Yesterday, National Public Radio (NPR) aired an interview with a former prisoner in Iran to discuss the recent release of 5 Amerikan citizens from an Iranian prison. The focus was on the horrible effects of solitary confinement and how to adapt to being back in society.
In our 2008 survey of long-term solitary confinement in the United $tates, we found that there were over 90,000 people suffering in those conditions. It is strange for the NPR story to not have mentioned this problem at home as well, or how the oppressed people in this country fair after years in torture cells. The NPR report spoke of “death chambers” in the Iranian prison, yet the United $tates has electric and now injection chairs with viewing areas and what they call “death row” in prisons across this country (though only about a dozen states are actively murdering prisoners in recent years).
The United $tates has long had the highest imprisonment rate across the world. They even boasted a higher imprisonment rate of Black people than the internationally condemned apartheid regime in South Africa.
The one-sided depiction of prisons and solitary confinement in Iran on NPR revealed a strong bias in their reporting. Yet what was most shocking to learn was that these people coming out of Iranian prisons were being offered what sounded like a fully immersive program through the U.$. military for dealing with the mental anguish of being in long-term solitary confinement.
Really? Yet every year we have comrades who are released from the same conditions in this country with nothing but a parole officer watching over them, often sabotaging their efforts to maintain a job and build a new life. Tens of thousands of people every year are released from long-term solitary in the United $tates, either into general population prisons or to the streets, with no concern for their mental well-being from the state. Who the U.$. imperialists offer mental health services to is a political decision, and it is our politics that guide us to offer help to those the imperialists will not.
As of last week, the California Mandela Act (AB 280) passed a supermajority in the state house and senate, heading next to the desk of Governor Newsom. Newsom vetoed the Mandela Act just one year ago. An aspiring presidential candidate, Newsom is likely to reject the calls from the state legislator to stop this torture again. This is over a decade after the historic California hunger strikes that called for an end to long-term solitary confinement, leading to the 2015 Ashker vs. CDCR settlement where those sacrifices led only to individuals being released from the SHU, leaving the institution in place.
For comrades currently suffering in torture cells in U.$. prisons, you can write to us for back issues of Under Lock & Key on solitary and materials from the American Friends Service Committee on dealing with isolation. For comrades who are getting out, who have spent long periods in solitary, our Re-Lease on Life Program attempts to offer mentoring, guidance and political engagement to ease the transition back into society. Meanwhile, we encourage everyone to get involved in the struggle to abolish long-term solitary confinement in this country completely.
Because over 100,000 people face torture in solitary in the United $tates every year with no imperialist Army programs for rehabilitation offered afterwards, we must develop independent institutions of the oppressed to address this material need among the oppressed masses in this country.
In the last month we have seen the state of Georgia bring RICO Act charges against Rudy Giuliani and others who worked with Donald Trump to steal the 2020 U.$. presidential election, as well activists who were doing things as simple as handing out fliers opposing the construction of Cop City in Atlanta.
The Federal Racketeering and Corrupt Organizations Act (RICO) was enacted in 1970 as a tool to charge people with crimes when they were having other people do their dirty work for them. Each crime charged under RICO can add years to ones prison sentence. The Georgia RICO Act of 1980 covers more crimes than the federal version. The Georgia Act makes Racketeering a felony in the state.(1) Historically, we have had multiple readers who were victims of RICO Act charges brought during the Giuliani years in New York City, and more recently in the Atlanta area, for their leadership roles in lumpen organizations, the more typical target of RICO.
Rudy Giuliani earned fame as a federal prosecutor for getting Mafia bosses in New York City convicted on RICO Act charges. He then used his reputation to become a “tough-on-crime” mayor of New York City known for “cleaning up” the city. It was during Giuliani’s time as Mayor of NYC that the infamous case was brought against King Blood (aka Luis Felipe) under the RICO Act. King Blood was charged for murders committed while ey was already in prison and received the inhumane and unprecedented sentence of life in solitary confinement. All of King Blood’s First Amendment rights to communication were denied, allowing only communication with eir lawyer and immediate family. This was not typically something a judge could sentence, but was justified via the racketeering statute, 18 U.S.C. § 3582(d).(2) Decades later, King Blood still sits in a torture cage in ADX Florence, isolated from the world. While the RICO charges against Giuliani may provide some cathartic humor, the 79-year-old will not be facing anything like King Blood is doing.
Weeks following the Georgia RICO Act charges against Trump, Giuliani, et al., another set of RICO Act charges (and domestic terrorism charges) were made against 61 activists involved in opposing the construction of Cop City in Atlanta. This is a continuation of the state’s warfare against Stop Cop City, including the ludicrous money laundering charges brought against bail support fundraisers we reported on in the last issue of ULK.(3) In the recent RICO indictment, the date of the murder of George Floyd (25 May 2020) is stated a the beginning of the investigations around the so-called “racketeering.” In other words, the state was trumping up these charges against activists before there was a Stop Cop City movement. This is not about stopping any criminal conspiracy, it is about repressing any opposition to the use of lethal police force against New Afrika and oppressed people in general. It is a defense of the state’s right to wage violent war against New Afrika.
In a recent article, a comrade laid out the political nature of the law, debunking the myth that laws were developed as a way to impose morality or address inherent problems in society.(4) Rather law stemmed from the need to manage the division of humyns into classes. With Trump/Giuliani, we see the RICO Act law being used by the bourgeoisie to discipline other bourgeoisie who are threatening the image of bourgeois democracy. And in the case of the 61 activists they are using the same law to discipline youth and oppressed nations who are opposing more violent forms of state discipline.
When we go up against the courts, the police, or even the politicians, we must be prepared for war. The cops murdering us in could blood is war. The courts and prisons putting us in torture cells for years is war. City governments in Atlanta and San Pablo, California funding cop cities where pigs can play war games is war. These more obvious forms of war, are part of political struggle. There are no rights, only power struggles. To engage in power struggles, requires giving the war two sides.
^*Notes: 1. https://en.wikipedia.org/wiki/Georgia_RICO_(Racketeer_Influenced_and_Corrupt_Organizations)_Act 2. Prison Legal News, 15 March 1999, Judicial Sentence of Life in Solitary Upheld. 3. A comrade, July 2023, “Law and the Courts of Late”, Under Lock & Key No. 82. 4. A comrade of Anti-Imperialist Prisoner Support, July 2023 “Atlanta Criminalizes Protest Against Cop City”, Under Lock & Key No. 82.*^
For all it’s self-proclaimed enlightened ways, U.$. imperialism continues to uphold the myth of race in everything it does. Enter the Supreme Court with their historic decision to end affirmative action in higher education. While the “race-conscious” policy did benefit (some in the) oppressed nations, the framework of race, created by the oppressor, continues to setback the progress of the oppressed.
Chief Justice John Roberts wrote in the majority position, “Many universities have for too long… concluded, wrongly, that the touchstone of an individual’s identity is not challenges bested, skills built, or lessons learned but the color of their skin… Our constitutional history does not tolerate that choice.”
We are not in the game of integrating oppressed people into the oppressor nation, but affirmative action based on “race” did prove an effective way to do that. Ending it will mean less oppressed nation people in higher education as recent history in California has shown.(1)
However, the racial statistics used to tout the success of affirmative action can be misleading. Because “race” and not income, or zip code, or cultural background are used in many of these statistics, what looks like perfect representation by skin color may be doing nothing to benefit the New Afrikan masses. Extrapolating from some broad statistics, one author estimates that maybe 7 or 8 of 154 “Black” freshman (5%) at Harvard in 2020 were from families defined in the U.$. as impoverished. Whereas, in the general population, 30% of New Afrikan youth are from impoverished households. This article also cites anecdotes saying the vast majority of black faces at Harvard are from bourgeois African families or had one Euro-Amerikan parent. Again, indicating affirmative action was not really benefiting the New Afrikan nation at Harvard anyway.(2)
The passage of the U.$. Civil Rights Act in 1964, which preceded the “affirmative action” practices we know today, was a comprehensive act to outlaw discrimination in what had been a segregated country. This was not just a result of the organizing of the oppressed within U.$. borders, but the pressure from the Soviet Union (though at that time they’d taken up the capitalist road) and China and the broader national liberation movement taking place across Africa, Asia and Latin America. And while progressive changes took place in the United $tates in the 1960s it did not quell the upsurge of national liberation struggles within U.$. borders because it never addressed the national question like the Soviet Union and China did. Rather it continued to institutionalize the concept of race through the new civil rights laws being passed.
By never addressing the national question, things like affirmative action, or Under Lock & Key can be attacked by the imperialist state as “racist.” To the imperialists the oppressed nations don’t exist, so when we talk about New Afrikans or Chican@s or Euro-Amerikans, they censor our literature for “racism.”
We must identify the principal contradiction to keep our eyes on the prize and not get distracted into dead-end politics. The principal contradiction we see under imperialism is nation, as well within the United $tates we say it is nation. This does not mean everyone from an oppressed nation is an ally. We must think in terms of percentages, not in black and white.
In discussing racism in political repression, Triumphant talks about the neo-colonial era. And we echo this sentiment that “skinfolk ain’t necessarily kinfolk.” That Black bourgeoisie are often playing significant enemy roles, in defense of U.$. imperialism.
However, just because neo-colonialism exists, it does not mean that nation is erased and class is all that matters. Neo-colonialism is still national oppression, it’s just a smarter form.
In reality, not seeing race at all is impossible for us in this racist society. Even when speaking of nations, we use phenotypes to classify people; we are still stuck in this model handed down by the European settlers who created “whiteness.” We must develop a political analysis to guide us that is beyond the myth of race and bloodlines, that instead operates in the material reality of nation, which J.V. Stalin defined as " a historically evolved, stable community of language, territory, economic life, and psychological make up manifested in a community of culture."
Comrade USW36 wrote on this topic:
i too, no longer use “Black” and “White” to define people. i’m a “New Afrikan”, Black is “created” by European settlers to enforce their new “white” identity rule. i hope all Rev Nats study Fanon (and Yaki’s “Meditations”), New Afrika, Native Amerika, and New Aztlan can be freed. We can be united and create a true North Amerikan Revolutionary Nationalist United Front to decolonize and delink from this imperialist juggernaut. Black and White identities won’t help us free any of the NA nations (i’d like also to salute New Asian Pacific Islanders).
If Amerika is the “prison house of nations”, if our aim is to weaken it from the inside, if revolutionary nationalism is viable then this isn’t just a path for New Afrikans it’s for us all, even European-settlers if they commit class-suicide. New Afrika isn’t just descendants of Afrika. It’s a scattered and potentially solidified nation with all sorts of “ethnicities”, and too, anyone can be a New Afrikan; shaming people ’cause they’re not “Black” enough or not at all is bourgeois bullshit. Someone like the Euro-Amerikan teacher Rachel Dolezal shouldn’t have been discarded like trash if she lied about her ethnicity; that could be corrected by self-criticism but if she consciously was willing to fight for the liberation of “New Afrika” then she’s a “New Afrikan” it’s that fucken simple. But we all need to wrestle with these contradictions here in the heart of empire.
A better example than Rachel Dolezal is Yuri Kochiyama, who was actually a citizen of the Republic of New Afrika (RNA), joining at its founding in 1968 along with a 17 year-old Mutulu Shakur. Kochiyama was a close comrade of el Hajj Malik el-Shabazz (Malcolm X when they met). As a child of Japanese descent she spent years in a U.$. concentration camp during WWII. The RNA continues to serve as a model for how to address oppression from within the empire. Armed with Maoism, revolutionary nationalism within the belly of the beast can lead us to a world with out racism.
For many months we’ve been hearing some grumblings from our readers about sky-rocketing commissary prices. Last issue we put out a call for more reports on this price inflation. But this inflation is not unique to prisons, and in recent weeks we’ve seen its impacts on the imperialists with a number of banks in the United $tates and Switzerland failing.
The cycles of boom and bust, which lead to instability, are inherent to capitalism and how it works. While the imperialists have adapted in many ways to keep things going, they can never solve these problems or prevent these cycles.
“since the prices of commissary has gone up due to inflation I think that all prisoners with jobs should be given pay rate raises to help with the new higher costs of living in the prison population. It is much harder to keep up with the financial strain. …I know that out in society whenever the cost of living goes up due to inflation so does our income and of course I am referring to low-income people – people on Social Security Income (SSI) or Social Security(SS) or struggling on Welfare. Well in prisons we don’t make anywhere near what is made on SSI or SS or even Welfare for that matter.”
"At the beginning of the Covid-19 crisis President Trump warned us against price gouging but that never stopped the jail system. The criminal injustice system put people in jail for stealing but then they turn around and steal from the same people they accuse of stealing. County jails are full of homeless people, drug addicts and indigent people who have limited means or no family or friend to help provide those means, yet the canteen prices for commissary are outrageous. These same products can be bought at the Dollar store.
"For example, items such as V05 shampoo, which you can purchase at the dollar store for $1.25, commissary price is $3.99. One ramen noodle can be purchased for $0.25 at the store, will cost you $1.19 in commissary. Also a 10 pack of SweetNLow costs $0.99. For generic denture glue it’s $7 in commissary compared to $1.25 at the Dollar store. The list goes on and on. Is that not price gouging?
“Prisoners are forced to accept it. They have no choice. They have to pay it or go without. Hygiene and medications they desperately need. My question to you – how do we change this and stop jails from stealing from prisoners?”
Price gouging or extortion is common in U.$. prisons where the state allows private companies to come in and prey on prisoners and their families with legally enforce monopoly pricing systems.
A comrade in New York responded to our call with some of the price increases seen there since July 2022.
Most price increases in New York seemed to be in the 10 to 20% range. As a member of the Incarcerated Individual Liaison Committee, this comrade wrote the Deputy Superintendent about the troubles they were having with getting items on the commissary list. They responded in September 2022,
“The commissary contract allows the vendor to bid items and the price is allowed to rise (or fall) based on the real world. They are not required to lose money. Our stocking situation reflects the real world supply chain issues and inflation.”
The comrade told us,
“the New York Department of Corrections and Community Supervision has raised the commissary buy limit from $75.00 to $90.00 to compensate for the inflation and changes to the package from home/vendor program that was implemented last year (2022).”
Unlike in the free world, not only do prisoners face limits on how much they can earn but also on how much they can spend.
Inflation is Real
Above, the NYSDOCS refers to the “real world” as being the cause of the rising prices in commissary. The fact of the matter is that inflation rates in the United $tates have been higher than we’ve seen in many decades for everyone. The Consumer Price Index (CPI) in December 2021 had increased 7% year-over-year, and in December 2022 it was 6.5%. That means over two years the inflation rate is around 15% for all consumer goods. In this context, the price increases in New York commissaries look pretty typical for the economy overall. That does not mean that this is inevitable, it is only inevitable in the type of economy we live in.
And it is only if we are slaves to the capitalist market forces that we must accept these price increases on necessities for some of the poorest people in this country. Even capitalist countries use subsidies to alter the market.
Socialist China had no inflation
The Communist Party of China seized state power in 1949 after over two decades of people’s war waged against the imperialists and their Chinese lackies among the comprador bourgeoisie and landlord classes. Immediately following liberation there were speculators
“still trying to manipulate prices and stirring up waves in the economy… who ignored the repeated warnings of the People’s Government, gold and silver prices kept soaring, pushing up all other prices. So on 10 June 1949 the Stock Exchange – that centre of crime located in downtown Shanghai – was ordered to close down and 238 leading speculators were arrested and indicted. The 1,800 gold and silver coin peddlers were released on the spot after being enjoined to lead a more honest life. At one stroke, the headquarters of speculation vanished forever from Shanghai.”(1)
Unfortunately that last statement proved untrue, as the Shanghai Stock Exchange was re-established on 26 November 1990, following over a decade of capitalist restoration in China.(2) This is why China has it’s own economic woes today. But for a quarter century, China had no inflation.
During the socialist period of 1949-1976, the Communist Party never resorted to bank-note issue as a solution for fiscal problems, relying on raising production and practicing economy instead.(3) This remained true through the Korean War and periods of famine in the 1950s.(4) During the Covid-19 lockdown period the capitalist economy suffered greatly because it cannot adapt to decreases in production. The solution in the imperialist countries was for central banks to print a lot of money and give it to the capitalists as well as their labor aristocracy, to keep consumption up and prevent economic collapse. The solution to the bank collapses in recent weeks has been similar, providing more liquidity from the U.$. Federal Reserve on loan to banks that can’t cover their balance sheets.
The communist approach in China was the opposite. Rather than putting as much money out into the world as needed, and encouraging banks to loan more than they have, the Communist Party forced banks to hold most of their currency, forced agencies to keep most of their money in the banks and prohibited securities, bonds, precious metal trade and foreign currency. Remember, mortgage-backed securities were at the center of the last recession in 2008. Today we are seeing a similar crisis in high-risk loans for automobiles in the United $tates that happened for home loans in 2008.
Bond prices are at the heart of the collapse of Silicon Valley Bank and others. Socialist China didn’t issue bonds, because they didn’t take on federal debt.
Prior to liberation, in 1935-37, the Chinese currency was pegged to the USD. As a result, when inflation spiked in the United $tates, that inflation was amplified in China. In ULK 79 we discussed the current inflation crisis in Ghana. Because Ghana does not control its currency and does not keep out foreign currency and speculators, their currency (the Cedi) is manipulated by the imperialists. This is true across the Third World, where inflation will continue to be felt much more harshly than it is for us here in the belly of the beast.
The other problem in countries like Ghana is the foreign debt. Inflation is playing a big role here, as the USD becomes more expensive compared to local currencies, larger and larger portions of the money supplies in exploited countries are going to pay the same interest rates on loans from the imperialists. Debt forgiveness in these countries needs to occur to protect the lives of millions threatened with starvation today.
According to the World Food Program, “An expected 345.2 million people [are] projected to be food insecure in 2023 – more than double the number in 2020.”(5) The recent increase in famine is mainly in the poorest, exploited countries, and triggered by a combination of inflation, war and climate change.
We know there is enough food in the world to feed everyone. The problem is capitalism cannot be efficient enough to distribute it to places where super-exploitation occurs. And super-exploitation is necessary to maintain profit rates. Without positive profit rates, capitalism grinds to a halt.
When socialist China had actual shortages in essentials, they would ration them instead of increasing prices and making the problem worse. Then they would focus on increasing production of those essentials (rather than decreasing production like the capitalists do when there’s no profits to be had).(6) Contrast this with prisoners (and everyone else) in the United $tates who are now paying higher prices for food and other essentials because the commissary is operated on the capitalist market. The anarchy of production under capitalism means we constantly have too much or too little of various goods as individuals decide what to produce based on their own profit interests. And this is particularly noticeable when the economy starts to slow down or shows volatility as it has been lately.
Socialist China focused on production to manage and drive the economy, whereas imperialist United $tates focuses on money supply to do so. In socialist China the banks were merely a tool to manage and allocate resources to manage production for the people’s needs.
Why Banks are failing
As mentioned above, Silicon Valley Bank (SVB) had a big problem due to the value of its federal bonds dropping in value. They had bought the bonds when interest rates were much lower, so as the Fed continues to increase interest rates these old bonds drop in value. They cannot cash in the bonds until their term is due and they can only sell them at a loss. Some big players began pulling their money out of the bank, perhaps related to this knowledge. Soon SVB could not cover the deposits they owed people. The U.$. government has stepped in to cover it, and now the FDIC is covering infinite deposits if your bank fails, instead of the previous limit of $250,000. This is another sign of the willingness of the imperialists to throw newly printed cash at the problem.
One interesting point here is that federal bonds are a “safe” investment. SVB didn’t fail because of garbage mortgage-backed securities as happened in 2008. So the financial system is failing firms that play it safe this time around. In addition, according to the FDIC, SVB was not in the worst situation.(7) In other words, other banks in the United $tates have worse balance sheets than SVB and will fail if there is a run on their money. “The total unrealised losses sitting on the books of all banks is currently $620bn, or 2.7% of US GDP.”(7)
The biggest failure this year, at the time of this writing, was the 165 year-old bank Credit Suisse. Meanwhile the market is jittery around many large imperialist banks with stock prices seeing big dips and credit default swaps (CDS) spiking in price. CDSs going up means other institutions are not confident these banks can pay off their debts and are charging more to insure bonds from these banks. The differing interests of these major financial institutions are beginning to show on the markets as they bet against each other.
Prisoners are on some of the most fixed budgets of any population in this country. In order to get their basic needs related to nutrition, hygiene and outside contact, prisons need to increase pay rates and limits on how much money prisoners can spend and receive from the outside. In some states these reforms have already occurred, and this is in the interests of the commissary companies, which the prison systems want to keep satisfied.
The solution to the bigger economic contradictions playing out now is obviously replacing capitalism with socialism. The report from socialist China cited above succinctly explains why this is the case. Capitalism doesn’t just put profit over the need of people and life on this planet, capitalism actually requires profit to function. When profits dry up, as we’re seeing some evidence of right now, capitalism can’t produce what people need. Of course, we’re also seeing various forms of state intervention to ensure that this does not happen by providing more money and creating profitable situations using the central banks. But these contradictions continue to exist, and different interests are acting in anarchic ways, so that state intervention cannot always work as it does in a socialist economy.
Lately there has been a rash of woke mail room staff and prison officials who seem to be able to find “racism” everywhere they look. Under Lock & Key has been censored by a number of these activist employees of the state in Arizona, Indiana and Florida. This is very odd, as most of our readers know we rarely even mention the concept of race as we maintain that it is not a biologically valid concept, so clearly we do not believe or promote ideas of racism or racial superiority. But these snowflakes are just looking for reasons to be offended and use the state to crush free speech and association of the oppressed.
The Arizona Department of Corrections, Rehabilitation & Reentry - Office of Publication Review gave as one of their reasons for censoring Under Lock & Key 78 as:
“7.2.8 Content that is oriented toward and/or promotes racism and/or religious oppression and the superiority of one race/religion/political group over another, and/or the degradation of one race/religion/political group by another.”
“…The pages identified containing such content are throughout, including, but not limited to, pages 1, 2, 4, 9, 16.”
Page 2 is the same in every issue of Under Lock & Key and is an explanation of what MIM(Prisons) is and how our programs work. We do not promote racism or even discuss race on that page. Page 1, 4 and 9 contain reports on the struggle of Texas prisoners against oppression, and page 16 lists ongoing campaigns, including the one in Texas. It is confusing why Arizona is so worried about this campaign in Texas, and why they would call it “racist.” However, it did advocate boycotting the Juneteenth holiday, which triggered prison staff in Texas to get very repressive.
On 21 November 2022, staff member Chambers of the Indiana Department of Corrections censored Under Lock & Key 79 at Pendleton Correctional Facility. Pendleton has been censoring all mail from MIM Distributors for the last year for spurious reasons. Snowflake Chambers was offended by the spelling of Amerikkka with 3 K’s and decided to label it Security Threat Group material.
Security Threat Group (STG) can be used to prevent materials from entering the prison that facilitate illegal activities by a criminal group (STG). STG cannot be used as an excuse to censor people for their political beliefs. It is our belief that Amerikkka is a white supremacist nation and therefore we spell it with 3 K’s to criticize it as such. This is political speech, and it is legal in the U.S.A.
Florida State Prison (FSP) also deemed Under Lock & Key 79 to be “racist” among other things, on 2 December 2022. We really must go through their reasoning point-by-point for censoring this newspaper as it is quite revealing.
They objected to “Obtaining Copy of Lawsuit on TX Mail Policy BP-03.91” because “our inmates might try this”! The article is literally just telling people where to write and how much to pay to get a copy of a pending lawsuit around Texas mail policies. At this point it seems they’re just rubbing it in our faces to use the most illegal reasons they can to censor us.
FSP employee J.M. Clillen (sp?) goes on to cite “Alabama Prisoners Demand Freedom” because “talking about living conditions”. So that’s illegal now? If we talk about conditions in prisons all of a sudden we’re “racists”?
The one article Clillen cites that does not have a reason with it is “Free Palestine - Join the BDS Movement.” This couldn’t possibly be a threat to security at FSP, and is clearly just demonstrating their support for the Zionist (racist?) state of I$rael.
Finally we get to the “racist” claim, which was made against the article “Conquering My Demons” on page 13. This article is a self-criticism by a USW comrade regarding eir past substance use and misogyny, and a call for all of us to become new, better people. It discusses the resistance of oppressed nations against the imperialists – which is our best guess as to why they labelled it “racist.” Oh, and it also spells Amerikkka with 3 K’s. That’s not racism idiot, that’s a critique of racism.
There are no rights, only power struggles. And it is the oppressed and powerless who are denied rights by the powerful in this racist woke imperialist country.
It seems unanimous that 2023 will be a year of recession. A recent report from the United Nations Committee on Trade And Development (UNCTAD) opens up with:
"The world is headed towards a global recession and prolonged stagnation unless we quickly change the current policy course of monetary and fiscal tightening in advanced economies.
“Supply-side shocks, waning consumer and investor confidence and the war in Ukraine have provoked a global slowdown and triggered inflationary pressures.”(1)
Before talking more about the report, let’s start with some basics. Recession is something that is unique to capitalism. It is a product of capitalism’s inherent contradictions. In previous economic systems, problems of getting resources to people were caused by things like plagues, floods, droughts and war. All things that we are still familiar with today. But there is no other economics system where people go hungry because of “market forces” preventing adequate production and distribution. This happens at all times in capitalism, but it will be affecting broader swaths of the population as we go into recession.
While the pandemic was not the cause of current imbalances, it certainly helped exacerbate them. Because we live in a service economy, Amerikans had a hard time spending all their money when things were shut down. They’re used to regular entertainment, movies, costly sporting events and clubs, having people prepare food for them and the infamous getting their hair done which they cried for during the early lockdowns. Having all that cash on hand, they turned to purchasing goods, which were harder to get due to supply chains slowing down. As the U.$. government continued to roll out benefits to Amerikans they wanted to buy more things and there were less things available to buy. Companies selling things increased prices, and the pressure for inflation began.
The ability to keep printing dollars (in the forms of COVID relief money and low interest loans) is backed by the fact that the dollar is the dominant currency for international trade. And this is backed by U.$. dominance of international monetary organizations and U.$. militarism shaping the world economy in its image.
Increasing Dollar Power
In 2022, the U.$. Federal Reserve got serious about addressing inflation as it began to surpass 8% year-over-year (when they’d like it closer to 2%). In recent months, the Fed has continued to increase the interest rates by .75% at each meeting they have every 4 to 6 weeks. They have indicated that they plan to continue to do so to bring down wages and inflation. One of the goals of the Fed here is to increase unemployment and cool down the job market by making it more expensive for companies to borrow money. Recently Amerikans have had their pick of jobs with many opportunities to increase their incomes. Under capitalism, this is somehow a bad thing. Contrast this with the MIM Platform for a socialist dictatorship of the proletariat, which guarantees employment (as well as free day care, medical care, public transport and college education).
The UNCTAD report highlights the even greater negative impacts of raising interest rates in the United $tates on the Third World proletariat. Yet, UNCTAD’s calls for, “Central banks in developed economies to revert course and avoid the temptation to try to bring down prices by relying on ever higher interest rates.” seems to be a pipe dream at this point. As we discussed in our recent article on the war in Ukraine, the U.$. dollar is the reserve currency, which means what the U.$. Fed does has huge implications for money everywhere.(2) And other imperialist countries have filed suit by increasing interest rates to protect their own currencies from more extreme devaluation. The British pound just hit it’s all-time low exchange rate to the dollar, putting them almost at 1-to-1.
While Amerikans complain about oil prices rising from inflation, war and supply chain issues, OPEC has announced it is cutting production, which will increase global oil prices. This is not helping the cause of the Fed and the U.$. government trying to mitigate inflation for Amerikans.
Relatedly, Saudi Arabia is one of the few countries the UNCTAD forecasts to exceed “normal” pre-COVID GDP trends next year. However, President Biden is striking back at Saudi Arabia threatening to cut off arms sales to the country saying their leadership role in OPEC is aiding Russia, who has been engaged in a proxy war with the United $tates for more than half a year now. Again, we are seeing increasing divisions among the global powers. Similar to the divisions that precluded WWI and WWII as discussed by author Richard Krooth.
In our review of Arms & Empire in ULK 78 we quoted Krooth’s explanation of the role of the strong dollar in bringing on the Great Depression:
“…making it the hardest currency in the world, pushing up its value vis-a-vis other currencies, but also making it inaccessible to nations that otherwise would have purchased from America. When other nations could not obtain dollars by exports to the U.S., obviously they could import nothing at all. And so U.S. exports tended to fall and had to be replaced with bilateral trade agreements. Up went U.S. unemployment when markets fell away and bilateral trade could not replace them. Then down came the dollar, the U.S. devaluing in 1933 in an attempt to stimulate the exports again. But, alas, it was too late. The depression was on, production was down, America was spreading crisis to Europe!” (p.119)
While Europe is not quite in the rough shape it was at that time, de-industrialization has been the trend, as Amerikan’s have had more and more say in how their economies are structured. As we discussed in our recent article on Ukraine, the Amerikans have been conspiring to prevent a close relationship between Germany and Russia. Now it seems that the sabotage attack on the Nordstream 2 pipeline that was built to pipe gas from Russia to Germany is a continuation of those efforts by the Amerikans.
Economic Policy and Economic Systems
The UNCTAD report makes a number of recommendations to mitigate the impacts of the coming recession on the exploited Third World nations of the world, who of course will suffer the most. Again, these problems are inherent to capitalism and cannot ultimately be avoided without replacing it with a socialist economy. However, there are economic policies that can improve, or even save, the lives of millions of people today under capitalism. But they would need to be a bit more radical than those suggested by UNCTAD.
The MIM Platform includes two policies to be enforced by international banking authorities under capitalism:
Elimination of international currency exchange rate fixing by governments.
Tying of exchange rates to a standard basket of goods.
The UNCTAD report points out exchange rate depreciation in just six months this year for a number of exploited countries:
In the current system, when the currency in Sri Lanka depreciates by 77.8% that means that day-to-day expenses for the proletariat of Sri Lanka are probably about doubled. If exchange rates were tied to a standard basket of goods, then this would no longer be the case. Prices of things like food and fuel would be stabilized across the globe in local prices. The impact on the imperialist system on the people of Ghana is explained in more depth in our accompanying article.
Importantly, the above two demands by the MIM Platform would affect the ability to pay off foreign debts as well. The UNCTAD report lists the percent of government revenues spent on external debt in a number of countries:
How the heck can a state spend 97% of its revenue on debts to finance capital (or even 25% for that matter) and ever be able to provide for and serve the people of that country? Exchange rates cannot fix these huge problems, which require debt forgiveness. But the current system of exchange rates does make these debt payments increase as exchange rates worsen as is happening now with a strengthening dollar (as most debts are held in dollars). Overall, the percentage of state revenue spent on servicing debts across the Third World has doubled over the last decade according to this UNCTAD report. As surplus value extraction becomes more difficult, interest payments on debt becomes a larger part of the net flow of wealth from the exploited nations to the imperialist countries.
There seems to be no momentum for MIM’s proposed radical changes among the international bourgeoisie at this time, which means the economy will continue to tighten and shrink. And under capitalism that means people will suffer and die. The system is madness. If production of goods ceases to be profitable, production ceases, it does not matter how many people are in need of those goods. But one of the inherent contradictions within capitalism is that the tendency to compete and increase production constantly undercuts the rate of surplus value extraction. As a result profits are always (generally) becoming harder to come by. The introduction of the Chinese proletariat back into the imperialist economy after 1976, but especially in the 1990s, by the capitalists who run that country brought a breath of fresh air to imperialism with a huge, new source of surplus value. By 2008, the rates of profit had once again become harder to maintain, and today those contradictions are playing out in the form of hot wars, trade wars, currency wars and realignments of major powers.
The overturning of Roe v. Wade is a setback for the health of mostly the gender aristocracy, but also some who are truly gender oppressed in this country. In that sense, we view this issue similar to how we view the question of universal healthcare in the United $tates.(1) However, MIM’s gender analysis is more relevant in this struggle over abortion.
"The gender aristocracy by definition is not oppressed in the gender strand. Concretely, imperialist country wimmin are not gender oppressed.
For this reason, if we put forward the gender demands of the imperialist country wimmin, like it or not, we are heading in a reactionary direction."
To those who see the overturn of Roe v. Wade as a violent attack on themselves, on wimmin, we offer some food for thought. The abortion issue was made a hot button issue with a lot of money for the purpose of mobilizing voters. As long as we live under a bourgeois democracy, this will continue to happen. For all the rhetoric about “taking money out of politics”, nothing has happened, because we live in a profit-driven system. We must overthrow capitalism and patriarchy to meet the needs of the gender oppressed.
To those who oppose abortion, we repeat that we can eliminate abortion by sterilizing men after storing semen samples from them. If you aren’t willing to talk about such alternatives, that would save the lives of wimmin, then you are not pro-life you are pro-patriarchy.
The MIM Platform calls for mandatory sex education by age 11. Under the dictatorship of the proletariat, there will be free universal health care including unlimited access to PPE such as contraception. This, combined with the overall sense of purpose and community that will come with building a new society, we believe will significantly decrease the number of abortions, which have already been declining in this country.
More than laws and policies however, what will be a decisive point in the struggle against patriarchy under proletarian dictatorship is the mass raising of class struggle and mass campaigns against patriarchy in the superstructure (from material institutions to backward ideological culture). The key support of these policies of universal healthcare under socialism is having the masses learn in practice the new society they wish to implement free from male chauvinism amongst other things. This is one thing the Maoist practice in China had that marked a qualitative leap from the Soviet Union through implementing a cultural revolution.
Of course, some abortions are in response to medical conditions that we have no control over. Following the overturn of Roe v. Wade, Pew Research found that 57% of adults disapproved of the decision and 41% approved.(2) The survey also showed that only 8% believe abortion should be illegal in all cases. As the opposition to abortion came after big-money marketing over many decades, we can expect these numbers to shift quickly in favor of access to abortion with a shift in social relations under the dictatorship of the proletariat. In other words, mass collection of semen samples and sterilization of men probably won’t be necessary to resolve contradictions in a socialist world as it is today.
From Victory to Defeat: China’s Socialist Road and Capitalist Reversal by Pao-Yu Ching Foreign Languages Press 2019
In a recent online debate between two random “Marxist-Leninists” and two fascists, one of the self-described “Marxist-Leninists” stated that every country in the last 100 years has been socialist. The fascists are happy to parade such meaningless dribble as “Marxism” so that they can make Marxism look bad. With Obama’s election, white nationalist fear became expressed in many derogatory words, including “communism” and “Marxism,” with no sense of irony that they were accusing the number one enemy of the world’s people of being a communist.
What is common among “Marxists” in the First World is saying every country is socialist that says it is and has some form of state intervention in the economy. This superficial analysis has also helped muddy the water of what socialism is. And it allows the fascists to say that they share many of the goals and ideals of the self-described Marxists. In particular they both look to China as a positive model of how to run a country and they both think Amerikans and various First World European nations are being victimized by the current world system. The fact that many of these fascists have chauvinist anti-Chinese views and wish war against the social-imperialist CPC is of no matter. For MIM, the question of whether today’s China is socialist or social-imperialist is a dividing line question.
To understand what socialism is, MIM has long recommended The Chinese Road to Socialism by Wheelright and MacFarlane. For the history of the coup that overthrew socialism in China MIM distributed The Capitalist Roaders Are Still on The Capitalist Road. In 1986, MIM cadre Henry Park published “Postrevolutionary China and the Soviet NEP” comparing state capitalism in the early days of the Russian revolution to state capitalism after the coup in China. In 1988, Park published “The Political Economy of Counterrevolution in China: 1976-88”, which tied all of these subjects together through a Maoist framework and analyzes the failures of state capitalism in post-Maoist China.
Pao-Yu Ching’s From Victory to Defeat serves as a more up-to-date introduction to the topic of the differences between socialism and capitalism in the last 100 years of Chinese history. It is written as a sort of FAQ and provides a broad overview, while explaining the key concepts that allow us to differentiate between the two economic systems. As such, MIM(Prisons) recommends Pao-Yu Ching’s work as a solid starting place when exploring this topic. The topic of “What is socialism?” must be fully grasped by all communists.
It seems that Pao-Yu may disagree with the Maoist class analysis. In eir introduction ey states, “Today the living conditions of the working masses in imperialist countries have grown increasingly difficult.”(p.9) Ey then alludes to rising prices, rising debt and precarious work, none of which necessarily reflect worsening objective conditions. Without a recognition that these populations are parasitic on the working classes, this line leads to the politics of the fascists and social-fascist “Marxist-Leninists” mentioned above. It is also relevant to the question of revisionism in the formerly socialist countries who looked to emulate the lifestyles of Amerikans. Since this point is not taken up in the rest of the book we will not dwell on it here, but it remains the biggest problem with this work.
What is Socialism?
Many of our readers and those who are interested in what we have to say in general are still confused as to what socialism is for the reasons mentioned above. Ultimately it is defined differently by different people, and it is used politically rather than scientifically. Pao-Yu outlines what the most advanced example of socialism looked like quite nicely in eir short book, so we will just mention some key points here to help clarify things.
Socializing industry first required that the state took control of the means of production in the form of factories, supply lines, raw materials, etc. This is where many stop with their definition of socialism. Some other key things that Pao-Yu points out is that success was no longer measured in the surplus produced but rather on improvements in the production and overall running of the enterprise.(p.20) This recognizes that some will be more profitable in a capitalist sense, but that the nation benefits more when all enterprises are improving, not just the profitable ones. Another key point is that laborers were guaranteed a job that was paid by the state at a standard rate.(p.28) This eliminated labor as a commodity that you must sell on the open market. Commodities are at the heart of capitalism. Socialism is the the transition away from commodities, starting with the most important commodity of humyn labor.
The above only applied to a minority of the country, as the vast majority of China was a peasant population. It is only in recent years that the peasantry is now less than half the population. It is in the countryside where the capitalist roaders and the Maoists disagreed the most. Pao-Yu walks us through the different phases of the transition to socialism and how the principal contradiction shifted in each phase. Ey explains the contradiction amongst the countryside, where production was not owned collectively by the whole population, and the cities where it was. The disagreement with the capitalist roaders was a disagreement over the principal contradiction at the time, which they thought was the advanced social system (of socialism) with the backward productive forces (of small scale farming by peasants). To resolve this contradiction the capitalist roaders thought they must accelerate production, industrialize agriculture, and feed the industrialized cities with the surplus of that agricultural production. This focus on production is one of the key defining lines of revisionism.
While Marx taught us that the productive forces are the economic base that define humyn history and the superstructure, he also said the contradiction with the relations of production is what leads to revolutionary transformations of society. As Pao-Yu points out, learning from Mao Zedong, during these revolutionary periods is when the relations of production become primary, in order to unleash the productive forces that have become stagnant under the previous mode of production.(p.30) In other words peasants living under semi-feudalism in China pre-liberation were not improving their conditions. They needed to revolutionize how they related to each other, how they were organized, specifically the class relations, in order to move towards a new mode of production (socialism) that could meet their needs much better. Therefore Mao focused on education, theory, class struggle, culture, the people, instead of focusing on production, profitability, surplus, and wage incentives, as the capitalist roaders did. The Maoist path took the Chinese peasants through a gradual process of increasing collectivization through communes, which was quickly dismantled after the coup in 1976.
What is Democracy?
Another question those living in bourgeois democracies often ask is how you can have democracy with only one party, where people are purged for having the wrong political line? Pao-Yu makes the point well by explaining that in established bourgeois democracies you can have many parties and many candidates, because they all represent the same class.(p.48) This is the case because these countries are stable in their mode of production (capitalism). In the transition to a new economic system the political struggle is between two classes. In the case of capitalism transitioning to socialism, it is between the bourgeoisie and the proletariat (and their class allies on each side).
The bourgeoisie by definition is always competing amongst itself, so it cannot have one party represent all of their interests, except in extreme crises when fascism becomes viable. In the United $tates today, the left-wing of the bourgeoisie are represented by the democrats while the right-wing flock to the republicans. Even amongst these parties are different bourgeois factions fighting amongst each other. The proletariat however is united in it’s class interest, so there will be no need for multiple proletarian parties. There are many books that outline the components of socialist democracy where people select their representatives at each level of administration, where free speech and criticism are encouraged, where education is universal and free and where everyone is involved in studying theory and practice to shape the decisions that affect their day-to-day lives. It does not require having multiple political parties to choose from as bourgeois democracies do in their electoral farce.
What is China?
Pao-Yu covered China before, during, and after socialism so that the reader can better understand the differences. As such the book is a good introduction to the explanation of why China has not been on the socialist road since 1976. Ey touches on the loss of the guaranteed job, with the introduction of temporary workers, the ending of the right to strike and free expression among the workers, the ability of managers to start keeping the profits from the enterprises they oversee, the loss of universal medical care, and the focus on production for other nations, while importing the pollution of those consumer nations. Ey briefly documents the struggles of the workers to maintain control of the enterprises they once owned collectively. China is now a capitalist hell hole for the majority objectively and it does not matter whether the CPC has millions of cadre who believe the opposite subjectively.
The Global Economy
One point Pao-Yu makes that we have also stressed as being important, is the role of the proletarianization of the Chinese masses in saving global imperialism from crisis. When the imperialist economies were facing economic crisis in the 1970s, one third of the world’s population was not available to be exploited by the imperialist system. One of the laws of capitalism is its need to always expand. When China went capitalist, it opened up a vast population to exploitation and super-exploitation for the imperialists. This labor was the source of value that the imperialist system thrived off of by the mid 1980s until just recently.
Interestingly, Pao-Yu says that almost 30% of the Chinese population is petty bourgeoisie, owning (often multiple) investment properties and traveling around the world.(p.111) In a previous article we explained that we saw China as a proletarian country still despite its imperialist activities. We referred to Bromma’s research that stated China’s “middle class” was 12-15% of the population some years prior. It is interesting to hear that the Chinese petty bourgeoisie has reached the same size in absolute numbers as the Amerikan one. It would be interesting to compare the wealth of these two groups, we presume the Amerikans remain wealthier. Of course, China is still majority proletariat, while Amerika is almost completely bourgeoisified, so the class interests of these nations overall remain opposed to one another. But we will rarely hear the proletarian voices from China until a new proletarian party rises there.
The housing market is one example of how China has emulated the United $tates. Investing in properties has become an important way for the new petty bourgeoisie in China to accumulate wealth without working. Just last week, the Chinese investment firm Evergrande made headlines when it became public knowledge that they would not be able to pay the billions of dollars they owe. Evergrande has significant backing from Amerikan finance capital, as is true for the Chinese economy in general. Therefore the collapse of the Chinese housing market could have real ripple effects in the global economy.
The fact that real estate investment firms exist in China, and that they are defaulting on hundreds of billions of dollars owed, is really all you need to know to see that the economy is oriented towards profit and not people. Things like inflation and bubbles and stock markets and speculation just didn’t exist during the Maoist era. The reintroduction of these things for the last four decades destroyed the progress in class struggle in China long ago.