World Perspectives 2017: I. A New Political Phase Has Opened: The Reactionary Offensive of the Ruling Class in the Era of Trumpism

Note of the Editorial Board: The following document is an extensive study of the present state of the world situation and the global class struggle. It contains 9 figures and 4 tables. The figures can only be viewed in the pdf version of the document below for technical reasons.

 

Introduction

 

1.                   The victory of Donald Trump – the arch-reactionary candidate of the right wing of the conservative Republican Party – in the US presidential election has opened a new era both for the US as well as for the world. It qualitatively accelerates the dynamics of all contradictions between the classes as well as between the Great Power. We stand before an intensified reactionary offensive of the ruling class on all continents. The rivalry between the Great Powers – in particular the US, Russia and China – is reaching a new stage. In addition, Trump, Putin and the other rulers will wage new attacks against the oppressed people of the South. These dynamics will provoke new upsurges of mass resistance, both domestically and abroad. In short, the Trump Era will deepen the fundamental instability of the capitalist world order and hasten massive political and economic explosions. History’s pace is accelerating.

2.                   As this reality alters the world political situation, it will also have profound effects on the tasks of socialists in building a new Revolutionary World Party; just as it offers new opportunities, as well as dangers, for the revolutionary struggle. The acceleration of history’s pace also obliges us to accelerate the construction of a strong international revolutionary organization. Any routinism or even cynicism about “yet again” building a new International – so popular among the “radical left” – is nothing but an expression of demoralization and political bankruptcy against which the Bolshevik-Communists of the RCIT will fight with all our strength. Now is the time to energetically tackle the task of building the new Revolutionary World Party!

3.                   In presenting this analysis of the world situation, the RCIT is not only attempting to provide a political compass to all socialists in understanding the present dynamics of the global struggle between the classes and the Great Powers. We also see this document as an important contribution to the extremely urgent discussion among revolutionaries all over the world to formulate the perspectives and the foundation of a new Revolutionary World Party. In the end, our success or failure in building such a world party will determine the fate of humanity!

 

 


I.             A New Political Phase Has Opened: The Reactionary Offensive of the Ruling Class in the Era of Trumpism

 

 

 

4.                   Trump’s victory opens a new political phase. To be more precise, it does not represent a qualitative turn in the preceding political dynamics but rather their acceleration. In past documents the RCIT has repeatedly drawn attention to the reactionary offensive of the ruling class in the face of decaying capitalism. In our last World Perspectives document, we pointed out the reactionary offensive which began to accelerate from 2013/14 and which has, in particular, been manifested in a series of defeats: the aborted Arab Revolution; the ascent of right-wing reactionary forces in Latin America (including the coup d’état in Brazil); and increasing of Islamophobic chauvinism and militarization in Europe.

 

5.                   However, with the outcome of the US presidential election, these trends are now being massively exacerbated. Or, to formulate it in the language of Hegelian dialectics, the plethora of quantitative changes has culminated in a new qualitative change. The election of the most reactionary government in the modern history of the United States – still the most important Great Power on the planet – by definition not only has dramatic consequences for North American but for the entire world.

 

6.                   In particular, Trump’s victory signifies both the official recognition of US imperialism of its loss of status as the hegemonic Great Power, as well as its determination to intensify its rivalry with the other Great Powers. This will have dramatic political and economic consequences. Trump’s announcement of his intention to terminate US involvement in the TPP negotiations – for a “free trade” agreement between the US and a number of Asian and Latin American countries, his determination to renegotiate the NAFTA accord, his threat to scrap the Kyoto Climate Protocol, are all revealing indications of things to come Together they herald the end of the “era of globalization” and the beginning of a period characterized by the formation of open rivalry between the regional imperialist blocs.

 

7.                   Furthermore, the rise of Trump and right-wing, anti-democratic reactionary forces in Latin America, Europe, Central and Eastern Asia and the Arab world reflects the terminal crisis of the capitalist regime of liberal democracy. Faced with accelerating political and social contradictions, capitalism can less and less afford to rely on a “democratic” political superstructure to suppress social unrest and political revolts. As a result, the bourgeoisie is and will continue to turn more and more toward Bonapartist and authoritarian forms of rule. The current period of decaying liberal democracy also results in the deep ideological crisis of present-day capitalism which, on the one hand, propagates reactionary – including fascist – forces but, on the other hand, also paves the road for the advance of revolutionary and anti-capitalist currents.

 

8.                   We can reasonably assume that the already accelerating economic, political and social contradictions of global capitalism will again be severely aggravated by the next Great Recession. While it is not possible to make exact predictions about the concrete forms of such explosions, revolutionaries should prepare for sharp reactions by the ruling classes in all countries in order to deflect the attention of the popular masses. Such reactions can include, but are not limited to, horrible chauvinistic excesses, counterrevolutionary coups, and the escalation of economic wars between the Great Powers. However, such developments also have the potential to provoke revolutionary crises and civil wars pitting the workers and oppressed against the ruling class. In all cases, the next Great Recession will accelerate the ongoing acceleration of capitalism’s contradictions.

 

 

 

Intensification of the Reactionary Offensive on All Continents

 

 

 

9.                   The accelerating reactionary offensives will bear tremendous dangers for the working class and oppressed. These face accelerated austerity offensives with the threat of further cuts in wages and labor rights, an increase of racism, a turn towards Bonapartist rule and dictatorships, as well as more imperialist aggression. In addition to attacks on wages and labor rights throughout the world, the reactionary offensives will in particular impact the workers and oppressed in the coming period in the following way:

 

i)             The ongoing onslaught of reactionary dictatorships against the popular masses in the Middle East. This includes the reactionary advances of Assad and his foreign backers against the Syrian masses (for example the fall of Aleppo); joint efforts by Russian and US imperialism along with Iran, Turkey and others to liquidate the Syrian Revolution with the assistance of their local allies; continuing repression of the popular masses by the military dictatorship in Egypt; ongoing aggression of the reactionary Saudi coalition against the people of Yemen.

 

ii)            The continuing rise of the right-wing forces in Latin America. This has already resulted in the successful coup d’état against Brazil’s popular-front government headed by Dilma Rousseff, while today even more extreme right-wing forces are attempting to undermine the unstable Temer government. Similarly, we are witness to the ongoing efforts of the right-wing opposition to overthrow the Bolivarian government of Maduro in Venezuela.

 

iii)           Massive attacks against workers, migrants and Afro-Americans in the US. Trump’s victory will accelerate the already ongoing attacks of the bosses on wages and labor rights. His incoming administration will also increase the power of the police and other forces of repression towards the nationally oppressed masses – in particularly blacks as well as Latinos, many millions of whom will face the threat of deportation.

 

iv)           The ongoing ascent of right-wing racist forces and state repression in Europe. The bourgeoisie is continuing its efforts to implement its austerity programs – via their lackey governments which include, among the more openly neo-liberals, the “socialist” Hollande government, supported by the so called French “Communist” Party and the FdG, as well as the supposedly “anti-capitalist” SYRIZA government in Greece. Similarly, state repression and militarization is continuing within the EU – mostly directed against migrants and, in particular, the Muslim minority. These reactionary attacks, combined with the betrayal of the official reformist leaderships of the workers’ movement, are resulting in the ascent of extreme right-wing populist and racist forces in nearly all European countries. The victory for Brexit in Britain was a result of this trend.

 

v)            The continuing imperialist military offensive – by the US, Russia, the UK, France and Germany – in the Middle East and North Africa against Islamist-led popular rebellions. The nominees for the key military and security positions in the new Trump administration make clear that this will be an extremely aggressive imperialist regime determined to a “multi-generational world war against Islam.” Related to this, we can expect another wave of refugees fleeing to neighboring countries as well as to Western Europe.

 

vi)           In Asia too, the ruling class is accelerating its anti-social and anti-democratic attacks. India’s right-wing BJP government of Narendra Modi is robbing the workers and poor with its “demonetization” reform and is encouraging the ongoing brutal discrimination of Dalits, women and Muslims. In Thailand, the military dictatorship is whipping up reactionary monarchism and consolidating its regime following the appointment of the new King Rama X. In the Philippines, President Duerte is consolidating his semi-Bonapartist regime by inciting an all-out war against real and alleged drug dealers and addicts. In South Korea, the extreme conservative President Park Geun-hye attempted to impose a pro-business agenda, but has now fallen after a series of corruption scandals and mass protests.

 

vii)          In Africa, we are witnessing the continuing efforts of the imperialist powers to exploit the continent’s workers and natural resources with the assistance of the local governments. Faced with increasing mass protests, various regimes are desperately attempting to retain power. Thus, we see the Ethiopian regime violently suppressing mass demonstrations and declaring a state of emergency. In Gabon, President Ali Bongo could only stay in power by rigging the elections in late August, despite mass protests. Similarly, in the Democratic Republic of Congo, President Joseph Kabila hopes to retain power by postponing this year's scheduled elections to April 2018. In Zimbabwe, the Mugabe government is also trying to hold onto power by suppressing demonstrations. In South Africa too, the corrupt and discredited Zuma government is waging a massive battle to fight popular dissent both on the streets as well as inside the ruling ANC party.

 

viii)        The aggravation of the inter-imperialist rivalry between the Great Powers – in particular of the US against Russia and China. Trump’s victory may result in the short-term closer collaboration of the US with Russia, among other things, to further their joint effort to liquidate the Syrian Revolution. However, it is clear that Trump’s chauvinist and protectionist policies will provoke a further acceleration of the already intensifying rivalry between the Great Powers (the US, EU, Japan, Russia and China), as they will intensify economic and ultimately military warfare against one other. In addition, EU imperialism will be forced to either accelerate integration and become politically and military independent of Washington, or disintegrate.

 

 

 

Workers and Oppressed Fight Back Despite the Chronic Crisis of Leadership

 

 

 

10.                On all continents, workers and the oppressed are resolutely resisting this reactionary offensive of the ruling class. The heroic struggle of the workers and poor in Aleppo – Syria’s Stalingrad; the successful resistance of the Yemeni people against the Saudi aggressors; the mass mobilizations in Morocco after the death of Mouhcine Fikri; the general strikes against the Temer government in Brazil; the mass demonstrations in several Latin American countries to stop the repulsive violence against women; the spontaneous mass demonstrations of the youth and migrants against US president-elect Donald Trump; the struggle of the workers and youth against the reactionary labor laws in France, the massive protests of the Dalit in India; the mass demonstrations against South Korea’s corrupt President Park Geun-hye; the struggles of the workers, the poor and the youth in South Africa as well as in Zimbabwe – all these are ample proof of the unbroken determination of the popular masses to fight back.

 

11.                However, all these mass struggles suffer from a chronic lack of a revolutionary leadership. Instead they are led either by corrupt trade union leaderships and career-obsessed bourgeois politicians or by petty-bourgeois populist, Islamist or nationalist forces that are sincere and dedicated in their convictions but lack a strategy to organize the workers and peasants and to lead them towards victory. This is why the popular masses have suffered so many terrible defeats in the past years.

 

12.                Therefore, the RCIT once again emphasizes that the most important task in the coming period is the overcoming of the crisis of working class leadership by advancing the formation of a revolutionary world party with national sections in all countries. This can only be achieved on the basis of agreement in the analyses of the main features of the present period of capitalism and the programmatic tasks derived from them. Hence, the RCIT calls all revolutionaries who agree on the fundamental features of our analysis and program to join us in driving forward the formation of new World Party.

 

13.                We have stated above that history’s pace has accelerated. However, it is crucial to correctly understand the tempo and the consequential tasks. We have emphasized the reactionary offensive of the ruling class. But this is an offensive resulting from the fundamental crisis and instability of capitalism, i.e., as a result of the weakness and not the strength of the bourgeoisie. It is a reactionary offensive which opens a new phase of class struggle and not one which follows a victorious – from the perspective of the bourgeoisie -- period of struggle. The new phase is – to use an historical analogy – in no way similar to Germany after Hitler’s taking of power in 1933, but rather to Western Europe in the mid-1920s. In short,  the new phase is the end of the beginning of the historic period which opened in 2008, rather than being the beginning of the period’s end.

 

14.                In summary: revolutionaries must be absolutely clear about the character of the present historic period, as well as about the nature of the phase within this period. Since the beginning of the Great Recession in 2008, we have been living in an historic revolutionary period. This is a period characterized by the acute decay of capitalism. In this period, the clashes and struggles being waged along the three fronts of imperialism’s contradictions are unavoidably exacerbated in all regions of the world: (a) the struggle between the bourgeoisie and the world proletariat; (b) the struggle of the Great Powers and monopoly capital against the oppressed people in the South; and (c) the conflicts between the imperialist rivals. These, in turn, will provoke revolutions, counterrevolutions and wars, and offer numerous opportunities (as well as dangers) for the working class to advance in its struggle for liberation. Currently we are living in a phase characterized by the reactionary offensive of the ruling class, one which has already resulted in a number of defeats for the workers and oppressed due to the chronic crisis of revolutionary leadership. However, this reactionary offensive unavoidably provokes new contradictions and new struggles. The new World Party will be forged under the blows of the reactionary offensive of the ruling class. It is towards the workers and oppressed engaged in these struggles that all revolutionary forces must orient all their efforts to build a new Revolutionary World Party.

 

 

 

Notes on the State of the World Economy

 

 

 

15.                The acceleration of the reactionary offensive takes place on the backdrop of the stagnation of the capitalist world economy and the approach of the next Great Recession. Here we will not elaborate an extensive analysis of the world economy, but instead refer readers to our previous documents in which we undertook such a detailed examination. [1] Therefore, here we will limit ourselves to making a few comments. First among them is our observation that the beginning of the next Great Recession is longer in coming than we anticipated in our previous World Perspectives document published a year ago.

 

16.                This is mainly the result of energetic state-capitalist efforts on the part of various imperialist governments. For example, the Chinese regime countered the downturn of its economy by a massive public investment program. According to Professor Zhu Tian from the China-Europe International Business School, state-owned fixed-asset investments annually grew from January to June 2016 by 23.5% over the same period a year earlier, but private fixed asset investment growth had dropped to 2.8% (see Figure 1).

 

 

 

Figure 1. China’s State and Private Investment, % Change Year by Year for 2011-2016 [2]

 

 

 

17.                As an aside we note that the Indian government also launched a significant state-capitalist public investment program which helped to induce short-term accelerated growth in this important semi-colonial country (see Figure 2). [3]

 

Figure 2. India’s Public and Private Investment, % Change Year by Year for 2010-2016 [4]

 

 

18.                Similarly, the European Central Bank (ECB) initiated a massive Quantitative Easing (QE) program hoping to energize the economy. From March 2015 to March 2016, the ECB printed over 700 billion Euros (which is about 5.5% percent of Eurozone’s GDP)! In December 2016, the ECB decided to continue the program until the end of 2017, which involves adding at least another 540 billion Euros as stimulus to the already existing 1.74 billion ($1.87 trillion) effort. [5]

 

19.                However, while these state-capitalist interventions were able to delay the outbreak of the next Great Recession, naturally they cannot undo the decline of the world economy heading for another Great Recession (see Figure 3 and 4). Hence, the IMF concludes in its report for the latest G-20 meeting: “The global outlook remains subdued, with unfavorable longer-term growth dynamics and domestic income disparities adding to the challenges faced by policymakers. Recent developments—including very low inflation, along with slowing investment growth and trade—broadly confirm the modest pace of global activity. The decline in investment, exacerbated by private sector debt overhangs and financial sector balance sheet issues in many countries, low productivity growth trends, and demographic factors weigh on long-term growth prospects, further reducing incentives for investment despite record-low interest rates. A period of low growth that has bypassed many low-income earners has raised anxiety about globalization and worsened the political climate for reform. Downside risks still dominate.” [6]

 

Figure 3. Industrial Production Volume, Annual Growth Rate 2010-2016 [7]

 

Figure 4. World Trade, Industrial Production, and Manufacturing PMI, 2010-2016 [8]

 

 

 

 

20.                As we have repeatedly pointed out, this decline reflects the failure of the monopoly bourgeoisie to overcome the fundamental inner contradictions of the capitalist world economy – its over-accumulation of capital and the fall of the rate of profit. The Marxist economist Michael Roberts, among others, has demonstrated this mechanism in his works. In Figure 5 we see the downward trend of the rate of profit in the U.S. economy.

 

Figure 5. US Corporate Profits (Adjusted for Depreciation), % Change Year by Year [9]

 



[1] On this, see RCIT: Advancing Counterrevolution and Acceleration of Class Contradictions Mark the Opening of a New Political Phase. Theses on the World Situation, the Perspectives for Class Struggle and the Tasks of Revolutionaries (January 2016), Chapter II and III, in: Revolutionary Communism No. 46, http://www.thecommunists.net/theory/world-perspectives-2016/; RCIT: Perspectives for the Class Struggle in Light of the Deepening Crisis in the Imperialist World Economy and Politics. Theses on Recent Major Developments in the World Situation and Perspectives Ahead (January 2015), in: Revolutionary Communism No. 32, http://www.thecommunists.net/theory/world-situation-january-2015/

[2] John Ross: Why Are China and India Growing So Fast? State Investment, 29 August, 2016, http://www.huffingtonpost.com/john_ross-/china-india-growth_b_11655472.html

[3] See on this e.g., Swarajya: Investment Scenario: The Worst May Well Be Over, July 22, 2016, http://swarajyamag.com/economy/investment-scenario-the-worst-may-well-be-over

[4] See on this e.g., Swarajya: Investment Scenario: The Worst May Well Be Over, July 22, 2016, http://swarajyamag.com/economy/investment-scenario-the-worst-may-well-be-over

[5] David McHugh: European Central Bank adds half a trillion euros in stimulus, Associated Press, Dec. 8, 2016, http://hosted2.ap.org/APDEFAULT/f70471f764144b2fab526d39972d37b3/Article_2016-12-08-EU--Europe-Economy/id-dfe53898cf794ba69b66781e0b882212; Vincent Flasseur: GRAPHIC-One year of ECB quantitative easing, 7 March 2016, http://www.reuters.com/article/eurozone-ecb-qe-idUSL5N16F1KH; Tomas Bimbirison: The EU printed €700 billion as a desperate plan to save the economy. It failed. What now? April 27, 2016, http://www.whygofederal.eu/eurozone-quantitative-easing-helicopter-money/

[6] IMF: Global Prospects And Policy Challenges, G-20 Leaders’ Summit September 4–5 Hangzhou, China (2016), p.2

[7] CPB Netherlands Bureau for Economic Policy Analysis: CPB Memo, 25 November 2016, p.5

[8] IMF: World Economic Outlook October 2016. Subdued Demand. Symptoms and Remedies, p. 4

[9] Michael Roberts: Debating the rate of profit, 10 November 2016, https://thenextrecession.wordpress.com/2016/11/10/debating-the-rate-of-profit/