask questions later

One of the many empty promises made by President Trump during the 2016 campaign was that his infrastructure plan would “leverage public-private partnerships, and private investments through tax incentives, to spur $1 trillion in infrastructure investment over ten years. It is revenue neutral.”

“Spur” investment, not actually spend on investment. This supposed plan originated with Wilbur Ross and Peter Navarro, a conservative economics professor. Ross, now Commerce secretary (although perhaps not for long if recent reports are to believed), was an investment banker who specialized in buying companies and then taking away pensions and medical benefits in order to quickly flip his companies for a big short-term profit. The two recommended the Trump administration allocate $137 billion in tax credits for private investors who underwrite infrastructure projects. The two claimed that over 10 years the credits could spur $1 trillion in investment.

So the new administration won’t actually spend $1 trillion to fix the country’s badly decaying infrastructure; it hopes to encourage private capital to do so through tax cuts.

That brings us to this week’s leak. The news site Axios published the Trump administration’s six-page outline for infrastructure investment on January 22. The document mentions no dollar figures. But what the document does do is to discuss where money will be sent. First up is “infrastructure incentives initiative,” which is to account for 50 percent of total appropriations. This category will provide grants to be used for “core infrastructure” projects and requires “Evidence supporting how applicant will secure and commit new, non-federal revenue to create sustainable long-term funding” and requires new sources of “revenue for operations, maintenance and operations.”

Netherlands highway (Daan Roosegaarde)

Although it is possible that local- or state-government funding could provide the required revenues, given the intentions of the Trump régime, what this means is that privatization is being counted on for these projects, with corporations taking over public facilities providing the required ongoing revenue streams.

A hint that this is intended is that the first item on a list of “Principles for Infrastructure Improvements” is an intention to make it easier for tolls to be placed on highways. That item is this: “Allow states flexibility to toll on interstates and reinvest toll revenues in infrastructure.” Again, it is possible that state governments might do this themselves. But the more likely scenario is the privatization of highways, with the corporations gaining control then installing toll booths to not only provide funds for maintenance but to hand themselves a perpetual profit. And if the profits don’t materialize, it won’t be private capital holding the bag. For example, nine privatized toll roads in Spain will cost taxpayers there €5 billion because the roads are being nationalized in the wake of the private operators’ failures.

A further hint is found buried in the section on water infrastructure, where we find this passage: “Remove the application of Federal requirements for de minimis Federal involvement.” This is likely intended to provide a green light to privatization of water systems. That has been done in France and Germany, with disastrous results. For example, water prices in Paris doubled over 25 years before the city took back its water system, saving €35 million in the first year and cutting rates. The German city of Bergkamen reduced costs by as much as 30 percent after returning its basic utilities to the public sector.

No details for a plan not based in reality

Another 25 percent of the total appropriations for the White House infrastructure investment plan is a “rural infrastructure program,” under which state governments are “incentivized to partner” with “private investment.” Various other programs constitute the remainder of the plan, none of which are clear as to who or what will be eligible.

The official unveiling of the plan will likely not be released until after the January 30 State of the Union address, according to a report in The Hill. A further sign of the lack of specifics is that the White House has had nothing substantial to say on the topic. The most recent statement on infrastructure that a search of the official White House web page could find was an August announcement that the president had signed an executive order making the “environmental and permitting processes more efficient.”

Channeling the president’s usual disregard for reality, the announcement claimed that “delays” in infrastructure projects cost “trillions” of dollars. The only actual projects mentioned are three pipelines, including the Keystone XL and Dakota Access lines, of which the announcement claims will “create over 42,000 jobs and $2 billion in earnings.” (Those figures appear directly copied from a widely discredited State Department environmental impact statement issued in 2014, when the Obama administration was supporting them.) In reality, a study by the Cornell Global Labor Institute found that, when all effects are calculated, there may be a net loss of jobs. Additional fuel costs in the Midwest, pipeline spills, pollution and the rising costs of climate change would contribute to job losses.

Of course, environmental damages are not considered in Trump administration projections, putting them even more in the realm of fantasy. Consider two World Health Organization studies that concluded polluted environments cause 1.7 million children age five or younger to die per year. The U.S. Environmental Protection Agency estimated a year ago that 230,000 lives would be saved and 120,000 emergency-room visits saved in 2020 if the Clean Air Act is left intact. Globally, air pollution could lead to nine million premature deaths and US$2.6 trillion in economic damage from the costs of sick days, medical bills and reduced agricultural output by 2060, according to an Organisation for Economic Cooperation and Development study.

This doesn’t come cheap, either — a study of energy subsidies estimates the totality of subsidies given to fossil fuels for 2015 was $5.6 trillion. Lest you think some “anti-oil” group made that calculation, that figure comes to us courtesy of the International Monetary Fund! The Trump administration will only add to this mind-boggling total as it has made clear its intentions to further subsidize gas, oil and especially coal, no matter the lack of rational economics. And the cost of global warming? Incalculable. What would be the future cost of hundreds of millions displaced from drowned cities? Or, in the long term, of destroying the Earth’s ability to maintain a stable environment?

Although Donald Trump is the worst yet of a long line of disastrous U.S. presidents, let’s forgo the easy idea that he alone is responsible for facilitating corporate plunder at the cost of all other human considerations. He is highly useful to the plutocrats who control the Republican Party, so much so that talk of a Trump impeachment should be relegated to the level of fantasy for the foreseeable future, barring an all-time wipeout in the 2018 midterms despite the Democratic Party’s uncanny ability to blow elections. The greater question is if sufficient numbers of Trump voters come to realize the degree they were hoodwinked for believing that a billionaire who built his fortune by screwing working people would somehow come to their rescue.

That’s the short term. For the longer term, humanity finding its way out of the dead end it is speeding toward depends on freeing itself from the grips of a system that repeatedly throws up Trumps, Bushes, Harpers, Thatchers and the like. The Trump administration is a symptom, not a cause, of morbid decay.

Tax cuts as a route to cutting Social Security

Conservatives are fond of saying that if you give a man a fish you can feed him for a day, but if you teach him how to fish you can feed him for a lifetime. This is supposed to tell us that social benefits, such as government programs, are bad for people. A much better example of conservative thought would be to say if I put a fence at the entrance to the pier and don’t let anyone else have access to the water, I can have all the fish for myself.

Let those peasants starve! Such a privatization of fish isn’t distant from the actual mechanics of class warfare as it is practiced, unfortunately.

Take the latest salvo in ongoing class warfare, United States edition: The coming assault on Social Security. Curious as to why the Republican Party’s mania for balanced budgets suddenly vanished? I mean, besides the mind-boggling hypocrisy we can expect from the Right. The immediate cause was to placate their billionaire donors who issued marching orders last June. A “donor retreat” at a Koch brothers’ compound in Colorado was attended by 400 people, and, as The Guardian reported, the “price for admission for most was a pledge to give at least $100,000 this year to the Kochs’ broad policy and political network. Donors decreed that Republicans must pass “tax reform” and reverse the Affordable Care Act (because health care is a socialist plot?) or their checkbooks would be shut.

That the Trump/Republican tax plan will be a bonanza for the wealthiest is well documented by this point, with the “Corker kickback” not only giving “dissident” Republican Senator Bob Corker a multimillion-dollar payday to ensure his vote but giving Donald Trump himself tens of millions of dollars thanks to the special rule benefiting real estate speculators. But lurking behind this devastating corporate offensive is the little matter of the extra $1.5 trillion to be added to the deficit. When Republicans (probably assisted by the more spineless among the Democrats) decide in the near future that deficits matter after all, social benefits will be in the cross hairs, with Social Security and Medicare likely to be the prime targets.

In advance of this, we will be treated to a rerun of horror stories designed to convince United Statesians that Social Security is unsustainable. The claim will once again be that either we’ll have to accept steep cuts to Social Security payments or privatize it, putting our retirements in the hands of Wall Street. This has been the wet dream of financiers for decades, and as an added bonus, Wall Street is another major beneficiary of the Trump tax cuts. “Heads I win, tails you lose” is always the way of Wall Street and here we have it again, pocketing untold millions from tax cuts and then taking away your Social Security when the ensuing deficit mounts.

One way of promoting privatization is to allege that there isn’t enough being paid into the system to cover future claims. It is true that in recent years Social Security has been paying out more than it is taking in, although it is far from broke. Concomitant with that argument is the claim that everybody takes out much more than they pay into it over their working lives. But that isn’t necessarily true — a Congressional Budget Office (CBO) report, issued in 2006, found that people earning near the median income get back about the same as they pay into the fund. Low-income earners do receive more than they pay, but conversely high earns get back less. But Social Security is supposed to be progressive. Indeed, the CBO’s report says, “The Social Security benefit formula is designed to provide beneficiaries who had lower life-time earnings with monthly benefits that are higher, as a percentage of their lifetime average earnings, than those received by higher-earning beneficiaries.”

The corporate interest in gutting Social Security

Those saddled with a lifetime of low or median earnings have spent a lifetime being exploited on the job, so whatever extras are received are pennies on the stacks of dollars extracted from them. Remember that profits come from the usually wide gap between what you are paid and the value of your work, and what financiers haul in is skimming off that pot collected by employers dealing in tangible services and products. There is a symbiotic relationship between financiers and industrialists and although there is much wrangling between them (which is why corporate press releases so often proclaim “enhancing shareholder value” as an important part of their mission), they have a mutual interest in exploiting employees.

That mutual interest extends to gutting Social Security, even if financiers have the more immediate interest. The challenge of funding Social Security isn’t a difficult one. An important reason why that is so is because Social Security taxes are only imposed on income up to $127,200. Anything above that is untouched. So why not raise the bar? Senator Bernie Sanders has introduced a bill that would apply this tax to all income above $250,000. This plan would eliminate 80 percent of the projected shortfall, according to an analysis from the Social Security office of the Chief Actuary. For whatever reason, Senator Sanders’ plan wouldn’t touch income in between. Taxing all income would raise still more money.

New York Stock Exchange (photo by Elisa Rolle)

Another method is suggested by Dean Baker of the Center for Economic and Policy Research. He argues that a payroll tax increase of four percent would be sufficient to fully fund Social Security and Medicare for another 75 years. He acknowledges that such an increase would be difficult for many workers, but he estimates that the loss of income from decades of upward distribution of income to be 40 percent — a loss ten times greater. That figures comes from the gap between the rate of earnings increases for working people and the rate of increases in productivity. He explains:

“[U]pward redistribution over this period has reduced wage growth by more than 40 percentage points. In short, our children are 40 percent poorer than they would otherwise be because of the money going to people like Bill Gates and Steve Zuckerberg rather than ordinary workers.

So by very conservative estimates, a typical person in their twenties or thirties has seen their income reduced by more than 40 percent because of all the money redistributed to those at the top. However, the generational warriors want young people to be upset about the possibility that a bit more than one-tenth of this amount could be used to pay for their parents’ and their own Social Security and Medicare. (This upward redistribution is also responsible for about half of the projected shortfall in Social Security, as more income going to profits and high-income workers escapes the Social Security tax.)

It is also important to understand that government action was at the center of this upward redistribution. Without government-granted patent monopolies for Windows and other Microsoft software, Bill Gates would probably still be working for a living.”

A trillion dollars for Wall Street

Privatizing Social Security would additionally cut benefits because financiers would take hefty cuts. The administrative costs of the retirement portion of Social Security (the bulk of the program) is 0.4 percent. In contrast, Dr. Baker reports, “even relatively well-run privatized systems, like those in Chile or the United Kingdom, are 10–15 percent of benefits.”

Such ratios were Social Security privatized would cost nearly $1 trillion in a decade, he calculates — $1 trillion taken from Social Security benefits and diverted into Wall Street’s bottomless pockets. Consider that the standard payment for hedge-fund managers is to receive an annual fee of two percent of the value of the total assets under management and 20 percent of any profits. The fee gets paid even when the fund loses money. In 2014, the top 25 hedge-fund managers hauled in $11.6 billion despite collectively underperforming the stock market.

Fees for ordinary money managers are not this high, and a privatized Social Security wouldn’t pay fees as exorbitant as those charged by hedge funds. But it would still be huge sums of money. That is why Wall Street has long lusted to get its hands on it.

U.S. Treasury Department under new management (photo by takomabibelot)

Then there is the matter of returns. Would gambling Social Security funds on the stock market really result in better results? Not necessarily. In studying the stock market’s long-term returns for an article I wrote a decade ago, not long after the 1990s bubble had burst, I found that you would have to time your retirement to the peaks of bubbles. When adjusted for inflation, the Dow Jones Industrial Average — the ultimate index of stock-market health and which has its components continually adjusted so as to replace low-performing stocks with high-performing ones — was below its 1929 peak as late as 1991. Here are some long-term results:

  • The Dow peaked at 995 in February 1965. Adjusted for inflation, that was 42 percent more than it was worth at its previous bubble peak in 1929, not so impressive when it took 36 years to get there.
  • The ensuring crash bottomed out in December 1974. At this point, the Dow, adjusted for inflation, was worth only half of what it was worth in 1929 and little more than one-third of its 1965 peak.
  • The most recent crash bottomed out in March 2009, at which point the Dow was three percent below its 1965 peak, adjusted for inflation.

The stock market is edging into bubble territory as we begin 2018, and stocks are priced high by historical standards. The basic measure of stock-price sustainability is the price/earnings ratio of the S&P 500, representing the largest companies on U.S. stock markets. The ratio’s average, calculated back to 1872, is 14. Prior to the 1990s bubble, the S&P 500 P/E ratio rose above 20 four times; each time it subsequently fell below 10. A standard measurement of the P/E ratio today is 26. One way to understand that number is that an investor is essentially paying $26 for each dollar of corporate profit, which is considered too high. It is true that the P/E ratio has been almost continually above the historic average since the 1990s bubble, but nonetheless this more recent rise indicates that a stock collapse is looming.

Goodbye retirement, goodbye disability payments

There aren’t any free lunches. A Center on Budget and Policy Priorities study notes that Social Security is not only a retirement program, but also an insurance program that could not be duplicated if privatized:

“Social Security is not only a retirement program but also an insurance program. About one-third of payroll taxes go to fund Social Security disability insurance and survivors insurance. Comparable insurance products would be extremely expensive to buy in the private insurance market, if one could even find such products. Social Security also provides an inflation-indexed annuity: Social Security benefits are adjusted each year for inflation and are paid until death, regardless of how long a beneficiary lives. These features of Social Security provide a valuable form of insurance against the risks of inflation and of outliving one’s savings.”

Nor would sinking funds into stock markets necessarily be a wise gamble, the Congressional Budget Office has said:

“Government investment in private securities does not offer a free lunch: although it would increase the expected value of budgetary resources, it would do so at the cost of exposing the government, future taxpayers, and beneficiaries of federal programs to greater risk. If that risk was taken into account, the returns on private securities would be no greater than the returns on government securities. … Using risky investment portfolios to finance spending by government agencies could weaken budgetary control of federal financial resources.”

That last item, however, is a lure of Republicans and their corporate masters. Create a larger deficit, cut social spending, repeat. This reduces lifespans, reducing payouts through Social Security and corporate retirement plans, for those lucky enough to still have one. Earlier deaths has already been declared a “silver lining” by U.S. corporations.

And let us not forget the sometimes bipartisan nature of Social Security cuts — Barack Obama had proposed a change to the way inflation is calculated for the determination of cost-of-living increases that would have resulted in lower adjustments for inflation, effectively a small yearly reduction. He did so as a bargaining chip in an effort to force Republicans in Congress to agree to modest tax increases. Ultimately, a Democratic Party revolt, spurred by grassroots opposition, forced an end to this plan, but this episode does serve as a reminder that social movements, not hoping for political office holders to do good, is the key to being able to retire some day.

In Chile, in 1998, the government actually asked workers not to retire because of a sustained economic downturn. (The Chilean retirement system was forcibly privatized under Pinochet). Think it can’t happen elsewhere? Keep in mind these words by Stephen Moore of the far right groups Club for Growth and Cato Institute: “Social Security is the soft underbelly of the welfare state. If you can jab your spear through that, you can undermine the whole welfare state.”

You’ll work until you drop, but Wall Street will profit.

You are working harder and getting paid less

The bad news: Your wages are declining. The worse news: Surveys documenting falling wage actually under-estimate how much your wages are declining.

A recent entrant to this labor literature, a research paper titled “Decomposing the Productivity-Wage Nexus in Selected OECD Countries, 1986-2013,” studied 11 advanced-capitalist countries and found that in eight of them median wages have not kept pace with growth in labor productivity. To put the preceding sentence in clear language: You are producing more and getting paid less.

You likely did not need to read the above to know that. But there is nothing wrong with confirmation. The paper’s authors, Andrew Sharpe and James Uguccioni, publishing in the International Productivity Monitor, wrote:

“In eight of the 11 [Organisation for Economic Co-operation and Development] countries examined in this article, median real wage growth since the mid-1980s has not kept pace with labour productivity growth. The size of the growth gap between labour productivity and median real wages differs across countries, but the qualitative pattern is consistent: workers are growing more productive, but those productivity gains are not being matched by growth in the typical worker’s wage.”

The 11 countries studied were Canada, the United States, Norway and eight members of the European Union — Denmark, France, Finland, Germany, Ireland, the Netherlands, Spain and the United Kingdom. Working people in the United States will not be surprised to find that the widest gap between pay and productivity growth occurred there, with Germany in second place. Spain, Norway and Ireland were the three exceptions, although in each the gain in wages over productivity is small.

The opening of the 2003 World Social Forum (photo by Feijaocomarroz from pt)

There is no one single factor accounting for these results, the authors write, looking to mainstream economics for explanation. They offer conventional causes for declining wages:

“The causes of labour’s deteriorating bargaining power are hotly debated. One of the most trumpeted causes is globalization. Proponents argue that capital is far more mobile than labour in an increasingly globalized world, which makes the threat of outsourcing and offshoring far more credible. Due to the threat of offshoring from countries with less strict labour regulations and lower labour costs, workers are increasingly forced to accept lower wages. Some argue that labour’s deteriorating bargaining power is less a matter of globalization and more a matter of technological change which is biased against labour. For example, the OECD [in its 2012 employment outlook] argues that the spread of information and communication technologies have led to major innovation and productivity gains over recent decades, but have also had the effect of replacing workers altogether. The result is an increase in capital’s bargaining power, and a decrease in labour’s — particularly for workers in highly repetitive jobs which naturally lend themselves to automation. Structural and institutional reforms may also have contributed to the reduction of labour’s bargaining power.”

Globalization, yes, but what is behind globalization?

Are these causes some natural phenomenon like the tides in the ocean? Or might there be reasons behind these explanations? To this we will return. But, first, it should be noted this report under-reports the extent that wages are falling behind, which the authors readily acknowledge.

This under-estimation is revealed when the differences between average and median real hourly earnings are reported. This matters because an average is the midpoint between highest and lowest, while median represents the earner at the point where half make more and half make less. When those at the top make more and the rest make the same, the average goes up while the median stays the same; thus examining median income as opposed to average gives a more accurate representation.

The gap between labor productivity and median real hourly wages growth, 1986-2013 (percentage points per year)

Of the 11 countries examined, the authors report that median hourly earnings fell further behind average hourly earnings in 10, with France the exception and there the change was minuscule. This finding represents fresh proof of increasing wage inequality. The biggest increasing in this measure of wage inequality is — surprise! — the United States, followed by Britain. OK, United Statesians or Britons reading these lines won’t be surprised.

The paper’s authors report:

“Empirically, earnings distributions within OECD countries are positively skewed; the mean is greater than the median because the mean is dragged upward by very high earners. … This would imply that the gains from labour productivity are flowing disproportionately to workers who were already high earners relative to the median worker.”

Only the wages of the top one per cent grew faster than productivity growth.

“[R]emoving the top one percent from labour income doubled the rate of decline of labour’s share of income in Canada and the United States. In fact, the removal of the top one percent from total labour income hastened the decline in labour’s share of income in all of the OECD countries they studied except Spain.”

There are plenty more studies where that one comes from. The International Labour Organization, in its 2014/2015 Global Wages Report, similarly found that wages are declining:

“In the group of developed economies, real wages were flat in 2012 and 2013, growing by 0.1 per cent and 0.2 per cent, respectively. In some cases — including Greece, Ireland, Italy, Japan, Spain and the United Kingdom—average real wages in 2013 were below their 2007 level. … Between 1999 and 2013, labour productivity growth in developed economies outstripped real wage growth, and labour’s share of national income – also a reflection of the link between wages and productivity – fell in the largest developed economies.”

Less income and fewer protections for labor

David Ruccio, in a brief post for the Real-World Economics Review Blog, reports that the labor share of income in the United States is the lowest it has ever been since the end of World War II. The tendency throughout the period has been for decline, but the decline has been much steeper since 2001 —  labor share of income in the U.S. is 15 percent lower than it was in 2001. Skewing those results is that the share of income going to the top one percent has doubled since the mid-1970s. So the income share of working people has actually worsened more than the overall statistic indicates.

Concurrent with the increasingly precarious state of working people are dwindling labor rights. No country on Earth fully safeguards labor rights, the International Trade Union Confederation found in its 2017 Global Rights Index report. On a scale of one to five, with one representing the countries with the best ratings (merely “irregular violations of rights”) and five representing the worst (“no guarantee of rights”), Britain and the United States received rankings of four. Thus inequality being the most pronounced in those two countries, so fond of finger-wagging at the rest of the world, comes as little surprise.

(graphic by David Ruccio, Real-World Economics Review Blog)

And still less so considering the immense pressure financial capital puts on corporate executives to squeeze ever more out of employees, exemplified by Verizon Communications attacking its workforce to the point of forcing its employees to go on strike despite racking up $45 billion in profits over five years and Wall Street judging even merciless Wal-Mart as insufficiently ruthless in extracting billions of dollars in profits out of its employees.

The reasons behind these trends appear to be somewhat of a mystery to the two authors of “Decomposing the Productivity-Wage Nexus.” They disapprove of the decline in wages they document but seem to believe this is due to some unfortunately poor political decisions. They conclude their paper with these thoughts:

“The lack of inclusive growth we observe in many OECD countries has significant societal implications. There may be less political support for productivity-enhancing policies in the future if the benefits of productivity growth are not shared equitably. The incentives for employees to work hard may diminish if they believe that they are not receiving their ‘fair share’ of the firm’s productivity gains. Finally, the current taxes and transfers system may not be well equipped to offset the growing trend of wage inequality among workers if it was designed assuming labour productivity growth will lead to real wage growth for all workers.”

Writing a letter to your representative might not do the trick

Well, it’s all a misunderstanding then? If only we speak up, and point out the unfairness of this, somebody out there will do something about it. One imagines that members of parliaments and congresses are largely aware of growing inequality. But if political policies are doing what the sponsors of those policies expect them to do, just what should we expect those office holders to do? This sort of class warfare rages on because only one class is waging it, and that class has the means to dominate society through a mass of institutions paid to do their bidding, control of the mass media and ability to buy government and the legislative process.

Does anybody believe that Donald Trump, or Theresa May, or Emmanuel Macron, or Malcolm Turnbull, upon receiving a well-written letter explaining the problem, would then slap their heads to their forehead and exclaim, “I never realized this was happening!” Pigs, elephants and polar bears will all fly long before any such epiphanies. We can add leaders of the past, such as Gerhard Schröder, to the list. It was the former Social Democratic leader, when chancellor, who pushed through his “Agenda 2010” legislation to codify austerity on German workers, which, inter alia, cut business taxes while reducing unemployment pay and pensions. German wages have been suppressed since 2001 in relation to inflation or productivity gains — the prosperity of German manufacturers has come at the expense of German workers.

Globalization, pointed to by the two authors of “Decomposing the Productivity-Wage Nexus” as a culprit, doesn’t happen in a vacuum or because some capitalist somewhere woke up in an ornery mood. Globalization is the response of industrialists and financiers to the rigors of capitalist competition.

Once the limits of Keynesianism were reached in the 1970s, and the growth levels of the mid-20th century could no longer be sustained, capitalists ceased tolerating wage increases. Instead, from their perspective, they needed to force through wage cuts to maintain profit margins. Relocating production to places with lower wages and fewer regulations was the answer.

Mergers, with attendant layoffs, are another response to capitalist competition. Once one capitalist succeeds with such an “innovation,” the others must follow on pain of losing their competitive position. The need to move raw materials and finished products across borders, from the capitalists’ point of view, necessitates the lowering of barriers and borders to trade, and thus the increasing harshness of so-called “free trade” agreements that are promoted by multi-national corporations.

Globalization is not some natural process beyond human control, but rather is the result of capitalist competition — of allowing markets to decide ever more outcomes. When one side has so many more resources and weapons at its disposal, it’s no surprise that class warfare is such a one-sided affair. If we want the world to be otherwise, we’ll have to struggle for it. Everything of human creation can be changed by human effort, including the world’s failing economic system.

Climate summit’s solution to global warming: More talking

The world’s governments got together in Germany over the past two weeks to discuss global warming, and as a result, they, well, talked. And issued some nice press releases.

Discussing an existential threat to the environment, and all who are dependent on it, certainly is better than not discussing it. Agreeing to do something about it is also good, as is reiterating that something will be done.

None of the above, however, should be confused with implementing, and mandating, measures that would reverse global warming and begin to deal concretely with the wrenching changes necessary to avoid flooded cities, a climate going out of control, mass species die-offs and the other rather serious problems that have only begun to manifest themselves in an already warming world.

The 23rd Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC), or COP23, wrapped up on November 17 in Bonn. Fiji was actually the presiding country, but the conference was held in Bonn because Fiji was not seen as able to accommodate the 25,000 people expected to attend. The formal hosting by Fiji, as a small Pacific island country, was symbolic of a wish to highlight the problems of low-lying countries, but that this was merely symbolic was perhaps most fitting of all.

A melting glacier (photo by Vojife)

These conferences have been held yearly since the UNFCCC was adopted in 1992 at the Rio Earth Summit. Two years ago, at COP21 in Paris, the world’s governments negotiated the Paris Accord, committing to specific targets for reducing greenhouse-gas emissions. Although capping global warming at 2 degrees Celsius (as measured from the 19th century as the Industrial Revolution took off around the world) has been considered the outer limit of “safe” warming, a goal of halting global warming at 1.5 degrees was adopted at Paris. The catch here is that the goals adopted are far from the strength necessary to achieve the 2-degree goals, much less 1.5 degrees.

Before we explore that contradiction, let’s take a brief look at the self-congratulatory statements issued at the Bonn conference’s conclusion.

Agreement that summit participants like to talk

The official COP23/Fiji web site exalts:

“In Bonn, the support for climate action from countries, regions, cities, civil society, the private sector and ordinary men and women was clearly on display. Together, we have done the job we came here to do, which is to advance the implementation guidelines of the Paris Agreement and prepare for more ambitious action in the Talanoa Dialogue of 2018.”

The German Ministry for the Environment, Nature Conservation, Building and Nuclear Safety provided this message:

“One key outcome of the conference is the Talanoa Dialogue. Talanoa is a Fiji term for a conversation in which the people involved share ideas and resolve problems. As the sum total of the current climate targets under the Paris Agreement is not yet sufficient for limiting global warming to well below two degrees Celsius, agreement was reached in Paris that the international community would have to raise the level of ambition over time. The Talanoa Dialogue is the trial run for this ambition mechanism.”

And the United Nations itself, on its UNFCCC web site dedicated to COP23, had this to say:

“The ‘Talanoa Dialogue’, inspired by the Pacific concept of constructive discussion, debate and story-telling, will set the stage in Poland in 2018 for the revising upwards of national climate action plans needed to put the world on track to meet pre-2020 ambition and the long-term goals of the two-year old Paris Agreement. … With so many climate action pledges and initiatives, a further strong message from all sides at COP23 was the growing need to coordinate efforts across policy, planning and investment to ensure that every cent invested and every minute of work contributed results in a much greater impact and boosts ambition under the national climate plans.”

Atmospheric carbon dioxide over the past 800,000 years (graphic by the Scripps Institution of Oceanography, University of California, San Diego)

Again, discussion is better than no discussion, and at least no country other than the United States came to Bonn to push coal, isolating the Trump administration further as the U.S. is now the only country that intends to stay outside the Paris Accords. And let us acknowledge that a baby step forward is far better than a giant leap backward, as the Trump gang wishes to attempt.

The main takeaway of COP23 is that people will get together and talk some more. The “2018 Talanoa Dialogue” is said by the United Nations to be “an inclusive and participatory process that allows countries, as well as non-state actors, to share stories and showcase best practices in order to urgently raise ambition — including pre-2020 action — in nationally determined contributions.” Beyond that, there was a bit of money committed — the German government pledged €110 million to an insurance fund, an adoption fund was replenished with US$93 million of new pledges, and the World Health Organisation said it would commence a “special initiative” to help island countries that has a goal to “triple the levels of international financial support to climate and health in Small Island Developing States.”

It you feel less than overwhelmed by the above, it would seem a reasonable reaction.

The world’s biggest advertising conclave?

A commentator for the German public broadcaster Deutsche Welle certainly was less than overwhelmed, referring to the event as a “massive advertising offensive.” The commentary published by Deutsche Welle, a most sober mainstream news organization not known for flamboyance, summarized the COP23 outcome this way:

“The negotiations in Bonn sound more like agenda points run through by a working group of midlevel importance than the work of the largest multination conference ever held in Germany. Two years after the international climate accord was signed in Paris, the task at hand in Bonn was to establish just who was required to do what in the fight against climate change and how their contributions could be measured. Binding agreements were not on the agenda. … It would also be in poor taste to ask about the carbon footprint left by the conference — especially as most of the electricity used to run Bonn’s charging stations is derived from the region’s lignite coal power plants. Such a query would only upset the mood of those inhabiting this taxpayer-funded parallel universe.”

Ouch! At least the host Germans, and most others in attendance, wanted to do the right thing even if words and actions are yet to synchronize. The public-policy magazine Pacific Standard pulled no punches in reporting the embarrassing antics of the United States delegation in Bonn. The article opened with this passage:

“The United States delegation held a side event at the COP23 climate talks in Bonn on Monday, an affair run by fossil-fuel and nuclear-industry boosters that reprised the same tune heard at the G7 and G20 summits this summer: According to the U.S., using clean coal and nuclear energy is the only way to meet the goals of the Paris climate agreement.”

The Pacific Standard report went on to say:

“At the U.S. panel, Barry Worthington, executive director of the U.S. Energy Association, claimed that clean coal is needed to reach many of the United Nations Sustainable Development Goals, including universal access to energy, zero hunger, and zero poverty. … Worthington also drew on the Trump administration’s demagogic notion of an ongoing ‘war on coal,’ charging that international development banks have an ‘anti-fossil bias’ that blocks investments for financing coal plants in poor countries, potentially at the expense of public safety. The U.S. side event also included pitches for liquid natural gas exports from the U.S. to developing countries as a bridge fuel to help power the shift to renewable energy, as well as for small-scale modular nuclear reactors that can serve a similar purpose.”

Average yearly global temperatures compared to the 20th century average (U.S. National Oceanic and Atmospheric Administration’s National Centers for Environmental information)

Clean coal and safe nuclear energy? Still oxymorons. Although fairness compels an acknowledgement that the concepts of “clean coal” and “safe nuclear energy” were championed by the Obama administration, which in fact was nearly as enthusiastic as the Bush II/Cheney administration in throwing bottomless sums of money at nuclear power companies.

At least the Obama administration was willing to promote renewable energy as part of its ill-advised “all of the above” energy program and did believe that breathable air and drinkable water are good ideas, even if not willing to disrupt corporate business as usual to achieve those ideas, or so much as hint that resource consumption far beyond the Earth’s capacity might necessitate consuming less. The Trump gang can’t be bothered to do even that. Searches for any statement on COP23 on the official White House web site turns up not a word. One can find statements about favorable editorials in Murdoch newspapers but nothing on the climate summit.

Do you get half credit if the bridge collapses when walkers are halfway across?

This about brings us to the point where the latest dire reports of catastrophe that would result from a failure to tackle climate warming is appropriate. We’ll get to that momentarily, but first it would be useful to reiterate just what was committed two years ago, none of which have been updated or improved upon despite cheery press releases.

National global-warming commitments made in time for the 2015 Paris Climate Summit included these goals:

  • The United States pledged at the time to reduce greenhouse-gas emissions by 26 to 28 percent in 2025, relative to 2005 levels; instituted new national regulations on power-plant emissions; and announced a state-level cap-and-trade system whereby states, rather than enterprises, will trade pollution permits.
  • China intended to reach a peak in its greenhouse-gas emissions by 2030; intended to inaugurate a cap-and-trade system in 2017; and pledged to have 50 percent of its new buildings meet “green” standards by 2020.
  • The European Union’s goal was a 40 percent cut in emissions in 2030, relative to 1990. The centerpiece of EU efforts is a failed cap-and-trade system that will not be reformed until 2021.
  • Brazil said it would cut emissions by 37 percent in 2025, relative to 2005, and intended to achieve a 43 percent reduction by 2030. Brazil said it would generate 20 percent of its electricity from non-hydropower renewables by 2030 and pledged to restore 30 million acres (120,000 square kilometers) of forests.
  • Canada committed to cutting output of greenhouse gases by 30 percent in 2030, relative to 2005, but this includes international “offsets” and failed to address the Alberta tar sands. On a provincial level, Ontario and Québec will participate in a cap-and-trade system.
  • Japan intended to reduce emissions by 26 percent in 2030, relative to 2013 (the equivalent to 18 percent below 1990 levels by 2030), reductions that would include international “offsets” and “credits” for forest management.
  • India pledged to reduce the intensity of its emissions 33 to 35 percent in 2030, relative to 2005, and to produce 40 percent of its electricity from non-fossil fuel sources by that year. This goal, however, is a commitment to only slow the rate of emissions rather than cut them.
  • Australia committed to a 26 to 28 percent cut in emissions, relative to 2005, reductions to be achieved in part through land-use changes and forestation. But the coalition government in power then and now repealed the Clean Energy Future Plan, seen as a step backward.

Of the above countries and regions, only India is rated by Climate Action Tracker, a consortium of three research organizations, as compatible with a goal of capping global warming at 2 degrees. Every other one has been found to be insufficient, with the United States joining Chile, Russia, Saudi Arabia, Turkey and Ukraine as “critically insufficient,” the worst category.

The Alberta tar sands (photo by Howl Arts Collective, Montréal)

Should all the pledges made at the Paris Summit actually be met, the increase in global temperatures will be about 2.7 degrees, according to Climate Action Tracker. The group calculates that fulfillment of the national pledges would result in an increase in the global temperature of 2.2 to 3.4 degrees C. (with a median of 2.7) by 2100, with further increases beyond that. In other words, global warming would advance at a slower pace that it would have otherwise should all commitments be fulfilled. But there are no enforcement mechanisms to force compliance with these goals; peer pressure is expected to be sufficient.

This is reminiscent of a Group of 7 Summit a few months earlier, in June 2015, when the G7 governments said they would phase out fossil fuels by 2100, a case not of closing the barn door after the horse has left but rather declaring an intention to consider closing the barn door after waiting for the horse to disappear over the horizon.

In case you needed still more evidence …

OK, we’ve reached the point where we should summarize the latest scientific reports. In just the past few weeks:

  • A report published in Lancet reported that the health of millions of people across the world is already being significantly harmed by climate change, thanks in part to increased risk of infections diseases. This risk, the Lancet report declared, qualifies as “the major threat of the 21st century.”
  • As carbon dioxide increases, accelerating global warming, scientists fear that Arctic melting will trigger a massive release of methane, a gas more than 20 times more potent than carbon dioxide in ability to causing atmospheric warming.
  • It is a virtual certainty that human activity is responsible for all global warming since 1950, according to the Climate Science Special Report, a report prepared by hundreds of U.S. scientists. Humans are likely responsible for 93 to 123 percent of Earth’s net global warming, the report said, meaning that Earth might have cooled slightly in the period absent human activity.
  • Hundreds of millions of people would face displacement due to their their home cities becoming flooded as a result of rising sea levels triggered by global warming of 3 degrees, which would be reached if current trends continue. Alexandria, Miami, Osaka, Rio de Janeiro and Shanghai are among the many cities to be drastically affected.
  • Extreme rains of at least 20 inches from a single storm are six times more likely than they were in the 1990s, and will become another three times more likely by 2090.

Those represent just some of the most recent research. Earlier studies have found that humanity may have already committed itself to a sea level rise of at least six meters from the greenhouse gases already thrown into the atmosphere and that several more decades of global warming would occur even if all greenhouse-gas production ceased today because the oceans will release much of the heat they have absorbed from the atmosphere.

You can’t have infinite growth on a finite planet

The bottom line is that business can’t continue as usual. That means wrenching changes to the economy in a system, capitalism, that offers no alternative employment to those whose jobs would be eliminated. Conservatives see that seriously tackling global warming would trigger significant disruption, so their solution is to deny global warming, policies unfortunately being carried out by the Trump administration. Liberals acknowledge the severity of the problem, but advocate renewable energy and techno-fixes requiring technologies that unfortunately are yet to exist in order to claim that any dip in the economy would be no more than a statistical blip. That’s not realistic, either.

Already, the demand for resources to support present-day consumption is equal to 1.7 Earths. That indeed is not sustainable. And although renewable energy obviously should be developed, with fossil fuels phased out as soon as practical, those changes will only get us part of the way, before mentioning that manufacturing the parts for wind and solar energy have their own environmental concerns. Renewable energy is not a shortcut to reversing global warming. Alas, there is no alternative but for the global North to consume much less.

Illusions that “green capitalism” will save us must be abandoned. Capitalism requires constant growth (infinite growth is impossible on a finite planet) and discourages corporate responsibility because enterprises can offload their responsibilities onto society. Thus every incentive is for more production. Maximizing profit and environmentalism are broadly in conflict; the occasional time when they might be in harmony are rare exceptions and temporary. This is because the managers of corporations are answerable to private owners and shareholders, not to society. Profit maximization trumps all else under capitalism and thereby holds back ecological reform — this is reflected in the “maximization of shareholder value” that is elevated to a holy cause and even a legal requirement.

Consumerism and over-consumption are not products of a particular culture nor the result of personal characteristics — they are a natural consequence of capitalism and built into a system that can’t function without growth. Problems like global warming and other aspects of the world environmental crisis can only be solved on a global level through democratic control of the economy, not by individual consumer choices or by national governments.

There can’t be infinite growth on a finite planet, and even if humanity begins to strip-mine the Moon and the asteroid belt, that would merely postpone the reckoning because the solar system is finite, too (assuming that off-world industrialism could be made financial viable). What the planet needs is action, not only words, and the later that action is put off the more painful will be any attempted cure. Environmental crisis can no longer be disentangled from economic crisis.

The revolt that shook the world

History does not travel in a straight line. I won’t argue against that sentence being a cliché. Yet it is still true. If it weren’t, we wouldn’t be still debating the meaning of the October Revolution on its centenary, and more than a quarter-century after its demise.

Neither the Bolsheviks or any other party had played a direct role in the February revolution that toppled the tsar, for leaders of those organizations were in exile abroad or in Siberia, or in jail. Nonetheless the tireless work of activists laid the groundwork. The Bolsheviks were a minority even among the active workers of Russia’s cities then, but later in the year, their candidates steadily gained majorities in all the working class organizations — factory committees, unions and soviets. The slogan of “peace, bread, land” resonated powerfully.

The time had come for the working class to take power. Should they really do it? How could backward Russia with a vast rural population still largely illiterate possibly leap all the way to a socialist revolution? The answer was in the West — the Bolsheviks were convinced that socialist revolutions would soon sweep Europe, after which advanced industrial countries would lend ample helping hands. The October Revolution was staked on European revolution, particularly in Germany.

The beginning of the October Revolution in Nizhny Novgorod on the Annunciation Square

We can’t replay the past and counterfactuals are generally sterile exercises. History is what it is. It would be easy, and overly simplistic, to see European revolution as romantic dreaming, as many historians would like us to believe. Germany came close to a successful revolution, and likely would have done so with better leadership and without the treachery of the Social Democrats who suppressed their own rank and file in alliance with the profoundly undemocratic Germany army. That alone would have profoundly changed the 20th century. And provided impetus to the uprisings sparking off across the continent.

Consider the words of British prime minister David Lloyd George in 1919 as he discussed his fears with Georges Clemenceau, the French prime minister: “The whole of Europe is filled with the spirit of revolution. There is a deep sense not only of discontent, but of anger and revolt among the workmen against prewar conditions. The whole existing order, in its political, social and economic aspects is questioned by the masses of the population from one end of Europe to the other.”

What country goes first?

Russia was the weak link in European capitalism and the stresses of World War I added to the conditions for a revolution. Not an inevitability. Leon Trotsky’s analogy of a steam engine comes to life here: “Without a guiding organisation, the energy of the masses would dissipate like steam not enclosed in a piston-box. But nevertheless what moves things is not the piston or the box, but the steam.”

The October Revolution wouldn’t have happened without a lot of steam; without masses of people in motion working toward a goal. The revolution faced enormous problems, assuming it could withstand the counter-assault of a capitalist world determined to destroy it. The revolution was a beacon for millions around the world as strikes and uprisings, inspired by the example of Russians, touched off across Europe and North America. Dock and rail workers in Britain, France, Italy and the United States showed solidarity through refusing to load ships intended to be sent to support the counterrevolutionary White Armies that massacred without pity. Armies, assisted by 14 invading countries, that sought to drown the revolution in blood.

The revolution survived. But the revolutionaries inherited a country in ruins, subjected to embargoes that allowed famines and epidemics to rage. The cities emptied of the new government’s working class base, the country surrounded by hostile capitalist governments. There was one thing the Bolshevik leaders had agreed on: Revolutionary Russia could not survive without revolutions in at least some countries of Europe, both to lend helping hands and to create a socialist bloc sufficiently large enough to survive. The October Revolution would go under if European revolution failed.

Meeting at the Putilov Factory (1917)

Yet here they were. What to do? With no road map, shattered industry, depopulated cities and infrastructure systematically destroyed by all armies hostile to the revolution — having endured seven years of world war and civil war — the Bolsheviks had no alternative to falling back on Russia’s own resources. Those resources included workers and peasants. For it was from them that the capital needed to rebuild the country and then begin to build an infrastructure that could put Russia on a path toward actual socialism, as opposed to an aspirational goal well into the future, would come.

The debates on this, centering on tempo and how much living standards could be short-changed to develop industry, raged through the 1920s. Russia’s isolation, the dispersal of the working class, the inability of a new working class assembled from the peasantry to assert its interests and the centralization necessary to survive a hostile world — all compounded by ever tightening grasps on political power by ever narrowing groups that flowed from the country’s isolation — would culminate in the dictatorship of Stalin.

Privatization ends chance of democratic control

Stalin would one day be gone and the terror he used to maintain power gone with him. But the political superstructure remained — the single party controlling economic, political and cultural life, and the overcentralized economic system that steadily became a more significant fetter on development. The Soviet system was overdue for large-scale reforms, including giving the workers in whose name the party ruled much more say in how the factories (and the country itself) were run. Once the Soviet Union collapsed, and the country’s enterprises were put in private hands at minuscule fractions of the value of those enterprises, the chance to build a real democracy vanished.

A real democracy? Yes. For without economic democracy, there can be no political democracy. The capitalist world we currently inhabit testifies to that. What if the people of the Soviet Union had rallied to their own cause? What if the enterprises of that vast country had become democratized — some combination of cooperatives and state property with democratic control? That could have happened because the economy was already in state hands. That could have happened because a large majority of the Soviet people wanted just that. Not capitalism.

They were unable to intervene during perestroika. Nor did they realize what was in store for them once the Soviet Union was disbanded, and Boris Yeltsin could impose shock therapy that threw tens of millions into poverty and would eventually cause a 45 percent reduction in gross domestic product — much deeper than the U.S. contraction during the Great Depression.

A revolution that began with three words — peace, bread, land — and a struggle to fulfill that program ended with imposed “shock therapy” — a term denoting the forced privatization and destruction of social safety nets coined by neoliberal godfather Milton Friedman as he provided guidance to Chilean dictator Augusto Pinochet. Millions brought that revolution to life; three people (the leaders of Russia, Ukraine and Belarus) put an end to it in a private meeting. With the financial weapons of the capitalist powers looming in the background, ready to pounce.

The Soviet model won’t be recreated. That does not mean we have nothing to learn from it. One important lesson from revolutions that promised socialism (such as the October Revolution) and revolutions that promised a better life through a mixed economy (such as the Sandinista Revolution) is that a democratic economy and thus a stable political democracy has to rest on popular control of the economy — or, to use the old-fashioned term, the means of production.

Leaving most of the economy in the hands of capitalists gives them the power to destroy the economy, as Nicaragua found out in the 1980s and Venezuela is finding out today. Putting all of the enterprises in the hands of a centralized state and its bureaucracy reproduces alienation on the part of those whose work makes it run. It also puts into motion distortions and inefficiencies because no small group of people, no matter how dedicated, can master all the knowledge necessary to make the vast array of decisions that make it work smoothly.

The world of 2017 is different from the world of 1917; for one, the looming environmental and global-warming crisis of today gives us additional impetus to transcend the capitalist system. We need to produce and consume less, not more, unlike those of a century ago. We need the participation of everyone, not bureaucracy. Planning from below with flexibility, not rigid planning imposed from above. But we need also learn from the many advancements of the 20th century’s revolutions — the ideals of full employment, culture available for everyone, affordable housing and health care as human rights, dignified retirements, and that human beings exploiting and stunting the development of other human beings for personal gain is an affront.

The march forward of human history is not a gift from gods above nor presents handed us from benevolent rulers, governments, institutions or markets — it is the product of collective human struggle on the ground. If revolutions fall short, or fail, that simply means the time has come again to try again and do it better next time.

This article originally ran in the Indypendent newspaper of New York.

China maintains its capitalist course

The Western corporate media have been fixated on Chinese President Xi Jinping’s hold on power, speculating on if he will follow the Communist Party’s tradition of leaders stepping down after two five-year terms. The larger story, however, is that there appears there will be no change in course, at least for now, for China.

Perhaps the fixation on President Xi is due to the corporate media’s tendency to focus on personalities over issues, or perhaps because it could be presumed in advance that China would not become a poster child for the International Monetary Fund or World Bank. To be fair, Chinese institutions have strongly emphasized President Xi’s leadership, continually referring to him as the “core” of the party’s central committee and celebrating that “Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era” has been enshrined in the party constitution.

The way in which “Xi Jinping Thought” has been enshrined, however, indicates that the party and state leader is stressing continuity with his predecessors. The resolution by the 19th Chinese Communist Party Congress adopting the report of the outgoing central committee said this in the first paragraph:

“The Congress holds high the banner of socialism with Chinese characteristics and is guided by Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, the Theory of Three Represents, the Scientific Outlook on Development, and Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era.”

Forbidden City, Beijing (photo by Adamantios)

Looking past the ritualistic style, what is noteworthy about the above paragraph is that every Chinese leader is mentioned. The “Scientific Outlook on Development” is the product of President Xi’s predecessor, Hu Jintao, who declared that China must end its reliance on cheap labor and invest more in science and technology. The “Theory of Three Represents,” laid down by former President Hu’s predecessor, Jiang Jemin, declares that the party should represent the most advanced productive forces, the most advanced culture and the broadest layers of the people. That is an assertion that the interests of different classes are not in conflict and that the party can harmoniously represent all classes simultaneously.

On the surface, that lineup of leaders seems unremarkable, but it represents a change from four years ago, when the party did not formally mention the “Scientific Outlook on Development” and attached the adjective “important” to the “Three Represents.” Combined with the announcement four years ago that the party declared “the role of the market” in China to be “decisive,” a switch from “basic,” this was a strong indication that China would further its integration into the world capitalist system, albeit on its own terms.

A continuing commitment to the capitalist road

The lines laid down by presidents Jiang and Hu, following the turn toward capitalism by Deng Xiaoping, would seem quite contradictory to “Mao Zedong Thought” or, for that matter, Marxism-Leninism. What can be reasonably inferred here is that the party will continue to use Mao as one source of its authority. That all post-revolutionary rulers are included in the list of enshrined theories, with none elevated above any other, indicates that the party is stressing continuity.

If there are to be any significant changes, particularly to economic policy, they are unlikely to be revealed before next autumn, when the third plenum of the new central committee will likely be held. Third plenums, generally held about a year after a congress, are often the occasions for major announcements, as was the case in 2013, when the above switch to making the market “decisive” was announced. (A plenum is a meeting of the entire central committee, generally scheduled at precise intervals.)

Also noteworthy in the congress’ resolution of October 24 was an acknowledgment that the party has to give greater priority to consumer interests and the environment:

“[T]he Congress forms the major political judgments that socialism with Chinese characteristics has entered a new era and the principal contradiction in Chinese society has evolved into one between unbalanced and inadequate development and the people’s ever-growing needs for a better life.”

The party, despite the heavy stress on “Xi Jinping Thought,” also sought to dampen hopes that the growth in living standards would be rapid:

“The Congress elaborates on the Party’s historic mission in the new era and establishes the historical position of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. It sets forth the basic policy for upholding and developing socialism with Chinese characteristics in the new era, and establishes the goal of securing a decisive victory in building a moderately prosperous society in all respects and then embarking on a journey to fully build a modern socialist China.”

The resolution, which repeatedly referred to the goal of a “moderately prosperous society,” also stressed the party will firmly hold onto its leading role, uphold the unity of China and strengthen its military. As to the direction in which the party intends to lead, the list of goals in the resolution give a strong hint. Among the listed goals are “pursue supply-side structural reform as our main task” and “endeavor to develop an economy with more effective market mechanisms.”

Although “supply-side” in this context certainly is not meant in precisely the same way that “supply-side” was meant during the Reagan administration in the United States, it is not without content, either. The Chinese business magazine Caixin, in a commentary about the congress, had this to say:

“The report said that ‘in resource allocation, the market plays the decisive role and the government plays its role better.’ This line shows unwavering determination to move toward market reform. But we should remain vigilant about how, under China’s current system, in terms of specific administration, the government plays a decisive role, while the market is in a subordinate role. Supply-side reform needs to accomplish five tasks — cutting overcapacity, lowering inventory, deleveraging, lowering costs, and improving economic weak spots. ‘Government failure’ cannot be entirely absolved in causing these problems.”

Party acknowledges “unbalanced and inadequate development”

So, again, more capitalism for the Chinese Communist Party despite its insistence that “socialism” is its guiding ideology. A commentary by the official Chinese press agency, Xinhua, offered these passages:

“The genesis of China’s development miracle is socialism, not other ‘-isms.’ The country succeeds not by rigidly copying the original ideas of scientific socialism, but by adapting it to China’s reality. Xi Jinping’s thought will be China’s signature ideology and the new communism. … China is now strong enough, willing, and able to contribute more for mankind. The new world order cannot be just dominated by capitalism and the West, and the time will come for a change.”

The reality is that China is ever more integrated into the world capitalist system, and has built its economy on being the world’s sweatshop — rendering it highly dependent on exports, particularly to the West. The party would like to follow the path of Japan, which started out making cheap consumer products before moving up the value chain to become a producer of high-end electronics and other technological products. Traveling such a path is a necessity if the party is to fulfill its goal of raising Chinese living standards and making China an undisputed global power.

Shanghai (photo by dawvon)

The reference to the “principal contradiction” of China being “between unbalanced and inadequate development and the people’s ever-growing needs for a better life” is an acknowledgment that China has made insufficient progress. A few numbers will illustrate that.

Household consumption in China remains far below the level of advanced capitalist countries. According to World Bank data, household consumption accounted for 37 percent of China’s gross domestic product in 2015, barely improved from 36 percent in 2007. (Household consumption is all the things that people buy for personal use from toothbrushes to automobiles.) To put that number in perspective, household consumption was as high as 71 percent during the Mao era and above 50 percent as recently as the early 1980s. In comparison, household consumption in advanced capitalist countries tends to be between 58 and 72 percent of GDP.

China’s rapid growth has been overly dependent on investment, and given the overcapacity of many Chinese basic industries and the rash of ghost cities constructed, the ability to continue driving growth through investment is questionable. Here again, data from 2015 is the latest available, when investment accounted for 45 percent of Chinese GDP, down only slightly from a high of 48 percent in 2011. To put that in perspective, the world average is 24 percent.

Wages rising but are still very low

Concurrent with the over-reliance on investment is an ongoing real estate bubble and increasing debt. For the period 2007 to 2014, only four countries saw their debt increase faster than China. A 2016 Financial Times report said that more than 60 percent of Chinese bank loans were directly or indirectly tied to real estate. That any downturn or stagnation remains well into the future is demonstrated in a sudden and pronounced drop in the Shanghai stock market in 2015, ending a stock bubble, not having much of a dampening effect on the economy. Nonetheless, a stock-market bubble is no panacea for low wages or a shredded social safety net.

And wages remain low in China, despite the gains of recent years. The minimum wage in Shanghai, the highest in China, more than doubled from 2010 to 2016, but was still the equivalent of US$327 per month. The minimum wage in most major cities is US$239 and in poorer provinces can be lower still. These increases, the product of labor struggle, may be coming to an end for the near future, however, reports the China Labour Bulletin:

“Current central government policy was clearly stated by Vice Minister for Human Relations and Social Security, Xin Changxing, in July 2016 when he said that because: ‘Our advantage in labour costs is no longer as clear-cut as before; we should ease the frequency and scale of wage increases so as to preserve our competitive advantage.’ ”

Garment manufacturers are relocating to Bangladesh, Cambodia and Vietnam, where wages are even lower. The Bulletin reports that Chinese minimum wages (which are set locally) should be between 40 and 60 percent of the local average wage, but in most cities it is less than 30 percent. The gap between low-paid workers and those earning the average wage has been growing, nor are overtime rules enforced.

The Bulletin concludes its report on Chinese working conditions in sobering terms:

“A superficial look at China’s major cities seems to show a reasonably affluent society: young, hard-working middle class families, determined to make a better life for themselves. Look beneath the surface however and you soon realize that the goods, services and lifestyle products that these middle class families aspire to are all produced, marketed, and delivered to their homes by an army of over-worked and under-paid working class labourers.”

Socialism or sweatshops?

If socialism is defined as a system of political and economic democracy in which industry and agriculture are brought under popular control so that production is oriented toward human, community and social need rather than private accumulation of capital, and all human beings have a say in decisions that affect their lives and communities, integration into the world capitalist system on the basis of low-paid sweatshop labor allowing massive profits for foreign multi-national corporations is not socialism, whether or not with “Chinese characteristics.”

Western corporations, led by Wal-Mart, are responsible for production being moved to China. China did not “take” anybody’s job; it became the favored destination of the transfer of production by taking advantage of capital’s relentless desire to relocate to locations with the lowest wages and most permissive regulations. Japan and South Korea were able to move up the value chain, develop industry and become new members of the Global North. China’s intention is to do this, but it is by no means certain that there is room for it to do so.

China, because of its size, is able to extract concessions from foreign capital and assert more control than other developing countries, and thus is in the unique position of entering the capitalist system on its own terms. But the market has its own “logic,” one that no country is able to escape.

There is considerable speculation that Chinese leaders are playing a long game, using the capitalist system to develop with the intention of later nationalizing and moving again to a socialist system. A healthy skepticism toward such scenarios is more than warranted. Wealth is being accumulated. The power the concentration of capital inevitably builds, and the commonality of interests of capital across borders, are not something that can removed via a decree.

However much China’s leadership might believe it can control and harness the market, there are always interests at stake. Capitalist markets are nothing more than the aggregate interests of the largest industrialists and financiers, and, in the absence of sustained, organized resistance, those interests are decisive, with all the attendant exploitation.

The rapid minting of billionaires in China, the party’s welcoming of those with wealth, and the wealth acquired by those related to party officials, means that the material interests of the Chinese Communist Party is more capitalism.