Archive for October, 2011

“Occupy The World! To the barricades comrades?” by William Bowles [Strategic Culture Foundation]

Posted in Australia, Bourgeois parliamentary democracy, Capitalism crisis early 21st century, Marx, U.K., USA on October 31, 2011 by Zuo Shou / 左手


Four years ago in a Ministry of Defence Review, the Whitehall Mandarins [sic], more astutely than any so-called Lefty, determined the following:

“The Middle Class Proletariat — The middle classes could become a revolutionary class, taking the role envisaged for the proletariat by Marx. The globalization of labour markets and reducing levels of national welfare provision and employment could reduce peoples’ attachment to particular states. The growing gap between themselves and a small number of highly visible super-rich individuals might fuel disillusion with meritocracy, while the growing urban under-classes are likely to pose an increasing threat to social order and stability, as the burden of acquired debt and the failure of pension provision begins to bite. Faced by these twin challenges, the world’s middle-classes might unite, using access to knowledge, resources and skills to shape transnational processes in their own class interest.” — ‘UK Ministry of Defence report, The DCDC Global Strategic Trends Programme 2007-2036’ (Third Edition) p.96, March 2007.

Yeah, I know, I’m always using this quote (I first used it four years ago) but it illustrates the great intellectual divide between the political class and the citizens they rule, including our Left, now made so apparent by what the pundits are now calling the ‘Occupy The World’ (OTW) movement. It seems that only our very own ruling class foresaw OTW.

Dig a little deeper into OTW and we find that with a few exceptions, there are no challenges to capitalism, mostly it’s a ‘clean up your act’ kinda thing. Throw a few billionaires in jail, add some regulation and things will eventually turn out just fine. Dream on…

But we’ve been here before. This is what attempts at ‘reforming’ capitalism in the past have looked like. We lived under such a system from 1945 until the late 1970s, before the Empire reasserted itself, proving once again, that concepts like ‘democracy’ under capitalism, are at best, mere conveniences and so vague a concept that it can be made to resemble almost anything.

And once the so-called Good Life that capitalism allegedly had offered us started to wear thin and capitalism once more plunged us into war and poverty, so too the ‘Good Life’ had to be dumped. Belt-tightening time again.

But unlike 1968, that some are comparing OTW to, socialism is barely mentioned, let alone the central motif. In 1968, politics was at the very heart of the situation. It wasn’t about money but about posing a real alternative to capitalism. The concept of belonging to a class still existed in the public’s consciousness, even if it lacked the collective will to do anything about it.

Am I being altogether too cruel to OTW? It is after all, early days in the development of OTW. It might all fizzle out or if it doesn’t, the political class might have to use the logical response to the MoD’s quote above: suppress it. Something for which, no doubt in another (secret) report, the Whitehall Mandarins have laid out the strategy and tactics to be employed in suppressing a burgeoning (socialist?) revolution.

After all, when “[f]aced by th[o]se twin challenges, the world’s middle-classes might unite, using access to knowledge, resources and skills to shape transnational processes in their own class interest”, says it all.

You have to take this stuff seriously! It’s not a game and the state is very adept at employing whatever tactics it chooses to suppress serious dissent including the use of agents provocateurs (a long-standing ‘tradition’) to infiltrate and provoke pointless confrontations with the state, in order not only to justify suppression but more importantly, as part of a propaganda war waged through the media, where we have no counter-voice.

Repression of course carries its own risks and far from being a solution could only further excerbate the problem. Timing is all. This is not a game. The political class is fighting for its life and that of its masters, the corporations. That’s why they write those reports. Just as with the insurrections earlier this year in the UK, the state had a clear response to it and the role of the media was central to its effectiveness in spreading the state’s message.

Let it ‘burn baby, burn’ and turn the world’s cameras onto the conflagration, followed by a good dose of Victorian ‘rough justice’ (pity they’ve abolished hard labour and deportation to Australia). Make an example of them should anyone else have ideas about following in their footsteps.

The key here is the observation made by the Whitehall Mandarins about “class interests”. Now if well-paid and no doubt loyal members of the political class’ intelligentsia have gotten it figured out (and so far, their prediction is right on the money), how come the ‘Left’ hasn’t?

Currently class is something almost entirely absent from the OTW movement. Without it eventually taking centre stage, OTW is bound to be stillborn. But there are some positive signs that some kind of ‘consensus’ mechanism is emerging from the chaos akin to some kind of ‘self-organizing’ principle. After all, we have what the MoD report called “access to knowledge, resources and skills” necessary to produce workable alternatives not only to capitalism but to fashion a new kind of inclusive democracy, one that hasn’t existed before.

The aim is to create a venue for democratic deliberation and open debate in a place normally associated with secretive privilege. People working in the City of London have played a starring role in creating the global economic crisis. Since our representative institutions have thus far failed to address this crisis in a way that is both sensible and just, it is only fitting that we should use the City as a place in which [to] work on solutions ourselves. — ‘Talk Amongst Yourselves’ By Dan Hind.

It’s not a ‘peasants revolt’ kinda thing, though of course inevitably those hit the worst by the crisis will revolt first. But the crisis of capital has now hit those who make up the very bedrock of capitalist society’s justification for existing, its so-called middle classes. These are the major consumers in our economy, not only is their consumption a major chunk of our GDP (as well its debt), they are also the managers and technicians of capitalism and the state machine. Piss them off and things could get out of hand just as the MoD has predicted.

Some on the Left in the UK are still calling for revitalizing the Labour Party as a potential force for socialism but if so, then it means that it would have to come from its decimated grassroots membership, a tall if not impossible order to carry out. At the first signs of revolt in the Labour Party’s constituency membership, the Party Machine will intervene and purge its ranks just as it has done so many times in the past.

For a Left largely pinning its hopes on a working class that no longer exists, it will have to broaden and deepen its knowledge of how capitalism has evolved and transformed the nature of the working class and learn to seek connections to a much more diverse alliance of forces if we are to defeat the Empire.

What an irony that the Left — led largely by middle class intellectuals — fails to see what has happened, trapped as it is in its own patronizing and nostalgic vision of the working class aka George ‘middle class’ Orwell’s ‘Road to Wigan Pier’. And this is the problem: it’s always middle class intellectuals on the Left who have set the agenda, not for their own ‘class’ mind but for an idea that emerged in the middle of the 19th century; that the organized industrial working class would undertake the Revolution, led of course by middle class intellectuals.

OTW is nevertheless a transcendent moment, one to cherish and sustain and no doubt just the first shot across the bows of Global Capital but for it to have a chance of success it will have challenge corporate capitalism’s right to exist.

To do this we will first have to dispel the ‘bad apple’ theory as the cause of the current crisis. That it’s just a question of regulating capitalism, smoothing out the rough edges, eliminating the extremes and above all, restoring ‘competition’, so-called real capitalism.

But this could only be done by breaking up the giant corporations and abolishing the financial sector in its entirety as it currently exists. Is it likely that advocates of ‘real’ capitalism aka Max Keisser could undertake such a mission? The way I understand it, a ‘real’ capitalist economy would consist only of small competing private businesses, cooperatives, public utilities and the self-employed, and one assumes massive state intervention in order to make it all happen.

Sounds a bit like my favourite kind of socialism, William Morris’s version and not an overly ambitious objective given the political will to carry it out.

But who will break up Shell or Goldman Sachs? Who will smash the military-industrial-media complex? Only a state owned and managed by the working class can undertake such a momentous task. OTY OTW…

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Expats say domestic Chinese condoms don’t fit [People’s Daily]

Posted in China, Expats in China, Shanghai, Thailand on October 31, 2011 by Zuo Shou / 左手

by Xu Chi

October 23, 2011

Shanghai–Some expatriates from Europe and Africa complained to Shanghai Daily that they are always embarrassed about “ill-fitting” condoms in the city as almost all of them are designed to a standard Asian size, which may not fit them.

Main condom suppliers including Durex, Jissbon and Okamoto confirmed that they supply condoms only with a common size suitable for Chinese men – their target consumer group.

Sizes of condoms differ in various countries and Chinese condoms, usually 180mm long and 52mm wide, are slightly smaller in length and girth than those being sold in Western countries, some suppliers said.

An official surnamed Zhao with Jissbon said his company has received complaints from some foreigners about Chinese condoms that are sometimes a little bit tight for them. But considering those people are a very tiny part of their consumer group, they haven’t considered making bigger ones.

An official surnamed Wang with Okamoto’s Beijing retailer said they used to sell bigger condoms with XL sizes in the country, but the business didn’t last long as the company didn’t earn much profit from it.

For many condom suppliers, although it would be very easy to design condoms of different sizes, the problem lies with high delivery costs, said Zhao with Jissbon.

He said most Chinese condoms are made in other countries such as Thailand and the delivery fee has long been a headache for them. As a result, condoms are usually produced in one size so they can go through fixed production lines to save money, he said.

“To alter their sizes means the factory has to develop another production line, and the goods have to be sent back to China in different batches, which will add to the already high delivery cost,” said Zhao.

The short supply of condoms in different sizes in Shanghai has brought problems to some of the city’s expats. A European who asked not to be named told Shanghai Daily that the problem has existed for many years and that he always has to bring condoms from his homeland.

He said one of his female friends got pregnant and had to get an abortion because her boyfriend couldn’t find a “proper size” condom.

“Many foreigners find it embarrassing to talk about the problem, but it’s still there unsolved while posing a danger to us of catching venereal diseases or having unwanted babies in unprotected sex,” he said.

Original article title: “Expats say condoms don’t fit”

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China to maintain its family planning policy: official [Xinhua]

Posted in China, Education, Employment, Family planning policy, Housing on October 31, 2011 by Zuo Shou / 左手

BEIJING, Oct. 30 (Xinhua) — China will adhere to its family planning policy so as to maintain a low reproduction rate, said the country’s family planning chief on Sunday, expected to be the eve of the world’s population reaching seven billion.

“Over-population remains one of the major challenges to social and economic development,” said Li Bin, director of the State Population and Family Planning Commission in an exclusive interview with Xinhua, adding that the population of China will hit 1.45 billion in 2020.

Li said maintaining and improving the existing family planning policy and keeping a low reproduction rate, along with addressing the issues of gender imbalance and an aging population, will be the major tasks in the future.

Li’s words came just one day before Oct. 31, the day on which the United Nations estimates the world’s population will reach seven billion.

Zhai Zhenwu, a leading Chinese demographer, said earlier in the past week that China’s family planning policy had postponed this day for at least five years, as it prevented 400 million people from being added to the country’s population, which is 1.34 billion at present.

“The population of China would have hit 1.7 billion had it not been for the family planning policy, and it would have created more difficulties for society,” said Li.

The most populous nation in the world, China introduced its family planning policy, often referred to as the “one-child policy”, in the late 1970s to curb pressure on the environment and resources.

Li said the policy has made a favorable environment for the country’s economic development and social stability by alleviating demand for fundamentals including education, employment and housing.

Thanks to the policy, China’s average education term has reached nine years and its population’s life expectancy 73.5 years. In addition, maternal mortality rates and infant mortality rates are among the lowest in all developing countries.

China is focusing more on the all-round development and the livelihood of the people. It is a model of poverty relief efforts for developing countries, said Li.

“The Chinese government seriously fulfills the World Population Plan of Action and the Millennium Development Goals set by the United Nations, making positive contributions to the world’s population development,” said Li.

However, Li said that besides overpopulation, China is still facing other population-related challenges, including gender imbalance and an aging population.

For every 100 girls born in 2010, 118 boys were born. And 13.26 percent of China’s population are aged 60 or above. It is expected the ratio will hit one third, or 440 million, by 2050. One fifth of the population will be 80 years of age or older in 2050, according to Li.

Although the average education term has been extended, the rate of higher educated people in the main labor force stands only 12 percent, which still lags far behind the average level in developed countries.

In the meantime, the rate of infant defects in recent years has stood at four percent to six percent, and people with disabilities account for 6.34 percent of the aggregate population, said Li.

“We must stick to the existing policy, raise the quality of the population and optimize its structure, so as to reach the sustainable development of population, society, environment and economy,” Li said…

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“‘Free trade’ imperialism” – Editorial [Workers World]

Posted in Capitalism crisis early 21st century, Colombia, Engels, Marx, Mexico, Panama, south Korea on October 30, 2011 by Zuo Shou / 左手

Oct 23, 2011

That the U.S. Senate took four years to endorse the “free trade” accords between U.S. imperialism and its vassals in Panama, Colombia and south Korea is no sign there was anything good about these agreements for working people in any of the countries.

A Free Trade Act sounds so harmless. It isn’t. It is not an agreement between peoples to work for their mutual benefit. It’s an agreement among the ruling classes in the countries signing the accord to better exploit the laboring masses, that is, the working class and the individual farmers. It enriches the 1 percent — or maybe the 1 percent of that richest 1 percent — who control areas of trade and finance at the expense of everyone else.

The biggest advantage from these agreements usually goes to the ruling class in the imperialist countries, who gain a commanding foothold in the “developing” countries that they never give up.

Some 163 years ago in the Communist Manifesto Karl Marx and Friedrich Engels called attention to the ability of the capitalist ruling class to use the “cheap prices of commodities” they produce with their developed technology as “the heavy artillery with which it batters down all Chinese walls” to penetrate any country.

In the current situation, U.S. agricultural technology — agribusiness — can produce many foodstuffs more cheaply than individual peasant farmers can. That’s one reason the south Korean farmers’ organizations have been fighting against the FTA. They know what happened in Mexico after the North American FTA went into effect in 1994. Within a few years the peasants growing corn in Mexico were undersold by U.S. corn and a million farmers were driven off the land.

Desperate to earn a living, many migrated north despite the dangers of the border, where the Senators who voted for NAFTA and for this new law could then insult them, persecute them and oppress them for daring to cross the border to stay alive.

Under the capitalist system — and especially during a capitalist crisis — these FTAs destroy jobs in both the imperialist and the oppressed countries. They drive workers and peasants to despair while a handful of people grow fabulously rich. They are everything that the occupiers of Wall Street are fighting against. And we join with the Occupy forces here as well as the movements in south Korea, Colombia and Panama that condemn this new round of FTAs.

Solidarity between the workers and farmers of all countries! Down with the FTAs!

Articles copyright 1995-2011 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.

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Goals of US ‘Return-to-Asia’ strategy questioned [People’s Daily]

Posted in Afghanistan, China, Encirclement of China, Hillary Clinton, Iraq, Japan, Pentagon, Philippines, Thailand, US imperialism, USA, World War II on October 30, 2011 by Zuo Shou / 左手

by Zhong Sheng (People’s Daily)

Oct. 18, 2011

Edited and Translated by People’s Daily Online

U.S. Secretary of State Hillary Clinton published an article titled “America’s Pacific Century” in the latest issue of Foreign Policy magazine, in which she has made it clear that the United States will shift its strategic focus to Asia in the future.

Clinton said in the article, “The future of politics will be decided in Asia, not Afghanistan or Iraq, and the United States will be right at the center of the action. One of the most important tasks of American statecraft over the next decade will therefore be to lock in a substantially increased investment — diplomatic, economic, strategic and otherwise — in the Asia-Pacific region”

Clinton’s remarks appear to lack something new. She once proclaimed in Thailand last summer, “The United States is back.” The United States has paid more attention to the Asian-Pacific region than ever, particularly military spending. The “return” of the United States will deeply involve the country in the issues concerning Asia’s politics, economy and security.

“The United States is back” is a famous phrase of Douglas Macarthur. The U.S. general, who once lost to the Japanese army during the Pacific War, said the words to announce the success of the U.S. counterattack when landing the territory of the Philippines again. Today’s Asia is totally different from what it was six decades ago because the United States has neither been defeated by any Asian country nor suffered a loss in Asia [sic]. The United States has achieved enormous returns from Asia’s development over the past two to three decades. Certainly, Asian countries have also benefited greatly from their cooperation with the United States.

Since the United States has never left Asia, why will it need to “return” to Asia? Given rapid economic development of Asian countries over recent years and the gradual formation of a new type of cooperation pattern, the United States is afraid to miss the express train of Asia’s development and accordingly lose its dominance of regional affairs. The U.S. move to “return to Asia” aims to gain more interests from Asia’s regional development and cement its dominant position in Asia. Clinton has got it straight that the United States is willing to continue to get involved and play leading roles.

The United States faces at least two challenges as it “returns” to Asia.

First, it should learn to get along with China. Its “return” to Asia has drawn people’s attention back to a possible confrontation between itself and China. Many Western scholars believe that the reassertion of the leading U.S. role in Asia is directed against China because only China’s rise can pose a potential challenge to its hegemony. Furthermore, a few Asian countries hope to take advantage of the United States, especially its military power, to strike a so-called strategic balance with China. If the United States adopts this mentality in “returning” to Asia, it will face a zero-sum game with China, and will neither benefit from Asia’s development nor play a positive role in promoting th regional security.

Second, a leading role requires more than ambition. The United States’ status in Asia ultimately depends on its input. It should play a more constructive role in promoting the regional economic development and cooperation in multiple fields, instead of expanding its military presence to show off its irreplaceability because it has proven to be a dead end. Certain Asian scholars are worried that once the United States finds itself unable to maintain its leading role, it may extort more money from Asian countries in the name of protection and even stir up trouble by playing dirty tricks.

Asia’s development is an unstoppable trend, and Asian countries will get closer and closer to one another during the process of development. Asia is a big stage and has enough space for the “return” of the United States. In this regard, the superpower’s priority should be putting itself in the right place and working out an appropriate and practical strategy.

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Vast majority of Americans discontented with Wall Street: poll [Xinhua]

Posted in Fraud, USA, Wall Street on October 30, 2011 by Zuo Shou / 左手

WASHINGTON, Oct. 24 (Xinhua) — Vast majority of Americans are dissatisfied with the Wall Street, though split on how they feel about the widespread Occupy Wall Street movement, a new national poll showed Monday.

Eight in 10 of those surveyed say Wall Street bankers are greedy, 77 percent say they’re overpaid, and two-thirds say they are dishonest, according to the CNN/ORC International poll.

The survey also suggested a deterioration of the public opinion toward the nation’s financial center. In the 1990s, only 30 percent of the country said they had no trust at all in Wall Street to do what is best for the economy, 24 percentage points lower than now, it showed.

However, Americans’ anger with the financial sector did not translate into support for the Occupy Wall Street protests, a movement which was initiated in mid-September in New York City and rapidly spread to elsewhere across the country and even overseas.

Four in 10 say they don’t have an opinion about the protests, the survey showed. Among those who have an opinion, 32 percent say they have a favorable view of the movement, while 29 percent say they have an unfavorable view.

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Shadow banking risky [China Daily]

Posted in China, Early 21st Century global capitalist financial crisis' US origins, Economic crisis & decline, Economy, Japan, State-owned Enterprise (SOE), USA on October 30, 2011 by Zuo Shou / 左手

By Zhang Monan (China Daily)

* Stricter supervision of unofficial loan industry is needed to contain its negative effects and maintain financial stability *

The recent disastrous debt crisis that hit Wenzhou city, Zhejiang province, revealed a problem that is deeply rooted in China’s financial market and which challenges its stability. Shadow banking, being outside State supervision, challenges the stability of China’s financial market, because its inverted-pyramid financial structure could collapse at any time if there is a problem with its supporting funds.

Shadow banking has existed for a long time, but it has grown rapidly since the beginning of this year when the State tightened control of financial supply. As the tightening did not change demand, space was left for underground financing to expand. According to Japan-based Nomura Securities, the size of China’s shadow financing could amount to 8.5 trillion yuan ($1.33 trillion). Liu Jigang, a researcher from ANZ bank, estimates it could even be as high as 10 trillion yuan. These estimates may not be accurate, but they nonetheless highlight the problem of shadow banking in China.

Shadow banking originated in the United States, with practitioners indefinitely expanding their credit loans by putting loans into the financial market. But it took a different form in China, where practitioners usually get loans from unofficial financial agencies like private lenders or underground banks. Both are unofficial and unsupervised.

Today shadow banking is already deeply intertwined with the US financial system, and it is now one of the main causes of risks. Credit Default Swaps (CDS) are a typical example, by changing the form of raising funds for mortgages they lowered the costs for house buyers, but introduced more bubbles into the US realty market.

In 1997, the CDS market totaled $180 billion, but it had soared to $6.2 trillion within nine years, accumulating enormous risks in the process, exemplified by the over-trading of CDS. Finally in 2008, with a fall in realty prices, the financial crisis was kindled and swept like wildfire through the US and the whole world.

Despite different practices, China’s shadow banking is nonetheless also potentially dangerous and destructive. For the past 30 years, China has generally maintained a typical indirect bank-led financing system, which owes 80 to 90 percent of funds to banks in the form of loans. Within this relatively stable system, the central bank can estimate the supply of broad money (M2) and decide the size of the each year’s new loans from the GDP growth rate, so as to control the amount of money loaned.

But the situation has changed with deeper financialization of the economy. Various emerging financial tools, such as agencies that raise funds through securities and insurance, have increasingly taken a larger share of the banks’ role in the financial market.

None-bank loans were only 8.7 percent of the total yuan loans in 2002, but had grown to 79.7 percent in 2010. This growth in finance means the loan size is no longer an index of money supply-demand relations.

As shadow banking is not controlled by the State, many banks turn their loans into financial products through trust companies, which invest them in sectors with high returns but also with high risk.

The high returns attract more economic participants and even State-owned enterprises (SOEs) have joined the game. According to the Financial Times, several jumbo SOEs have financial platforms, while 90 percent of all loan-lending enterprises are SOEs.

The shadow banking system now has an estimated annual fund flow of 2 trillion yuan, or 5 percent of China’s GDP. If it continues to grow without control and supervision, China’s financing market will become increasing unstable in the near future, with possibly serious economic and social effects.

To limit the growth of shadow banking, China needs to properly deal with its relations with the official financing system. The urgent mission today is to keep a free flow of social funds within the official financing system, and to implement stricter supervision upon shadow banking, so as to solve the problem without causing grave shocks to the economy.

The author is an economic researcher with the State Information Center.

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