Analyzing Currency Circulation

On May 20, a ceasefire was announced between the Hamas-led government of Gaza and Israel. The truce followed an 11-day pounding of Gaza’s 2 million-plus residents by Israeli bombers and rockets. Residents of Gaza, described as the world’s largest open-air prison, are not allowed to leave. According to Gaza’s Ministry of Health, total deaths among Gaza residents — or perhaps we should say inmates — were at least 248. Of these, 39 were women and 66 were children. An additional 1,910 people were wounded. According to UN officials as a result of the Israeli assault, 800,000 people in Gaza do not have access to clean water. All of this is amid the COVID-19 pandemic, which has swept through Gaza as it has through the rest of the world.

According to the Israeli government, Israeli casualties from rockets fired from Gaza include 12 deaths, of which two were children. Israel is well supplied by the United States with bombers and highly accurate computer-guided missiles, while Gaza residents have only highly inaccurate missiles that can only be shot in the general direction of their targets. In addition, most of the Gazan missiles have been shot down by the Israeli military using the U.S.-provided Iron Dome anti-missile system. As a result, physical damage done to Israel by Gazan missiles has been minimal.

The accuracy of the U.S.-provided bombs and missiles is illustrated by the destruction of a Gaza high-rise that housed both the Al Jazeera news agency and the U.S.-based Associated Press. The Israeli government gave journalists minutes to leave claiming that the building was being used by Hamas, the elected governing party in Gaza. However, AP claimed there was no evidence that Hamas used the building.

What is true is that the high-rise provided an excellent view of Gaza and therefore of the toll the Israeli assault was taking on the besieged city. Perhaps the Israelis were more concerned about Al Jazeera than they were about AP. Still, the attack on the building was a clear attack by the Israeli government on journalists and freedom of the press.

AP was therefore forced to protest. However, the next day AP under right-wing pressure fired an American journalist, Emily Wilder, for pro-Palestinian tweets when she was a college student as if that is a crime. Wilder was active as a college student in the Jewish Voice for Peace and so happens to be Jewish.

She is not alone in the American Jewish community. Increasingly, younger Jews have come to oppose the actions of the Israeli government, which claims to represent all Jews, including those who do not live or wish to live in Israel, but not its Arab citizens. Most of the American Jewish community opposed the administration of Donald Trump, not least because Trump’s racist demagoguery was reminiscent of the ideology that eventually led to the Third Reich in Germany. Indeed, extreme antisemitism is widespread among Trump’s supporters.

This did not prevent Trump from claiming that he was the most pro-Israel president ever. He pointed to his decision to move the U.S. embassy from Tel-Aviv to Jerusalem. The former president when speaking to Jewish-American organizations repeatedly described Israeli Prime Minister Benjamin Netanyahu as “your prime minister,” which drew protests even from docile (to American imperialism) pro-Zionist Jewish organizations. This did not prevent these same organizations from coming out once again in support of the latest Israeli war against the Palestinian people.

Netanyahu and most of the Israeli population, in contrast, strongly supported Trump. The racist rhetoric of the former — and possible future — U.S. president was music to their ears. The latest crisis broke out when the Israeli government moved to evict some four Palestinian families from their East Jerusalem neighborhood of Sheikh Jarrah to make room for Jewish settlers in the historically Arab area. The Zionist propaganda machine claimed that this was a routine eviction case involving the fact that the Arab residents had not paid rent for 39 years to Jewish landlords who the Zionists claim had owned the apartments since the 1870s.

Putting monopoly super-profits over human lives

The 2020 recession was more than the usual cyclical downturn. There were, however, signs a cyclical recession was developing before the COVID-19 pandemic hit with full force in March 2020. Industrial production in most countries had already ceased to rise. The U.S. Federal Reserve System had already initiated an “easing” cycle in an attempt to contain the incipient downturn. That was the situation when it became impossible to deny that the COVID pandemic was rapidly spreading in the United States and around the world.

As the reality of the deadly global pandemic became widely known, the travel, hotel and hospitality industries came to a grinding halt. Many other industries were devastated. As people were forced to hunker down across the globe, both the production of surplus value and its realization were sharply curtailed. As sales of commodities plummeted, the velocity of circulation of the currency dropped drastically. This meant that a given quantity of currency generated far less monetarily effective demand than it would under normal recession conditions.

Eager to get both the production of surplus value and its realization back to normal, capitalist politicians, most notoriously former President Donald Trump, pushed for “reopening” the economy. Trump originally set a target of Easter 2020 for the reopening! So began a cycle of premature “re-openings,” followed by rising COVID cases, hospitalizations, and deaths to new highs leading to renewed, if ever more limited, shutdowns.

Among the countries that dealt with the pandemic the worst was the world’s richest country, the United States. In no other country in the world does the capitalist class have more unbridled power. Business pushed for the fastest reopening possible so that normal profit-making could resume. President Trump was more than willing to oblige since he had planned to pitch his reelection campaign around the theme that the U.S. was experiencing “the greatest economy ever.” Democrats and Republicans competed with one another on who could reopen their state and local economies fastest. As a result, the total number of official U.S. COVID-19 deaths now approaches 600,000. Worldwide, more than 3 million people and rising have died.

Brianna Griffith, writing in the online socialist publication Liberation News, reported: “India, South Africa and 80 other countries proposed a temporary waiver of the Trade-Related Aspects of International Property agreement on patents. The proposal was blocked in February by the United States, European Union, United Kingdom, Japan, and Australia. It is also opposed by the U.S. Chamber of Commerce, Pfizer, BioNTech, Moderna and Johnson & Johnson — key beneficiaries that stand to profit immensely from global suffering.”

So far, the Biden administration, just like its notorious predecessor, prefers to safeguard the monopoly super-profits of big pharmaceutical companies holding the patents on the lifesaving vaccines. The result is that less vaccine is being produced than would be the case without the state-enforced monopolistic profit protection for “Big Pharma,” and the vaccines being produced are selling at prices far above their prices of production.

The greater the price of a vaccine relative to its price of production, the harder it is for governments to find the money to purchase it and the greater the number of preventable deaths and serious illnesses. Naturally, the people of the most exploited countries and classes in the world are hit the hardest. (3 ) Therefore, safeguarding the patents of the drug companies begun under Trump and continuing under Biden is not just a policy of putting profits over people but rather putting super-profits above human lives.

Commodity Money Versus Non-Commodity Money

On March 11, President Joseph Biden signed into law a $1.9 trillion package called the Coronavirus Relief bill. It provides for $300-a-week extra in unemployment insurance payments — only half the original $600 provided by the CARES Act passed last year — and only until Sept. 6. It also provides $25 billion for rental relief and utility assistance and $350 billion relief for hard-pressed state and local and Native American tribal governments.

The bill includes a one-time $1,400 payment for low- and middle-income Americans. Also, $20 billion will be spent on COVID-19 vaccinations. Democrats are especially proud of a provision that extends for a year a child tax credit that was part of the CARES Act. They claim this will reduce child poverty in the richest nation in the world by one-half. This tells you a lot about the nature of the U.S. tax system, which pushes many children of working-class families below the official federal poverty line while allowing billionaires like former President Trump as well as giant corporations like Apple to get away with paying virtually no taxes.

Progressives were hoping that the stimulus bill would have a provision raising the federal minimum wage to $15 an hour from the current $7.25. This was important because the bizarre and undemocratic rules that govern the U.S. Senate mean only a few bills can be passed through a process known as “budgetary reconciliation” with a simple majority vote. All other bills need the support of 60 senators. This means that given the composition of the current Senate, 50 Democrats and 50 Republicans with Democratic Vice President Kamala Harris casting the tie-breaking vote, the GOP has veto power over most other proposed legislation coming up this session.

For the minimum wage hike to have had any chance of passing in the current session, it would have been necessary to include it in the stimulus bill. President Biden gave lip service to the proposed minimum wage hike but failed to push it. This gave the green light to conservative Democrats to ally with the GOP to exclude the $15-an-hour minimum wage from the bill — effectively killing it. This is the exact outcome the capitalists wanted. Once again, the Democrats and Republicans working together delivered the goods for capital.

The Second Trump Impeachment Trial

Former President Donald Trump was acquitted on an insurrection count on Feb. 13 in his second impeachment trial, though 57 senators out of a hundred, including seven Republicans, voted to convict him. However, this was short of the two-thirds’ majority required to convict a federal official or ex-official on an impeachment count.

Senate Republican minority leader Mitch McConnell admitted that, while Trump was guilty, it was unconstitutional for the Senate to try a former official on an impeachment count after the official had left office. This was despite the fact that there was precedent to do so.

In the days leading up to the five-day impeachment trial, Trump had blackmailed the Republicans by threatening to form a new far-right “Patriot Party.” Such a party would split much of Trump’s MAGA base away from the Republicans, which would make many, perhaps most, Republican politicians unelectable.

Besides the acquittal, the trial was notable not only for its brevity — particularly considering the gravity of the count — but by the agreement between the Republicans and Democrats to not call witnesses.

The issue was not simply Trump’s incendiary speech to a MAGA crowd of tens of thousands gathered in front of the White House on Jan. 6. It could be argued that Trump’s speech, however despicable its content, was protected speech under the First Amendment. You can be sure that if a U.S. president can be convicted in an impeachment trial for exercising his right of free speech, Black Lives Matter activists, leftists of all types, trade unionists, and other progressive activists can be convicted at a criminal trial for exercising the same right.

What made Jan. 6 a failed putsch rather than a right-wing demonstration that got out of hand was not the content of Trump’s speech. It was the fact that National Guard and police forces were withheld for hours even though the Pentagon and FBI as well as the police knew that a dangerous armed demonstration was planned. Indeed, Washington, D.C., Mayor Muriel Bowser had specifically requested on Jan. 5 that National Guard forces be called to the capital in case needed to prevent the impending violence.

The Current Industrial Cycle (Pt 3)

A deepening political crisis

On Aug. 23, African-American Jacob Blake was shot in the back by police seven times in Kenosha, Wisconsin. Blake is expected to survive but is paralyzed from the waist down. This latest police outrage triggered a wave of demonstrations by the Black Lives Matter movement in Kenosha and elsewhere. Two days later, a Trump supporter and police wannabe named Kyle Rittenhouse shot to death two Black Lives Matter protesters with a rifle he was carrying. Rittenhouse, who lives in Illinois, is a member of a fascist militia group that came to Kenosha for the announced purpose of defending the property of business owners from Black Lives Matter protesters.

The cops were seen thanking the fascists and offering them water. After Rittenhouse killed the two protesters, he walked up to the cops with his hands up. However, the guardians of “law and order” refused to arrest him. He was finally arrested and charged with murder only after he returned to Illinois. U.S. President Donald Trump then weighed in. Trump defended the young fascist killer claiming that Rittenhouse faced certain death if he had not acted to defend himself. Trump also attacked the alleged violence of “left-wing” — Black Lives Matter — protesters but defended the violence of Rittenhouse and other murderous right-wing counter-protesters.

The Current Industrial Cycle (Pt 1)

COVID-19 devastates the U.S.

It has now become clear that the COVID-19 pandemic has hit the U.S. harder than any other large nation — and most smaller ones. The U.S. ruling class and Trump administration have been particularly enraged by China’s ability to largely check the pandemic. China has had far fewer cases, hospitalizations, and deaths despite its far larger population. Though the U.S. has only about 4 percent of the population it has 25 percent of the world’s COVID-19 cases.

Both Trump and the U.S. ruling class as a whole, including Democratic presumptive nominee Joseph Biden, have stepped up their anti-China propaganda — often combined with old-fashioned red-baiting — on numerous fronts. In Trump’s case, the anti-China attacks have an openly racist character. He regularly refers to COVID-19 as the “Chinese flu” or the even more racist “Kung flu.” This is typical Trump.

Less commented on is the record of Vietnam. Vietnam acted early and effectively in controlling the pandemic, first reported in its northern neighbor late last year. According to the website Exemplars of Global Health, “Although Vietnam reported its first case of COVID-19 on January 23, 2020, it reported only a little more than 300 cases and zero deaths over the following four months.”

Exemplars reports that Vietnam’s “early success has been attributed to several key factors, including a well-developed public health system, a strong central government, and a proactive containment strategy based on comprehensive testing, tracing, and quarantining.” Not mentioned is the fact that none of the factors that have enabled Vietnam to deal so successfully with the COVID pandemic would have been possible without Vietnam’s successful struggle half a century ago against the attempt by U.S. imperialism to destroy it in the name of “fighting communist aggression.” The Southeast Asian country is still struggling with the effects of the infamous “Agent Orange” defoliation program and other effects of the brutal “American war,” as it is called in Vietnam.

The Crisis (Pt 11)

Is capitalism approaching its limits?

In the first years of the 20th century, Rosa Luxemburg expressed great alarm when she discovered that Marx’s formulas of expanded reproduction in Volume II of “Capital” suggested that capitalism can in principle go on forever. These formulas appeared to contradict Marx’s famous Preface in “A Contribution to a Critique of Political Economy.” There Marx wrote: “No social order ever perishes before all the productive forces for which there is room in it have developed [my emphasis — SW] and new, higher relations of production never appear before the material conditions of their existence have matured in the womb of the old society itself.”

If, however, capitalism can engage in expanded reproduction without limit, how can capitalism ever develop all the productive forces “for which it has room”? Didn’t Marx himself mathematically demonstrate that capitalism can develop the productive forces without limit? However, a closer look reveals this apparent contradiction to be an illusion.

In the Volume II formula, the productive forces expanded only quantitatively but not qualitatively. There is no growth in labor productivity or what Marx called the organic composition of capital — the ratio of constant capital, which does not produce surplus value but merely transfers its value to the commodities it helps produce, and variable capital, the sold labor power of the workers, which replaces its value and produces additional surplus value.

It is also assumed that the correct proportions of production, including the correct proportions between Department I, which produces the means of production, and Department II, which produces the means of consumption, are maintained without explaining how they are maintained. And — almost always overlooked — among the correct proportions between the various branches of production that must be maintained is that between the production of money material and all other branches of commodity production.

In reality, the concrete history of capitalism has been marked by growth in labor productivity. The rate at which productivity grows is largely regulated by the competition between the industrial capitalists and the workers. To maximize their profits, the industrial capitalists as the buyers of labor power try to pay the workers the lowest possible wage. The workers as the sellers of labor attempt to get the highest possible wage right up to the mathematical limit where surplus value — and therefore its monetary form, profit — disappears altogether.

If Marx’s formulas show expanded capitalist reproduction running forever, it must be assumed that the quantity of auxiliary materials and the ores out of which money material is produced, and the supply of labor power that produces the means of subsistence for the workers, must be available in infinite quantities. If this is true — which it obviously is not — then the population, including the fraction of the population that consists of workers, can grow to the mathematical limit of infinity and capitalism can indeed go on forever. Otherwise, it can’t.

The Crisis (Pt 9)

After police murder of George Floyd, demonstrations and uprisings sweep U.S.

On June 1, a combined force of military police, park police, and Secret Service brutally cleared an area around the White House of peaceful demonstrators who had been protesting the May 25 murder by Minneapolis police officers of African-American George Floyd. To clear the crowd, these military-police forces used a low-flying helicopter, tear gas, and stun grenades. This was so that President Donald Trump could appear in front of a nearby church Bible in hand.

Trump, who had earlier been sheltering in a special bunker beneath the White House, threatened to invoke the Insurrection Act of 1807, which would permit him to order the military to suppress the massive wave of demonstrations and uprisings that have been sweeping the U.S. since the police murder of Floyd. Trump’s threat to use the military, if carried out, would be a major step towards a military-Bonapartist dictatorship.

Trump’s threats led to a wave of complaints by mostly Democratic politicians and warnings of some retired generals, including Trump’s former Secretary of “Defense” General James “Maddog” Mattis, not to use the military against peaceful demonstrators. Republican leaders, with a few exceptions, either supported Trump or maintained an icy silence.

Political and Economic Crises (Pt 15)

Trump orders assassination of top Iranian general

On Jan. 2, 2020, Donald Trump ordered a drone strike that the next day assassinated among others General Qassem Soleimani, considered Iran’s leading general and one of the most powerful and popular leaders of the Islamic Republic. Soleimani was killed at the Baghdad airport while on a diplomatic mission aimed at improving relations among Iran on one side and Saudi Arabia and the United States on the other. The murder of such an important military and political leader while on a peaceful diplomatic mission has few if any precedents in the history of diplomatic relations stretching back over thousands of years. Rather, Trump’s action is straight out of the history of the 20th-century New York mob.

This has brought the U.S. to the brink of full-scale military war with Iran, and frankly, as I write these lines it is hard to see how this war can be avoided. The U.S. is already at war with Iran in the economic and political sense. Iraq’s Parliament has now demanded that the U.S. withdraw its 5,000 troops in the country, which are supposedly there to fight ISIS, though the U.S. has announced it has now “suspended” its war with ISIS.

Trump responded by saying he will refuse this demand unless Iraq repays the U.S. for the “aid” it has given Iraq and threatened Iraq with vicious sanctions if it does not withdraw the demand. For its part, Iran has announced it is finally pulling out of the nuclear accord it signed under Obama that exchanged intrusive inspections for promises by the U.S. and its imperialist satellites to relax economic sanctions — dial back economic warfare. These events have raised the chilling possibility that the year 2020 could be for this century what 1914 was to the last.

Trump’s action should remove the illusions shared apparently by the government of Russia and even a few progressives that, however racist and reactionary he is, in other ways Trump is part of some right-wing “isolationist” anti-war tradition that opposes the “Wilsonian” imperialism that has long dominated the Democratic Party, and since at least 1940 the Republican Party as well. In reality, Trump’s economic and political nationalism has always pointed in the direction of war, not peace, whether Trump personally wants war or not. History shows that the beginning of a major war brings with it a “rallying around the commander in chief.” Such an effect could considerably increase Trump’s chances of reelection. True, as the experience of many countries shows, as wars drag on public support for the war and the government turns into its opposite. But by then, Trump may be thinking, the election of 2020 will be far behind him.

In general, there seems to be an unofficial rule that U.S. presidents don’t start major military campaigns in election years. Otherwise, every president facing dubious reelection prospects would be tempted to start a war. But Trump’s Bonapartist and autocratic tendencies mean that he does not feel bound by such a rule, any more than he feels bound by the rule that the president should not criticize the Federal Reserve System.

However, while Trump’s unstable personality and autocratic tendencies are extremely dangerous factors in the current crisis, it is not the main factor behind the current war danger. The roots of the current war crisis can be traced back to George W. Bush’s decision to invade Iraq — supported by Democratic Senators Hillary Clinton and Joseph Biden — on March 19, 2003. The Bush administration intended to create a new Iraqi puppet government that would provide a thin veneer over what would amount to U.S. colonial control of Iraq.

Political and Economic Crises (Pt 13)

Trump faces impeachment

On Oct. 31, 2019, the U.S. House of Representatives passed a resolution by a vote of 232 to 196 that established procedures for the ongoing impeachment inquiry into President Donald Trump. No articles of impeachment — equivalent to counts in a criminal case — have been passed or even drawn up against Trump. The resolution only establishes the technical procedures under which the impeachment probe in the House will proceed.

The vote was almost entirely along party lines. Two Democrats who come from districts that went for Trump in 2016 voted against the proposed procedures. One congressman, who was until recently a right-wing Republican but is now strongly anti-Trump and calls himself an independent, voted for the resolution.

The vote indicates that Trump will probably be impeached in the House. It is possible that new revelations about Trump’s conduct in office could cause — or provide a pretext for — the Republicans to turn on Trump, forcing him to resign or be removed by a vote of two-thirds of the Senate. This is what happened in August 1974 during the Nixon impeachment crisis. But at this time it appears a long shot. Assuming that Trump is acquitted as expected in a Senate trial, he will be in office until Jan. 20, 2020 — or until Jan. 20, 2024, if he wins a second term.