Paper prepared for the 13th International Seminar – “Problems of the Revolution in Latin America”

“The Answer of the Workers and the Peoples to the Global Crisis of Capitalism”

By Revolutionary Organization of Labor, USA (formerly Ray O. Light Group)

A New Great Depression on the Horizon

Over the past nine months, the world capitalist economic crisis has deepened everywhere. The international working class and the oppressed peoples of the world are facing a global economic crisis of enormous proportions. From China to the former USSR to the USA, and especially in the oppressed nations of Asia, Africa and Latin America, mass unemployment, homelessness, hunger and disease are on the rise. In the USA, November and December each saw over five hundred thousand new unemployed workers; and over six hundred thousand lost their jobs in each of the first three months of 2009. Though official figures for the past three months have not been quite as high, the number of workers still unemployed when they have exhausted their unemployment benefits has remained at an all time high. And the unemployment rate continues to rise, with even the “official” rate now approaching ten percent. The Organization of Economic Cooperation and Development (OECD) predicted in early April that unemployment in thirty industrial countries will rise from six percent last year to double digits this year.

Scientific socialism teaches us that the root cause of this global capitalist economic crisis lies in the very nature of the monopoly capitalist system. Under capitalism, the working class is systematically short-changed when we exchange our labor-power for the capitalist’s wage payment. In this way we produce surplus value (profit) for the capitalists. We cannot buy back the products that we make. Over time, the result is capitalist overproduction.

In the current imperialist stage of capitalism, characterized by the domination of finance capital, the fundamental contradiction between labor and capital is sometimes, in some places, moderated, while it is intensified elsewhere. This system is based on the exploitation and super exploitation of the working class and the oppression of the peasantry around the world.  The immense profits in a world economy already saturated with monopoly capitalist domination have led to increasingly desperate “investment opportunities” such as in various forms of financial debt. This even includes “securitizing securities”, as was done by AIG, the recipient of almost 200 billion U.S. dollars in bailout money thus far. The utter dominance of finance capital has ripped asunder virtually any connection between actual product values and monetary valuation. It has resulted in an unprecedented division of the world between “haves” and “have-nots” such that the global capitalist system is in paralysis.

International Capital’s Response to the Crisis

The primary response of the imperialist and other reactionary governments to the crisis has been to provide multi-billion dollar (euro, pound, yen) bailout giveaways to the wealthiest, greediest and most guilty ruling class bankers and businessmen, the very people most responsible for the depth of the crisis. This booty has been squeezed out of the sweat and blood of the working class in every country. Indeed, the amount of dollars, euro, etc. involved in the bailouts will still be coming out of the children and grandchildren of those of us in today’s working class, if we allow the system of monopoly capitalism and imperialism to survive.

Every day, of course, the bourgeois media is singing a lullaby to the peoples of the world, and the working class in the first place, about how the capitalist economic crisis is almost over. New partial and distorted statistics (called “green shoots”) are constantly raised to “prove” this thesis. However, Rajat Nag, managing director of the Asian Development Bank, in an attempt to dispel “complacency in India and China”, recently cited the following: “weak economic growth in Asia---estimated at 3-4 percent this year – would leave sixty million more people in poverty than would have been the case had the region maintained last year’s pace of 6.5 percent.” (“Asia warned of growing poverty,” Financial Times, 6-29-09)

President John Sweeney of the American Federation of Labor-Congress of Industrial Organization (AFL-CIO) and the International Labor Organization (ILO), whose roles include helping to prevent the working class from toppling the capitalist system, are very worried. Sweeney admits that the “global economy continues to deteriorate at an unprecedented rate. Workers around the world… are losing their jobs and incomes.”  The ILO predicts that “unemployment in the G8 countries … is likely to almost double over the next 18 months…At the same time, more than 200 million workers could be pushed into extreme poverty, lifting the number of working poor to 1.4 billion.”

Global Working Class and Popular Resistance

In this setting, the international working class is being jolted into action; it is being shaken out of its slumber. And billions of toilers in the oppressed and dependent countries of the world are likewise becoming awakened to the need for struggle against monopoly capitalism and imperialism.

In February, March and April of this year, the working class of the French colonies of Guadeloupe and Martinique waged powerful strike struggles organized through their trade unions, spearheading their islands’ masses in their demand for economic relief from this global capitalist crisis. The general strikes on both these Caribbean islands, with overwhelming popular support, have succeeded in winning their immediate wage and price demands and demands for political, cultural and national rights, challenging the power relationship, up to, if not including, the question of national sovereignty vis-à-vis French imperialism. Their struggle has inspired a similar struggle with similar demands in the French island colony of La Réunion in the Indian Ocean on the other side of the world.

No doubt, too, the strong uprisings of the exploited and oppressed masses of Guadeloupe and Martinique have helped provide inspiration to the increasingly independent  stands of Latin American countries such as Venezuela, Bolivia and Ecuador in opposition to U.S. imperialism.  The defeat of the Arena Party government in the March 2009 election in El Salvador also represents a resurgence of mass anti-imperialist sentiment among the workers in this Central American country, a center of revolutionary activity in decades past. For more than two decades, prior to this current victory, the Salvadoran working people had been living under the Arena party-led state of terror. Likewise, in Honduras, early this year, President Zelaya implemented a measure increasing the minimum wage by 60%, among other pro-people measures. In this setting, the Bolivarian Alternative of the Americas (ALBA) has been strengthened in its independent stance vis-à-vis U.S. imperialism.

At the same time, the French working class, inspired at least in part by their class brothers and sisters in Guadeloupe and Martinique, has undertaken massive and militant demonstrations within that important imperialist country, resisting the efforts of the French ruling class and the international capitalist class to put the burden of the crisis on their shoulders. This newly rediscovered militancy of French workers has been demonstrated in various extralegal actions aimed against a number of monopoly capitalist firms.

Likewise, also fueled by the economic crisis, the working people of Greece, along with the students, have staged massive protests against police brutality and in defense of popular education. The street demonstrations of the Greek masses have shaken the roots of the reactionary regime there.

The working class and popular militancy being exhibited in oppressed colonies and neo-colonies and major imperialist countries, as well as countries in between, is a reflection of the mass disaffection with the world system of monopoly capitalism and imperialism. Even without the existence of a viable alternative socialist camp at this time, the toiling masses’ fascination with global capitalism has been broken.

Sixty years of “Social Peace” by the U.S. Labor Movement

Within the USA itself, for sixty years U.S. imperialism’s post World War II hegemony in the capitalist world allowed for a situation to develop in which the organized labor movement has been almost totally subservient to U.S. imperialism, and the U.S. working class has been loyal to the U.S. imperialist ruling class as it became almost completely caught up in the consumer culture. For about twenty-five years after World War II (approximately 1947-1972) – after an especially strong strike wave in 1946 – the organized section of the U.S. working class was able to win wage increases (and material gains) without the bitter and bloody struggles normally associated with such working class advance. This fact of life was precisely in accordance with Lenin’s teachings on the ability of major imperialist powers to bribe large strata of “their own” working class out of the super-profits reaped from the super-exploitation of the working class in the oppressed nations.

For the past thirty-five years or so, since then, the real wages of U.S. workers have not increased. Yet working people here have continued to experience significant material gains. This has been largely due to the inflation bubble and especially inflation in the housing sector on which most working class family wealth is based. In recent years the consumer spending of U.S. working people, largely on the basis of the proceeds from housing inflation, has been the engine driving much of the world capitalist system’s economic production. The result has been a dramatic confirmation of Lenin’s teaching that “the essence of imperialism lies in the fundamental distinction between the oppressing and oppressed nations.” For the Chinese working class, suffering from one of the biggest income gaps in the entire capitalist world and remaining in extremely humble circumstances, has provided much of the labor that has kept the debt heavy U.S. workers and their families in relative material comfort.

In the imperialist era, in the period of U.S. global hegemony in particular, extension of credit to U.S. workers, that is, debt, has served as an antidote to overproduction. Similarly, U.S. bankruptcy laws for most of the past few decades have encouraged the continual use of and forgiveness of debt. It is no wonder, then, that, over these sixty years, the U.S. working class and its labor movement have been almost completely won over to the “virtues” of capitalism, U.S. imperialism style.

Now this is no longer the case! The subprime mortgage crisis in the USA has led to a housing crisis which has led to a U.S. financial crisis, to a world financial crisis, and finally to a world capitalist economic crisis. The subsequent massive job loss and the wiping out of private pensions, along with the U.S. government bailout of rich ruling class financial criminal organizations like Bank of America, Citigroup and Goldman Sachs is awakening the U.S. working class to the fact that the system is rotten. Certainly, if we don’t yet know it, we feel it in our bones.

John Sweeney, the AFL-CIO President, and other “labor lieutenants of the capitalist class” in the USA and elsewhere, are clearly afraid of losing their influence over the working class. On June 26th, meeting with leaders of unions in the other G8 Countries, Sweeney said: “Trade unions and the workers we represent have no confidence that this time governments and bankers alone will get it right. We are asking for a seat at the table.” This is the answer of Social-Democracy to the blatant criminal theft by the biggest bankers and businessmen – to ask these criminals for a seat at their table!

In the USA, the growing mass disaffection with the system of monopoly capitalism and imperialism is a fundamentally new condition that dramatically impacts every clash between labor and capital, between the oppressed and the oppressor, between the police and the oppressed nationalities, between the workers and the opportunists leading the U.S. labor movement.

U.S. Working Class Makes Some Positive Strides

Three outstanding recent developments in the U.S. working class movement reflect this new reality – the growing revolutionary potential of the working class within the belly of the beast itself.

No doubt partly fueled by the Obama election victory as well as an increasingly angry mood of the working class in response to the economic crisis and the bailouts for the Wall Street rich, five thousand meatpackers at the massive Smithfield Foods plant in Tarheel, North Carolina (N.C.) won their union election in December 2008, in a close vote, and affiliated with the United Food and Commercial Workers Union (UFCW). This victory culminated a sixteen year struggle against one of the most intense anti-union company offensives in recent U.S. history – including firings and physical assaults on union activists, use of local police agencies and immigration raids aimed at intimidating and splitting the workforce, and anti-trust lawsuits against the union. The unity of the Afro-American and Latino workers and the fact that the factory is located in the “Black Belt South,” in the old slave plantation region, in one of the least unionized states (3% of the workers in N.C. are unionized) add to the significance of this victory.

There was another indication in December 2008 that the mood of U.S. workers, especially immigrant national minority and Afro-American workers, had begun to change rapidly and dramatically for the better. It was revealed by the successful factory occupation by 240 Republic Windows unionized employees in Chicago after they received three days notice of lay-off in violation of the law that required a 60 day notice of plant closing. With their union, United Electrical, Radio and Machine Workers of America (UE), the workers occupied the factory for six days demanding their severance pay, continuation of health benefits and pay for accrued vacation.

Workers were especially angered by the fact that Bank of America, a recipient of $34 billion as part of the massive Wall Street bailout, withheld credit from the company, in part causing the plant shutdown. The demands and actions of the Republic Window workers received the sympathy and captured the imagination of working people all over the country who share their outrage at Bank of America, et al. After a six day occupation of the factory the workers won all their demands, including a severance package worth $1.75 million.

The past few decades have witnessed the almost total disappearance of the strike weapon from the arsenal of U.S. organized labor. In this context, the Republic Windows workers and the UE’s adoption of the far more advanced tactic of factory occupation (or “sit down strike”) in defense of their rights and standard of living and the widespread sympathetic response they received, are very good signs indeed.

These first two events occurred after the election of Obama and before he was installed as U.S. President, as helmsman of the U.S. Empire. Widespread mass illusions about Obama, especially among the Afro-American and Latino working people, the most militant sectors of the working class within the U.S. multinational state, are no doubt diluting the anger and delaying the further development of the U.S. working class response to the crisis for now. Nevertheless, it is noteworthy that the illusions are no longer about the capitalist system itself but are focused on the Obama Presidency.

The third event is ongoing and most significant for the long run. Currently, the largest union in the USA is the Service Employees International Union (SEIU) led by its autocratic President Andy Stern. Stern has overseen the rapid growth of SEIU, in marked contrast with most U.S. unions which are shrinking. But he has accomplished this on the unprincipled, anti-union basis of “sweetheart agreements” with hospital and health care and nursing home corporations over the heads of and at the expense of the workers, the members he is signing up.

Stern has attempted to crush a democratically run, San Francisco-based 150,000 member United Health Care local of SEIU led by its progressive President, Sal Roselli. But the membership and leadership of SEIU local #250 mobilized and defended its rank and file-led union and its decent contracts. In late January, after Stern seized control of the local, more than a hundred union officers and staffers, led by Roselli, in consultation with 5,000 local union stewards, resigned from the SEIU and launched the formation of a new National Union of Health Care Workers (NUHW). Thus far the workers in bargaining units representing almost one hundred thousand workers have indicated a majority commitment to NUHW. Unfortunately, the U.S. Labor Department, influenced by Stern and his Obama and Democratic Party political connections, are frustrating many rank and file attempts to hold votes on union affiliation at this time. But the struggle continues.

The protracted and mass struggle for union democracy being carried out by NUHW, is occurring in this period of economic crisis and nascent working class ferment. It has the potential for helping to pave the way for class struggle-oriented, democratically-run, rank and file-led unions, capable of leading a crusade of working class organization and struggle against capital such as were born and thrived in the last Great Depression with the rise of the Congress of Industrial Organization (CIO). NUHW needs and deserves our support.

Dangers in the Current U.S. Situation

President Obama’s decision to retain Robert Gates, Bush’s Secretary of Defense, underscored the fact that Obama is essentially a new more formidable opponent at the helm of the U.S. Empire. Beyond this, the Obama-Biden Administration has actually increased the presence of military and former military leaders in their “civilian” ranks, including four-star General James Jones at the very top of the Administration as National Security Chief. The new administration supported the change in U.S. law to require telecom companies to cooperate with the government in the widespread surveillance of U.S. citizens; and it joined with the Bush forces in the extremely dangerous “retroactive immunity” provided by the courts to the telecom giants for the surveillance carried out by telecom companies on behalf of the Bush Regime when it was still clearly illegal to do so. Perhaps the most telltale sign is that Obama has refused thus far to even consider prosecution of the top Bush Administration war criminals for any of a number of overt criminal acts including torture, revealing the political duopoly that consistently represents the U.S. Empire from Democrats to Republicans and back again.

Aggravating the domestic situation, the rapidly growing unemployment rate is creating the need and opportunity for the U.S. ruling class to make the massive number of immigrant Latino workers a scapegoat for the economic calamity now being experienced by the masses of U.S. citizens. At the same time, white supremacist hate groups are recruiting large numbers, somewhat based on the ascension to the highest office in the land by a person of color; while, for the same reason, Blacks and Latinos are being told that they no longer need self-defense organizations. Finally, U.S. working class youth, and especially Black and Latino youth, are the most likely to be unemployed or underemployed, and/or working at minimum-starvation wages, in the current economic crisis. One negative response is to join the U.S. military. As U.S. anti-war heroine Cindy Sheehan has pointed out, “recruiters are targeting young people of color even more intensely now telling them that they will be ‘Fighting for Obama’…” (Cindy Sheehan blog, 12-21-08) Thus, the U.S. military is no longer having difficulty in meeting its manpower quotas. Taken together, these facts indicate that the drive toward fascism is rapidly proceeding under the new administration.

In response to the dangers of the new U.S. situation, the proletarian vanguard needs to unite those among the masses who retain illusions about Obama and the Obama-Biden Democratic Party Administration with those who have already seen through their imperialist demagoguery to jointly make the demands on the Obama Regime for relief from this crisis. In this process, the working class and the masses will learn through their own experience the need to go beyond Obama and the Democrats and to fight for proletarian political power.

Current Latin American Ferment and the New U.S. Administration

During the seven and one-half years of the Bush-led U.S. imperialist-led war of terror on the peoples of the world, starting with the U.S. imperialist-led invasion of Afghanistan in October, 2001, U.S. imperialism became more and more isolated internationally under the impetus of the Iraqi and Afghani resistance. This was especially true in Latin America where popular uprisings backed the emergence of new independent and semi-independent regimes. At the core of this developing continental independence from U.S. imperialism was the alliance formed between Fidel Castro-led Cuba and Hugo Chavez-led Venezuela. During the U.S. presidential campaign, Barack Obama demonized both Chavez and Castro, signaling his intention to continue the long standing U.S. imperialist stance that Latin America is the special property and province of the USA.

Once in office, however, Obama has had to deal with the reality of the leftward trend among Latin American governments and peoples – from Brazil, Chile, Honduras, Nicaragua and Argentina to Ecuador, Bolivia, Venezuela and Cuba. Thus, Obama has modified the U.S. embargo of Cuba, socially and economically, and been party to the invitation to Cuba to join the Organization of American States (OAS). Recently, Obama has also had highly publicized friendly personal interaction with Hugo Chavez.

In the midst of the current Honduran political crisis, on June 29th, Obama met with Colombian President Alvaro Uribe, a U.S. imperialist puppet. He counseled Uribe not to push for a constitutional change in Colombian law to allow him to run for a third term. The Honduran crisis was precipitated by a military coup which included the forcible removal of elected bourgeois liberal president Manuel Zelaya to Costa Rica, in the name of “defending” the (U.S. created) Honduran constitution banning a second presidential term, as well as other democratic rights. Because Zelaya had supported pro-people measures such as the increased minimum wage and affiliation with ALBA, every established institution in Honduras, all created and/or sustained by U.S. imperialism over the years, has supported the coup. Thus, Obama and U.S. imperialism are “caught between a rock and a hard place.”

Obama has, in words, condemned the coup; while his Secretary of State, Hillary Clinton, has made it clear that the U.S. government was not doing anything or taking any specific stand with regard to the resolution of the crisis. Consequently, the OAS and the United Nations, with U.S. government acquiescence, have universally condemned the coup and threatened reprisal against the new military-installed government led by President Micheletti from Zelaya’s own party.

Unfortunately, Zelaya, bourgeois liberal that he is, despite the favorable political situation he is in, has apparently already conceded that he will not pursue the pro-people constitutional changes that precipitated the coup, if he is returned to power in Honduras.

Thus far at least, Obama has been able to hold his own in the Honduran crisis, despite the long history of U.S. imperialist domination of Honduras, in particular. (Recall the 1980’s when Honduras was a staging ground for U.S. military invasion of Nicaragua and U.S. ambassador John Negroponte was the acknowledged ruler of Honduras.) In fact, the leader of the current coup was a general trained at the School of the Americas in the USA! Overall, this crisis reveals how clever and formidable an adversary Obama is, as the chief political representative of U.S. imperialism.

Obama and U.S. imperialism have bigger fish to fry. The New York Times has already floated the idea that Obama may promote Brazil’s President Lula to be the next head of the World Bank! Such a move can only be aimed at breaking the popular leftward political momentum in Latin America and splitting the growing economic unity and cooperation of the increasingly independent governments of the region, all largely aimed against U.S. imperialist-dominated institutions such as the International Monetary Fund and the World Bank.

Clearly, the proletarian revolutionary vanguard forces of Latin America need to take up the leadership tasks involved with the national democratic revolutionary struggles against imperialism, headed by U.S. imperialism. The world capitalist economic crisis should help propel the proletariat in Latin America to fulfill its historical initiative on the road to socialism and communism.


One hundred and fifty years ago, in the era of industrial capitalism, Karl Marx made the profound observation that, under capitalism, in any class struggle confrontation between the workers and the capitalists, where the workers had more unity than the capitalists they made advances; where the capitalists maintained stronger unity than  the workers, the working class was pushed back.

Over the past nine months or so, as a new world capitalist crisis has unfolded, the international working class has witnessed bottomless bailouts of U.S. and international banks and financial institutions based on naked power relations, such as observed by Marx in the pre-monopoly capitalist, pre-imperialist era, but now on a national and global scale. These bailouts, in particular, demonstrated that U.S. and international capital were largely united; the U.S. and international working class were not. This greater degree of unity of international capital relative to the unity of the international working class has been maintained in spite of the fact that, under the impetus of the global capitalist economic crisis, the drive toward protectionist measures is growing rapidly throughout the world. How is this possible?

In the first half of the twentieth century, the international communist movement, under Lenin-Stalin Bolshevik leadership and the Communist International, had been the pathfinder, trailblazer, organizer and leader of the international working class, the most advanced class in the struggle for world progress. For most of the past fifty years, by contrast, the international communist and workers movement has been led largely by collaborators with imperialism, headed by U.S. imperialism. We should never forget that, after waging an unprecedentedly heroic struggle to drive U.S. imperialism out of Vietnam in the 1970’s, tragically, the Vietnamese people had to face invading armies at the hands of their erstwhile friends and comrades from Kampuchea and China. This was in direct opposition to Che Guevara’s righteous revolutionary call, in solidarity with the heroic Vietnamese people, for “two, three, many Vietnams” aimed against U.S. imperialism. In the period since, even when engaged in bitter struggles against U.S.-led imperialism, national democratic revolutionary leadership in the oppressed nations and “communist” leadership in the socialist camp has been mostly bourgeois nationalist rather than proletarian internationalist in character. Thus, rather than maintaining its unity in the struggle against imperialism and for socialism, the international working class has been pulled in many different directions.

Today, one reason why, globally, there are tremendous bourgeois democratic illusions about Obama (and thus about the nature of U.S. imperialism) is that there is no general line and no substantial international communist movement which has recognized and mobilized around the resistance of the Iraqi and Afghani peoples to U.S.-led imperialism as the frontline of the proletarian struggle of this time. Consequently, Obama’s current bellicose and “Bush-like” role in relation to both Afghanistan and Iraq has not served to arm the international proletariat and the oppressed peoples to deal with the U.S. Empire “under new management.”

Drawing upon the wisdom of the Soviet experience in the 1930’s, as his economy blossomed while the capitalist world was in a state of collapse, Soviet economist Leontiev warned : “…capitalism will not go off the stage on its own initiative, it will not collapse automatically….all the theories of the automatic collapse of capitalism only bring untold harm to the cause of the working class, lulling its will to the long persistent struggle which is necessary in order to triumph over the exploiters. No…situation [exists] where the bourgeoisie can find absolutely no way out. Only a persistent struggle will decide the collapse of the capitalist system.” (p.282)

To wage this persistent struggle, let us heed the words of Georgi Dimitroff, the outstanding leader of the Communist International and hero of the fight against Hitler and world fascism leading up to and during World War II: “…in history great revolutions have grown out of small movements for the defense of the elementary rights of the working class.”

For those of us who have continued to uphold the banner of socialism, even as the Socialist Camp dissolved and disappeared, as well as new fighters in our ranks, the current world capitalist economic crisis provides a great opportunity and responsibility. We need to spread the truth about the superiority of the socialist system to a new generation of workers and oppressed peoples who are every day learning new bitter lessons about the degradation and dead end character of capitalism in the twenty-first century. The proletarian vanguard nationally and internationally has the task of leading the working class and the masses, through their own experience in the class and national struggles against international capital, to learn or rediscover the Marxist truth: “We have nothing to lose but our chains! We have a world to win!” On to the Socialist Future!

July 1st, 2009

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