By David Walsh, Arts & Cultural critic, wsws.org

“The super-wealthy elite in America lives and expects to be treated like royalty. The handful at the top of society, enjoying unimaginable riches, considers the population at large to be riffraff, whose needs and opinions don’t count, whose lives amount to nothing…”

The American news and entertainment media went into a frenzy Monday on reports that Kate Middleton, wife of Britain’s Prince William and Duchess of Cambridge, had gone into labor and later in the day gave birth to a baby boy, the third in line to the British throne.

The anticipatory morning headlines—“Royal baby expected soon; Duchess Kate in labor,” “10 royal baby traditions to know,” “Royal baby wait almost over,” “Tri-State, World Anxiously Await Word Of Royal Birth”—gave way to jubilant ones in the afternoon—“Royal baby born in London,” “Royal Arrival: It’s A Boy!,” “Prince William and Kate celebrate birth of first baby,” “The Royal baby has arrived,” etc.

[pullquote]  The growth of vast social inequality, the existence in the US of a financial aristocracy, in fact if not in name, have made even that nominal adherence to democracy untenable. Official conduct and communication are now catching up to reality and that finds its way into the language and behavior of the ruling class’s propagandists on television and in the press. [/pullquote]

CNN breathlessly told its viewers: “The royal bundle of joy [is] about to arrive… Prince William is under strict instructions to telephone the queen as soon as the birth will happen… He will make that call on a specially encrypted phone.” Two US television networks, ABC and NBC, broke into regular programming to announce the birth.

President Barack Obama took time from his schedule to “congratulate the Duke and Duchess of Cambridge on the joyous occasion of the birth of their first child… Given the special relationship between us, the American people are pleased to join with the people of the United Kingdom as they celebrate the birth of the young prince.”

Obama should speak for himself. From all indications, hardly anyone in the US cares very much about the royal birth. According to Pew Research, “by and large, most Americans say they do not follow news of the British royal family.” Why in the world should they?

In December 2012, a quarter of those polled by Pew said they were following the news that the royal couple was expecting a child, which was all over the television and tabloid press. Among those 18-24, only 16 percent expressed interest. The most intrigued were Americans 55 and older. One suspects that if the survey results were organized along income lines, the youngest and least affluent layers of the US population would express minimal concern with the British royal family…if not open hostility.

In that sense, the media’s insistence on the significance of the event, in the face of the public’s general lack of interest, is an expression of the social, political and moral divide in American life.

As always, the media coverage involves a great deal of fakery and manipulation. It is unlikely that even the numbskulls who deliver the news to the US population are genuinely made “excited” and “giddy” by a new addition to the crowd of unamiable parasites who sit atop and live at the expense of the British people.

The Crown Estate (the royal property portfolio), one of the largest property owners in Britain, had holdings estimated at £7.3 billion [$US11.2 billion] in 2011. Forbes in 2010 calculated Queen Elizabeth’s wealth to be approximately $450 million.

It is hard to imagine a more useless bunch than the British royal family, from whom the odor of fascism, with which they were infatuated in the 1930s, cannot be eliminated.

No doubt the insatiable need for empty, mind-numbing items to fill up time and space, especially at a “slow time” in the news calendar, accounts for some of the media’s disgraceful antics, but there is more than mere empty-headedness at work here.

For one thing, the television networks, cable channels and print media have more reason than ever to try to distract public attention and push into the background highly disturbing stories, from Edward Snowden’s revelations about the government’s antidemocratic conspiracies, its support for dictatorship in Egypt and plans for a new war against Syria, to the bankruptcy of Detroit and devastation of its population.

Beyond that, the more substantial media outlets, such as the New York Times and the Washington Post, pointed to the importance of a new royal heir in stabilizing and legitimizing an institution that has fallen into disrepute in recent decades, through a series of scandals and disgraces.

The Times noted Monday, “William and Catherine’s baby is not just the essence of monarchy, which is always about succession. The birth will also confirm the stability of a throne that looked so wobbly when Diana, Princess of Wales, William’s mother, died 16 years ago.

“Who would have predicted that a generation after that fatal car crash everything in the royal garden would be rosy?”

Noting that the infant boy was expected to follow Prince Charles and Prince William to the throne, the Post commented:

“No one can tell what political and personal changes the intervening years will bring, but the baby can be expected to become the head of state of 16 countries, including Britain, Australia and Canada, and possibly the head of the Commonwealth, which covers 54 nations.

“The child will also eventually become Supreme Governor of the Church of England.

“The baby represents a living link to Britain’s imperial history—the infant is the great-great-great-great-great-grandchild of Queen Victoria, who ruled at the peak of British power.”

The British monarchy, for all its tattered and deteriorated condition, still represents a pillar of global social reaction, around which the establishment (in the English-speaking nations in particular) attempts to rally the most backward and malleable social layers. It is not a matter of indifference to the ruling elites in Europe, North America and Australia what becomes of the British throne.

Of course, forgotten in all the relentless US media coverage of the monarchy’s goings-on is the fact that the American people were obliged to take up arms and violently oppose Britain’s rulers some 240 years ago and establish a republic. This is not a small matter, nor is the media’s oversight accidental.

The American Revolution was a world-historical event, which struck a blow against the aristocratic principle and the inherited prerogatives of wealth and privilege. Of course, in the modern era, as the dominant imperialist power, the “republican” US has played an even more reactionary and predatory a role than the UK with its monarchy. However, at least until recently the ruling elite in America felt obliged to pay lip service to the ideals of 1776, the Declaration of Independence and the “self-evident truth” that all men were “created equal.”

The growth of vast social inequality, the existence in the US of a financial aristocracy, in fact if not in name, have made even that nominal adherence to democracy untenable. Official conduct and communication are now catching up to reality and that finds its way into the language and behavior of the ruling class’s propagandists on television and in the press.

The super-wealthy elite in America lives and expects to be treated like royalty. The handful at the top of society, enjoying unimaginable riches, considers the population at large to be riffraff, whose needs and opinions don’t count, whose lives amount to nothing.

Far from identifying with the traditions of the American Revolution and Civil War, they feel a greater and greater affinity for the British nobility and Southern slavocracy. This, of course, extends to their means of rule, which represent a repudiation of democracy in favor of authoritarianism, police-state methods, secret courts, plots against the population and so on.

It is the envy and fascination that the financiers and corporate thieves who run America, along with their political and media agents, instinctively feel for the British royal family, whose privileges are enshrined in law and tradition, that helps account for the current frenzy about the royal birth.

If the billionaires who run the US could install a hereditary nobility to ensure their wealth and power, they would do so without hesitation. A new “1776” will involve a revolt against this corporate-financial aristocracy on the program of social equality and socialism.

ABOUT THE AUTHOR

The   B u l l e t / Socialist Project • E-Bulletin No. 853

“They do not represent us!”

Introduction: The Limits of a Good Idea

It started as a good idea. Rather than taking the path of the old Latin American left, in the form of the guerrilla movement, or the Stalinist party, Brazil’s Workers’ Party (Partido dos Trabalhadores, PT), aided by strong union and social movements, decided to try something new. The challenge was to somehow combine the institutions of liberal democracy with popular participation by communities and movements.

The answer eventually became participatory budgeting (PB). Introduced in the city of Porto Alegre in 1999, PB was a highly innovative experiment in co-management and de-centralization (Weyh, 2011). It allowed communities of diverse political stripes to democratically manage a small portion of their city’s budget. Not only did this result in more and better services for poor communities, it also opened a space where people could learn new democratic skills and build new solidarities. In PB, a virtuous cycle of democracy was unleashed: the more people participated, the more people learned to participate. Add to this, a number of poverty reducing programs at the national level, such as Bolsa Familia, and you suddenly had a new path to social transformation: peaceful, gradual and pluralist.

It wasn’t long after the PT acquired power at the national level in 2003 that cracks in its political economic model began to show, however. Agrarian reform, the key demand of one of its most important early allies, the Brazilian Landless Workers’ Movement (MST), was effectively dropped from the PT’s program. More accurately, the PT re-articulated the MST’s demand of agrarian reform by strengthening the productive capacities of existing MST lands, rather than addressing Brazil’s highly unequal land ownership structure, in which the top 1 per cent own 50 per cent of the land. In other words, of the three key elements of the MST’s program, namely “occupy, resist, produce,” the PT opted to act only on the last point. It did so by, for example, opening avenues for the sale of products produced by MST run cooperatives, as in the case of Cooperdotchi, an agricultural cooperative in the state of Santa Catarina. This re-articulation of the MST’s goals has created ongoing conflict between the government and the MST who has itself re-articulated its demand for agrarian reform as, “food sovereignty,” focusing instead on the government’s alliance with agribusiness (Ferrero, 2012).

Anti-FIFA World Cup Sentiment

The other traditional ally of the PT is the middle class (particularly in the southern states), who have benefited from strong growth and employment in recent years. However, health and education have been badly neglected, and sections of the middle class are feeling the effects. This comes at a time when the government is spending billions of dollars on the FIFA World Cup (in 2014). This situation has created a growing cynicism among people expressed in the popular phrase, “imagina na copa” (imagine during the cup!). First heard in middle class circles, the expression is a criticism of problems in transportation, health care or any situation in which there is delays, line ups or disorganization. The expression soon became more generalized, as people began to perceive the world cup as the source of the country’s growing problems. In other words, if its this bad now, “imagine during the cup!”

Unions, another traditional bastion of PT support, have also gone on board with this anti-cup sentiment, several of them threatening strike actions during the tournament next year if their demands are not met now. In addition, indigenous groups are facing displacement around the country, as new stadiums and infrastructure is built. For example, in March of this year, an indigenous community was forcibly evicted from an abandoned museum next to the Maracanã, Brazil’s most emblematic soccer stadium located in Rio de Janeiro, which recently underwent a $500-million renovation. Poor communities living in favelas (shanty towns), many of them new supporters of the PT, have also faced similar displacement.

Many people have also grown frustrated with the PT’s “strategic alliances” with the right, for example, its decision to allow Marco Feliciano to be the chair of Brazil’s Human Rights Commission. To the outrage of the LGBTQ community (and progressive sectors more generally), Feliciano recently led an initiative that encourages gay people to undergo psychological treatment. In short, a variety of sectors supportive of the PT have real reasons for being dissatisfied with the government’s handling of, not only the World Cup, but a number of other issues also. It seems the PT’s model of a new left was reaching its limits.

“Não me representa”

The protests have their most immediate roots in Porto Alegre, and indeed it is here that the contradictions of the PT’s model are most evident. To the surprise of many, Porto Alegre elected a right wing government in 2004, that is, after 16 consecutive years of PT rule. This was a huge blow to the party in the city that hosted the World Social Forum no less than five times. Some even began to see the PT as having reached a crisis. After a few years of relative quiet, middle class students began to organize against the privatization of public spaces in the city center, as part of preparations for the World Cup. Parallel to this, in 2011, the Comitê Popular da Copa (World Cup Popular Committee) was formed, composed of several groups including the MST. Their goal was to raise awareness and begin organizing against the cup and what they saw as the Municipal government’s mistaken priorities.

Since 2004, Participatory Budgeting, the PT’s signature program, has been noticeably weakened. For example, by June of 2012, only 17 per cent of the money allotted that year to various programs through the city’s PB had actually been spent (De Olho). Meanwhile, participation has decreased in recent years. In addition, poor communities near one of the local soccer stadiums, Arena Grêmio, were displaced in preparation for the cup. Lastly, there has been a growing discontent about the city’s public transportation, resulting in successful mobilizations in April 2013, which managed to stop a 20 cent hike in transit fares. From here, the movement took root in São Paulo, where it grew quickly and became strengthened by the participation of the Subway Workers Union who were already struggling for a new contract (Costa, 2013). The transit movement is led by Movimento Passe Livre (Free Fare Movement), or MPL. Formed in 2004, the MPL considers itself a horizontal, autonomous, and non-partisan movement. Importantly, although non-partisan, the MPL does not consider itself anti-party. Their demand of free public transit has resonated throughout the country, posing direct challenge to Brazil’s oligopolistic transit system (Gibb, 2013).

The magnitude of the mobilizations caught the PT totally by surprise. Indeed, during the first large demonstrations on June 17, there was no visible PT presence in Porto Alegre. The demonstration was organized by Bloco de Luta Pelo Transporte Público (Struggle Block for Free Transit), a popular front bringing together several organizations, and greatly amplified via social media networks. About five to seven thousand people amassed at the city’s prefecture. The mood was confident, energetic and inspiring. Youth between 15-25 years of age were the majority. People freely experimented with various chants, including, “sem partido” (without a party), “Não nos representam” (doesn’t represent us), “Brasil acordo” (Brazil woke up), “acabou o amor, Brasil vai virar Turquia,” (the love is over, Brazil will turn into Turkey), “vem pra rua” (come to the streets), and “sem violencia” (without violence).

Some people held Brazilian flags with the words, “primaveira brasilera” written on them, while others held up Turkish flags. Clearly, in addition to the national context, protestors had similar global revolts in mind. Finally, placards demanded better public education, health care and an end to the World Cup. Interestingly, despite the anti party sentiment, party flags were in plain view, including those of the Socialism and Freedom Party (Partido Socialismo e Liberdade, PSOL), a socialist party to the left of the PT. As with all subsequent demonstrations, protestors were met with police repression, which included the use of teargas and rubber bullets.

Some have noted that the demonstrations contain right wing and even fascist elements (particularly in the bigger cities), citing examples of vandalism and violence against left wing parties. However, it would be very premature to say that these elements are becoming a social force. For example, in Porto Alegre, violent groups are a tiny minority and there were no reports of organized fascist activities. It is true that in some of the bigger cities attacks on left wing parties have been reported, but at least some of these can be attributed to individuals or small groups that simply reject the presence of any parties on the streets.

It is true that a simplistic rejection of all parties can lead to an apolitical nihilism, which indeed formed part of the sentiment right before the 1964 Brazilian dictatorship. However, we must not immediately equate an anti-party sentiment with right wing politics, as some have done. It is also worth noting who is making the claims of this being a right wing movement, namely the PT (at least certain currents within it) and the corporate media, supposed bitter enemies. They each have their own reasons, however. Given that the movement contains anti-party elements (and therefore is not pro-PT), the PT’s thinking is, “if they are not with us, then they must be right wing.” For its part, the corporate media’s strategy has been spinning the movement as being simply anti-corruption and anti-taxes so as to impose its own right wing agenda and create the conditions for replacing the PT.

The next demonstration took place on June 20, only this time it brought together close to 10,000 people, that is, despite persistent heavy rain. Overall, over a million people took to the streets in over 100 cities that night. Unions had a significant presence for the first time in Porto Alegre, including members of SIMPA, representing the city’s municipal workers. Also of note is that this time, few if any party flags were in view. This was also the case during the following demonstrations on June 24th and 27th. However, gone were also the anti-party chants. Interviews revealed that by now the movement had recognized the co-optation attempts by the right wing media, and dropped its simplistic anti-party position. Indeed, they recognized that a number of parties had been on the ground floor of organizing. For example, Lucas Monteiro, an important figure in the free transit movement in Porto Alegre, is also a member of PSOL.

The movement’s rapid learning was evident at a student assembly held at Universidade Federal do Rio Grande do Sul (UFRGS) on June 27th, where activists from a variety of groups, including the MPL, suggested that the way forward was to develop a coherent political program. In addition, at the demonstration later that night, a mysterious plane or helicopter was flown over the protestors, projecting a number of political messages, including “sem partido.” The crowds responded with what, up to this point, most accurately captures their political sentiment: “não nos representam” (doesn’t represent us). In other words, in a matter of days, protestors had transformed a simplistic “sem partido” to “não nos representam,” therefore avoiding co-optation by the right while asserting their commitment to direct political participation.

Beyond the Workers’ Party?

After the PT’s initial surprise, it reacted by trying to sympathize with the protestors. Brazilian president, Dilma Rousseff, stated that the protests were a sign of Brazil’s democratic strength and that the government was ready to listen to the streets. In addition, more than 20 municipalities accepted a 20 cent reduction in transit fares. Nevertheless, in preparation for the next demonstrations, Dilma quickly deployed the military to several major cities. Former president Lula perhaps best encapsulated the PT’s position, stating that the movement should now channel its demands to the negotiating table. Indeed, Dilma invited Free Fare Movement (MPL) leaders to a meeting in order to find a solution. This resulted in a number of proposals by the government, with the two most important ones being: a popular plebiscite for a constitutional reform, and a public transportation plan with $25-billion of new funding. In addition, Tarso Genro (PT), governor of Rio Grande do Sul, announced free transit for students in the state. These are major victories for the movement.

If carried through, these proposals demonstrate the PT’s ability to incorporate some of the protestor’s grievances into the PT model. However, it is clear that it can’t incorporate others. For example, consider one of Dilma’s recent statements regarding the protests: “The streets are telling us that the country wants quality public services, more effective measures to combat corruption … and responsive political representation.” Yet, for better or worse, what the protestors want is not “responsive political representation.” Indeed, one of the central themes of the movement (maybe even the central theme) is people’s deep suspicion of political representation. Direct democracy, at least as much as free transit or quality education, is what this movement stands for. The question now is whether the PT’s re-articulation of the movement’s demands will placate the streets.

However, this seems unlikely at the moment. Several unions, including the Central Única dos Trabalhadores (CUT), Brazil’s most important union federation, called for a general strike to take place on July 11, and their demands included quality public transportation new investments in health and education, and agrarian reform, hardly traditional union demands. In Porto Alegre, Bloco de Luta organized a popular assembly that brought together over 300 activists. Several bold and innovative proposals were discussed, such as organizing a permanent encampment in the city. One woman demanded transit companies’ books be opened so that, to paraphrase, we find out how much money is going to workers, and how much is being spent by the owners on champagne. Several union members were in attendance, including the leadership of SIMPA who pledged full support for the movement. In their general membership meeting later that week, the union approved full participation in the upcoming general strike. Lastly, the MST is also pledging full support for the movement, now calling for agrarian and urban reform.

A recent poll of Brazilian voters shows Dilma’s ratings have dropped from 57 per cent to 30 per cent, while 81 per cent say they support the protests (Guardian). Nevertheless, it is certainly too early to say how far this movement has weakened the PT hegemony in the country. It has, however, exposed its weaknesses and limits. More than this, by emphasizing the centrality of direct political participation and active struggle, the demonstrations are also posing a tentative alternative to the PT model for social transformation. Although Participatory Budgeting, the PT’s definitive political initiative, does provide important avenues for democratic learning, so do the streets. As one demonstrator’s placard read, “Essa é nossa educação!” (this is our school!).

However, as Le Monde reports, for 70 per cent of the youth on the streets, these protests were their first (Bava). Hence, as Emir Sadr notes, this is a young movement that lacks clear goals for the future. As such, it can also create a new space for the right, as we have seen in the “Arab Spring” and in the case of Spain (something PT supporters like to point out). This should not deter us from fully supporting this movement, though. As Rosa Luxemburg put it, “the errors committed by a truly revolutionary movement are infinitely more fruitful than the infallibility of the cleverest Central Committee.” Regardless of where the movement goes from here, it has already shown the world that its capable of big victories.

Post Script: Historic General Strike

The first since 1991 (and the fourth in Brazil’s history), the general strike that took place on July 11, 2013 successfully brought much of the country to a standstill. The strike came amidst, not only widespread popular protests, but also an upswing of strike activity that began in 2008. This culminated in a yearly average of 560 strikes by 2012, a record since 1998 (Le Monde). The strike also took place a day after the national chamber of deputies rejected Dilma Rousseff’s proposal of a popular plebiscite for political reforms, opting instead to form a “working table” to discuss the issue in the future. Unlike previous general strikes, this one brought together workers and social movements. Diverse actions were witnessed throughout the country, including road blockades, building occupations, demonstrations and marches.

Porto Alegre was one of the city’s most affected by the strike. The public transportation system was almost completely paralyzed and practically all businesses were closed, giving the city the feel of a national holiday. The strike actually began on the night of July 10th in Porto Alegre, as a number of activist groups occupied the municipal chamber of aldermen demanding “free transit now” and the opening of transit companies’ books. The next day, hundreds of workers gathered in several spots throughout the city and marched toward the city center. In the early afternoon, Bloco de Luta, asked the unions to continue their march all the way to the Chamber, where the occupation was ongoing. This revealed a certain disorganization in the movement, as many activists were left wondering where exactly to meet and march toward.

Once under way, the march split downtown, with about 3000 people continuing to the Chamber and 2000 remaining near the prefecture. Surprisingly, these numbers were a bit lower than in previous marches and demonstrations. Although organized workers were much more visible than in previous days, it seems most decided to stay home rather than go out to the streets. Also more visible were party flags, demonstrating that the anti-party sentiment of the first wave of demonstrations had considerably eroded. Now it’s June 12, 2013, and things are back to “normal” … at least for now. •

Manuel Larrabure is a Ph.D. candidate in the Political Science department at York University in Toronto, Canada. His research is on Latin America’s new cooperative movement and 21st-century socialism. He is currently in Brazil conducting fieldwork.

References:

Bava, S. (2013). “Para onde vai o governo.” Le Monde Diplomatic Brasil, 6(72).
Costa, C. “Brazilian Demonstrators Fill the Streets, Unions Join In,” retrieved July 4, 2013.
De Olho Na Cidade. September, 2012, 15(33).
Ferrero, J. (2012). Agronegocio o soberanía Alimentaria? El MST y La Otra Reforma Agraria, Brasil. In “Movimientos Sociales y Autonomía Colectiva” (Dinerstein et al Eds.). Capital Intelectual: Buenos Aires.
Gibb, E. “Brazil: Private Transit, Public Protests,” retrieved June 30, 2013.
The Guardian. “Brazilian president Dilma Rousseff’s support plummets in wake of protests,” retrieved June 30, 2013.
Le Monde Diplomatique Brasil. “O movimento recente das greves,” 6(72).
Sadr, E. Brasil: primeras reflexiones, retrieved June 29, 2013.
Weyh, C. (2011). Educar Pela Participação. Santo Angelo: FURI.

The fireball in Lac-Mégantic, Quebec, flashed around the world last week as a very hot news item. Thirty-five people are now confirmed to have been killed, with 15 more still missing and presumed dead, as a result of the explosions of crude oil carried by the Montreal, Maine and Atlantic Railway’s (MM&A) runaway freight train. When Canadian prime minister Stephen Harper quickly showed up to offer his condolences, this also made international news.

What has not received quite as much international attention as it has here in Canada, is what has since been revealed about Transport Canada, the federal government regulator of the railway industry which decided only last year to allow MM&A to run each train with only one engineer.

Amidst all the apportioning of blame – and there is plenty enough to go around – our sober attention must also turn to what this appalling incident, like the terrible Bangladeshi textile factory fire just over a month ago, tells us about the dark side of competitive markets, and the complicity of governments committed to facilitating their spread around the world.

Market-Driven Logic

The ugly logic underlying this tragedy was starkly revealed by Ed Burkhardt, the president and CEO of the MM&A railway’s parent company, Rail World Inc, in an interview on CBC television on 9 July, the day after Harper visited the devastated town. The fundamental reason the train wasn’t being overseen on that now-infamous night, he averred, was that the 2 per cent higher labour costs entailed in hiring more workers to guard their trains would lead to a company raising their freight rates to compensate by 2 per cent, which would result in it losing the business to some other company that wasn’t paying for workers to guard their trains. However callous this sounds, he spoke nothing less than the truth when he added: “That’s the way it works.”

The “it” here is our market-driven capitalist world. As Burkhardt explained, the largest corporations in the freight train industry compete with each other by outsourcing the more accident-prone operations to smaller companies with low profit margins. And these smaller companies compete in a world where one-man train operations have become the norm in other countries. “If you go overseas, almost everybody has one-man crews,” he said. “Go to the UK, they are running 100 freight trains and 10,000 passenger trains every day with one-man crews.”

Joe Barton, from Texas, typifies the political vermin that is killing the world by shilling for capitalism. He is the norm in the US political system, but his kind is common around the world. Most recently he is remembered as the Congresscritter who apologized to BP chief Tony Hayward. (See footnote #1)

The players in this world are not only the businesses that compete in it, big and small, but also the politicians of every stripe who promise to get governments off their backs to help them do so. This should once and for all be understood as an offer to carry business on the backs of governments. They have authored the free trade agreements whose key provisions are designed to leverage the sorts of regulations that promote competitiveness from one jurisdiction to another. And they have appointed people to regulatory bodies who sustain the logic of competitiveness.

At the heart of the competitive logic behind “this is the way it works,” in this instance as in so many others, was the reduction of the number of workers to save labour costs. In the 1970s, North American freight trains usually carried five-man crews around the clock. As crew sizes shrank over the following decades, the effect of this downsizing, in turn, was to have more workers competing for jobs, which of course drives down wages – including, eventually, those of the one person left running the train.

This is not an unintended consequence of competitive markets. It is their purpose.

One can be sure that the case made to Transport Canada for permission to run a one-man crew made reference to the common use of one-man train crews in the UK. The integrated nature of global capitalism today means that so long as people in one place buy into the peddlers of the logic of competitiveness, they become inadvertently complicit in the uses made by it by the peddlers of it elsewhere. •

Leo Panitch is the Canada Research Chair in Comparative Political Economy at York University, and is the co-author of The Making of Global Capitalism: The Political Economy of American Empire (Verso, 2012). This article first appeared on the www.guardian.co.uk website.

_________

(1)

Wall Street profits and the widening social divide in America

By Andre Damon, wsws

JPMorgan-Chase’s Jamie Dimon: Third-generation Wall Streeter. These are the guys who own the government. 

The profits of the biggest US banks continued to swell in the second quarter of this year, even as the impact of five years of mass unemployment, stagnant economic growth and brutal cuts in social spending produced a further rise in poverty, homelessness and hunger.

On Tuesday, Goldman Sachs, the fifth-largest US bank by assets, said its second-quarter profits doubled from a year ago, to $1.93 billion, significantly higher than analysts were expecting. This followed the announcement of record profits by JPMorgan Chase and Wells Fargo, the largest and fourth largest US banks, respectively.

JPMorgan made $6.1 billion in the second quarter, up 32 percent from a year ago, while Wells Fargo took in $5.27 billion, up 20 percent. JPMorgan Chase is expected to make $25 billion in profits this year, equivalent to the gross domestic product of Afghanistan, a country with a population of 30 million.

Citigroup and Bank of America, which together were bailed out by the US government to the tune of $90 billion, likewise posted huge profit increases, with Citigroup posting profits of $4.18 billion, up 42 percent from a year earlier.

Pay for bank CEOs has likewise soared, according to data reported by the Financial Times. John Stumpf of Wells Fargo received $19.3 million in 2012, up 7.8 percent from the year before. He was followed by Jamie Dimon of JPMorgan Chase, who took in $18.7 million, and Lloyd Blankfein of Goldman Sachs, who received $13.3 million.

The vast enrichment of financial executives is by no means confined to the US. The European Banking Authority said Monday that over 3,000 employees in the European financial sector earned more than $1.3 million in 2011.

Nor are the vast executive payouts confined to financial firms. According to an analysis conducted by Equilar Inc. for the Wall Street Journal, the CEOs of 200 US companies with revenues over $1 billion saw their pay swell by 16 percent in 2012, with the average hitting $15.1 million.

The announcement of bumper profits on Wall Street came only days after Federal Reserve Chairman Ben Bernanke delivered a speech in which he reassured the financial elite that the near-zero interest rates that have fueled record stock prices and the banks’ profit bonanza would continue indefinitely.

This vast subsidy for the big banks goes hand in hand with sweeping attacks on working class wages and living standards. The imposition of $85 billion in federal spending cuts this fiscal year, as part of the ten-year “sequester” cut of $1.2 trillion, has resulted in unpaid furloughs for hundreds of thousands of government employees, amounting to pay reductions of up to 20 percent. The sequester cuts also include sweeping reductions in housing assistance and education, as well as cuts of 15-20 percent in extended unemployment benefits for 2 million people.

The sequester cuts are only the beginning. On July 1, the interest rate on government subsidized college loans, which are given out selectively to low- and medium-income students, doubled, rising from 3.4 percent to 6.8 percent. The rate increase affects nearly 7.5 million students.

Last week, the House of Representatives passed a farm bill that excludes $743 billion in food stamps—a political maneuver that anticipates a bipartisan deal with the Obama White House and congressional Democrats to impose sharp cuts in the nutrition program upon which 48 million people—one in six Americans—depend.

Earlier this month, the Obama administration said it was delaying by one year the implementation of a legal requirement as part of its health care overhaul for businesses with 50 or more full-time employees to provide health insurance. At the same time, the administration and Congress are working to slash hundreds of billions of dollars from Social Security, Medicare and Medicaid in the next round of budget discussions.

In Detroit, Emergency Manager Kevyn Orr announced a plan last month to wipe out the pensions and health benefits of all current and retired city workers, calling for the elimination of $9 billion in benefits at one stroke.

The juxtaposition of draconian austerity for working people and unlimited cash for the financial elite makes clear that the growth of social inequality, poverty and social deprivation is not simply the result of impartial economic forces. It is the result of a conscious class policy being carried out by the Obama administration with the support of both parties.

Ever higher profits for Wall Street and ever more colossal pay packages for the bankers give the lie to the claim that “there is no money” for basic social needs.

The obscene enrichment of the financial elite amid mass poverty is treated as a non-issue by the media and the politicians, Democratic as well as Republican. The entire political establishment is on the payroll and under the control of the Wall Street bankers.

Only the working class itself, on its own initiative and on the basis of a socialist program, can break the stranglehold of the financial oligarchy and end the poverty, unemployment and social misery that plague American society.

Andre Damon is a senior political commentator with wsws.org, information arm of the Social Equality Party.