Japan's Prime Minister Shinzo Abe is expected to pledge more than $14bn (£8.5bn) in aid and trade deals during his week-long visit to Africa.
He is also hoping to secure energy resources and increase exports.
Mr Abe's first stop is Oman, before he visits three fast-growing economies - Ethiopia, Ivory Coast and Mozambique.
BBC Africa Business Report's Lerato Mbele says the visit is seen as a step by Japan to compete with China, in the new scramble for African resources.
In Ethiopia, he is to announce plans for a geo-thermal plant, which reinforces the country's growing renewable energy profile.
Mozambique recently made huge gas and coal discoveries and Japan is one of many investors scouting deals there.
Although Ivory Coast is recovering after the end of a long period of conflict and political instability, it provides a gateway into French-speaking Africa, a region that's still relatively untapped by most foreign players.
Our reporter says the backdrop to this visit, is of course China, which has become the largest investor in Africa, with five times as much trade with the continent as the Japanese.
In the past week, China's foreign minister has also been visiting the continent to reinforce diplomatic and economic ties.
But one of Mr Abe's senior officials, Hiroshigo Seko, sought to downplay the rivalry in an interview with the AP news agency
"Wherever he goes, Prime Minister Abe is asked if he is there to compete against China, but that's not our intention at all, as far as the African nations are concerned, they are important regardless of China," he said.
Last year, Mr Abe hosted a three-day conference on African development, at which he pledged $32bn (£21bn) in aid, including money to tackle militant Islamists.
At the time, he said that African countries would be at the centre of global economic growth in the coming years and so Japan should increase its economic ties to the continent.
Source: BBC
Showing posts with label Economic Change. Show all posts
Showing posts with label Economic Change. Show all posts
Thursday, January 9, 2014
Thursday, August 30, 2012
Poverty now a crisis in the first world: Motlanthe
The adverse impact of capitalism on social and economic growth requires a mind shift in socialism, Deputy President Kgalema Motlanthe said today.
"The global crisis of capitalism and imperialism, which is negatively affecting growth, widening social inequality, increasing levels of poverty and worsening [un]employment figures, needs a sharpened, radical shift in the approach the Socialist International takes," he said in Cape Town.
Speaking at the opening of the 24th Congress of the Socialist International (SI), he said debates had to focus on the reform of the organisation. Poverty was no longer just a problem for developing nations, but also now becoming a crisis in the first world. "Therefore this leaves us with no choice but to review, analyse and rethink the impact of the global economic crisis on society and the toiling masses of the world." He said there were various concerns sociality parties needed to confront. These included a need to strive for conflict resolution, while securing conditions of development.
Motlanthe's sentiments were echoed by the SI's president and former Greek prime minister George Papandreou. Innovative and alternative solutions were needed in a changing world, he said. "This human ingenuity needs to be accompanied by political and democratic will to make these changes... That will, my friends, has been lacking in Europe and around the world."
Papandreou defended the SI's existence, saying leftist parties were important to achieve, among others, peace, justice, good governance, equality, growth and employment for all. He warned against attributing blame for the global economic crisis. "We point fingers at each other rather than reach out our hands and lift each other up."
Papandreou lamented the fact that immigrants were being held responsible for the economic troubles in several countries. He said international co-ordination was needed now more than ever. "We've seen this spectacular rise in nationalism over the years, and at the same time we've noticed a terrifying rise in racism, prejudice."
Source: Times Live
"The global crisis of capitalism and imperialism, which is negatively affecting growth, widening social inequality, increasing levels of poverty and worsening [un]employment figures, needs a sharpened, radical shift in the approach the Socialist International takes," he said in Cape Town.
Speaking at the opening of the 24th Congress of the Socialist International (SI), he said debates had to focus on the reform of the organisation. Poverty was no longer just a problem for developing nations, but also now becoming a crisis in the first world. "Therefore this leaves us with no choice but to review, analyse and rethink the impact of the global economic crisis on society and the toiling masses of the world." He said there were various concerns sociality parties needed to confront. These included a need to strive for conflict resolution, while securing conditions of development.
Motlanthe's sentiments were echoed by the SI's president and former Greek prime minister George Papandreou. Innovative and alternative solutions were needed in a changing world, he said. "This human ingenuity needs to be accompanied by political and democratic will to make these changes... That will, my friends, has been lacking in Europe and around the world."
Papandreou defended the SI's existence, saying leftist parties were important to achieve, among others, peace, justice, good governance, equality, growth and employment for all. He warned against attributing blame for the global economic crisis. "We point fingers at each other rather than reach out our hands and lift each other up."
Papandreou lamented the fact that immigrants were being held responsible for the economic troubles in several countries. He said international co-ordination was needed now more than ever. "We've seen this spectacular rise in nationalism over the years, and at the same time we've noticed a terrifying rise in racism, prejudice."
Source: Times Live
Wednesday, August 22, 2012
'We've failed to rebuild economy'
ANC secretary-general Gwede Mantashe admitted that the party had failed to negotiate a better deal when the party ascended to power in 1994.
He was speaking at a meeting at the University of Johannesburg (Soweto campus) attended by academics, businesspeople and civil society to discuss the outcomes of the ANC policy conference that was held in June.
He said the economic transformation backlog would be dealt with through the adoption of radical policies later this year.
"We don't think we were very strong on the economic aspect. We thought when we acquired power we would use it to change the economic terrain. We are in a continuation from apartheid to national democratic society. We need a radical shift in policy to realise economic transformation," Mantashe said.
Thirteen draft policy documents emanating from that conference will be discussed further and adopted in Mangaung in December.
Mantashe said the party regrets some flaws such as how the SA Reserve Bank had been made more independent than it was in 1994 and how the government had allowed private shareholding among other things.
"We must make a bold statement that we will attend to that backlog on economic transformation," he said, referring to the Strategy and Tactics document, which charts the way forward for achieving a "national democratic revolution".
The document was criticised as lacking depth by some analysts yesterday, who also felt there was a broad understanding of the term "revolution" and that this needed to be simplified.
Mantashe also hit out at the tender system, saying the state needed to have its own capacity to do basic things. He highlighted the unintended consequences of Black Economic Empowerment (BEE), which had so far failed to transform the economy. Such failures, including rampant poverty, inequality and unemployment, had prompted the debate on the new phase of the national democratic revolution.
Xolani Qubeka, CEO of the Black Business Forum, agreed with Mantashe, saying the BEE policy "lacked teeth". He further criticised many government interventions, saying they were more focused on compliance than driving economic transformation.
Another professional from the banking sector lamented that the term "BEE" had become a swearword used by people only when it suited them.
With just four months to go before Mangaung, Mantashe said the dynamics in the ruling party had changed, as it was currently marred by "negative tendencies".
"Today we must deal with the reality of corruption," he said, comparing the current situation with taking a mouse to a cheese factory. But he played down factionalism within the the party.
"I don't think the fact that people have different views means the organisation is stagnant," he said.
Source: Sowetan
He was speaking at a meeting at the University of Johannesburg (Soweto campus) attended by academics, businesspeople and civil society to discuss the outcomes of the ANC policy conference that was held in June.
He said the economic transformation backlog would be dealt with through the adoption of radical policies later this year.
"We don't think we were very strong on the economic aspect. We thought when we acquired power we would use it to change the economic terrain. We are in a continuation from apartheid to national democratic society. We need a radical shift in policy to realise economic transformation," Mantashe said.
Thirteen draft policy documents emanating from that conference will be discussed further and adopted in Mangaung in December.
Mantashe said the party regrets some flaws such as how the SA Reserve Bank had been made more independent than it was in 1994 and how the government had allowed private shareholding among other things.
"We must make a bold statement that we will attend to that backlog on economic transformation," he said, referring to the Strategy and Tactics document, which charts the way forward for achieving a "national democratic revolution".
The document was criticised as lacking depth by some analysts yesterday, who also felt there was a broad understanding of the term "revolution" and that this needed to be simplified.
Mantashe also hit out at the tender system, saying the state needed to have its own capacity to do basic things. He highlighted the unintended consequences of Black Economic Empowerment (BEE), which had so far failed to transform the economy. Such failures, including rampant poverty, inequality and unemployment, had prompted the debate on the new phase of the national democratic revolution.
Xolani Qubeka, CEO of the Black Business Forum, agreed with Mantashe, saying the BEE policy "lacked teeth". He further criticised many government interventions, saying they were more focused on compliance than driving economic transformation.
Another professional from the banking sector lamented that the term "BEE" had become a swearword used by people only when it suited them.
With just four months to go before Mangaung, Mantashe said the dynamics in the ruling party had changed, as it was currently marred by "negative tendencies".
"Today we must deal with the reality of corruption," he said, comparing the current situation with taking a mouse to a cheese factory. But he played down factionalism within the the party.
"I don't think the fact that people have different views means the organisation is stagnant," he said.
Source: Sowetan
Thursday, August 16, 2012
Just what SA needs
THE National Plan for South Africa is out! It is comprehensive, ambitious and laudable. It has the elements required to move the country forward. Unveiling the plan in Parliament yesterday National Planning Minister Trevor Manuel mentioned many things contained in the plan. Some sounded pretty obvious. But the important one is that the plan goes beyond the rhetoric. It sets targets. It suggest ways to meet targets on, among other things, jobs, growth, literacy and poverty.
Manuel and members of the National Planning Commission have done a wonderful job, putting together the plan. They would not have been able to had they not been honest about the problems we face as a nation.
The plan is based on six pillars. But it will not work if it does not get a buy-in from the government that established the planning commission. Of course, some of the suggestions will not sit well with those in government who have privatised public policy-making. They are now required to set their sights on the targets for the benefit of the country and not themselves.
The plan will not implement itself. The government will not do it alone. Nor will business, civil society and labour. What is required - and this is the most important pillar of the six - is active citizenship. Citizens must be responsible for their own progress and for that of the country. Otherwise the plan will be meaningless.
Source: The Sowetan
Manuel and members of the National Planning Commission have done a wonderful job, putting together the plan. They would not have been able to had they not been honest about the problems we face as a nation.
The plan is based on six pillars. But it will not work if it does not get a buy-in from the government that established the planning commission. Of course, some of the suggestions will not sit well with those in government who have privatised public policy-making. They are now required to set their sights on the targets for the benefit of the country and not themselves.
The plan will not implement itself. The government will not do it alone. Nor will business, civil society and labour. What is required - and this is the most important pillar of the six - is active citizenship. Citizens must be responsible for their own progress and for that of the country. Otherwise the plan will be meaningless.
Source: The Sowetan
Sunday, December 11, 2011
Durban and the search for climate justice
The COP17/CMP7 summit in Durban which concluded on 11 December reached decisions that can move us towards a legally binding agreement to halt and reverse the path we are currently taking towards catastrophic climate change, but the hopes for a substantial deal on emissions reductions have not been realised. The international community must find an accord with the ambition to limit the global temperature rise to a maximum of 2°C or 1.5°C above pre-industrial levels, which remains the only possible solution to the dangers faced by the world.
In establishing the Ad Hoc Working Group on the Durban Platform for Enhanced Action, the conference rightly concluded that any future agreement on climate change must be legally binding, referred to officially as "an agreed outcome with legal force". It is now more vital than ever that negotiations continue without delay and in a spirit of compromise and understanding in order to make these goals a reality, as the cost of postponing such an agreement grows with every passing year.
With Durban, the framework is also now in place for the operation of the Green Climate Fund with the approval of its Governing Instrument, although long-term sources of financing for the Fund have yet to be finalised. The decision launching the Fund addresses the need to balance the allocation of resources between adaptation and mitigation activities, which is in line with the Socialist International’s call in Johannesburg at the end of October this year.
A positive step is also the commitment that a mechanism for technology transfer will be fully operational by 2012 to "promote and enhance the research, development, and deployment and diffusion of environmentally sound technologies for mitigation and adaptation in developing countries".
We congratulate the South African hosts for showing the leadership and perseverance to obtain these and other agreements, but we are under no illusions that there is much hard work ahead of us all.
It must be acknowledged at the same time that some of the commitments we were hoping to see in Durban on deepening and formalising pledged cuts in emissions, as outlined in the declaration of the Socialist International made in Johannesburg, have not been achieved. Equally, much progress needs to be made on policies for the protection of forests, developing renewable technologies and establishing systems for measurement, reporting and verification, and the decisions reached lack the necessary urgency to effectively address the case of the Small Island Developing States (SIDS).
The international community must persevere within the framework of the UNFCCC to come together in a common search for solutions to the greatest threat that currently faces the planet. Multilateralism continues to be the only way forward, with the vast majority of the nations on the planet wishing to see political will match the scientific requirements and no longer willing to accept ‘pledge and review’, with the direct involvement of political leaders in the process crucial to deliver the responses needed.
The Socialist International will continue to place the issue of climate change at the heart of its agenda, starting with the forthcoming Council meeting to take place in San José, Costa Rica in January 2012 and continuing with the work and activities of its Commission for a Sustainable World Society as we head towards Rio+20, COP18 and beyond.
Source: Socialist International
In establishing the Ad Hoc Working Group on the Durban Platform for Enhanced Action, the conference rightly concluded that any future agreement on climate change must be legally binding, referred to officially as "an agreed outcome with legal force". It is now more vital than ever that negotiations continue without delay and in a spirit of compromise and understanding in order to make these goals a reality, as the cost of postponing such an agreement grows with every passing year.
With Durban, the framework is also now in place for the operation of the Green Climate Fund with the approval of its Governing Instrument, although long-term sources of financing for the Fund have yet to be finalised. The decision launching the Fund addresses the need to balance the allocation of resources between adaptation and mitigation activities, which is in line with the Socialist International’s call in Johannesburg at the end of October this year.
A positive step is also the commitment that a mechanism for technology transfer will be fully operational by 2012 to "promote and enhance the research, development, and deployment and diffusion of environmentally sound technologies for mitigation and adaptation in developing countries".
We congratulate the South African hosts for showing the leadership and perseverance to obtain these and other agreements, but we are under no illusions that there is much hard work ahead of us all.
It must be acknowledged at the same time that some of the commitments we were hoping to see in Durban on deepening and formalising pledged cuts in emissions, as outlined in the declaration of the Socialist International made in Johannesburg, have not been achieved. Equally, much progress needs to be made on policies for the protection of forests, developing renewable technologies and establishing systems for measurement, reporting and verification, and the decisions reached lack the necessary urgency to effectively address the case of the Small Island Developing States (SIDS).
The international community must persevere within the framework of the UNFCCC to come together in a common search for solutions to the greatest threat that currently faces the planet. Multilateralism continues to be the only way forward, with the vast majority of the nations on the planet wishing to see political will match the scientific requirements and no longer willing to accept ‘pledge and review’, with the direct involvement of political leaders in the process crucial to deliver the responses needed.
The Socialist International will continue to place the issue of climate change at the heart of its agenda, starting with the forthcoming Council meeting to take place in San José, Costa Rica in January 2012 and continuing with the work and activities of its Commission for a Sustainable World Society as we head towards Rio+20, COP18 and beyond.
Source: Socialist International
Tuesday, September 14, 2010
Constructing a democratic developmental state in South Africa
The social and economic successes of Asia have drawn global attention to the developmental state as a possible model for developing countries. In South Africa, many, including government, see this as a possible panacea to the country's social, economic and institutional crises. However, a government committing itself to constructing a developmental state is one thing; actually implementing the necessary institutional and policy reforms to bring that into reality is another.
In this seminal collection, an interdisciplinary team of distinguished scholars examine how South Africa could go about building a democratic developmental state, while drawing on relevant conceptual models and useful comparative experiences from other countries. The macro- and microeconomic questions, as well as the institutional, governance and social challenges facing South Africa are lucidly analysed, as are the country's advantages; such as its existing constitutional democracy, rents from its mineral resources and the commitment of its political leadership to creating a democratic developmental state.
Providing an eloquent and intelligent account of what the state's primary goals should be at this point, the contributors make the case that for South Africa to become a developmental state that is both democratic and socially inclusive, economic and social policy have to be intertwined; development and democratic agendas have to be mutually reinforcing; and a competent bureaucracy needs to be built to enhance state capacity.
An authoritative and comprehensive study that illuminates the political economy of economic development, this work is invaluable for anyone interested in the political and economic future of South Africa and similar developing countries.
Source: HSRC
In this seminal collection, an interdisciplinary team of distinguished scholars examine how South Africa could go about building a democratic developmental state, while drawing on relevant conceptual models and useful comparative experiences from other countries. The macro- and microeconomic questions, as well as the institutional, governance and social challenges facing South Africa are lucidly analysed, as are the country's advantages; such as its existing constitutional democracy, rents from its mineral resources and the commitment of its political leadership to creating a democratic developmental state.
Providing an eloquent and intelligent account of what the state's primary goals should be at this point, the contributors make the case that for South Africa to become a developmental state that is both democratic and socially inclusive, economic and social policy have to be intertwined; development and democratic agendas have to be mutually reinforcing; and a competent bureaucracy needs to be built to enhance state capacity.
An authoritative and comprehensive study that illuminates the political economy of economic development, this work is invaluable for anyone interested in the political and economic future of South Africa and similar developing countries.
Source: HSRC
Thursday, August 6, 2009
Zuma: R2,4bn for job fund to help weather recession
An amount of R2,4-billion will be placed in the national job fund to help employers and workers weather South Africa's financial recession, President Jacob Zuma said on Wednesday.
After a meeting with the economic crisis response team, Zuma said the resources would be drawn from the national skills fund and the unemployment insurance fund. "This fund will be used to pay a training allowance to workers pegged at 50% of the basic wage or salary to a maximum of R6 239 a month," Zuma said. "It will be launched in September 2009 and will be applicable to workers in defined circumstances earning up to R180 000 per annum," said Zuma.
Economic Development Minister Ebrahim Patel said volumes of applications would be administered by the Commission for Conciliation, Mediation and Arbitration. The government would also encourage training in the fields of information communication and technology, as well as basic literacy and numeracy. The exact module was yet to be defined, however the maximum period for a training lay-off would be capped at three months.
Source: Mail & Guardian
After a meeting with the economic crisis response team, Zuma said the resources would be drawn from the national skills fund and the unemployment insurance fund. "This fund will be used to pay a training allowance to workers pegged at 50% of the basic wage or salary to a maximum of R6 239 a month," Zuma said. "It will be launched in September 2009 and will be applicable to workers in defined circumstances earning up to R180 000 per annum," said Zuma.
Economic Development Minister Ebrahim Patel said volumes of applications would be administered by the Commission for Conciliation, Mediation and Arbitration. The government would also encourage training in the fields of information communication and technology, as well as basic literacy and numeracy. The exact module was yet to be defined, however the maximum period for a training lay-off would be capped at three months.
Source: Mail & Guardian
Saturday, August 1, 2009
Land reform's middle ground
When President Jacob Zuma announced his new Cabinet on May 10, he ushered in a new era for the state's apparatus charged with responding to rural poverty: political and bureaucratic responsibilities for land reform, fisheries, forestry and agricultural development have been reshuffled, and are now clustered into an array of new and renamed ministries and departments. Zuma presented this reshuffling as a sign that his administration will embark on a re-energised initiative for rural development, in line with the ANC's manifesto for the 2009 national elections which featured "Rural development, food security and land reform" as one of its top five priorities.
This signals a new commitment from a party which has historically relied on an urban support base of the working class and unemployed and has de-emphasised, if not quite ignored, the spatial legacy of apartheid and the concentration of poverty in the rural areas. For the future of the rural areas, the most significant changes in the new Cabinet are the separation of land and agriculture, and the introduction of rural development as a ministerial mandate. The new-look cabinet places these responsibilities in separate ministries: a Ministry of Rural Development and Land Reform (MRDLR) on the one hand, and a Ministry of Agriculture, Forestry and Fisheries (MAFF) on the other. Both are to be headed by former MECs for Agriculture: Gugile Nkwinti from the Eastern Cape, and the Northern Cape's Tina Joemat-Petterson, respectively. But key decisions about government's plans for the rural areas are likely to be taken elsewhere. At the heart of the new administration's thinking on the future of the economy is a heavyweight triumvirate made up of the National Treasury headed by Pravin Gordhan, a Ministry of Economic Development under former unionist Ebrahim Patel, and a National Planning Commission in the Presidency led by Trevor Manuel.
The core challenge is to enable large numbers of the rural poor to participate in economic activities -- to produce, process and market -- on beneficial terms in order to enable employment (including self-employment) for the rural poor, not only welfare. This would reduce rural poverty and create new livelihoods and jobs, but also set South Africa on a different and more appropriate growth path.The central position that rural development now occupies in the thinking of government draws attention to the multidimensional nature of rural people's livelihoods -- a recognition that land reform cannot be entirely about agriculture, that people want and need land for a variety of purposes, and that rural people participate in a variety of economic activities for their survival.
The new political priority placed on rural development is a great opportunity and new approaches are urgently needed. Rural development must not be limited to ad hoc and localised "projects". A new policy framework must set out an ambitious agenda for structural change in the key rural economic sectors. It must change the ways in which the poor participate in, own, control, use, and produce in the rural economy and enable new pathways of production and accumulation.
Source: Mail & Guardian
This signals a new commitment from a party which has historically relied on an urban support base of the working class and unemployed and has de-emphasised, if not quite ignored, the spatial legacy of apartheid and the concentration of poverty in the rural areas. For the future of the rural areas, the most significant changes in the new Cabinet are the separation of land and agriculture, and the introduction of rural development as a ministerial mandate. The new-look cabinet places these responsibilities in separate ministries: a Ministry of Rural Development and Land Reform (MRDLR) on the one hand, and a Ministry of Agriculture, Forestry and Fisheries (MAFF) on the other. Both are to be headed by former MECs for Agriculture: Gugile Nkwinti from the Eastern Cape, and the Northern Cape's Tina Joemat-Petterson, respectively. But key decisions about government's plans for the rural areas are likely to be taken elsewhere. At the heart of the new administration's thinking on the future of the economy is a heavyweight triumvirate made up of the National Treasury headed by Pravin Gordhan, a Ministry of Economic Development under former unionist Ebrahim Patel, and a National Planning Commission in the Presidency led by Trevor Manuel.
The core challenge is to enable large numbers of the rural poor to participate in economic activities -- to produce, process and market -- on beneficial terms in order to enable employment (including self-employment) for the rural poor, not only welfare. This would reduce rural poverty and create new livelihoods and jobs, but also set South Africa on a different and more appropriate growth path.The central position that rural development now occupies in the thinking of government draws attention to the multidimensional nature of rural people's livelihoods -- a recognition that land reform cannot be entirely about agriculture, that people want and need land for a variety of purposes, and that rural people participate in a variety of economic activities for their survival.
The new political priority placed on rural development is a great opportunity and new approaches are urgently needed. Rural development must not be limited to ad hoc and localised "projects". A new policy framework must set out an ambitious agenda for structural change in the key rural economic sectors. It must change the ways in which the poor participate in, own, control, use, and produce in the rural economy and enable new pathways of production and accumulation.
Source: Mail & Guardian
Wednesday, May 20, 2009
China Working on Further National Plan to Address Climate Change: Official
A senior Chinese official told Xinhua Tuesday that the country is working on a national plan to further cope with the issue of climate change.
"We are working on a further national plan based on a longer term in a bid to strengthen the enforcement of international treaties about the issue," Xie said.
The plan is aimed to better tackle the climate change and boost economic growth in the meantime, Xie added.
The Chinese chief climate negotiator did not elaborate the plan, only saying that the country eyes on accumulating useful experiences to establish a low-carbon economy through some pilot projects.
In 2007, a national leading group on climate change, headed by Premier Wen Jiabao, was set up to oversee the issues related to climate change.
In the same year, the Chinese government issued the National Climate Change Program, the first of its kind issued by a developing country, which worked out the strategies and measures to tackle climate change.
China's "green" determination has been boosted by the country's achievements in its environmental initiatives. Figures show China's energy consumption per unit of GDP dropped 4.59 percent in 2008, and 10.08 percent from 2006 to 2008.
Source: China Radio International
"We are working on a further national plan based on a longer term in a bid to strengthen the enforcement of international treaties about the issue," Xie said.
The plan is aimed to better tackle the climate change and boost economic growth in the meantime, Xie added.
The Chinese chief climate negotiator did not elaborate the plan, only saying that the country eyes on accumulating useful experiences to establish a low-carbon economy through some pilot projects.
In 2007, a national leading group on climate change, headed by Premier Wen Jiabao, was set up to oversee the issues related to climate change.
In the same year, the Chinese government issued the National Climate Change Program, the first of its kind issued by a developing country, which worked out the strategies and measures to tackle climate change.
China's "green" determination has been boosted by the country's achievements in its environmental initiatives. Figures show China's energy consumption per unit of GDP dropped 4.59 percent in 2008, and 10.08 percent from 2006 to 2008.
Source: China Radio International
Renewables Surge Despite Economic Crisis
The 2008 figures are in from the new REN 21 Renewables Global Status Report: Renewable power capacity (excluding large hydropower) increased a hefty 16 percent last year, which is remarkable given that world oil use actually declined. Growth in some renewable sectors was even more impressive. Biodiesel production increased 34 percent, and solar power took the prize with a 73 percent jump.
Source: Worldwatch Institute
Source: Worldwatch Institute
Sharp fall in exports from China
China's exports in April were down 22.6% from a year ago, the sixth successive month of decline.
April's fall in exports was also bigger than the 17.1% annual decline recorded in March.But other data released on Tuesday suggest that Chinese government efforts to stimulate the economy are pushing up investment levels in the country.
Analysts remain optimistic that China will be the first to make its way out of recession.For those Chinese factory owners who send most of their products abroad, there is little relief in these latest trade figures.Some had hoped the worst was over for exporters, but the 22.6% fall was greater than many analysts had expected.
On the other hand, investment in industrial plants and property in cities was 30% higher in the first four months of the year than it had been in the same period of 2008.
Source: BBC
April's fall in exports was also bigger than the 17.1% annual decline recorded in March.But other data released on Tuesday suggest that Chinese government efforts to stimulate the economy are pushing up investment levels in the country.
Analysts remain optimistic that China will be the first to make its way out of recession.For those Chinese factory owners who send most of their products abroad, there is little relief in these latest trade figures.Some had hoped the worst was over for exporters, but the 22.6% fall was greater than many analysts had expected.
On the other hand, investment in industrial plants and property in cities was 30% higher in the first four months of the year than it had been in the same period of 2008.
Source: BBC
Tuesday, May 19, 2009
Chinese culture to shine in Africa
Chinese culture will be transplanted to South Africa thanks to a $250 million theme-park-with-a-difference being built by local company Huaqiang Holdings.
Fantawild Adventure, the 770,000 sq m high-tech facility destined for Johannesburg was among major successes announced during the four-day China (Shenzhen) International Cultural Industries Fair that closed yesterday with a record-high accumulative contract volume of 87.7 billion yuan.
"The park will be the first major technology-driven cultural theme park in Southern Africa," said Cassim Nakkooda, director of trade and investment promotion for the city of Johannesburg.
"It will not only give citizens of South Africa a chance to better understand Chinese culture, but also serve the interests of other African countries."
Source: China View
Fantawild Adventure, the 770,000 sq m high-tech facility destined for Johannesburg was among major successes announced during the four-day China (Shenzhen) International Cultural Industries Fair that closed yesterday with a record-high accumulative contract volume of 87.7 billion yuan.
"The park will be the first major technology-driven cultural theme park in Southern Africa," said Cassim Nakkooda, director of trade and investment promotion for the city of Johannesburg.
"It will not only give citizens of South Africa a chance to better understand Chinese culture, but also serve the interests of other African countries."
Source: China View
Monday, March 23, 2009
Calling all refugees
Government officials have slammed Bishop Paul Verryn for offering refuge to thousands of Zimbabweans in and around Jo'burg's Central Methodist Church.
"If a man shuts his ears to the cry of the poor, he too will cry out and not be answered" (Proverbs 21:13). There are many similar texts in the writings of Christianity and the other major religions. They regard it as a virtue to care for the poor and homeless, and there is a noble tradition that a church building is also a place of sanctuary.
Every society has to strike a delicate balance between accommodating the marginalised and protecting the right of other citizens to go about their business. Investors in the renewal of the city centre can be forgiven if they withhold their money.
Not to do so would constitute an invitation to anarchy.
Can this be seen as an open invitation to anyone seeking refuge?
Unashamedly, yes.
Source: Financial Mail
"If a man shuts his ears to the cry of the poor, he too will cry out and not be answered" (Proverbs 21:13). There are many similar texts in the writings of Christianity and the other major religions. They regard it as a virtue to care for the poor and homeless, and there is a noble tradition that a church building is also a place of sanctuary.
Every society has to strike a delicate balance between accommodating the marginalised and protecting the right of other citizens to go about their business. Investors in the renewal of the city centre can be forgiven if they withhold their money.
Not to do so would constitute an invitation to anarchy.
Can this be seen as an open invitation to anyone seeking refuge?
Unashamedly, yes.
Source: Financial Mail
Friday, February 13, 2009
Guangdong GDP set to grow 8.5%
Guangdong province, the country's top economic powerhouse, is forecasting 8.5 percent GDP growth this year, a draft government report said yesterday.
The report is yet to be discussed by delegates to the provincial people's congress, which opens today in the provincial capital of Guangzhou. Growth will be less than last year's 10.1 percent, sources close to the provincial people's congress said. GDP of the province was about 3.57 trillion yuan ($522 billion) last year, down 4.6 percent on 2007.
"As the largest province in terms of GDP, Guangdong will face a tough time in 2009 as it has been greatly affected by the global financial crisis," Governor Huang Huahua said at a government work meeting in December 2008.
Source: China View
The report is yet to be discussed by delegates to the provincial people's congress, which opens today in the provincial capital of Guangzhou. Growth will be less than last year's 10.1 percent, sources close to the provincial people's congress said. GDP of the province was about 3.57 trillion yuan ($522 billion) last year, down 4.6 percent on 2007.
"As the largest province in terms of GDP, Guangdong will face a tough time in 2009 as it has been greatly affected by the global financial crisis," Governor Huang Huahua said at a government work meeting in December 2008.
Source: China View
Monday, November 3, 2008
Statement of the Socialist International Commission on Global Financial Issues, meeting in Vienna, Austria
It is today beyond dispute that the current global financial crisis is the worst in the last twenty-five years and may well be the worst since the Great Depression.
A first response to the crisis was to bail out financial institutions in the developed economies, at an enormous cost for tax payers, with stark differences of opinion on the best way to proceed. Progressive forces and governments moved for accountability, transparency and guarantees for the average citizen, so they would not become the victim of the reckless acts and irresponsibility of those who provoked the crisis.
From the very beginning, at the centre of our concerns have been people’s jobs, housing, pensions, access to health and education services, in short the livelihood and social protection of citizens severely threatened by this crisis.
The social democratic vision of the economy and financial markets is that they should serve the citizens of our society. Financial markets are a means to an end, not an end in themselves. It is not necessarily the case that what is good for Wall Street or other financial centres is good for the rest of the economy. Moreover, trickle down economics - the notion that helping those at the top will benefit all - has been repeatedly rejected.
Four principles continue to guide the social democratic response: solutions to the crisis must be consistent with basic values of social justice and social solidarity as well as basic notions of fairness. The bonds of social solidarity must go across national boundaries; we cannot take actions which help ourselves at the expense of those in the developing world. They must reflect an understanding of the necessary balance between government and markets. Fourthly, any response must respect basic principles of democratic due process, including full transparency.
These principles take on a greater sense of urgency today, as what started as a financial crisis has become very quickly one of the real economy, with the threat of recession a reality around the world, and as we enter a new phase where emerging and developing economies are suffering the consequences of this crisis as well.
Lack of financial regulation triggered the crisis, while fiscal weakness and large public debts have hindered many governments’ ability to formulate policies to tackle it. At the same time, serious deficiencies in the global financial system have also been exposed, such as the limitations of the Bretton Woods institutions to guard against macroeconomic imbalances and provide liquidity to those economies in need; inadequate supervision of financial markets in developed economies and under-representation of emerging economies in the governance of the main multilateral lending institutions.
We will not be able to restore confidence in our financial markets unless we change their behaviour, through regulation. And regulation must be comprehensive. Too often, the regulatory process has been captured by those who were supposed to be regulated. The voice of those injured as a result of inadequate regulation—pensioners who lose their life savings, homeowners who lose their homes, workers who lose their jobs—has to be paramount. Such regulation could encourage real innovation, not the kind that has marked financial markets in recent years, like the derivatives that were supposed to manage risk but instead created it; but innovations that might allow average citizens to remain in their homes in the face of the economic vicissitudes which they face. Banks were allowed to become too big to fail and that was dangerous for all of us.
Given that the restructuring of global finance will take time, the Commission on Global Financial Issues proposes five immediate programmes to protect people today in countries most directly affected by the crisis:
The creation of a Social Protection Fund to assist developing countries that have inadequate or underfunded social protection schemes to set up social security systems to provide minimum social protections, including provisions for the unemployed, for health, and for retirees;
The creation of a Small Enterprises Development Fund to facilitate credit and capital flows to small businesses, as a sector which provides the major source of employment and a large contribution to the GDP, and assisting their technological development and expanding decent work;
The creation of a Financing Infrastructure Fund to help stimulate the economy. Such a fund would simultaneously stimulate the economy in the short run and help our societies meet the long run challenges they face; some funds might be directed, for instance, towards helping meet the challenges posed by global warming; others might be directed at the informal economy from which so many poor earn their living, for example with local programmes for small power plants, rural roads and markets, and technology parks.
The Commission equally supports the immediate and urgent establishment by the International Monetary Fund of a short-term liquidity line for emerging and developing economies which face a liquidity crisis caused not by deficient domestic policies but by sources of financing being severed due to the systemic crisis, as internationally active banks hoard liquidity, capital is repatriated to financial centres and rich countries’ GDP contract. This liquidity facility must allow access to countries by broadening the eligibility criteria in a fair way, so giving support to hundreds of millions of people who are now unwitting victims of this crisis; and it should be provided without the severe conditionalities often imposed in the past.
New sources of funding, and new lending facilities, have to be given urgent consideration. There is a growing consensus that there are insufficient financial resources in multilateral institutions and regional development banks to provide adequate support for the many economies that may face difficulties. Since the sources of liquid funds in the world today are in countries that have inadequate representation within the IMF, the World Bank, and other existing multilateral institutions, it will be imperative to create new governance structures for these lending facilities that are more representative. These new governance structures should be thought of as a precursor to the more fundamental reforms in the global economic governance that have long been demanded, and may entail more active involvement of other international institutions with wider and more diverse representation, including the various agencies of the UN family, such as UNDP and the International Labour Organisation.
Transparent and sustainable financial governance requires robust regulation of the world of finances which, as stated by the Presidium of the Socialist International, should include the establishment of a World Financial Organisation. The nature and extent of such regulation should itself emerge from global, democratic processes. Well designed regulation should focus on financial institutions and products whose failure puts the entire economy at risk. Elements will include, but not be limited to, demands for more transparency, restrictions on compensation schemes, especially those that encourage short sighted and excessively risky behaviour, restrictions on conflicts of interest, oversight of credit rating agencies, and control of other aspects of the behaviour of financial institutions that have imposed large social costs, without commensurate social benefits. Deficiencies in corporate governance that have given rise to compensation schemes that have benefited corporate managers at the expense of other stakeholders, including even shareholders, need to be given urgent consideration. Tax havens should be ended; and, a tax on short-term transactions considered.
There are other reforms to the international financial system that must be addressed if we are to have a more stable, prosperous, and equitable global economy. These include a reform of the global reserve system, better macro-economic coordination, with more attention paid to the consequences of policies for unemployment, and better ways of dealing with cross border bankruptcies and defaults, including those of sovereigns. The system in which countercyclical monetary and fiscal policies were pursued in the advanced industrial countries while pro-cyclical policies were imposed on developing countries has contributed to global volatility and imposed huge costs on developing countries. The current crisis has given new urgency to these long delayed reforms.
The reform process itself must be open, transparent, inclusive, and democratic; this means that the reform of the global regulatory framework or the way in which financial markets are regulated and supervised must take into account opinions and views of all. For this reason, we propose that discussion about reforms to the regulatory and financial framework for private markets be broadened to include the emerging economies, while at the same time providing a role for contributions from existing institutions that are less representative, such as the Financial Stability Forum.
Social democrats have always stood for markets with social responsibility. Markets that put citizens first. For a role for government in the economy with rules and regulation in the market. 75 years ago John Maynard Keynes explained how government action could help the economy recover from the Great Depression. Today his ideas have become part of conventional wisdom. Social democratic policies and their proposals for preventing another such calamity, as the one we are living through today, will in time also be accepted as conventional wisdom. But time is of the essence: the quicker governments can act, the shorter will be our downturn, and the fewer the number of innocent bystanders whose lives and dreams will be dashed in this tragic episode. We are living in a man-made crisis that should never be allowed to happen again. Our Commission is committed to contributing to that end, by constructing a roadmap, in which democracy, inclusion, fairness and green development will find a place in a new political, social and economic vision required for these times.
Source: Socialist International
A first response to the crisis was to bail out financial institutions in the developed economies, at an enormous cost for tax payers, with stark differences of opinion on the best way to proceed. Progressive forces and governments moved for accountability, transparency and guarantees for the average citizen, so they would not become the victim of the reckless acts and irresponsibility of those who provoked the crisis.
From the very beginning, at the centre of our concerns have been people’s jobs, housing, pensions, access to health and education services, in short the livelihood and social protection of citizens severely threatened by this crisis.
The social democratic vision of the economy and financial markets is that they should serve the citizens of our society. Financial markets are a means to an end, not an end in themselves. It is not necessarily the case that what is good for Wall Street or other financial centres is good for the rest of the economy. Moreover, trickle down economics - the notion that helping those at the top will benefit all - has been repeatedly rejected.
Four principles continue to guide the social democratic response: solutions to the crisis must be consistent with basic values of social justice and social solidarity as well as basic notions of fairness. The bonds of social solidarity must go across national boundaries; we cannot take actions which help ourselves at the expense of those in the developing world. They must reflect an understanding of the necessary balance between government and markets. Fourthly, any response must respect basic principles of democratic due process, including full transparency.
These principles take on a greater sense of urgency today, as what started as a financial crisis has become very quickly one of the real economy, with the threat of recession a reality around the world, and as we enter a new phase where emerging and developing economies are suffering the consequences of this crisis as well.
Lack of financial regulation triggered the crisis, while fiscal weakness and large public debts have hindered many governments’ ability to formulate policies to tackle it. At the same time, serious deficiencies in the global financial system have also been exposed, such as the limitations of the Bretton Woods institutions to guard against macroeconomic imbalances and provide liquidity to those economies in need; inadequate supervision of financial markets in developed economies and under-representation of emerging economies in the governance of the main multilateral lending institutions.
We will not be able to restore confidence in our financial markets unless we change their behaviour, through regulation. And regulation must be comprehensive. Too often, the regulatory process has been captured by those who were supposed to be regulated. The voice of those injured as a result of inadequate regulation—pensioners who lose their life savings, homeowners who lose their homes, workers who lose their jobs—has to be paramount. Such regulation could encourage real innovation, not the kind that has marked financial markets in recent years, like the derivatives that were supposed to manage risk but instead created it; but innovations that might allow average citizens to remain in their homes in the face of the economic vicissitudes which they face. Banks were allowed to become too big to fail and that was dangerous for all of us.
Given that the restructuring of global finance will take time, the Commission on Global Financial Issues proposes five immediate programmes to protect people today in countries most directly affected by the crisis:
The creation of a Social Protection Fund to assist developing countries that have inadequate or underfunded social protection schemes to set up social security systems to provide minimum social protections, including provisions for the unemployed, for health, and for retirees;
The creation of a Small Enterprises Development Fund to facilitate credit and capital flows to small businesses, as a sector which provides the major source of employment and a large contribution to the GDP, and assisting their technological development and expanding decent work;
The creation of a Financing Infrastructure Fund to help stimulate the economy. Such a fund would simultaneously stimulate the economy in the short run and help our societies meet the long run challenges they face; some funds might be directed, for instance, towards helping meet the challenges posed by global warming; others might be directed at the informal economy from which so many poor earn their living, for example with local programmes for small power plants, rural roads and markets, and technology parks.
The Commission equally supports the immediate and urgent establishment by the International Monetary Fund of a short-term liquidity line for emerging and developing economies which face a liquidity crisis caused not by deficient domestic policies but by sources of financing being severed due to the systemic crisis, as internationally active banks hoard liquidity, capital is repatriated to financial centres and rich countries’ GDP contract. This liquidity facility must allow access to countries by broadening the eligibility criteria in a fair way, so giving support to hundreds of millions of people who are now unwitting victims of this crisis; and it should be provided without the severe conditionalities often imposed in the past.
New sources of funding, and new lending facilities, have to be given urgent consideration. There is a growing consensus that there are insufficient financial resources in multilateral institutions and regional development banks to provide adequate support for the many economies that may face difficulties. Since the sources of liquid funds in the world today are in countries that have inadequate representation within the IMF, the World Bank, and other existing multilateral institutions, it will be imperative to create new governance structures for these lending facilities that are more representative. These new governance structures should be thought of as a precursor to the more fundamental reforms in the global economic governance that have long been demanded, and may entail more active involvement of other international institutions with wider and more diverse representation, including the various agencies of the UN family, such as UNDP and the International Labour Organisation.
Transparent and sustainable financial governance requires robust regulation of the world of finances which, as stated by the Presidium of the Socialist International, should include the establishment of a World Financial Organisation. The nature and extent of such regulation should itself emerge from global, democratic processes. Well designed regulation should focus on financial institutions and products whose failure puts the entire economy at risk. Elements will include, but not be limited to, demands for more transparency, restrictions on compensation schemes, especially those that encourage short sighted and excessively risky behaviour, restrictions on conflicts of interest, oversight of credit rating agencies, and control of other aspects of the behaviour of financial institutions that have imposed large social costs, without commensurate social benefits. Deficiencies in corporate governance that have given rise to compensation schemes that have benefited corporate managers at the expense of other stakeholders, including even shareholders, need to be given urgent consideration. Tax havens should be ended; and, a tax on short-term transactions considered.
There are other reforms to the international financial system that must be addressed if we are to have a more stable, prosperous, and equitable global economy. These include a reform of the global reserve system, better macro-economic coordination, with more attention paid to the consequences of policies for unemployment, and better ways of dealing with cross border bankruptcies and defaults, including those of sovereigns. The system in which countercyclical monetary and fiscal policies were pursued in the advanced industrial countries while pro-cyclical policies were imposed on developing countries has contributed to global volatility and imposed huge costs on developing countries. The current crisis has given new urgency to these long delayed reforms.
The reform process itself must be open, transparent, inclusive, and democratic; this means that the reform of the global regulatory framework or the way in which financial markets are regulated and supervised must take into account opinions and views of all. For this reason, we propose that discussion about reforms to the regulatory and financial framework for private markets be broadened to include the emerging economies, while at the same time providing a role for contributions from existing institutions that are less representative, such as the Financial Stability Forum.
Social democrats have always stood for markets with social responsibility. Markets that put citizens first. For a role for government in the economy with rules and regulation in the market. 75 years ago John Maynard Keynes explained how government action could help the economy recover from the Great Depression. Today his ideas have become part of conventional wisdom. Social democratic policies and their proposals for preventing another such calamity, as the one we are living through today, will in time also be accepted as conventional wisdom. But time is of the essence: the quicker governments can act, the shorter will be our downturn, and the fewer the number of innocent bystanders whose lives and dreams will be dashed in this tragic episode. We are living in a man-made crisis that should never be allowed to happen again. Our Commission is committed to contributing to that end, by constructing a roadmap, in which democracy, inclusion, fairness and green development will find a place in a new political, social and economic vision required for these times.
Source: Socialist International
Tackling the global financial crisis: For a new relationship between government and the market
First meeting of the Socialist International Commission on Global Financial Issues, Vienna, Austria
The SI Commission on Global Financial Issues met in Vienna on 3 November, for the first of a series of meetings, and in advance of the Socialist International Council in Mexico on 17-18 November where tackling the global financial crisis will be at the top of the agenda.
Hosted by the Chancellor of Austria, Alfred Gusenbauer, a member of the Commission, the discussions highlighted the principles guiding the global social democratic response to the world financial crisis and, given the new phase of the crisis affecting emerging and developing countries and the urgency of the situation of many people around the world today, the Commission set out five concrete initiatives to assist those directly affected by the crisis.
Calling for a new relationship between government and the market, the Commission underlined that confidence would not be restored in the financial markets unless behaviour was changed through comprehensive and robust regulation, accompanied by far-reaching reforms made to the international financial system.
Concerned for people who are unwitting victims of the crisis, losing their homes, jobs, pensions and social services, the Commission put forward the creation of a Social Protection Fund to aid developing countries with inadequate social protection schemes; the creation of a Small Enterprises Development Fund to support small business, as a sector which employs the majority of workers, contributes to the GDP and can expand decent work; the creation of a Financing Infrastructure Fund to help stimulate the economy; support for a short-term liquidity line for emerging and developing countries to be immediately and urgently established by the IMF; tackling the issue of insufficient financial resources in multilateral institutions and regional development banks by seeking new sources of funding and lending facilities, as well as more fundamental reforms in the global economic governance. These proposals emanating from the discussion were expanded upon in a statement of the Commission, called “For a new relationship between government and the market".
The Commission, established by the Socialist International Presidium at its meeting at the United Nations, New York, at the end of September, brings together political leaders, ministers and experts from all continents, and its members include: Professor Joseph Stiglitz from the United States, Nobel laureate and Chair of the Commission; Anatoly Aksakov, Member of the Board of the Russian Federation Central Bank and Member of Russian State Duma, For a Just Russia Party; Dr Héctor Alexander, Minister of Economy and Finances of Panama, Democratic Revolutionary Party, PRD; Cuauhtémoc Cárdenas, Founder of the Party for Democratic Revolution, PRD, Mexico and Honorary President of the Socialist International; Elio Di Rupo, Leader of the Socialist Party, PS, Belgium, and SI Vice-President; Alfred Gusenbauer, Chancellor of Austria and SI Vice-President; Eero Heinäluoma, Finnish Social Democratic Party and SI Vice-President; Ibrahim Boubacar Keita, Former Prime Minister of Mali and Leader of the Assembly for Mali, RPM; Pia Locatelli; President of Socialist International Women; Fathallah Oualalou, Former Minister of Finance, Socialist Union of Popular Forces, USFP, Morocco; Professor Shri Arjun K. Sengupta, Member of Parliament, Indian National Congress Party; Antolin Sánchez Presedo, Member of the European Parliament, Spanish Socialist Workers’ Party, PSOE, Spain; Peer Steinbrück, Federal Finance Minister of Germany and Deputy Chair of the Social Democratic Party; Andres Velasco, Minister of Finance, Chile; and Fozia Wahab, Member of the Pakistan National Assembly and Chair of the National Finance Committee of the Parliament. A member of the Commission from France will be appointed following the Socialist Party’s upcoming Congress.
George Papandreou, President of the Socialist International and Luis Ayala, Secretary General of the Socialist International, participated alongside the Commission members who took part in this first meeting. Juan Somavia, Director-General of the International Labour Organisation, joined the discussions as an invited guest. And from Austria, Christoph Matznetter, Secretary of State, Federal Ministry of Finance; and, Andreas Schieder, Secretary of State, Civil Service and Administrative Reform, also attended.
A progress report on the Commission’s work will be given by Commission members at the upcoming SI Council meeting in Mexico which takes the global social democratic response to the crisis as its main theme. The Council discussions, incorporating the entire membership of the organisation, will address this issue and a special document prepared by the Chair of the Commission on the social democratic principles towards a new financial architecture will be presented for adoption.
Future meetings of the Commission are envisaged, including seminars with academics and experts and a major Conference in the second half of 2009, to contribute to constructing a roadmap to deal with this crisis, in which democracy, inclusion, fairness, green development and protection for the environment will find their rightful place.
CRISE FINANCIERE MONDIALE : NOTE POUR L’INTERNATIONALE SOCIALISTE
Source: Socialist International
The SI Commission on Global Financial Issues met in Vienna on 3 November, for the first of a series of meetings, and in advance of the Socialist International Council in Mexico on 17-18 November where tackling the global financial crisis will be at the top of the agenda.
Hosted by the Chancellor of Austria, Alfred Gusenbauer, a member of the Commission, the discussions highlighted the principles guiding the global social democratic response to the world financial crisis and, given the new phase of the crisis affecting emerging and developing countries and the urgency of the situation of many people around the world today, the Commission set out five concrete initiatives to assist those directly affected by the crisis.
Calling for a new relationship between government and the market, the Commission underlined that confidence would not be restored in the financial markets unless behaviour was changed through comprehensive and robust regulation, accompanied by far-reaching reforms made to the international financial system.
Concerned for people who are unwitting victims of the crisis, losing their homes, jobs, pensions and social services, the Commission put forward the creation of a Social Protection Fund to aid developing countries with inadequate social protection schemes; the creation of a Small Enterprises Development Fund to support small business, as a sector which employs the majority of workers, contributes to the GDP and can expand decent work; the creation of a Financing Infrastructure Fund to help stimulate the economy; support for a short-term liquidity line for emerging and developing countries to be immediately and urgently established by the IMF; tackling the issue of insufficient financial resources in multilateral institutions and regional development banks by seeking new sources of funding and lending facilities, as well as more fundamental reforms in the global economic governance. These proposals emanating from the discussion were expanded upon in a statement of the Commission, called “For a new relationship between government and the market".
The Commission, established by the Socialist International Presidium at its meeting at the United Nations, New York, at the end of September, brings together political leaders, ministers and experts from all continents, and its members include: Professor Joseph Stiglitz from the United States, Nobel laureate and Chair of the Commission; Anatoly Aksakov, Member of the Board of the Russian Federation Central Bank and Member of Russian State Duma, For a Just Russia Party; Dr Héctor Alexander, Minister of Economy and Finances of Panama, Democratic Revolutionary Party, PRD; Cuauhtémoc Cárdenas, Founder of the Party for Democratic Revolution, PRD, Mexico and Honorary President of the Socialist International; Elio Di Rupo, Leader of the Socialist Party, PS, Belgium, and SI Vice-President; Alfred Gusenbauer, Chancellor of Austria and SI Vice-President; Eero Heinäluoma, Finnish Social Democratic Party and SI Vice-President; Ibrahim Boubacar Keita, Former Prime Minister of Mali and Leader of the Assembly for Mali, RPM; Pia Locatelli; President of Socialist International Women; Fathallah Oualalou, Former Minister of Finance, Socialist Union of Popular Forces, USFP, Morocco; Professor Shri Arjun K. Sengupta, Member of Parliament, Indian National Congress Party; Antolin Sánchez Presedo, Member of the European Parliament, Spanish Socialist Workers’ Party, PSOE, Spain; Peer Steinbrück, Federal Finance Minister of Germany and Deputy Chair of the Social Democratic Party; Andres Velasco, Minister of Finance, Chile; and Fozia Wahab, Member of the Pakistan National Assembly and Chair of the National Finance Committee of the Parliament. A member of the Commission from France will be appointed following the Socialist Party’s upcoming Congress.
George Papandreou, President of the Socialist International and Luis Ayala, Secretary General of the Socialist International, participated alongside the Commission members who took part in this first meeting. Juan Somavia, Director-General of the International Labour Organisation, joined the discussions as an invited guest. And from Austria, Christoph Matznetter, Secretary of State, Federal Ministry of Finance; and, Andreas Schieder, Secretary of State, Civil Service and Administrative Reform, also attended.
A progress report on the Commission’s work will be given by Commission members at the upcoming SI Council meeting in Mexico which takes the global social democratic response to the crisis as its main theme. The Council discussions, incorporating the entire membership of the organisation, will address this issue and a special document prepared by the Chair of the Commission on the social democratic principles towards a new financial architecture will be presented for adoption.
Future meetings of the Commission are envisaged, including seminars with academics and experts and a major Conference in the second half of 2009, to contribute to constructing a roadmap to deal with this crisis, in which democracy, inclusion, fairness, green development and protection for the environment will find their rightful place.
TESTIMONY BEFORE THE US CONGRESS HOUSE COMMITTEE ON FINANCIAL SERVICES
Joseph E. Stiglitz, University Professor, Columbia University, 21 October 2008
Joseph E. Stiglitz, University Professor, Columbia University, 21 October 2008
CRISE FINANCIERE MONDIALE : NOTE POUR L’INTERNATIONALE SOCIALISTE
Elio Di Rupo, President of the Socialist Party, PS, Belgium
- La crise financière et les limites du libéralisme non régulé
- La nouvelle crise et les prémisses d'un monde multipolaire
- Le Maroc face aux effets de la crise
Fathallah Oualalou, Socialist Union of Popular Forces, USFP, Morocco
- La crise financière et les limites du libéralisme non régulé
- La nouvelle crise et les prémisses d'un monde multipolaire
- Le Maroc face aux effets de la crise
Fathallah Oualalou, Socialist Union of Popular Forces, USFP, Morocco
REFORMING AND STRENGTHENING THE GLOBAL FINANCIAL SYSTEM
Andrés Velasco, Minister of Finance, Chile
SOCIAL CONSEQUENCES AND RESPONSES TO THE FINANCIAL AND ECONOMIC CRISIS
Discussion paper for the Chief Executives Board (CEB) of the United Nations, presented by ILO Director-General Juan Somavia, New York, October 2008
Discussion paper for the Chief Executives Board (CEB) of the United Nations, presented by ILO Director-General Juan Somavia, New York, October 2008
Source: Socialist International
Wednesday, January 15, 2003
South Africa: ANC escalates privatisations and economic restructuring
On January 14 President Thabo Mbeki gave his state of the nation address before the South African parliament, which was heralded with an air force flypast and a 21-gun salute.
In his speech Mbeki made vague and unsubstantiated promises that in the next year the government would increase the “social wage”, especially of the poor, the old and young children; reduce unemployment; improve public services like hospitals and clinics, schools, roads, access to water and electricity. He also promised to work to eradicate malaria, tuberculosis and particularly to “continue to focus on the treatment of sexually transmitted infections”.
Source: World Socialist Web
In his speech Mbeki made vague and unsubstantiated promises that in the next year the government would increase the “social wage”, especially of the poor, the old and young children; reduce unemployment; improve public services like hospitals and clinics, schools, roads, access to water and electricity. He also promised to work to eradicate malaria, tuberculosis and particularly to “continue to focus on the treatment of sexually transmitted infections”.
Source: World Socialist Web
Tuesday, December 29, 1998
Social inequality, bureaucracy and the betrayal of socialism in the Soviet Union
This lecture was delivered by Professor Vadim Rogovin at the Ruhr University in Germany in December 1996.
Today when many speak of the collapse of socialism, it is appropriate to pose the following question: what has collapsed with the ruling regimes in the Soviet Union and other countries? What were the aims of socialism and to what extent were they realised in the so-called socialist countries? Why was socialism in the Soviet Union twice betrayed, first by Stalin and the Stalinists and a second time by Gorbachev and his clique?
When we consider these questions, we arrive at the conclusion that the aim of socialism is the establishment of social equality among men.
It is no accident that official public opinion has always judged the conditions in those countries with nationalised property from the standpoint of the extent to which the principles of social equality were upheld. In this regard one sometimes comes across interesting examples.
One of my colleagues, who is frequently in Spain, related the following story: a well-known singer, a dissident from Cuba, recently appeared on Spanish television. With tears in her eyes she spoke of the privileges which existed in Cuba. She reported that party bureaucrats who were sick got single rooms in the hospitals, i.e., enjoyed privileges. All those who heard the program could only think "look at the privileges they have in Cuba!"
No one noticed that on the same day, a Madrid newspaper reported that the president of a leading stock company didn't attend a major shareholders' meeting because he had flown to his doctor in America, in a private aeroplane, for a consultation. The incident didn't provoke any particular attention. After all who could expect any sort of social equality and justice under capitalism?
Although such facts have been often used for openly demagogic purposes, ordinary people using their moral and social instincts have regarded the privileges which existed in the Soviet Union and the other nominally socialist countries as something which has distorted their picture and ideal of socialism.
Marxism has repeatedly raised the question of social equality and attempted to resolve it, in both a practical and theoretical sense. In their estimation of the Paris Commune, Marx and Engels regarded the fact that the wage of an official was not to exceed that of a worker to be of great significance. They regarded this measure as an effective way of preventing the state from being transformed from an instrument which serves society into an institution which stands above society.
Lenin developed this idea in his book The State and Revolution. He wrote that the masses yearned for a government which guaranteed low prices and fair wages and which itself did not consume too much money. Such a government is in principle impossible under capitalism.
Lenin emphasised that in the Second International at that time there was a tendency to pass over these Marxist ideas in silence, treating them as naive conceptions out of sync with the times, rather like those ideologues of Christianity who, following the transformation of the church into a state institution, forgot that Christianity was originally revolutionary.
Shortly after the October Revolution a number of measures were adopted with the aim of reducing the social differences between specific groups. In order to preclude privileges for the functionaries, a so-called party maximum was introduced, i.e., an upper limit for the incomes of party officials. In the 1920s, for example, the following was standard practice: a factory director who was a party member received 300 rubles for his work. The director of a similar factory who was not a party member could expect an income of 500 rubles.
In the 1920s there were workers who for a time occupied the position of town party secretary and then returned to their original place at the work bench. This didn't occur because of any blot on the record of the worker/party secretary. Rather it was a perfectly normal transition.
The situation changed in 1923 when Lenin, as a result of his illness, withdrew from leading positions. Now the emerging bureaucracy worked towards securing definite privileges.
It was no accident that the Left Opposition came into being in 1923 and attracted many of the old Bolsheviks. From the beginning it sounded the alarm regarding the development of bureaucratic methods inside the party and the workers state.
At the time, in the conflict between the ruling faction and the Left Opposition, relatively little was said about the question of privileges. But the social essence of the acute struggle between the two wings can only be understood in connection with the opposing positions taken regarding social equality and justice.
In 1925 a leader of the Opposition, Zinoviev, wrote that the working class strove for more social equality. It was just a brief comment in a long article. Zinoviev was not objecting in principle to the difference in wages for skilled and unskilled work. Stalin, however, concentrated his report to the 14th party conference on this small passage.
He maintained that Zinoviev was rejecting the thesis put forward in the Critique of the Gotha Program, where Marx maintains that in the transitional period between socialism and communism differences with regard to wages would continue to exist. The Opposition, according to Stalin, was attacking the income of the skilled worker as well as the meagre wages of the hard-working peasant. In reality, behind these demagogic words lay the attempt to defend those privileges which the bureaucracy had begun to accumulate.
Looking back, Trotsky remarked that Stalin's supporters, like those of the Left Opposition, belonged to the same social milieu. But the latter consciously broke away from their social interests and defended the interests of the sans-culottes -- the workers and peasants.
Following his victory over the Left Opposition, Stalin introduced decisive changes into the ideology of the ruling party. He put forward the thesis that the main principle of socialism was that everyone should be paid in accordance with his performance. In an attempt to elaborate on the content of this principle, none of the Soviet economic experts were able to explain how it was possible to compare the work of a miner with that of a doctor, the activities of a ballerina with those of a steel worker.
After Stalin's death, despite criticism of his political rule, none of his successors questioned this principle. All of them vigorously opposed what they called "levelling."
In reality the principle of payment for performance is a bourgeois principle. It only has significance when one interprets it in a liberal fashion: everyone is rewarded according to the results of his or her work, and this is realised on the free market in the interaction of supply and demand. It is clear that an immediate consequence of such market economy principles is the growth of inequality. The function of the bourgeois state is precisely to maintain this inequality.
Marx and Lenin predicted that every state arising from a socialist revolution would have a dual character: on the one hand a socialist character which defends socialised property against capitalist restoration, and on the other hand a bourgeois character, in so far as the state is obliged for a period to maintain certain privileges for a minority and preside over inequality. They therefore described the transitional state as a "bourgeois" workers state, even though there would be no bourgeoisie. According to Marxist doctrine this inequality must recede the more society develops in a socialist direction and the state correspondingly begins to wither away.
Since the middle of the 1920s, the situation in the Soviet Union developed in an opposite direction. The ruling bureaucracy excluded the workers from any sort of participation in the distribution of material goods and transformed itself into a powerful caste of those controlling the distribution of these goods. By the mid-1930s the disproportion with regard to inequality and the lack of social justice in the Soviet Union exceeded that which existed in the developed capitalist countries.
When we speak of the privileges in the Soviet Union, we must bear in mind that in the 1920s and 1930s the country was very poor and backward. That is why for us today the privileges at that time can appear inconsequential in comparison with modern-day Germany. But for the consciousness of the ordinary people, they had enormous significance. A new atmosphere developed in society. Whereas in earlier periods wealthier citizens were somewhat ashamed of their wealth, now they were proud of it.
The wife of the well-known Soviet poet Ossip Mandelstam, Nadezhda Mandelstam, wrote in her memoirs: "With us it was often the case that even a piece of bread was reckoned as a privilege." She related the case of a young man in a distribution station where the privileged received special food rations. The young man was eating a piece of beefsteak which had been allocated for his father-in-law and commented: "It tastes so good and pleasant because no one else has it."
Mandelstam added that medicine was also distributed in this way. Better medicine was reserved for the social elite. On one occasion she was admonishing a pensioned functionary when the latter retorted in an astonished voice: "What are you thinking of? Should I be treated like a cleaning woman?" Mandelstam added that this official was in reality a very decent and good-natured man, but that such attitudes had become widespread at the high-point of the struggle against levelling.
In attempting to overcome its isolation, the bureaucracy allowed other sections of the population to share in the privileges: the aristocracy of the working class, the kolkhoz (collective farm) aristocracy and, above all, the top layers of the intelligentsia. The securing of privileges could not be carried through without arousing resistance from a large part of the Communist Party. In this respect Trotsky wrote: "In a country which has undergone the October Revolution, it is not possible to cultivate inequality other than by resorting to ever more severe measures of repression."
Trotsky traced the totalitarian character of the state and its resort to mass terror to the drive of the bureaucracy to secure and retain its privileges. It could not permit social protest to spill over into open forms of class struggle.
Following Stalin's death, the social development of the Soviet Union did not follow a straight line. After the loss of its main lever of totalitarian power, the bureaucracy was forced to make certain concessions to the masses' strivings for equality.
Immediately after Stalin's death, various social reforms and social programs were introduced to improve the situation of the poorly paid and less fortunate layers of the population. In the following decade their standard of living improved, while the situation of the ruling bureaucracy, and also the better-off sections of the intelligentsia, worsened in a relative sense.
The concealed conflict between these layers of the intelligentsia and the bureaucracy, which broke out into the open in the 1960s and '70s, was rooted in this development. The external expression of this conflict was, on the one hand, the dissident movement, and, on the other, emigration.
The source of this conflict was not only the intelligentsia's striving for greater intellectual and spiritual freedom and access to power. It was also a reaction to the loss of privileges and material advantages which this layer had enjoyed under Stalin. As for the bureaucracy, it responded to the loss of privileges with an unprecedented level of corruption.
Despite the general improvement in living standards in the 1960s, one could describe the social conditions with Trotsky's words: although there was no exploitation in the classic sense of the word, the conditions of life for working people in the Soviet Union were still worse than those of workers suffering exploitation in the capitalist countries. Because it did not possess its own forms of property, the bureaucracy did not represent a propertied class in the real sense of the word. Nevertheless, it exhibited all the negative attributes of the previous ruling class.
In the consciousness of the popular masses, the formation of deep-going social differences devalued the great social achievements of the October Revolution -- the socialisation of the means of production and of the land. In the eyes of working people and the peasantry, the bureaucracy brought socialism into disrepute. It drove them, to a certain extent, to seek a solution other than socialism.
Trotsky had shown that the contradiction between the forms of property and the forms of distribution could not continue to develop indefinitely. The contradiction would have to be resolved one way or another. Either the forms of distribution would have to accommodate themselves to the socialist property relations, i.e., they would have to become more egalitarian, or the bourgeois principle would reach beyond distribution and consume the forms of property.
Proceeding from this thesis, Trotsky developed many prognoses which contained two possible variants. The first might be called revolutionary, the second, counter-revolutionary. Unfortunately the second, counter-revolutionary alternative was realised. And it was realised to an astonishing degree in conformity with Trotsky's warnings, albeit with some delay. (If even the most brilliant prognoses were realised to the letter, i.e., exactly as their authors had imagined, then we would be talking about prophecy, and history would have a mystical character.)
As Trotsky had foreseen, the first serious convulsion led to the social antagonisms rising to the surface. In the first years of perestroika, nothing indicated that things would end with the restoration of capitalism. On the contrary, in 1985, '86 and '87 Gorbachev called for more socialism and the restoration of the Leninist vision of Bolshevism.
In this context, it is interesting to note that the only politician of significance who attacked Gorbachev from the left was Yeltsin. As you are all familiar with the present-day politician Yeltsin, it is interesting to hear a few of his political utterances from earlier times.
At the 1986 party conference, Yeltsin enthusiastically and approvingly quoted Lenin's words: "Social inequality destroys democracy, leads to the decay of the party and diminishes the reputation of the party."
Three years later, he posed the rhetorical question in parliament: "Why do millions of people in our society live below the poverty line, while others literally live like lords and wallow in luxury?"
In his book, which appeared in 1991, one can read the following passage: "I cannot eat sturgeon when I know that my neighbours are not even able to buy milk for their children. I am ashamed to use expensive medicine because I know that many of my fellow citizens are not even able to afford aspirin."
And in his election campaign he promised that his policies would, in the first instance, serve the people whose incomes fell below the average. It was only due to this slogan, which appealed to the popular sense of justice, that Yeltsin was able to come to power.
The development of perestroika since 1988 has confirmed that the dismantling of the socialist foundations of society culminated in a capitalist order, or more precisely, in a capitalist chaos. This process has been accompanied by a catastrophic decline of culture and the economy.
The capitalism which is now emerging will not be a new edition of pre-revolutionary Russian capitalism, because the world has moved closer together since 1917. International finance capital is incomparably more powerful. For this reason, Russia's return to a state of semi-colonial exploitation is the only possibility. In achieving this, the forces of capitalist restoration can only realise their aims through years of civil war and the plundering of the country which Soviet power built up.
Conditions in the country over the last five years can be described in a phrase which has become quite popular in Russia of late, "creeping civil war." This creeping civil war discharges itself from time to time in a shooting war, for example with the bombarding of parliament in 1993, or the war in Chechnya which cannot be brought to an end, despite all the promises emanating from ruling circles.
As far as the country's devastation is concerned, history has never witnessed such destruction of the productive forces in peacetime as has taken place in Russia and the other former republics of the USSR over the last five years. A certain continuity between the earlier and present regimes can be observed. One could say that the present regime has taken over the bad sides of the former Soviet regime and has multiplied the evil with the addition of the bad sides of capitalist society.
Trotsky said: "The secret income of the bureaucracy is nothing other than theft, and outside this relatively legal theft exists an illegal ultra-theft to which Stalin" -- and today Yeltsin -- "closes his eyes because these thieves are his closest social support." The ruling bureaucracy cannot react in any other way than to resort to systematic thievery. This creates a system of bureaucratic gangsterism.
When one considers the tragic fate of our country, one can justifiably say that the October Revolution brought much more for the workers in other countries than for the workers of the Soviet Union. The challenge of socialism forced the capitalist countries to make quite large social concessions to their working classes. The intervention of the state into the relations of production, distribution and exchange in order to resolve social problems is a general law of this century which present day capitalism still has to take into account.
In all the capitalist countries in the second half of the 20th century there was a certain limitation of capitalist freedom. This included, for example, a minimum wage and other guarantees for working people in the advanced capitalist countries. Over decades an active redistribution took place: on one side, the development of social programs for those possessing little, on the other side, a strict control over income, and based on this a strict taxation policy. These measures not only influenced the social situation, but also the economic. They increased demand in the population and were a countervailing tendency to overproduction in the developed capitalist countries.
However, capitalism has still not been able to abolish social inequality. This inequality can be seen in every country, and also between developed and less developed countries -- in the current terminology, between North and South.
It is important to note that the break-up of the Soviet Union into a series of second-rate states has presaged the destruction of the welfare state in the advanced capitalist countries. The attempt is being made to eliminate social gains which were achieved over decades.
At the same time, I would like to stress that up until now no real socialist path has been attempted in any country which called itself socialist. The socialist alternative, which was developed by the Left Opposition in the 1920s and '30s, consists in containing inequality by strict economic measures and, with the increasing development of society, ensuring that the different social groups become more and more equal.
As long as the contradiction between the privileged and the poor exists in the world, the basis remains for the development of new social and political movements. The success of these movements will depend on the degree to which they draw lessons from the negative and positive experiences of socialist construction.
Source: World Socialist Web Site
Today when many speak of the collapse of socialism, it is appropriate to pose the following question: what has collapsed with the ruling regimes in the Soviet Union and other countries? What were the aims of socialism and to what extent were they realised in the so-called socialist countries? Why was socialism in the Soviet Union twice betrayed, first by Stalin and the Stalinists and a second time by Gorbachev and his clique?
When we consider these questions, we arrive at the conclusion that the aim of socialism is the establishment of social equality among men.
It is no accident that official public opinion has always judged the conditions in those countries with nationalised property from the standpoint of the extent to which the principles of social equality were upheld. In this regard one sometimes comes across interesting examples.
One of my colleagues, who is frequently in Spain, related the following story: a well-known singer, a dissident from Cuba, recently appeared on Spanish television. With tears in her eyes she spoke of the privileges which existed in Cuba. She reported that party bureaucrats who were sick got single rooms in the hospitals, i.e., enjoyed privileges. All those who heard the program could only think "look at the privileges they have in Cuba!"
No one noticed that on the same day, a Madrid newspaper reported that the president of a leading stock company didn't attend a major shareholders' meeting because he had flown to his doctor in America, in a private aeroplane, for a consultation. The incident didn't provoke any particular attention. After all who could expect any sort of social equality and justice under capitalism?
Although such facts have been often used for openly demagogic purposes, ordinary people using their moral and social instincts have regarded the privileges which existed in the Soviet Union and the other nominally socialist countries as something which has distorted their picture and ideal of socialism.
Marxism has repeatedly raised the question of social equality and attempted to resolve it, in both a practical and theoretical sense. In their estimation of the Paris Commune, Marx and Engels regarded the fact that the wage of an official was not to exceed that of a worker to be of great significance. They regarded this measure as an effective way of preventing the state from being transformed from an instrument which serves society into an institution which stands above society.
Lenin developed this idea in his book The State and Revolution. He wrote that the masses yearned for a government which guaranteed low prices and fair wages and which itself did not consume too much money. Such a government is in principle impossible under capitalism.
Lenin emphasised that in the Second International at that time there was a tendency to pass over these Marxist ideas in silence, treating them as naive conceptions out of sync with the times, rather like those ideologues of Christianity who, following the transformation of the church into a state institution, forgot that Christianity was originally revolutionary.
Shortly after the October Revolution a number of measures were adopted with the aim of reducing the social differences between specific groups. In order to preclude privileges for the functionaries, a so-called party maximum was introduced, i.e., an upper limit for the incomes of party officials. In the 1920s, for example, the following was standard practice: a factory director who was a party member received 300 rubles for his work. The director of a similar factory who was not a party member could expect an income of 500 rubles.
In the 1920s there were workers who for a time occupied the position of town party secretary and then returned to their original place at the work bench. This didn't occur because of any blot on the record of the worker/party secretary. Rather it was a perfectly normal transition.
The situation changed in 1923 when Lenin, as a result of his illness, withdrew from leading positions. Now the emerging bureaucracy worked towards securing definite privileges.
It was no accident that the Left Opposition came into being in 1923 and attracted many of the old Bolsheviks. From the beginning it sounded the alarm regarding the development of bureaucratic methods inside the party and the workers state.
At the time, in the conflict between the ruling faction and the Left Opposition, relatively little was said about the question of privileges. But the social essence of the acute struggle between the two wings can only be understood in connection with the opposing positions taken regarding social equality and justice.
In 1925 a leader of the Opposition, Zinoviev, wrote that the working class strove for more social equality. It was just a brief comment in a long article. Zinoviev was not objecting in principle to the difference in wages for skilled and unskilled work. Stalin, however, concentrated his report to the 14th party conference on this small passage.
He maintained that Zinoviev was rejecting the thesis put forward in the Critique of the Gotha Program, where Marx maintains that in the transitional period between socialism and communism differences with regard to wages would continue to exist. The Opposition, according to Stalin, was attacking the income of the skilled worker as well as the meagre wages of the hard-working peasant. In reality, behind these demagogic words lay the attempt to defend those privileges which the bureaucracy had begun to accumulate.
Looking back, Trotsky remarked that Stalin's supporters, like those of the Left Opposition, belonged to the same social milieu. But the latter consciously broke away from their social interests and defended the interests of the sans-culottes -- the workers and peasants.
Following his victory over the Left Opposition, Stalin introduced decisive changes into the ideology of the ruling party. He put forward the thesis that the main principle of socialism was that everyone should be paid in accordance with his performance. In an attempt to elaborate on the content of this principle, none of the Soviet economic experts were able to explain how it was possible to compare the work of a miner with that of a doctor, the activities of a ballerina with those of a steel worker.
After Stalin's death, despite criticism of his political rule, none of his successors questioned this principle. All of them vigorously opposed what they called "levelling."
In reality the principle of payment for performance is a bourgeois principle. It only has significance when one interprets it in a liberal fashion: everyone is rewarded according to the results of his or her work, and this is realised on the free market in the interaction of supply and demand. It is clear that an immediate consequence of such market economy principles is the growth of inequality. The function of the bourgeois state is precisely to maintain this inequality.
Marx and Lenin predicted that every state arising from a socialist revolution would have a dual character: on the one hand a socialist character which defends socialised property against capitalist restoration, and on the other hand a bourgeois character, in so far as the state is obliged for a period to maintain certain privileges for a minority and preside over inequality. They therefore described the transitional state as a "bourgeois" workers state, even though there would be no bourgeoisie. According to Marxist doctrine this inequality must recede the more society develops in a socialist direction and the state correspondingly begins to wither away.
Since the middle of the 1920s, the situation in the Soviet Union developed in an opposite direction. The ruling bureaucracy excluded the workers from any sort of participation in the distribution of material goods and transformed itself into a powerful caste of those controlling the distribution of these goods. By the mid-1930s the disproportion with regard to inequality and the lack of social justice in the Soviet Union exceeded that which existed in the developed capitalist countries.
When we speak of the privileges in the Soviet Union, we must bear in mind that in the 1920s and 1930s the country was very poor and backward. That is why for us today the privileges at that time can appear inconsequential in comparison with modern-day Germany. But for the consciousness of the ordinary people, they had enormous significance. A new atmosphere developed in society. Whereas in earlier periods wealthier citizens were somewhat ashamed of their wealth, now they were proud of it.
The wife of the well-known Soviet poet Ossip Mandelstam, Nadezhda Mandelstam, wrote in her memoirs: "With us it was often the case that even a piece of bread was reckoned as a privilege." She related the case of a young man in a distribution station where the privileged received special food rations. The young man was eating a piece of beefsteak which had been allocated for his father-in-law and commented: "It tastes so good and pleasant because no one else has it."
Mandelstam added that medicine was also distributed in this way. Better medicine was reserved for the social elite. On one occasion she was admonishing a pensioned functionary when the latter retorted in an astonished voice: "What are you thinking of? Should I be treated like a cleaning woman?" Mandelstam added that this official was in reality a very decent and good-natured man, but that such attitudes had become widespread at the high-point of the struggle against levelling.
In attempting to overcome its isolation, the bureaucracy allowed other sections of the population to share in the privileges: the aristocracy of the working class, the kolkhoz (collective farm) aristocracy and, above all, the top layers of the intelligentsia. The securing of privileges could not be carried through without arousing resistance from a large part of the Communist Party. In this respect Trotsky wrote: "In a country which has undergone the October Revolution, it is not possible to cultivate inequality other than by resorting to ever more severe measures of repression."
Trotsky traced the totalitarian character of the state and its resort to mass terror to the drive of the bureaucracy to secure and retain its privileges. It could not permit social protest to spill over into open forms of class struggle.
Following Stalin's death, the social development of the Soviet Union did not follow a straight line. After the loss of its main lever of totalitarian power, the bureaucracy was forced to make certain concessions to the masses' strivings for equality.
Immediately after Stalin's death, various social reforms and social programs were introduced to improve the situation of the poorly paid and less fortunate layers of the population. In the following decade their standard of living improved, while the situation of the ruling bureaucracy, and also the better-off sections of the intelligentsia, worsened in a relative sense.
The concealed conflict between these layers of the intelligentsia and the bureaucracy, which broke out into the open in the 1960s and '70s, was rooted in this development. The external expression of this conflict was, on the one hand, the dissident movement, and, on the other, emigration.
The source of this conflict was not only the intelligentsia's striving for greater intellectual and spiritual freedom and access to power. It was also a reaction to the loss of privileges and material advantages which this layer had enjoyed under Stalin. As for the bureaucracy, it responded to the loss of privileges with an unprecedented level of corruption.
Despite the general improvement in living standards in the 1960s, one could describe the social conditions with Trotsky's words: although there was no exploitation in the classic sense of the word, the conditions of life for working people in the Soviet Union were still worse than those of workers suffering exploitation in the capitalist countries. Because it did not possess its own forms of property, the bureaucracy did not represent a propertied class in the real sense of the word. Nevertheless, it exhibited all the negative attributes of the previous ruling class.
In the consciousness of the popular masses, the formation of deep-going social differences devalued the great social achievements of the October Revolution -- the socialisation of the means of production and of the land. In the eyes of working people and the peasantry, the bureaucracy brought socialism into disrepute. It drove them, to a certain extent, to seek a solution other than socialism.
Trotsky had shown that the contradiction between the forms of property and the forms of distribution could not continue to develop indefinitely. The contradiction would have to be resolved one way or another. Either the forms of distribution would have to accommodate themselves to the socialist property relations, i.e., they would have to become more egalitarian, or the bourgeois principle would reach beyond distribution and consume the forms of property.
Proceeding from this thesis, Trotsky developed many prognoses which contained two possible variants. The first might be called revolutionary, the second, counter-revolutionary. Unfortunately the second, counter-revolutionary alternative was realised. And it was realised to an astonishing degree in conformity with Trotsky's warnings, albeit with some delay. (If even the most brilliant prognoses were realised to the letter, i.e., exactly as their authors had imagined, then we would be talking about prophecy, and history would have a mystical character.)
As Trotsky had foreseen, the first serious convulsion led to the social antagonisms rising to the surface. In the first years of perestroika, nothing indicated that things would end with the restoration of capitalism. On the contrary, in 1985, '86 and '87 Gorbachev called for more socialism and the restoration of the Leninist vision of Bolshevism.
In this context, it is interesting to note that the only politician of significance who attacked Gorbachev from the left was Yeltsin. As you are all familiar with the present-day politician Yeltsin, it is interesting to hear a few of his political utterances from earlier times.
At the 1986 party conference, Yeltsin enthusiastically and approvingly quoted Lenin's words: "Social inequality destroys democracy, leads to the decay of the party and diminishes the reputation of the party."
Three years later, he posed the rhetorical question in parliament: "Why do millions of people in our society live below the poverty line, while others literally live like lords and wallow in luxury?"
In his book, which appeared in 1991, one can read the following passage: "I cannot eat sturgeon when I know that my neighbours are not even able to buy milk for their children. I am ashamed to use expensive medicine because I know that many of my fellow citizens are not even able to afford aspirin."
And in his election campaign he promised that his policies would, in the first instance, serve the people whose incomes fell below the average. It was only due to this slogan, which appealed to the popular sense of justice, that Yeltsin was able to come to power.
The development of perestroika since 1988 has confirmed that the dismantling of the socialist foundations of society culminated in a capitalist order, or more precisely, in a capitalist chaos. This process has been accompanied by a catastrophic decline of culture and the economy.
The capitalism which is now emerging will not be a new edition of pre-revolutionary Russian capitalism, because the world has moved closer together since 1917. International finance capital is incomparably more powerful. For this reason, Russia's return to a state of semi-colonial exploitation is the only possibility. In achieving this, the forces of capitalist restoration can only realise their aims through years of civil war and the plundering of the country which Soviet power built up.
Conditions in the country over the last five years can be described in a phrase which has become quite popular in Russia of late, "creeping civil war." This creeping civil war discharges itself from time to time in a shooting war, for example with the bombarding of parliament in 1993, or the war in Chechnya which cannot be brought to an end, despite all the promises emanating from ruling circles.
As far as the country's devastation is concerned, history has never witnessed such destruction of the productive forces in peacetime as has taken place in Russia and the other former republics of the USSR over the last five years. A certain continuity between the earlier and present regimes can be observed. One could say that the present regime has taken over the bad sides of the former Soviet regime and has multiplied the evil with the addition of the bad sides of capitalist society.
Trotsky said: "The secret income of the bureaucracy is nothing other than theft, and outside this relatively legal theft exists an illegal ultra-theft to which Stalin" -- and today Yeltsin -- "closes his eyes because these thieves are his closest social support." The ruling bureaucracy cannot react in any other way than to resort to systematic thievery. This creates a system of bureaucratic gangsterism.
When one considers the tragic fate of our country, one can justifiably say that the October Revolution brought much more for the workers in other countries than for the workers of the Soviet Union. The challenge of socialism forced the capitalist countries to make quite large social concessions to their working classes. The intervention of the state into the relations of production, distribution and exchange in order to resolve social problems is a general law of this century which present day capitalism still has to take into account.
In all the capitalist countries in the second half of the 20th century there was a certain limitation of capitalist freedom. This included, for example, a minimum wage and other guarantees for working people in the advanced capitalist countries. Over decades an active redistribution took place: on one side, the development of social programs for those possessing little, on the other side, a strict control over income, and based on this a strict taxation policy. These measures not only influenced the social situation, but also the economic. They increased demand in the population and were a countervailing tendency to overproduction in the developed capitalist countries.
However, capitalism has still not been able to abolish social inequality. This inequality can be seen in every country, and also between developed and less developed countries -- in the current terminology, between North and South.
It is important to note that the break-up of the Soviet Union into a series of second-rate states has presaged the destruction of the welfare state in the advanced capitalist countries. The attempt is being made to eliminate social gains which were achieved over decades.
At the same time, I would like to stress that up until now no real socialist path has been attempted in any country which called itself socialist. The socialist alternative, which was developed by the Left Opposition in the 1920s and '30s, consists in containing inequality by strict economic measures and, with the increasing development of society, ensuring that the different social groups become more and more equal.
As long as the contradiction between the privileged and the poor exists in the world, the basis remains for the development of new social and political movements. The success of these movements will depend on the degree to which they draw lessons from the negative and positive experiences of socialist construction.
Source: World Socialist Web Site
Thursday, November 9, 1989
Berliners celebrate the fall of the Wall
The Berlin Wall has been breached after nearly three decades keeping East and West Berliners apart.
At midnight East Germany's Communist rulers gave permission for gates along the Wall to be opened after hundreds of people converged on crossing points. They surged through cheering and shouting and were be met by jubilant West Berliners on the other side. Ecstatic crowds immediately began to clamber on top of the Wall and hack large chunks out of the 28-mile (45-kilometre) barrier.
It had been erected in 1961 on the orders of East Germany's former leader Walter Ulbricht to stop people leaving for West Germany.
Source: BBC
At midnight East Germany's Communist rulers gave permission for gates along the Wall to be opened after hundreds of people converged on crossing points. They surged through cheering and shouting and were be met by jubilant West Berliners on the other side. Ecstatic crowds immediately began to clamber on top of the Wall and hack large chunks out of the 28-mile (45-kilometre) barrier.
It had been erected in 1961 on the orders of East Germany's former leader Walter Ulbricht to stop people leaving for West Germany.
Source: BBC
Thursday, June 22, 1989
Global Change and Future Prospects
The idea of Socialism has caught the imagination of people across the world, promoted successful political movements, decisively improved the lives of working men and women, and contributed to shaping the 20th century. However, justified satisfaction about the realisation of many of our goals should not prevent us from clearly recognising present dangers and problems. We are aware that essential tasks still lie ahead which we can master only through common action, since human survival increasingly depends upon the joint efforts of people around the world.
Current economic, technological, political and social changes reflect a profound transformation of our world. The fundamental issue we now face is not whether there will be change in future years, but rather who is going to control it and how. The socialist answer is unequivocal. It is the people of the world who should exercise control by means of a more advanced democracy in all aspects of life: political, social, and economic. Political democracy, for socialists, is the necessary framework and precondition for other rights and liberties.
All the peoples of the world should be involved in the process of transforming our societies and promoting new hope for humankind. The Socialist International calls on all men and women committed to peace and progress to work together in order to translate this hope into reality.
The challenge of global change opens up enormous possibilities:
The rapid process of internationalisation and interdependence in the world economy has given rise to contradictions within existing political, social and national institutions. This growing gap between an international economy and inadequate international political structures has been a contributory factor to the poverty and underdevelopment of the South, as well as to mass unemployment and new forms of poverty in many areas of the North.
Real progress has been made since World War II in vital areas such as decolonisation, the growth of the Welfare State and, more recently, disarmament, where the first hopeful steps have been taken. However, age-old injustices remain. Human rights are still violated, racial and sex discrimination are rife, and individual opportunities in life are still determined by the region and class in which people are born.
Faced with such crucial issues, the Socialist International reaffirms its fundamental beliefs. It is committed, as ever, to the democratisation on a global scale of economic, social and political power structures. The same principles and political commitments which socialism has always held have to be attained in a world that has changed radically since the Frankfurt Declaration of 1951.
The Socialist International was founded a hundred years ago in order to coordinate the worldwide struggle of democratic socialist movements for social justice, human dignity and democracy. It brought together parties and organisations from different traditions which shared a common goal: democratic socialism. Throughout their history, socialist, social democratic and labour parties have stood for the same values and principles.
Today the Socialist International combines its traditional struggle for freedom, justice and solidarity with a deep commitment to peace, the protection of the environment, and the development of the South. All these issues require common answers. To this end, the Socialist International seeks the support of all those who share its values and commitment.
Source: Socialist International
DECLARATION OF PRINCIPLES OF THE SOCIALIST INTERNATIONAL
Adopted by the XVIII Congress, Stockholm, June 1989, para 11-11
Current economic, technological, political and social changes reflect a profound transformation of our world. The fundamental issue we now face is not whether there will be change in future years, but rather who is going to control it and how. The socialist answer is unequivocal. It is the people of the world who should exercise control by means of a more advanced democracy in all aspects of life: political, social, and economic. Political democracy, for socialists, is the necessary framework and precondition for other rights and liberties.
All the peoples of the world should be involved in the process of transforming our societies and promoting new hope for humankind. The Socialist International calls on all men and women committed to peace and progress to work together in order to translate this hope into reality.
The challenge of global change opens up enormous possibilities:
- The internationalisation of the economy and wide-spread access to information and new technologies can, if brought under democratic control, provide a basis for a world society better suited to cooperation. It is obvious that a world family is no longer a utopian dream, but, increasingly, a practical necessity.
- The technological revolution can and should be used to preserve the environment, create new employment and provide the means to liberate people from routine work rather than ruthlessly impose unwanted idleness.
- On the basis of suitable and humane democratic structures, freedom, equality, security and prosperity can be achieved within the framework of a democratic world society.
- Proliferation of the technologies of destruction promote a precarious balance of terror where there are inadequate guarantees for the security of humankind.
- The physical conditions for life on the planet are threatened by an uncontrolled urban and industrial expansion, the degradation of the biosphere, and the irrational exploitation of vital resources.
- Hunger, famine and death threaten whole regions and communities in the South, even though the world has enough natural and technical resources to feed itself.
The rapid process of internationalisation and interdependence in the world economy has given rise to contradictions within existing political, social and national institutions. This growing gap between an international economy and inadequate international political structures has been a contributory factor to the poverty and underdevelopment of the South, as well as to mass unemployment and new forms of poverty in many areas of the North.
Real progress has been made since World War II in vital areas such as decolonisation, the growth of the Welfare State and, more recently, disarmament, where the first hopeful steps have been taken. However, age-old injustices remain. Human rights are still violated, racial and sex discrimination are rife, and individual opportunities in life are still determined by the region and class in which people are born.
Faced with such crucial issues, the Socialist International reaffirms its fundamental beliefs. It is committed, as ever, to the democratisation on a global scale of economic, social and political power structures. The same principles and political commitments which socialism has always held have to be attained in a world that has changed radically since the Frankfurt Declaration of 1951.
The Socialist International was founded a hundred years ago in order to coordinate the worldwide struggle of democratic socialist movements for social justice, human dignity and democracy. It brought together parties and organisations from different traditions which shared a common goal: democratic socialism. Throughout their history, socialist, social democratic and labour parties have stood for the same values and principles.
Today the Socialist International combines its traditional struggle for freedom, justice and solidarity with a deep commitment to peace, the protection of the environment, and the development of the South. All these issues require common answers. To this end, the Socialist International seeks the support of all those who share its values and commitment.
Source: Socialist International
DECLARATION OF PRINCIPLES OF THE SOCIALIST INTERNATIONAL
Adopted by the XVIII Congress, Stockholm, June 1989, para 11-11
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