by Ellen Isaacs
June 27, 2022
It’s only six weeks since last we wrote about the dangers of war, pandemics, and climate change reaching a climax (https://multiracialunity.org/2022/05/07/an-exploding-world-requires-radical-change/), but already the crises are intensifying. Inflation, infection, injustice, impoverishment and war are all further endangering the lives of workers around the world.
We must mention that the most immediate thing on Americans’ minds is the overturning of Roe v Wade, which perhaps clarifies for many that the Supreme Court is a political institution that has long upheld the racist and classist basis of the Constitution. We should not forget that this revered document originally supported slavery and devalued women and unpropertied men, as it has always failed to guarantee anyone the right to basic sustenance – food, shelter, work, or health. The Court has taken many discriminatory actions in its history.(See https://multiracialunity.org/2020/10/16/the-racist-history-of-the-u-s-supreme-court-part-1/ and https://multiracialunity.org/2020/11/07/the-racist-history-of-the-u-s-supreme-court-part-2/.) Others decisions overturning various aspects of racism and sexism followed from mass movements such as that for abolition, the Civil War, the women’s suffrage and the gay rights movements. Now the Court is weakening the “right to privacy” of the 14th Amendment, a move which foretells a project to control the boundaries of all workers’ lives and grow the racism and sexism which divide and weaken us.
Consequences of Ukraine War Multiply
As the lead op-ed in the NY Times said recently (6/22/2022), “Are we already at war in Ukraine?” Having given $56 billion towards the war effort and provided the intelligence to kill three Russian generals and sink a warship and having promised rockets with ability to strike within Russia, haven’t we already committed acts of war? If Russians did the same to us, the article asks, would we not consider it as acts of war?
Elsewhere, the same paper points out that China and India are buying as much Russian oil as was previously sold to Europe. Given rising energy prices, Russia has earned $1.7 billion more in May than it did in April. Meanwhile, the West is dealing with soaring inflation, and fuel shortages loom in Europe and Asia.1 The alliances between China and India and Russia are thus also strengthening and weakening the position of the US versus its main rival on the world stage, China.
At least in the short term, pressure on energy supplies can be expected to worsen climate change by increasing fossil fuel use, which is more easily accelerated than renewable alternatives or nuclear energy. The latter two rely on metals and rare earth elements for their technologies which have also been rendered in short supply.2 Of course, there was little reason to hope the world’s capitalists were doing anything near enough to combat climate change even before this conflict.
Economic Crises Worsen
Just as the war in Ukraine and the growing competition between the US and China is the result of capitalist competition for power, resources, markets and profits, so does capitalism assure that crisis benefits owners and penalizes workers. While executive salaries increased by an average of $10.6 million in the last year to almost 700 times that of employees, worker pay rose only to an average of $23,968. Factoring in inflation, there has been a 3.9% drop in average weekly earnings.
Having recovered from the temporary Covid-related declines of 2020, corporations of North America, Europe, UK and Japan gave out $1.5 trillion in dividends in 2021 and from March, 2020 to February, 2022 spent $9.94 trillion buying back their own stock in order to artificially boost the profits per share.3 Even Biden, when offering his measly 18 cent decrease in the cost of gas per gallon by foregoing the federal tax, had to beg gas companies not to use the savings for stock buybacks instead of passing on savings to customers.
Meanwhile inflation has reached 11% in the UK, 8.8% in the EU, and 8.6% in the US. According to much of the press one of the causes of inflation is the padded income of households due to government generosity during the Covid shutdown.4 However, as economist Jack Rasmus points out, only $200 billion entered the economy from the American Relief Plan in the third quarter of 2021 compared to the $5 trillion GDP in that same quarter. Thus it is hard to attribute inflation, which began to accelerate at that time, to excess spending capacity. Instead what rose was demand as people began returning to work and needed goods and services.5
The most important inflationary factor was the bottleneck of supplies just as demand increased. There was a shortage of ships on top of a lack of workers. Although $25 billion was given to businesses in 2020-21, 75% of which was supposed to subsidize employee wages, most companies laid off their workers anyway, resulting in a shortage of transport workers. A third factor was the greed of large corporations, who simply raised their prices in industries where five or fewer companies controlled over 80% of a product or service. One example is US oil companies, who increased prices 34.2% by the end of 2021, well before the war in Ukraine.
The war, of course, has made things worse. Russia supplies 20-30% of many commodities, including oil, gas and industrial metals. Since the US has banned Russian oil and Europe is planning to reduce imports by 90% gasoline prices have risen sharply. Once shortages were foreseen, all kinds of middlemen, like shipping insurers, raised their rates(NYT 6/25).
Worker productivity per unit of work has been falling for a decade but has had the steepest drop since 1947 in the first quarter of 2022. Ultimately this negative pull on profits will result in rising layoffs and unemployment in order to restore the rate of exploitation capitalism requires.6
Worse than the economic disruptions of the West is the mass starvation in Africa. In Ethiopia, Somalia and Kenya alone, 23 million people are experiencing extreme hunger. These countries import 90% of their wheat from Ukraine and Russia and much of their cooking oil and fertilizer. In addition there has been severe drought since 2020, reflecting the worsening state of climate change. As of May, 2022, the UN has collected only $93 million to allay hunger in East Africa, compared to the billions for Ukraine.7
As of 2017, 28 African countries were dependent on food aid and account for half of the deaths of children under five in the world.8 However, hunger in Africa is nothing new and not just a result of this recent war, but of centuries of capitalist exploitation. The cause can be traced as far back as colonialism, when European countries promoted the change in agricultural economies to the production of single crops in each region that they wanted for export. More recently, World Bank and IMF loans have continued to focus on products desired by the West rather than the development of local agriculture.9 Crop subsidies in the EU and US have rendered African farmers noncompetitive.8
Failure to Control the Pandemic
Even as pandemic precautions have been weakened around the globe, infections continue to rise in 77 countries, led by the US.10 Although vaccines and infection-produced immunity in high and middle income countries have decreased the death and hospitalization rates, the problem of long Covid persists. 8% of the vaccinated and 20-30% of the unvaccinated develop chronic health problems, some affecting vital organs like the brain and kidneys, which may produce great numbers of the chronically ill.11
In low income countries only 17.8% of people have received even one dose of vaccine.12 The World Trade Organization meeting this month failed to overcome the opposition of the EU, UK and Switzerland to waiving intellectual property barriers to the production of mRNA vaccines. Although the US favors the waiver, it wanted it applied only to vaccines, not Covid treatments. 13 All this, of course, in the name of maintaining the outsize profits of pharmaceutical companies – Pfizer, BioNTech and Moderna made pre-tax profits of $34 billion in 2021.14
The result of failing to vaccinate so many low income countries, largely concentrated in Africa, is not only local disease and deaths. With so many available hosts, the virus will continue to mutate and some of the new variants may be more contagious or lethal than the current variants. Already B4 and B5 Omicron variants identified In South Africa are becoming common in the US, although they do not as yet appear to be more vaccine resistant or dangerous than other variants. However, as long as new variants are encouraged to emerge we can be sure the pandemic will not end and will likely worsen.
Capitalism is the Engine
So once again we must conclude that capitalism is driving war, climate disaster, disease, poverty and hunger, racism and sexism. As the ability to make profits is threatened, the exploitation of workers must needs increase. As the greed of drug companies and the practices of animal husbandry continue to produce pandemics and limit their treatment, millions more will die. As imperialist competition intensifies, wars will continue until direct conflict between the US and China ensues. We ourselves, let alone our children face imminent peril – UNLESS we begin to conceive of replacing capitalism. Voting is not enough. Marching is not enough. We must actually withhold our labor, encourage soldiers not to fight, and make of ourselves an army to fight for and create a worker-run society.