Tags: Capitalism, democracy, India, Labor, world politics, World-economy
Narendra Damodardas Modi’s spectacular victory in the 16th Lok Sabha elections—the first time in 30 years that a single political party has gained a majority of seats—has been hailed as a “democratic asteroid” by Sunil Khilnani, presumably in reference to the asteroid that is said to have exterminated the dinosaurs. The venerable dinosaur of Indian politics, the Congress Party, has indeed been reduced to a cipher, gaining less seats all-India than Modi’s Bharatiya Janata Party (BJP) won in Uttar Pradesh alone. And Pratap Bhanu Mehta crowed “Modi is a political phenomenon without precedent”:
he presented himself as something new: to walk into Bihar and talk about transcending caste politics, to utter the sentence no secularist in India has had the courage to utter, that poverty has no religion, to dream of reviving India’s growth prospects, to talk about jobs, to tap into the restlessness for doing things. He became an embodiment for a desire for change.
Even critics of Modi for his failure to protect Muslims from a massacre in 2002 when he was chief minister of Gujarat, like Tunku Varadarajan, argue that “it is time to wipe his slate clean” as we must honor the choice of the electorate and stop harping on 2002 because:
the size of Modi’s majority, … would allow him to govern magnanimously, and with no vindictiveness toward those who did not vote for him. His parliamentary numbers allow him to enact economic reforms that Indians crave, with no need to buy off, or kowtow to, difficult coalition partners. They allow him, also, to extend a hand of reconciliation to India’s Muslims, who, at 11 percent of the population number just over 170 million people. Early analyses indicate that only 10 percent of Muslim voters cast their ballots for the BJP, although the party did win just over 40 percent of all seats with a significant Muslim population.
Even a cursory glance at the electoral map of India will reveal the magnitude of BJP’s victory and the virtual annihilation of the Congress Party. Indeed, borrowing a page from Indira Gandhi’s victorious 1971 Garibi Hatao (“Eliminate Poverty”) campaign that projected her as a presidential-style candidate, Modi bested the Congress led by her daughter-in-law and grandson, by jettisoning the BJP’s Hindutva rhetoric and projecting himself as a no-nonsense champion of free enterprise and corporate capital.
In the first instance, the BJP’s stunning victory was a complete repudiation of the Congress—just as the 1977 Janata Party triumph was a repudiation of Indira Gandhi’s Emergency Rule. After having delivered high rates of economic growth during the Congress-led First United Progressive Alliance (UPA) term (2004-09), the country’s growth rate was halved during its second term (2009-14), even though at an annual average of 5.4%, it was still respectable in world terms when other economies are limping along at 0.1% to 2% annual growth rates. Rejection of the Congress stemmed from the Manmohan Singh government’s seeming inability to promote any bold initiatives when the economy was sluggish and inflation had risen to a three-month high in April, just as the massive nine-stage election got underway.
As pessimism about the economy mounted, Modi projected his ‘vibrant Gujarat’ as the model for India—a model with 24-hour electricity, a thriving agricultural sector, and the world’s largest oil refinery. Modi’s no-nonsense approach to industrialization was manifested by his invitation to Tata to produce his Nano car in Gujarat in 2006 after a two-year long farmers’ protest in Singrur, West Bengal led the company to abandon the project there. Modi immediately welcomed him to Gujarat, cut through the red-tape, and signed an agreement in a record 10 days with Tata Motors. This was, as Vinod K. Jose underlined, Modi’s decisive shift from brutal Hindutva to a corporate friendly strategy. When industrialists had once castigated him for his role in the Godhra massacre of Muslims in 2002, now they began courting him. As did intellectuals—Jagdish Bhagwati who had earlier castigated him for the Godhra massacres, told the Financial Times in an interview in April that he would be “optimistic” about India’s economic prospects only if Modi was elected prime minister. Colliding with corporate campaigns to promote Modi, the largest English-language newspaper in the country, the Times of India, “innovated a revenue-stream called ‘paid news’.”
Large corporate donations, and a slick media campaign allowed Modi to campaign all over the country—often holding five mass meetings a day—appearing in regional costumes and spending an unprecedented amount of money as India has no limits to campaign spending. Campaigning in presidential style, Modi offered as Pankaj Mishra pointed out
top-down modernisation, but without modernity: bullet trains without the culture of criticism, managerial efficiency without the guarantee of equal rights. And this streamlined design for a new India immediately entices those well-off Indians who have long regarded democracy as a nuisance, recoiled from the destitute masses, and idolised technocratic, if despotic, “doers” like the first prime minister of Singapore, Lee Kuan Yew.
And his messages were cloaked appropriately for a vast country with different electorates and he reaped a national harvest of votes except in the southern states where his economic message did not carry as these states were doing better than his ‘vibrant Gujarat’ or the East—where association with the Congress did not taint the regional parties in power.
The Congress, in turn, has been reduced to a shell of its former self—its members in the Lok Sabha plummeting from 206 in 2009 to a mere 44 in 2014, not enough for the leader of its parliamentary party to be recognized as the Leader of the Opposition. As the journalist T N Ninan pithily summarizes the plight of what was once the natural party of government:
The Congress… is now without a strong base anywhere, having been wiped out in its earlier stronghold of Andhra Pradesh, bested in Karnataka, routed in Maharashtra, sidelined in West Bengal, marginalised in Uttar Pradesh, and drawn a virtual blank in more than half a dozen key states across the heartland – a repeat of its rout in the state elections five months ago.
That this was not an anti-incumbency vote is indicated by the spectacular success of the AIADMK in Tamilnadu which captured 37 of the 39 seats and denied even a single seat to its regional rival, the DMK which was itself enmeshed in the corruption scandals of the Congress party and mired in a feud within its first family; the Trinamul Congress in West Bengal; and the Biju Janata Party in Odisha.The Left had nothing to offer the electorate. After their hopes of a Third Front were cynically dashed by Jayalalithaa who refused to allocate them a single seat in Tamil Nadu, they were left making rote noises about the evils of communalism, privatization, and globalization. The CPM’s long rule in West Bengal had increasingly isolated it from the masses as shown by its brutality towards villagers in Nandigram and Singrur. With its lack of political imagination and creativity, as Shiv Vishvanathan says
The Left leadership of Mr. Bardhan and Mr. Karat belong to a Tussauds of Marxism and one hopes the Left generates new leaders open to a new language of politics and justice. Numbers must generate rethinking in these parties.
Just as much as the sluggish-ness of the economy, it was the corruption scandals that plagued the Manmohan Singh government. Instead of holding open auctions, the government allocated coal-blocks worth some ₹1.86 lakh crore (almost $30 billion) to private firms without any transparent criteria. So too were the 2G and 3G cellular spectrums allocated to private mobile networks. And since 2004, in the run-up to the 2010 Commonwealth Games in Delhi, as Vishvanathan noted,
nearly 400,000 people from three large areas of Delhi were displaced, in a series of indiscriminate evictions reminiscent of the last days of the Emergency, to make way for new construction connected to the games. The tournament infrastructure was built with rampant violations of protections like the Minimum Wages Act, and with the widespread use of child labour. The litany of moral failings could go on.
Even when pressed in the only interview he gave in 10 years, Rahul Gandhi, the Congress vice president and dynastic heir apparent, could not explain why the party failed to take action against those found guilty of corruption or continue to nominate them as candidates. His stumbling, inept performance in the election campaign, rarely answering the charges that Modi hurled at him, his mother, and the ‘dynastic’ politics of the Congress only solidified Modi’s image as a dynamic leader. As the journalist, Rahul Pandita, wrote:
All these years Mr. Gandhi spoke about the social schemes the Congress party had introduced in a manner similar to how quacks at roadside Himalayan dawakhanas speak of their “herbs” to cure venereal diseases. In the last few months, his laying down his vision for a better India became a comic spectacle. He referred to poverty as a “state of mind” and commented that “the poor can’t eat roads.
And yet, if Modi jettisoned the rabid Hindutva rhetoric of the BJP, and indeed had marginalized its affiliated organizations like the RSS and the VHP in Gujarat, in the three elections he led in his home state, the BJP did not offer a single seat to a Muslim despite the community accounting for 10 percent of the state’s population. And of the 282 members of the BJP elected to the 16th Lok Sabha, not a single one is a Muslim—its lone Muslim candidate, Syed Shahnawaz Hussain, having lost the election. In his native Gujarat, Muslims are condemned to live in ghettos akin to the Jewish ones in pre-Second World War Europe as they are prevented from renting or buying houses in “Hindu” areas.
Unlike Modi, his key lieutenants, especially Amit Shah, the BJP General Secretary, said that the election was to seek “revenge” against the Muslims in Uttar Pradesh. And in neighboring Bihar, another senior BJP leader, Giriraj Singh, invited all those opposed to Modi to “go to Pakistan.” As a consequence, surveys suggest that the Congress increased its vote share of Muslims substantially—from 33 percent to 44 percent in Delhi’s Chandni Chowk constituency, and to over 90 percent in Madhya Pradesh and Chhatisgarh. Conversely, the Hindu vote consolidated for the BJP. This does not bode well for communal relations. Already there are reports of jubilant BJP supporters throwing stones and breaking windows of mastoids, of Muslims being beaten up for not participating in BJP victory processions.
Nor does it bode well that a third of the new MPs face criminal charges—and these are spread across the political spectrum.
The scale of Modi’s victory and his record of cutting his rivals down in Gujarat casts him as an Indian strong man, an Indian Caesar. With the 330-odd seats that his National Democratic Alliance commands in the Lok Sabha, it is believed that he would not have to cater to the demands of his coalition partners as his BJP has enough seats to govern on its own. Though much of the implementation of economic programs depends on state legislatures, the magnitude of his victory his supporters believe will compel the states to comply with the diktats from Delhi. Once Modi gets the government out of the way and stop pampering the poor and the lazy, the narrative purveyed by the business-friendly press suggests, nothing will stop bold, innovative, enterprising entrepreneurs from making the twenty-first century, the “Indian century.” As the scale of Modi’s victory became apparent, stock prices in Indian bourses rose exponentially, and Mukesh Ambani, the country’s wealthiest man and ardent Modi supporter saw his net worth increase by $1 billion in a single day!
Gita Gopinath and Iqbal Dhaliwal, respectively professors of economics at Harvard and MIT, articulate the new wisdom that Modi will de-regulate the economy and India will rapidly rise in the “Ease of Doing Buisiness” rankings; that the flood of investments will lead to greater employment and as labor costs in manufacturing rise in China, India will become the natural harbor for companies seeking a cheaper workforce and there will be prosperity for all. What is crucially missing from this fairy tale is that this has been the predictions of every neoliberal experiment since the coup in Chile in 1972 and none of it has borne fruit. By neglecting primary and secondary education since independence, India has a very poorly trained labor force in comparison to China; by neglecting health expenditures, India even trails Bangladesh in many key indicators. The country’s infrastructure—roads, ports, electricity, water supply—are in shambles. And in manufacturing the world over, labor’s share in profits and plummeting as increasingly production is driven by numerically-controlled machines and robots, so greater industrialization does not necessarily lead to greater employment. In fact, by eschewing the social democratic redistributive measures, pursued albeit half-heartedly and ham-handedly by the Congress, Modi will further decrease India’s competitiveness.
Tags: democracy, Egypt, international relations, Israel, military coup, Saudi Arabia, United States, world politics
Intermingled with images of bodies covered in funeral shrouds and kept on blocks of melting ice in Cairo’s mosques and of grieving families surrounding their dead on television screens and front pages of newspapers are other images of Egyptians thanking the military for one of the bloodiest massacres in recent history. This grotesque juxtaposition of images marks the violent denouement of the promising democratic sprouts of the Arab Spring.
The triumph of the counter-revolution also illustrates how the very narrative is tinged with elements that preclude a peaceful, democratic, and equitable resolution to the crisis. By pitching the conflict as between the Muslim Brotherhood and the military that ousted the first democratically elected president with the support of millions of Egyptians, the narrative erases crucial nuances. Opponents of the coup not only include the Muslim Brotherhood but also the secular sections who opposed the overthrow of a democratically elected government. In a poll reported by the Middle East Monitor, a week after the coup only 26 percent supported the coup while 63 percent were against it. If President Mohamed Morsi’s majoritarian rule alienated liberals, support for the military came from very large sections of the Hosni Mubarak regime that had been ousted by the Cairo chapter of the Arab Spring in February 2011.
This is what counter-revolution looks like
The blood-drenched counter-revolution triumphed—no one can now pretend that a democratic restoration is on the agenda, not even US Secretary of State John Kerry who said less than two weeks before the Egyptian military massacred its own citizens in Cairo that they were “restoring democracy” by ousting Morsi—as Adam Shatz noted, because the military and remnants of the old regime not only had better resources at their command but also a singular goal that the democratic mass movement lacked. What is more, most of Egypt’s allies—except notably for Turkey and Qatar—were clearly more comfortable with the military that promised “stability” than with the Muslim Brotherhood that had won the country’s first elections.
Much has been written about President Morsi’s overreach for power despite having secured only 51.7% of the vote in a run-off against a factotum of the old regime, Ahmed Shafik, the last prime minister to serve under Hosni Mubarak. After his Muslim Brotherhood engineered a walkout of the opposition from the Constituent Assembly, it rammed through a constitution in a referendum that was boycotted by most Egyptians. It received only 63 percent of the vote from the 30 percent of the eligible electorate—meaning the support of only 20 percent of the population.
Since the judiciary—a holdover from the Mubarak era—had invalidated the election of the lower house of parliament, President Morsi declared by fiat that the ceremonial upper house, the Shura Council—only 7 percent of which had been elected—was the parliament and had them pass a law that lowered the retirement age of judges from 75 years to 60 years. This would have put 25 percent of the judges out to pasture and enabled the Muslim Brotherhood to control all three branches of government as President Morsi has also nominated many members of the Shura Council.
Yet, the Western commentators who denounced this naked grab for power conveniently forget that in the United States, George W. Bush, not only stole an election but then went on to invade Iraq and destabilize the whole region without any popular mandate. Be that as it may, it is now clear that Morsi’s biggest failure was not to neutralize the country’s coercive apparatus—unlike Iran’s Ayatollah Khomeini who set about to decapitate the Shah’s army as soon as he attained power.
Large demonstrations in Cairo against Morsi and in support of his ouster also were misleading. Cairo and Alexandria were never Muslim Brotherhood strongholds, and in fact in the first round of the presidential elections neither of the top two candidates—Morsi and Shafik—won the most votes in these cities.
Though human rights activists had hoped that as Morsi had himself been targeted by the police during his long years in opposition, he would rein in the police, he openly praised the police for its role in the 2011 revolution—a revolution in which uniformed and plain clothes officers had killed over 800 people, just as they are killing Morsi supporters now. The military has also been unrepentant about its role under the old regime: as late as June 2012, the military strong man, General Abdul Fattah al-Sisi justified the “virginity tests” the Supreme Council of the Armed Forces inflicted, among other humiliations, on women demonstrators during the Cairo chapter of the Arab Spring.
Ironically, the liberals and the secularists also looked to the military to rein in the Morsi government’s excesses and indeed to overthrow the elected government. Without the confidence that a violent attack on the protesters in the Rabaa Al-Adaqwaiya Squate and other locations in Cairo would enjoy a wide degree of popular support, the military would not have rejected out of hand the compromise that the EU envoy, Bernandino Leon, and the US deputy secretary of state, Willian Burns had crafted and which had been accepted the Brotherhood. Under that plan, the Brotherhood would sharply reduce the number of protesters and limit the protest camps to two and the military would release the speaker of the parliament as a gesture of good will.
But General al-Sisi calculated that there would be little to pay if he were to eliminate the Brotherhood as a legitimate political force and restore authoritarian rule. Indeed, the liberals installed in the interim government initially even blamed the massacre on the protesters killing each other! Nor did the liberals protest the interior minister, General Mohamed Ibrahim, a holdover from Morsi’s cabinet claiming that the anti-Morsi crowds in Tahrir Square gave him the mandate to resurrect the old regime’s hated secret police, the Amn al-Dawla or State Security force that had been disbanded in March 2011.
Reaction overseas to the coup has been muted as well. Despite the casualty numbers topping a thousand killed and many thousands injured, the Obama administration could not bring itself to call the ouster of President Morsi by the military a ‘coup’ since it would then trigger an end to the $1.3 billion in aid the Egyptian military receives from Washington. As Juan Cole has argued the United States cannot substantially cut its aid to Egypt because much of it is corporate welfare for its domestic companies—US aid is effectively a credit card that Egypt must spend to buy US military and civilian supplies—and part of what passes for ‘US aid to Egypt’ is paradoxically for joint Israeli-Egyptian patrols and thus goes in part to Israel!
Saudi Arabia, in fact, has offered to compensate the military for any cuts in aid from the United States and the Israelis who have had a long relationship with al-Sisi when he was chief of military intelligence has also been lobbying for him in Washington. In fact, Patrick Smith underlines that it may not be a coincidence that Israeli prime minister Benyamin Netanyahu agreed to “peace talks” with the Palestinians only a few days after the Egyptian coup. “The dreaded question here,” Smith asks, “is whether U.S. support for Israel effectively precludes political advance in the Arab world.” Indeed, so confident is the military now that it has arrested the supreme leader of the Brotherhood, Mohamed Badie—something that even Mubarak had not done. Compounding its arrogance, it is also bringing charges of treason against Mohamed el-Baradei for resigning his post as vice president for international affairs in the interim government in protest against the massacres! Emboldened by the coup, the judges appointed by Mubarak have cleared him of all charges.
So confident has the military become that the New York Times reports that the “police scarcely bothered to offer a credible explanation for the deaths of three dozen Morsi supporters in custody over the [last] weekend. After repeatedly shifting stories, they ultimately said the detainees had suffocated from tear gas during a failed escape attempt. But photographs taken at the morgue on Monday showed that at least two had been badly burned from the shoulders up and that others bore evidence of torture.”
Identity politics and the declining salience of class analysis
The triumph of the counter-revolution has been met with resignation because it is seen as a choice for stability and a choice between two bad options since the debate has framed it as a conflict between political Islam and a secular military, one that would foster dangerous religious fundamentalism across the region and the other which would guarantee Israel’s annexation of Palestine and the kleptocratic oligarchies of Arabia.
By targeting political Islam as embodied by the Muslim Brotherhood as one axis of the conflict, secular opponents of the Ancien Régime and the Coptic Christian minority are cast in the role of defenders of the military overthrow of the elected government. And it followed as the night the day that the August bloodbath was followed by Muslim Brotherhood members torching Coptic Christian churches, businesses, and homes across the country as well as government offices. Yet, no one seems to have highlighted the military’s spectacular dereliction of duty in not safeguarding the churches and the Christian minorities. Indeed, it is likely that in an act of cynical callousness, the military deliberately left them defenseless to expose the Brotherhood.
On a broader scale, what is striking is that conflicts in the Islamic world are always portrayed as sectarian rivalries (between Sunnis and Shias) or ethnic conflicts (Kurds, Alawites) or between secularists and political Islam. But this is not limited to the Islamic world as identity politics has erased class politics virtually everywhere. In India, conflict is typically portrayed in casteist and religious terms, in Africa in tribal terms.
The rise of neo-liberalism and the parallel demise of socialism has meant that class has virtually been erased as a salient category of analysis. Class is central to capitalism. As Arif Dirlik underlined some two decades, even if categories like gender and ethnicity are social constructs, in most cases they correspond to readily identifiable referents. Not so with class which has to be derived from an analysis of the operation of capitalism itself. But class alone is never sufficient given the complex, multi-layered mosaic of social life. Gender, ethnicity, religion, language, sexual orientation are all axes of domination and subordination that are not reducible to class. What we need is a recuperation of secular categories to frame our narratives.
The military has defeated the democratic popular movement that characterized Tahrir Square but it cannot solve the economic morass that engulfs Egypt. The deteriorating political situation has undermined its tourist industry and unemployment now runs at 50 percent. Since Egypt requires at least $20 billion next year to keep the economy going, further austerity measures will be implemented as per the dictates of international financial agencies. Worsening economic conditions will only draw more recruits—martyrs—to the Brotherhood which will deepen the crisis.
It is only by acknowledging the gross inequalities in wealth and power, and seeking to reverse them that the beginnings of a new more equitable and democratic world order can be laid. And this requires secular categories of analysis not a rehearsal of tired old categories of religious fundamentalism
Tags: democracy, Egypt, Human Rights, Middle East, world politics
Once again, blood is flowing in the streets of Cairo. In the bloodiest crackdown against the Muslim Brotherhood, on a dawn raid at the protest camps in the Rabaa al-Adawiya mosque and Nahda Square near Cairo University, over 235 protesters and 40 policemen have been killed and the death toll is certainly going to rise. The Muslim Brotherhood, angry at the ouster of their democratically elected president, Mr. Mohamed Morsi, and the third mass killing of their members–over 14 when the army ousted the president on July 3 and at least 82 on July 27–have lashed out burning government buildings, Coptic Christian churches in Assiut, Sohag, Minya, Suez and Arish, and a Jesuit school in Minya.
Government television broadcast pictures of the Muslim Brotherhood supporters firing at the troops and showed them hiding ammunition and weapons in coffins. But why wouldn’t the Brotherhood try to arm themselves when the military has already cracked down on them twice and ousted their government? Even then it is clear that they were no match for the military and its snipers as the death toll indicates.
Given the brutality of the military crackdown, it is clear that democracy would not be restored in Egypt anytime soon, despite US Secretary of State John Kerry’s incredible claim that the military deposed President Morsi to restore democracy. The EU envoy, Bernardino Leon who, along with US deputy secretary of state William Burns, had formulated a political plan to end the impasse in Egypt said that the Brotherhood had accepted the plan but the military walked away from it and launched the bloody crackdown. The military was clearly preparing to cement its power as it installed 19 generals and 6 Mubarak loyalists as governors of Egypt’s 25 provinces the day before yesterday’s crackdown. One of them, General Mahmoud Othman Ateeq, had been a deputy governor of Alexandria in 2011 when he was filmed raising his gun against teachers who were begging him for their lives.
After the violent annihilation of their members, the imprisonment of their leaders, the impounding of their bank assets, and the closure of their media outlets, the Brotherhood, Egypt’s largest political organization by a country mile, is not likely to take part in any democratic political process. Indeed, given the Brotherhood’s sizable mass base, it is highly unlikely that the military leader General Abdel Fatah al-Sisi will even risk allowing them to compete in the elections. This is a repeat of the elections in Algeria in 1992 when the military cancelled the polls which the Islamicists were poised to win–and the 2007 victory of Hamas in the Palestinian elections when they were confined to Gaza and subject to a vicious siege. The message to the Muslim Brotherhood could not be clearer: you will not be allowed to win a democratic election.
Is it any wonder if they resort to insurgency? All that John Kerry can offer is to ask both sides “to take a step back” and assess the situation. Yet, what step back can the Brotherhood take except to will themselves out of existence. Despite their president being ousted, they signed on to the political compromise crafted by the EU and the US only to see the military reject it out of hand.
The military claims that it has wide popular support. And that is true at the moment because the Morsi government was incompetent and tried to push through a majoritarian agenda and ride roughshod over its opponents. Yet, it must be remembered that this popular support includes adherents of the old Mubarak regime and that popular support will soon evaporate as the military government is not positioned to solve Egypt’s economic problems. While the exact extent of the military’s economic interests are classified, it is widely estimated that it controls over 40 percent of the national economy–and beyond the arms factories, it produces a range of goods from washing machines and butane cylinders to olive oil and pasta. It is not voluntarily going to dismantle its economic empire, nor is it likely to repeal the austerity measures required by the IMF and the World Bank as the price for a $4.8 billion loan. Unemployment now runs at 50 percent and since Egypt requires at least $20 billion dollars next year to keep the economy running, further austerity measures are in store.
Under the Mubarak regime, the Brotherhood ran an extensive social service operation to provide the welfare that the state could not. Under current conditions of oppression, rather than run this safety net, it is likely to use the deteriorating economic situation to fuel its insurgency. This is a time for the United States to compel its allies in the Arab world–Saudi Arabia and many of the oil-rich Persian Gulf states–that are supporting the military coup to cut off aid to the military and force it to cede power to a democratically elected new order, an political order that accommodates the Muslim Brotherhood.
Tags: Brazil, China, democracy, Egypt, Europe, India, Libya, Middle East, South Africa, Tunisia, United States
Heaping irony upon irony, three weeks after protesters cheered the military for ousting Egypt’s President Mohamed Morsi, the new strongman, General Abdel Fattah al-Sisi called on the people to take to the streets in a show of support for him to defeat “violence and potential terrorism.” And taking the large crowds that gathered in Tahrir Square as a mandate to crush supporters of the democratically elected president, the army launched a massacre of Morsi loyalists at their Cairo sit-in on Saturday 27 June 2013.
Much has been written about President Morsi’s overreach for power despite having secured only 51.7% of the vote in a run-off against a factotum of the old regime, Ahmed Shafik, the last prime minister to serve under Hosni Mubarak. But perhaps his biggest failure was not to neutralize the country’s coercive apparatus, laughably called its security services.
Though human rights activists had hoped that as Morsi has himself been targeted by the police during his long years in opposition, he would rein in the police, he openly praised the police for its role in the 2011 revolution—a revolution in which uniformed and plain clothes officers had killed over 800 people, just as they killed Morsi’s supporters last Saturday. The military has also been unrepentant about its role under the old regime: as late as June 2011, General al-Sisi justified the “virginity tests” the Supreme Council of the Armed Forces inflicted, among other humiliations, on women demonstrators during the Cairo chapter of the Arab Spring.
In yet another irony, the liberals installed in the interim government by the military blamed the massacre on the protesters killing each other! Nor have the liberals protested the interior minister, General Mohamed Ibrahim, a holdover from Morsi’s cabinet claiming that the anti-Morsi crowds in Tahrir Square gave him the mandate to resurrect the old regime’s hated secret police, the Amn al-Dawla or State Security force that had been disbanded in March 2011. As University of Oklahoma professor Samer S Shehata observes, Egypt’s tragedy is that “its politics are dominated by democrats who are not liberals and liberals who are not democrats.”
When television cameras beam pictures of massive crowds in Tahrir Square opposing President Morsi and the Muslim Brotherhood, it is well to remember that in the first round of last year’s presidential elections, the candidate who won a plurality of votes in Cairo and in Alexandria, Egypt’s second city, was neither Morsi nor his opponent in the run off election, but a secular candidate, Hamdeen Sabahi. Long decades of providing social services to poor neighborhoods in Cairo and other cities, and in the rural areas where most Egyptians live has created a massive constituency of support for the Muslim Brotherhood. No democracy can take root in Egypt by excluding them as the military seeks to do with the connivance of the liberals and the West.
When secular Egyptians—even radicals like Samir Amin—rejoice at the military’s ouster of a democratically elected president and plaster the general’s photo all across Cairo, they repeat Morsi’s fatal mistake of relying on the army and the police rather than on democratic institutions and protocols. By shutting down Islamists’ media outlets, reviving the secret police, and conspiring to ban the Muslim Brotherhood entirely, the military is fast overturning the gains of the Arab Spring. No future government is safe from military intervention.
The coup d’etat against Egypt’s democratically elected government will have resonances far beyond the country’s borders. As the oldest and most influential Islamist movement, the Muslim Brotherhood has affiliates across the Islamic world and while these parties have largely renounced violence, now they could well conclude that violence is the only way to achieve power. After all, previously in 1992, as the Islamists were poised to win an election in Algeria, the army annulled the election. After they are denied office a second time, why should they place their hopes again in the electoral process? An ultraconservative Libyan cleric, Sheikh Mohamed Abu Sibra has already admitted that it has become impossible to persuade militias in Benghazi to lay down their weapons.
The interim government imposed by the military is also not going to be able to solve Egypt’s economic problems that also fueled the opposition to the Morsi government. When the tourist industry was in the doldrums and over 40% of the population was living below the poverty level, Morsi ended the food and utility subsidies as demanded by the IMF as the price for a $4.8 billion loan. As prices soared, food became unaffordable and the World Food Program reported that the growth of a third of all children in the country was stunted in 2011. Neither the military nor the interim government it installed is likely to reinstate subsidies and the military which controls 40% of the country’s economy will zealously safeguard its privileges. No future government will dare tamper with the military’s perks.
With poverty and disenchantment in the streets, and continuing oppression of the Muslim Brotherhood, chances are that Egypt is in for a prolonged bout of conflict unless international forces intervene. By closing the life-giving tunnels to the Palestinians brutally imprisoned in Gaza, the military has played on Israel’s security fears and inoculated the coup against pressure from Washington. And the collapse of Egypt’s democratic essay has once again prompted the racist trope that Islam is incompatible with democracy. In an op-ed in the New York Times on the day after the coup, David Brooks wrote: “It’s not that Egypt doesn’t have a recipe for a democratic transition. It seems to lack even the basic mental ingredients.”
It is a real pity that the so-called emerging powers—China, India, Brazil, and South Africa don’t weigh in on the events in Egypt and leave the West to define an ‘international response’! Democracy, after all, is not the exclusive preserve of the West—and the few governments elected by popular vote in Europe and North America before the Second World War were underpinned by colonial or neo-colonial exploitation of the peoples of Africa, Asia, Latin America, and the Middle East. Democracy is no privileged preserve of any peoples–and the peoples of the world ought to pressure governments everywhere to adhere to democratic norms!
Tags: Capitalism, democracy, Human Rights, Manufacturing, United States, Urban, world politics, World-economy
Detroitism has emerged a while ago to encapsulate the emergence of urban ruins in North America and Europe–from Camden NJ to Naples and Bucharest–with the decline of manufacturing and the outsourcing of production to low- and middle-income economies in Asia and Latin America. Populations of these cities have declined sharply–from 1.8 million fifty years ago to 700,000 today in Detroit, shrinking tax revenues and depressing property values leading to a degradation of city services and civic amenities and spiking the crime rate. Abandoned houses are stripped of their valuables–metal and copper are sold to junk merchants to be sent to India and China to be melted down and recycled to fuel these ’emerging economies.’
Smaller towns and cities in the United States have been declining even longer–for more than a century as the mechanization of agriculture and the exhaustion of natural resources set in even before manufacturing began to move to the non-unionized states of the ‘Sunbelt’ and later to even lower-wage locations overseas. And the emergence of ‘big box’ retailers like Wal-mart hollowed out their commercial cores as Edward Alden noted.
And so it has been with Binghamton, located at the confluence of the Susquehanna and the Chenango rivers in southern New York State. A small farming community till the Chenango Canal was constructed in the mid-1830s, linking it the the Erie Canal at Utica. In addition, the arrival of the railways in the mid-19th century transformed the area into a minor industrial hub for the production of cigars, and later shoes, and high-tech electronics. Between 1860 and 1880, the population of Binghamton rose from 8,325 to a little over 35,000. Tanneries and shoe factories–most notably the Endicott Johnson shoe factory–made Binghamton and its neighboring Johnson City one of the major shoe manufacturing centers in the United States
By the mid-1950s however, competition from several other locations led to a steep decline of shoe production though its impact was cushioned by the rise of several high-tech firms: IBM which was founded in nearby Endicott, Edwin Link who invented the flight stimulator, Valvoline which was to become Whirlpool Corporation
At the same time, the construction of the interstate highway system, led to a fall in ridership on the trains and the last passenger train rolled off the tracks of the Lackawanna Station in Binghamton in December 1964.
The continuing growth of IBM and other technology companies related to defense and the location of one of the four university centers of the State University of New York system led to further growth over the next two decades.
Yet, the gradual decline of IBM and the closure of the last shoe factory in the 1990s led to a precipitous decline in the fortunes of the city. The arrival of big box retailers like Wal-Mart finally hollowed out the city’s commercial core.
The population of Binghamton, which had peaked at 80.674 in 1950 slid to 47, 376 in the census of 2010–less than it was a 100 years ago in 1910.
Tags: Chile, democracy, Egypt, Europe, Human Rights, international relations, Middle East, Muslim Brotherhood, United States, world politics
Egypt’s Tahrir Square is once again dominating world news. For the second time in a little more than two years, the army has deposed a president. If the first had ruled as a dictator for 30 years, the second was popularly elected and had been in office for just 12 months. Both times there were massive protests and using these protests as a pretext, Western politicians and their allies in the Middle East have cautiously welcomed the ouster of a democratically elected leader–even calling it a ‘democratic coup’, an oxymoron if there ever was one. Egypt’s tragedy now, as Samer S. Shehata puts it is that “its politics are dominated by democrats who are not liberals ands liberals who are not democrats.”
Just as the masses there had brought about the ouster of the long-serving ruler Hosni Mubarak in February 2011, much larger popular assemblies gathered in the square on June 30, 2013 on the anniversary of President Mohamed Morsi taking office to demand his ouster. Nabuib Sawiris, a wealthy Coptic Christian businessman who founded the Al Masreyeen Al Ahrar party, tweeted that the BBC claimed that the demonstrations against Morsi were the largest in “the history of mankind” and though the BBC had made no such claim, the tweet went viral.
Be that as it may, that there was massive opposition to President Morsi was evident by the turnout of crowds demanding his ouster in Cairo, Alexandria, and elsewhere. Notably though these were cities that had voted for a different candidate, Hamdeen Sabahi–a secular leftist–than for Morsi or his rival in the run-off, Ahmed Shafik, Mubarak’s last prime minister. That Morsi secured only 51.7 percent of the vote in the run-off against a factotum of the old regime should have indicated the depth of opposition to the Muslim Brotherhood that Morsi represented.
The fact that the main secular candidate was able to capture the largest share of the vote only in the major urban centers puts in perspective the anti-Morsi protests in Tahrir Square. It highlights a sharp urban-rural divide that will only widen if the Muslim Brotherhood is not allowed to compete in the elections promised by the military-installed government.
Morsi turned out to be an incredibly incompetent president. Despite his narrow margin of victory, he overreached the mandate given to him especially last November when he sought to place himself above the law–though he quickly reversed himself after the streets erupted in anger. He pushed through a constitution after all the non-Islamic parties had walked out. When jt was put to a snap referendum, the turnout was only 32 percent of the eligible voters as most opposition groups boycotted the referendum.
Of course, what Morsi did was not very different from what George W. Bush did in the United States–after stealing an election with the help of Supreme Court judges nominated by Republican presidents, he set to rule as if he had a massive mandate to impose a far-right agenda!
Soon after Mubarak was ousted, Egypt’s Coptic Christians faced increased attacks and Morsi did nothing, after he came to power, to reassure them.Under the military interregnum between the fall of Mubarak and Morsi’s election, assaults against women rose sharply and the current minister of defense and head of the military who deposed Morsi, General Abdul-Fattah al-Sisi, Gilbert Achcar, writes
distinguished himself in June 2011 by justifying the “virginity tests” that the SCAF [Supreme Council of the Armed Forces] had inflicted, among other humiliations, on seventeen female demonstrators who had been arrested on Tahrir Square in March.
Morsi had to contend with remnants of the Mubarak regime which were deeply ensconced in the bureaucracy, the judiciary, and the military, Just days before the presidential run-off that Morsi won, Egypt’s Constitutional Court appointed by Mubarak dissolved the first popularly elected lower house of parliament dominated by the Muslim Brotherhood. More than a week before the military gave Morsi an ultimatum, it had begun deploying troops in cities without informing him. And the police refused to protect offices of the Muslim Brotherhood from attacks.
Meanwhile, the economy nosedived as Morsi implemented the IMF’s plans to end food and utility subsidies which led in turn to more street protests that ensured that the country’s tourism sector would not recover. When 40 percent of the population was below the poverty line of $2 a day, the IMF’s austerity measures imposed to secure a $4.8 billion loan, compounded the pressures and led to the explosive street protests.With the weakening of the currency, food prices have soared and the World Food Program reports that 31 percent of children experienced stunted growth in 2011. it is not that food is unavailable–just that it is not affordable and the withdrawal of subsidies under IMF directions will only make matters worse.
None of the candidates seeking to replace Morsi have rejected the IMF’s ruinous austerity drive. Hence, Morsi’s ouster even if followed by an election is not likely to turn Egypt’s economy around. If anything, it could make matters much, much worse. In a remarkably unguarded editorial, the Wall Street Journal opined
Egyptians would be lucky if their new ruling generals turn out to be in the mold of Chile’s Augusto Pinochet, who took power amid chaos but hired free-market reformers and midwifed a transition to democracy. If General Sisi merely tries to restore the old Mubarak order, he will eventually suffer Mr. Morsi’s fate.
Of course, after Pinochet assassinated Salvador Allende, Chile did not begin a transition to democracy for 18 years during which opponents of the regime were routinely tortured and executed en masse. As Amy Davidson writes,
Egyptians might not consider themselves as lucky if Cairo’s sports stadiums were turned into mass-execution sites, as Santiago’s were. (One wonders how many free passes for arbitrary arrests the Egyptian generals will earn from the Journal for each free-market reformer they hire.)
Despite Morsi being democratically elected, such is the West’s abhorrence of the Muslim Brotherhood, that neither Washington nor the European capitals have condemned his ouster and called it a military coup. Defending the coup, Tony Blair writes in the Guardian
I am a strong supporter of democracy. But democratic government doesn’t on its own mean effective government. Today, efficacy is the challenge.
David Brooks, goes further–and denies that democracy can even work in Egypt in breathtakingly racist terms:
It’s not that Egypt doesn’t have a recipe for a democratic transition. It seems to lack even the basic mental ingredients.
Yet, what the coup does most of all is to reverse the Arab Spring which had put the army back in its barracks. The military is once again king maker and future governments are unlikely to defy the military–the military that controls some 30 to 40 percent of the Egyptian economy and insulates itself from the economic problems of the masses. The military has not merely ousted Morsi, as Fawaz Gerges notes, “it has ousted democracy.”
This need not have happened. As the protests grew, Morsi offered to form a government of national unity–when he was on the ropes, he could have been forced to accept a prime minister acceptable to the opposition.
There is no indication that the military–or any government that it installs–is going to reverse the austerity policies that hurts the most vulnerable Egyptians. The military has already withdrawn the offer of prime ministership that it had made to Mohammed el-Baradei, the former head of the International Atomic Energy Agency and Nobel Prize laureate, as the Islamist Nour Party refused to work with him. Coptic priests continue to be killed and more than 80 women were assaulted in Tahrir Square on the night al-Sisi announced Morsi’s ouster. If they are willing to work with the Islamists, why should the Islamists trust the military after the ousted Morsi? And if they exclude them, they are ignoring the 50 percent who voted for Morsi and the country’s best organized political force.
Morsi’s ouster had region-wide significance. If the world looks idly by, why should Islamists elsewhere participate in democratic processes. As Sheikh Mohamed Abu Sidra, an ultraconservative cleric in Benghazi, Libya says it is now impossible to persuade the militias there to lay down their weapons and trust in democracy:
Do you think I can sell that to the people anymore? I have been saying all along, ‘If you want to build Shariah law, come to elections.’ Now they will just say, ‘Look at Egypt,’ and you don’t need to say anything else.
This was the time for the United States to call for the restoration of democracy but once again. Washington and its allies have sided with the anti-democratic forces. Perhaps to ingratiate themselves with the United States, a day after ousting Morsi, the military demolished the tunnels with Gaza, the tunnels that were vital lifelines to the besieged Palestinians.
The problem of a country where the democrats are not liberal and the liberals are not democrats as Shehata put it so well is not going to be solved any time soon. Democrats must accept that minorities have rights, stakes, and interests that must be protected, and liberals must recognize that armies cannot be king makers in democracies.
Tags: democracy, Human Rights, Syria, Turkey, United States, world politics
What began as a peaceful sit-in against government plans to turn Gezi Park, one of the last remaining green spaces in Istanbul, into a shopping mall has been met with perhaps the most violent police attacks on peaceful protesters in recent history.
Initially, trotting out clichéd Western tropes about the Middle East, international media had painted the clash between protesters and the government as a conflict between secular and Islamist Turks. The claim that this is a secular revolt against an Islamic identity is based on prime minister Recep Tayyip Erdogan’s ruling Justice and Development Party (AKP) winning 50 percent of the vote in the last elections. But the AKP’s support came not only from the Islamists. AKP’s successes at the ballot box has to do with the government diluting the dominance of the industrial family clans of Istanbul and steering benefits to the rural poor in Anatolia and elsewhere.
Faced with a disorganized opposition, the AKP government has become increasingly authoritarian. Last month, the Turkish parliament passed a law severely restricting the sale of alcohol, and the Ankara metro made an announcement asking passengers “to act in accordance with moral rules” after a couple was caught kissing on security cameras–an announcement that was met by dozens of couples locking lips in front of the capital’s metro stations!
Today, the protests stem from the government’s increasingly authoritarian policies and its majoritarian conception of power. Zeyno Üstun, one of the first 50 demonstrators to occupy Gezi Park on May 27 says
Sure, there are hardcore secularists in the crowds. But there are also feminists, LGBT activists, anarchists, socialists of various stripes, Kurdish movements leaders, unionized workers, architects and urban planners, soccer hooligans, environmentalists, and people who are protesting for the first time! Someone wearing an Atatürk [the founder of the Turkish Republic as a secular, ethnically Turkish nation-state] T-shirt walks alongside another waving a flag of [imprisoned Kurdish leader] Abdullah Öcalan.
Tags: democracy, Human Rights, India
During the last weekend, the entire city of Mumbai, India’s commercial capital came to a standstill as the xenophobic Hindu fundamentalist leader, Balasaheb Thackeray died on Saturday November 17, 2012. A 21-year old woman from Palghar in the neighboring Thane district posted on Facebook, the message:
This was “liked” by another 20 year-old woman, Renu Srinivasan. Shockingly, the two were arrested for “hurting religious sentiments” and by Sunday night, Shiv Sainiks–members of Thackeray’s political party–ransacked the orthopedic hospital of Dr. Abdul Dhada, the uncle of the woman who had posted the original message on FB.
In cold death as in life, Thackeray has been a menace, Since he founded the Shiv Sena–the army of Shiv–in 1966, he has plagued Maharashtra, first, by unleashing campaigns against migrants from South India, and later in the 1990s by vicious anti-Muslim agitations that led to more than 900 deaths, and in this century campaigns against North Indians. His strength stemmed from the Shiv Sena’s unions, which worked with employers to counter–and eventually subdue the more militant trade unions of the city’s textile mills. The Sena also acted as a cultural police targeting Valentine’s day celebrations, Indo-Pakistani cricket matches, and Pakistani writers and artists. Anyone critical of Shivaji, the great Maratha emperor also faced the Sena’s wrath as the historian James Laine found out when he wrote a book about Shivaji, Hindu King in Muslim India. His book was banned first in Maharashtra, and later in all of India, and the Bhandarkar Oriental Research Institute where he conducted his research was vandalized.
Rather than confronting arguments in a book, the preferred policy of the Indian government is to ban them altogether. Any book–or cartoon–that depicts someone or some community in an unflattering light is banned: recently a textbook that had a cartoon of Ambedkar, the Dalit leader; a novel by Rohinton Mistry; the noted scholar A. K. Ramanujam’s essay on the Ramayana; Salman Rushdie’s Satanic Verses to name just a few. Banning of books means of course no one in the country can assess the validity of the charges laid against the work in question and why a research institution where an academic consulted books should be vandalized is beyond rational comprehension.
Even then, the case of the arrest of the two women who were arrested in the latest incident should send a chill down the spine of everyone. They had not mentioned Thackeray by name and there are suggestions the arrests were made and the hospital vandalized to settle some local scores. Yet, how these FB posts were singled out among the literally thousands of such posts expressing similar ideas gives great concern.
No one can doubt it is fear that shut Mumbai down: surely one cannot expect the South Indians, the Muslims, and more recently the North Indians to moan the death of a man who persecuted them. What is worse, major political figures from the President of India to Bollywood stars and sporting royalty like Sachin Tendulkar all queued up to pay homage to him on his deathbed!
This is the real legacy of Bal Thackeray. To make political violence so routine that it ceases to outrage. To make the strategy of scapegoating and targeting particular ethnic, religious, or political groups part of the calculus of everyday politics. To make fear and intimidation a legitimate, accepted part of political leadership. And to constantly remind any potential critic, in media or otherwise, of the threat of violent reprisal for saying something that Thackeray and his thugs might not appreciate.
No less part of Thackeray’s legacy is the fact that the political establishment, world of Bombay celebrities, and mediapersons who fawned over him when he was alive as much as they are doing now appear to have quiescently accepted all of this. The curious insistence on journalists addressing Bal Thackeray as ‘saheb’ — imagine, for instance, an article beginning with the words, “Herr Hitler, responsible for the death of millions of German citizens”–merely reflects this legacy.
Only the former Supreme Court of India justice and current Chair of the Press Council of India, Markandey Katju, courageously proclaimed that he could not pay tribute to Thackeray for persecuting his many victims. This too is because
Thackeray did not…come out of nowhere. He was not the creation simply of disaffected subaltern Maharashtrian communities or of middle-class Maharashtrian communities who felt outsiders had snatched what was their due. He represented something central in Indian political society–not an essentialist, ahistorical tendency but a historically produced capacity for using violence as a form of political reason, the absence of a coherent vision of solidarity that could respect similarity and difference, and the many deep failures of the postcolonial Indian state that our exceptionalist pieties about Indian tolerance, coexistence, and secularism often obscure.
They are already talking of constructing a memorial for him in Shivaji Park–imagine what this must indicate to his many victims! Yet another blot on the tattered fabric of Indian democracy
Tags: democracy, Human Rights, Labor, US politics
People on the Left, even while criticizing President Barak Obama, often argue that there is no alternative to voting for him. Chameleon-like Mitt Romney, the Republican challenger, has disavowed his own greatest accomplishment–the Massachussets health care law that he passed when he was governor of that state–to pander to the hard-right Tea Party wing of the Republican party. A Romney victory, if he does not change his policies once elected and there is no indication that he will, would lead to further tax reductions on the wealthy, an increase in defense spending even though the armed forces do not request it, abject support for Israei’s Benjamin Netanyahu not only against the Palestinians but also for a pre-emptive strike against Iran even though the Israeli defense hierarchy is opposed to it, a rollback of Obama’s signature health care law, massive cuts in domestic spending that will have a disproportionately adverse effect on the poor. It would give the Republicans an opportunity to stack the Supreme Court for many years given that 3 justices are in their seventies and are likely to retire during the next presidential term. A Romney presidency would likely try to reverse Roe v. Wade especially if it can stack the Supreme Court and seek to ban gay marriages and reverse a host of social legislation. As indicated by the third and last of the presidential ‘debates’ on October 22, Romney is likely to continue an aggressive foreign policy.
Yet, because Romney is bad is not cause enough to endorse Obama. As Conor Friedersdorf wrote in the Atlantic Monthly,
If two candidates favored a return to slavery, or wanted to stone adulterers, you wouldn’t cast your ballot for the one with the better position on health care. I am not equating President Obama with a slavery apologist or an Islamic fundamentalist.
Though President Obama’s policies are not as heinous as promoting chattel slavery, as the New York Times reported on 29 May 2012, every Tuesday, the President discusses and personally approves a “kill list,” of targets intended for assassination without trial or due process by drones in Afghanistan, Pakistan, Somalia, Yemen, the Philippines and elsewhere. In these “Terror Tuesdays,” without any constitutional or legal mandate, Obama decides on the execution of people on macabre “baseball cards” including those of underage American citizens like the 16 year-old Abdulrahman Awlaki.
Obama’s rapid escalation of the drone war has not only killed thousands of innocent civilians but also probably created more enemies than those killed, apart from ruining the lives of hundreds of thousands–the constant noise of drones circling overhead in Afghanistan and Pakistan, driving people crazy by preventing them from sleeping and making them afraid of a strike at any hour of the day or night.
Domestically, the continuing economic crisis has had a disproportionately adverse impact on African-Americans, but Obama’s 2011 State of the Union speech was the first since 1948 not to mention poverty or the poor as Frederick C. Harris, director of the Institute for Research on African-Americans at Columbia University observed. Daniel Gillion, a political scientist at the University of Pennsylvania, wrote that in his first two years in office, President Obama talked less about race than any Democratic president since 1961.
Tags: Capitalism, democracy, European Union, financial crisis, Germany, Greece, Political Economy, Spain, United States, world politics
Though it should not have caused any surprise, the news that Eurozone economies had contracted by 0.2 percent in the second quarter of 2012 underscored the deepening economic crisis faced by the 17-state bloc. Though the German economy may have grown by 0.3 percent, France recorded a third straight quarter of no growth, and the Finnish, Italian, Portuguese, and Spanish economies all fell sharply. Greece, of course, suffered the steepest fall: 6.2 percent in the second quarter–and was 18 percent below its GDP level in the April-June quarter of 2008.
There is little doubt that the declines have been aggravated by a failure of political imagination. Confronted by budget deficits brought about by high levels of government borrowing and by the collapses of housing bubbles, the creation of a common currency has meant that indebted Eurozone economies have not been able to resort to a currency devaluation to gain a competitive edge. Consequently, the troika of the European Commission, the European Central Bank, and the International Monetary Fund sought to impose an “internal devaluation” on these economies by forcing budget cuts to lower government deficits and wage cuts.
It follows as the night the day that if budgets and wages are cut, the economy will shrink. Lower government spending due to budget cuts means welfare and pension benefits fall, the cost of health care rises, and educational opportunities vaporize. These impact far more adversely on the elderly and the young. With wage cuts, people have less money to spend and this will depress all sectors of the economy–as sales reduce because of lower spending, companies will slash their work forces leading to greater declines in sales and to further cuts in employment. In the most severely affected of the southern European economies, unemployment rates for the youth are already at 50 percent or more. By May 2012, unemployment in the euro zone had already reached 11.1 percent or 17.5 million people and the International Labor Organization (ILO) estimates that it would rise to almost 22 million in the next four years. And if the euro zone were to break up, the ILO estimates unemployment in the 17-state bloc could reach 17 percent.
The adverse conditions created by the stringent cuts mandated by the troika are aggravated by the greater interest rates imposed on the weaker economies by international financial markets–thus for instance, while Austrian banks and other financial institutions can borrow at 2 percent, Italian banks have to pay 6 percent. As these higher interest costs are passed on by the banks to their borrowers, the cost of doing business in Italy, Spain, Portugal, or Greece increases correspondingly and could even negate the wage cuts imposed by the troika!
The effects of economic contraction will spread to the better performing economies. After all, Germany has been able to have a strong industrial sector because cheaper credit to other eurozone members had allowed them to buy German products while the German small-scale sector–which employs 60 percent of the country’s labor force–did not have to worry about currency movements in other European countries or fear that a strong German mark will price them out of the market in other countries.
As Susan Watkins has written, German lessons on debt repayment are especially galling to the Greeks.
Under the Nazi occupation, a hefty monthly payment was extracted from the Greek central bank to cover the Wehrmacht’s expenses; in March 1942 an additional forced loan of 476 million Reichsmarks was levied by the Axis powers. Greek partisans put up some of the toughest military resistance to the Nazis in Europe; the damage wreaked by the occupiers’ revenge was commensurate. Reprisals were exacted on the civilian population at a rate of fifty Greeks for every German killed. Much of the country’s infrastructure was destroyed; forced exports and economic collapse helped bring about one of the worst famines in modern European history.
German occupation (strictly a tripartite occupation since the Italians and the Bulgarians also participated) of Greece also led to hyperinflation–Richard Clogg says it was
five thousand times more severe than the Weimar inflation of the early 1920s. Price levels in January 1946 were more than five trillion times those of May 1941. The exchange rate for the gold sovereign in the autumn of 1944, shortly after the liberation, stood at 170 trillion drachmas.
After the war, the question of German reparations were deferred till German reunification and in the so-called 2+4 (Bonn and Berlin with the US, the USSR, the UK and France) agreement of 1990, Greek claims were excluded. Though several Greek politicians including the current prime minister, Antonis Samaras when he was the foreign affairs minister in 1991, had raised the issue of 476 million marks with the Germans, their demands were summarily dismissed. If this money had, in fact, been paid as the Germans are legally obliged to do, with interest for more than half a century, Greece would no longer be a problem economy.
It is galling too because while ancient historical myths as Greece being the ‘birthplace of democracy’ are routinely trotted out in discussions of the contemporary situation, recent history that people over 70 remember are carefully hidden from view! Be that as it may.
What is crucial is that the crisis demonstrates that capital and finance markets need to be regulated more stringently. It was irresponsible lending that led to high government deficits in Greece and to the housing bubbles in Spain and Ireland, to the subprime crisis in the US, and to the meltdown of the Icelandic economy to mention just the most obvious cases. Financial markets are continuing to demand punitive rates of interest from the weaker economies. The unchecked power of finance must be corralled–or we will enter another great depression just as the obsession with the gold standard led to the depression as Karl Polanyi showed in his Great Transformation.
What is required is a new political imagination not the shrill advocacy of measures that have already aggravated the situation!