IMF chief warns of debt crisis for developing countries

https://www.wsws.org/en/articles/2021/04/01/debt-a01.html




Nick Beams
14 hours ago







The International Monetary Fund has warned that lower-income countries face a debt sustainability crisis as interest rates on bonds start to rise.

IMF chief Kristalina Georgieva delivered a speech this week at a virtual meeting, ahead of the spring meetings of the IMF and the World Bank. She said tightening financial conditions resulting from stronger economic growth in the US “could cause a rapid rise in interest rates… and significant capital outflow from emerging and developing economies.”

Kristalina Georgieva of the International Monetary Fund (Source: imp.org)

Such a development “would pose major challenges especially to middle-income countries with large external financing needs and elevated debt levels.”

The IMF warning follows similar statements from the UN secretary-general António Guterres. In an interview with the Financial Times this week, he said the world faced severe problems of debt sustainability in the wake of the coronavirus crisis that had not been properly understood or addressed.

He said the response to COVID-19 and to the financial aspects of the crisis “has been fragmented and geopolitical divides are not helping. It has been too limited in scope and too late.”

Guterres said the fact that only six countries—Argentina, Belize, Ecuador, Lebanon, Suriname and Zambia—had so far defaulted on their debts created the “illusion” of stability and a “misperception of the seriousness of the situation.”

In failing to address debt sustainability, “the risk is that we compromise the recovery of the economies of the developing world with catastrophic consequences for people’s lives, with an increase in hunger and poverty and dramatic problems with health and education systems, in many cases leading to instability, social unrest and, at the limit, conflict. Everything is now interlinked.”

In her remarks, Georgieva said the IMF would upgrade its forecast for global growth from the level of 5.5 percent it had predicted in January as a result of the stimulus measures in the US and fiscal action by other governments. But she said while the overall outlook had improved “prospects are diverging dangerously not only within nations but also across countries and regions.”

Compared to pre-COVID projections the cumulative loss in per capita income for advanced economies will be 11 percent by next year. But for emerging and developing economies, excluding China, the loss will be much worse, coming in at 20 percent.

“This loss of income means millions of people will face destitution, homelessness, and hunger,” she said.

“There could also be much more pressure coming to vulnerable emerging market, low-income and fragile states. They already have much more limited fiscal power to fight the crisis. And many are highly exposed to hard-hit sectors, such as tourism.”

The IMF chief also warned of impact of the rolling back of government support measures on small and medium-sized enterprises (SMEs).

SMEs are the world’s biggest employer, she said, and “our research shows that the share of insolvent SMEs could rise sharply this year as support is scaled back—threatening one in ten jobs in this vital sector.”

The warnings over the debt sustainability for lower-income countries come as the yield on US Treasury bonds has risen sharply in the first three months of this year. Earlier this week the yield on US 10-year Treasury bonds, the benchmark for global interest rates, rose to 1.77 percent—the highest point since January 2020 before the pandemic struck.

A continued rise will mean that capital will be sucked out of developing economies.

The fall in US bond prices and the consequent rise in yields, interest rates, is being fuelled by two interconnected processes—the fear that inflation will start to rise and the increased supply of bonds to finance US government debt will lead to further falls in their price.

As one financial analyst told the Financial Times, the “massive” scale of the stimulus in the US and globally—estimated by the IMF to be around $16 trillion—had caused “considerable nervousness over inflation and has been behind the recent sell-off in government bonds.”

The potential for rapid shifts in the Treasury bond market was seen in what had been as described as a “disastrous” auction of new seven-year bonds on February 25. Some 40 percent of the $68 billion issue had to be bought by the underwriters because there were no buyers. Some stability has returned in the past month but the threat of another freeze is ever-present.

Fed chair Jerome Powell has insisted the central bank does not fear a rise in long-term inflation and that any price hikes over the next year will not be structural.

But there is concern in financial markets that inflation could take off and the extent of the US stimulus measures will bring a rise in interest rates, notwithstanding the Fed’s commitment to keep its base rate near zero at least until 2024.

In a recent comment entitled “The return of the inflation spectre,” Financial Times columnist Martin Wolf warned that an inflation overshoot could trigger a deflationary response from central banks, leading to much higher rates. And its effects would go far beyond lower-income countries.

“That could lead to waves of defaults far more pervasive than in the early 1980s, when the big story was the debt crisis in developing countries. This time, the debt crisis could be almost everywhere, because there is so much more debt.”

It is a measure of the profound crisis within the capitalist system that the prospect of higher growth in the US—normally regarded as a positive for the world economy—has sparked fears it will lead to rising interest rates, resulting in economic devastation for lower-income countries. And not only there but it could hit the advanced countries as well because the profit-making machine centred in Wall Street and other major financial markets has become so addicted to the endless supply of cheap money.

Biden unveils infrastructure plan tied to corporate tax hike

https://www.wsws.org/en/articles/2021/04/01/bide-a01.html




Patrick Martin
14 hours ago







President Joe Biden unveiled a proposal for rebuilding the crumbling infrastructure of the United States, but the plan is longer on rhetoric than on actions on the scale required to rebuild and modernize roads, bridges, water systems, airports, schools, housing and other physical facilities, as well as the social infrastructure—education, health care, scientific research.

In a speech at a carpenters’ union training center in Pittsburgh—a city that symbolizes the collapse of American industry, not its rejuvenation—Biden called his “American Jobs Plan” the largest public investment since World War II, and compared it to the building of the interstate highways in the 1950s and the space race of the 1960s.

Biden speaks during at The Queen theater, Thursday, Jan. 14, 2021, in Wilmington, Del. [Credit: AP Photo/Matt Slocum]



He offered no explanation of how American capitalism, after 40 years of stagnation and decay, most noticeable in its physical and social infrastructure, could suddenly summon the resources to revive systems that had been allowed to disintegrate, to the point where tens of thousands of bridges are in imminent danger of collapse.

Biden said nothing about the responsibility of the American financial aristocracy, the Wall Street vampires who have sucked up the resources of the country, amassing fortunes on a scale that puts into shade all previous ruling elites in world history, while the country decayed around them. Instead he made a pledge of loyalty, declaring, “I have nothing against millionaires and billionaires. I believe in American capitalism.”

While the top-line number of $2.25 trillion is constantly emphasized by the White House and its media supporters, since that might sound like a lot of money, spread out over eight or even ten years, it comes to less than $300 billion a year—about one-third of the Pentagon budget each year, and less than a quarter of the $1.3 trillion increase in the wealth of America’s billionaires in the course of the pandemic year.

The four main categories of spending include $650 billion for transportation infrastructure, such as roads, bridges, highways and ports, including subsidies for public transit, Amtrak and freight rail; $300 billion for housing infrastructure, mainly for retrofitting and upgrading two million homes, and eliminating lead pipes and lead service lines in water systems; $300 billion to “revive US manufacturing” (i.e., various subsidies to favored industries); and $400 billion toward home care for the elderly and the disabled.

The $650 billion over eight to ten years should be compared to the $2.6 trillion funding gap found by a report earlier this year from the American Society for Civil Engineers, which accounts for the disastrous condition of American roads, bridges, water systems, airports and other public facilities.

Lesser sums include $100 billion for high-speed broadband across the entire country, $100 billion to upgrade and build new schools, and $100 billion to expand and improve power lines and the electric grid.

Another $180 billion is for expansion of research and development, particularly directed at competition with China in areas like semiconductors, batteries and computer technology. Much of the transportation money has a similar purpose. There is a combined total of $174 billion in spending to boost the electric vehicle market, including building 500,000 electric charging stations across the country, to “win the EV market,” a campaign directed at Europe and Japan as well, but above all against China.

Biden’s Press Secretary Jen Psaki emphasized the anti-China basis of the plan, telling reporters Tuesday, “Fundamentally, we don’t believe that making a historic investment in American workers and rebuilding our infrastructure across the country to help us compete with China is controversial.”

The final outlines of the plan were drafted by two of the most right-wing figures in the White House: National Economic Council Director Brian Deese, a longtime Wall Street hand, and Domestic Policy Council Director Susan Rice, who was national security advisor in the Obama administration and a fervent advocate of imperialist aggression in the Middle East and confrontation with Russia and China.

White House officials were at pains to emphasize that unlike the $1.9 trillion economic stimulus bill passed last month, there was room for major changes and amendments to the American Jobs Plan as it goes through Congress. This suggests that while there is likely to be bipartisan support for much of the brick-and-mortar spending—which amounts to subsidies to construction companies and giant corporations—the money to be spent on programs like home health care for the elderly could well be sacrificed.

Even more significant is how Biden proposes to pay for the spending outlined in the plan. He has rejected calls by Senator Elizabeth Warren and other liberal Democrats for a wealth tax that would target those with more than $50 million. The White House also rejected a proposal by Senator Bernie Sanders to raise the corporate tax from 21 percent back to the 35 percent level that prevailed until the 2017 Trump tax cut.

Instead, Biden will propose raising the corporate tax rate from 21 percent to 28 percent, in effect leaving the corporations with half of the Trump tax cut (and, of course, far more than that once their tax advisers and lawyers figure out how to evade the new rules). If they were honest, the White House spin doctors should perhaps revise Biden’s campaign slogan of “Build Back Better” to something closer to the reality: “Build Back Halfway.”

White House officials claimed that there would be a second round of tax hikes on the wealthy to finance a second round of spending on “social” infrastructure, including education, health care and other services, which will be unveiled next month. This legislation, initially pegged at $1 trillion, would be paid for by an increase in the income tax rate on wealthy households, those making more than $400,000 a year.

Press reports of Democratic Party strategy suggest that Biden and Senate Majority Leader Charles Schumer regard it as unlikely they can win the ten Republican votes in the Senate required to overcome a filibuster. This means that the infrastructure plan would have to pass under the reconciliation process, requiring only 50 votes plus the tie-breaking vote of Vice President Kamala Harris.

There is only one reconciliation vote for each fiscal year, since the arcane procedure is ostensibly tied to the passage of the annual budget. Schumer has been reportedly considering either a second reconciliation bill to “amend” the bill passed last month for the 2021 fiscal year, or using the budget for fiscal year 2022, which begins October 1, as the basis for the infrastructure bill.

There will be considerable horse-trading and wrangling between the two capitalist parties. In the meantime, the Republicans have rubber-stamped Biden’s cabinet, allowing all his nominees to head federal departments to win approval. In return, the Democrats have effectively shelved any investigation into the January 6 coup attempt by Trump and his congressional Republican allies to seize the Capitol and block the certification of Biden’s victory.

Striking nurses at St. Vincent Hospital starved of strike pay by MNA

https://www.wsws.org/en/articles/2021/04/01/vinc-m31.html




Ben Oliver
14 hours ago







Nurses at St. Vincent Hospital in Worcester, Massachusetts, are in the fourth week of an open-ended strike, demanding safe staffing ratios. Having walked out on March 8, 10 days after issuing management a strike notice, they have sacrificed nearly four weeks of pay.

The Dallas, Texas-based corporate owner, Tenet Healthcare, has so far spent $22 million for strikebreakers, public relations, and police details, and recently installed surveillance towers, in what has become a one-sided war of attrition, as the Massachusetts Nurses Association (MNA) union seeks to isolate and wear down nurses, depriving them of strike pay.

Nurses on the picket line at St. Vincent Hospital in Worcester, Massachusetts (Credit: MNA Facebook)



Staffing ratios have long been the main concern for nurses and ancillary staff at St. Vincent, and indeed for health care workers across the country. For the St. Vincent nurses, the medical-surgical nurse-to-patient ratio is of critical concern. Among their main demands, St. Vincent nurses are seeking a fixed maximum ratio of four-to-one, and the creation of two “floating” units of nurses to be able to respond to crises. The reduction from a ratio of five-to-one to four-to-one has been demonstrated to result in lower patient mortality.

Mandated ratios and adequate staffing are anathema to a health care model built on profit. Well before the arrival of the novel coronavirus, hospital administrators, business degrees in hand, honed the art of flexing staff off to maximize profit, “optimally” providing the least amount of care possible.

Even during the initial surge of COVID-19, when intensive care units (ICUs) were being overrun by a flood of patients succumbing to the highly contagious respiratory disease, St. Vincent, like so many other hospital systems, furloughed staff because profitable elective procedures had to be cancelled. In a rational health care system, a highly contagious and deadly respiratory disease would call for all hands on deck.

Facing a less profitable outlook from the lack of the initial decline in elective procedures, Tenet Healthcare nevertheless received hundreds of millions of dollars from the CARES Act. Meanwhile, nurses had to furnish personal protective equipment (PPE) for themselves, stocking up on garbage bags and raincoats as makeshift gowns. In one Dickensian episode, nurses who provided their own bonnets were confronted by angry administrators who demanded they be removed because other nurses would want their own.

With ancillary staff furloughed, nurses were given portable phones and expected to act as unit secretaries. Even as they were setting up an extra ICU for overflow on their own initiative, they were expected to take on the cleaning duties of housekeepers. The burdensome work, additional duties, austere conditions, and callous management, all in the midst of the worst public health crisis they had ever faced, pushed medical surgical nurses and their colleagues, some of whom were recent graduates, to the breaking point. They demanded a strike.

Health care is the largest industry in Massachusetts, and collectively, nurses and their colleagues can be a powerful force. However, as demonstrated by the health care worker struggles in New York, Illinois, Pennsylvania, and California in the past year alone, the St. Vincent nurses, who are compassionate and selfless professionals, can place no confidence in the union that purportedly represents them.

The Massachusetts Nurses Association counts 123,000 nurses as members and has 77 bargaining units. While dozens of MNA officials make six-figure salaries, the union does not maintain a dedicated strike fund to compensate members. For roughly $100 in monthly dues, nurses are left with an Emergency Relief Strike Fund, to which they must apply to receive funds. In a wholly inadequate move, the MNA has set up a Venmo account to help younger nurses with children to purchase items such as baby formula and diapers. While their adversary can fall back on hundreds of millions in taxpayer dollars, the nurses of St. Vincent will have soon given up a month of their annual salary.

Rather than mobilizing their tens of thousands of other members in Massachusetts or appealing for support from around the country, the MNA has predictably sought to promote illusions in the Democrats, this party of Wall Street and big business. Democratic Senators Elizabeth Warren and Edward Markey and Representative Jim McGovern were brought by the MNA to the picket line earlier in March, allowed to posture as the friends of striking nurses. However, the reality is that the Democratic Party has been no less complicit in the attacks on health care in the US than their Republican counterparts.

For the nurses to be successful, they must take the struggle out of the hands of the MNA, and should organize a rank-and-file strike committee independent of both the union and the Democratic Party. Such a committee would appeal for the broadest possible mobilization of workers—including striking steelworkers in Pennsylvania and grad student workers in New York City, educators, Amazon workers, and others—in a fight for decent working conditions, fully funded and high-quality universal health care, and more.

Australian government announces missile building program as US steps up war drive against China

https://www.wsws.org/en/articles/2021/04/01/miss-a01.html




Oscar Grenfell
13 hours ago







Prime Minister Scott Morrison yesterday announced that his government would begin a $1 billion program to build missiles in Australia, for the first time since the 1960s, in close collaboration with the US administration of President Joseph Biden.

The project was foreshadowed last June, when Morrison’s government unveiled a massive $270 billion spend on military hardware over this decade, taking total military expenditure to $575 billion in the next 10 years. At the time, emphasis was placed on the acquisition of missiles and other strike capabilities from abroad, including the purchase last year of 200 long-range, anti-ship missiles from the US.

US soldiers mount a refurbished nuclear warhead on to the top of a Minuteman III intercontinental ballistic missile. [Credit: AP Photo/Eric Draper]

Yesterday, however, the government declared that it would “accelerate” the creation of a “Sovereign Guided Weapons Enterprise.” This would encompass the establishment of a missile production facility and other military hardware development, spelt out in a “Defence National Manufacturing Priority roadmap,” which also calls for the construction of unmanned drones.

A government press release, detailing the plans, pointed to the dangers of supply chain disruptions, stemming from events such as the COVID-19 pandemic, and escalating trade war conflicts as motivating factors for the haste of the project, as well as what was vaguely described as a “changing global environment.”

Defence Minister Peter Dutton, who was only installed in the post this week, as part of a broader Cabinet reshuffle, was more explicit. “The manufacturing and supply of weapons in Australia will not only benefit and enhance our ADF operational capacity, but will ensure we have adequate supply of weapon stock holdings to sustain combat operations if global supply chains are disrupted,” he stated.

In other words, the project is part of preparations for a major war, and not in the distant future. The clear target is China.

In the first two months of his presidency, Biden has ratcheted up a conflict with Beijing, which was initiated by Obama and further accelerated under the Trump administration. Biden is inflaming regional flashpoints, especially Taiwan, waging a hypocritical campaign over Chinese human rights violations and engaging in “alliance building” aimed at furthering the encirclement of China.

Over recent weeks, this has included a push by the US for the stationing of offensive missiles, previously banned by the Intermediate Range Nuclear Forces (INF) Treaty, within striking distance of China, including in Japan and Taiwan. Biden officials have also hailed Taiwan’s initiation of its own missile building program, at the same time as they have forecast a possible war between China and the island state within the next five years.

Dutton’s comments made clear that the Australian missile build is part and parcel of this broader offensive.

The latest announcement, he said, flowed out of AUSMIN talks last July, between Australian government ministers and top US representatives, including Trump’s anti-China hawk Mike Pompeo, who was then secretary of state. And now, Dutton stated, “We will work closely with the United States on this important initiative to ensure that we understand how our enterprise can best support both Australia’s needs and the growing needs of our most important military partner.”

Morrison formally launched the program at US arms manufacturer Raytheon’s Joint Centre for Integration in Adelaide. He also announced a $111 million “sustainment” fund for the US company, which is preparing to produce its own National Advanced Surface-to-Air Missile System in Australia, as part of a separate project.

To signal the speed of the missile build, Morrison declared, “we are bringing 2045 forward to now.”

Those corporate journalists present did not ask a single question about the purpose of the project or the danger of war, but focused entirely on repeatedly demanding to know where the new facility would be located. This was in line with the government’s attempts to present the planned missile facility as a driver of “job creation,” even though ministers have stated that a maximum of 2,000 people, most with expertise in the weapons sector, will be given employment.

Morrison, however, volunteered the broader agenda, declaring, “we have augmented what our broader strategic outlook is, and that involved bringing forward the capability for longer-range strike and that’s what this capability is about.” This was part of a “coordinated and comprehensive plan” that “meshes together with our alliance partners as well, particularly the United States…”

The PM placed the missile project in the context of recent steps towards formalising the “Quad,” a de facto alliance of the most powerful militaries in the Pacific, the US, Japan, India and Australia, directed against China. In US and Australian think-tanks, the consolidation of the alliance is presented as a key step towards preparing for conflict.

Arms companies, including Raytheon and BAE will now bid for a government contract for the facility, which is slated to produce long and medium-range missiles, and could transition to the next generation of weapons in the sector. Australia has already partnered with the US to test and develop air-launched hypersonic cruise missiles, that fly eight times faster than the speed of sound.

The missile project and its implications have received scant attention in the official press. This is all the more striking, given the description of the plan by Greg Sheridan, the foreign editor of the Murdoch-owned Australian newspaper, who has extensive connections to the US and Australian military and intelligence establishments.

Sheridan this morning insisted that, “The Morrison government’s decision to establish a missile manufacturing industry is one of our nation’s most important strategic decisions in decades.” It was necessary to be “watchful of the distance between announcement and delivery,” but for the first time in fifteen years, the defence ministry was proceeding with “real urgency.”

The project, Sheridan stated, increases Australia’s “ability to hit any potential enemy and to keep it at a distance, and our ability to support the US militarily if necessary in this region.”

Sheridan called for the government to press ahead with its crisis-ridden project of building 12 Attack Class submarines, but made clear that he was forecasting conflict far-sooner than 2034, when they are slated to be operational. “Bureaucrats and certain types of military planners are always dreaming of technology two generations away, because they have no sense at all that they could face a crisis tomorrow,” Sheridan wrote.

In an article a week ago, which was clearly part of the discussion leading up to the announcement, Sheridan advocated a rapid build-up of military capabilities for imminent war. “[L]ast year the government announced we were going to buy from the 200 US long-range anti-ship missiles. That’s a good purchase. But it’s a tiny number. If a conflict starts at 9am on a Monday, 200 missiles should get us through to morning tea on Thursday. After that we’re stuffed.”

Representatives of the Australian Strategic Policy Institute, a hawkish think-tank funded by the Australian and American governments and arms manufacturers, also welcomed the announcement. One was asked on 3AW Radio whether there would be a war between China and Taiwan within five years, responding that this was probable, adding: “If the United States then intervenes to assist Taiwan, it would be highly likely that Australia would assist the United States in that scenario.”

The Labor Party opposition fully supports these plans for a catastrophic war, with its leader Anthony Albanese declaring yesterday: “Australia does need to be more resilient when it comes to our defence, and this announcement is part of that. This is a bipartisan issue.” At its just concluded national conference, Labor passed a series of resolutions, denouncing China and promoting the pretexts for US-led aggression against it.

It was the Labor government of Prime Minister Julia Gillard, who, in 2011, placed Australia on the frontline of the US war drive against China. Gillard hosted Obama, as he announced the “pivot to Asia,” which included a massive US military build-up in the Asia-Pacific, from the floor of the Australian parliament. She signed a series of agreements, including for the establishment of a new US military base in the northern city of Darwin.

Australia is to play a crucial role in a US conflict with China, centring on cutting off Chinese supply lines that pass through the sea lanes of South East Asia and the Pacific, and operating as a “southern anchor” for US offensive operations against the Chinese mainland. The missile program is part of those strategic plans.

These preparations, which have the support of the entire political and media establishment, are being conducted behind the backs of the population.

For the past six weeks, official Australian politics has centred on diversionary sexual misconduct scandals, involving the Morrison government. Corporate journalists have poured over the details and sharply condemned the response of the government to the various allegations. Not one of them has voiced a word of opposition, or even criticism, over the increasingly evident preparations for war.

Brutal assault on female Filipino immigrant captured on security camera in New York City

https://www.wsws.org/en/articles/2021/04/01/nyc-a01.html




Kevin Reed
13 hours ago







On Monday, a 65-year-old female Filipino immigrant who has lived in the US for decades was attacked and brutally beaten near Times Square in Manhattan in broad daylight.

Family members reported that Vilma Kari was in the hospital recovering from a fractured pelvis and contusions on her body and forehead after she was kicked in the chest to the ground and repeatedly stomped in the head by a man who shouted an obscenity and then said, “You don’t belong here,” according to New York City police.

Image from the apartment building security camera footage showing the assault on Vilma Kari in Manhattan on Monday [Credit: NYPD News]

The man, 33-year-old Brandon Elliott, was arrested and charged with felony assault as a hate crime on Wednesday. He was identified after an image of his face was copied from nearby security camera footage and shared on social media.

Elliot was reported by police to be on lifetime parole upon his release in 2019 after serving 17 years in prison for the fatal stabbing of his mother. According to the Manhattan District Attorney’s office, Elliott faces up to 25 years in prison if convicted for the assault.

The entire attack was recorded on a video from the lobby of a luxury apartment building in Midtown Manhattan at approximately 11:40 a.m. The video had been viewed more than 625,000 times by the time of this writing.

The low-resolution video shows several men inside the apartment building witnessing the attack without coming to the aid of Ms. Kari either during or after the assault. A security guard is seen closing the front door of the building as the victim struggled to get up from the sidewalk and, after several minutes, stepped outside to see what happened before others appeared on the scene.

The assault on Monday in New York City is the latest in the alarming growth of violent attacks against Asians in the US over the past year. Research released by Stop AAPI Hate (Asian Americans and Pacific Islanders) last week shows that there were 3,800 racist incidents—including verbal harassment, shunning and violence—primarily against Asian women between March 2020 and February 2021.

Significantly, the data shows that of these incidents, more than two-thirds have occurred in the past five months and women report incidents more than 2 times more often than men. Approximately 7 percent of the cases (more than 250 instances) the victims of the hate were either coughed or spit upon by the assailants.

Additional data maintained by California State University at Santa Barbara’s Center for the Study of Hate and Extremism shows that anti-Asian hate crimes increased between 2019 and 2020 in fifteen US cities including San Francisco, San Jose, Seattle, Boston, Los Angeles and New York City. While all of these cities have large Asian populations, New York City is by far the largest and with both the most instances of hate crimes (28) and the largest increase between 2019 and 2020 (nearly ten times).

New York Police Department (NYPD) received that 33 complaints about anti-Asian hate crimes in the first three months of 2021, already surpassing the total number of 28 reported last year. NYPD said that these numbers do not reflect the real scale of the problem with many cases going unreported for a host of reasons such as language barriers and distrust of law enforcement.

NYPD also said the victims of most assaults are middle-aged Asian men and women who were alone on the streets or public transit and the attackers tended to be homeless people and individuals who have prior arrests as well as behavioral or emotional conditions.

The attack on Ms. Kari followed the publication of a video on TikTok the same day of an Asian man being brutally beaten on a subway train by another passenger. This event is still under investigation.

Whatever the immediate individual causes of the attacks, the fact of the increasing manifestations of discrimination, hatred and assault is directly related to the deliberate stirring up of anti-Asian sentiments by the political establishment and corporate media over the coronavirus pandemic and the intensifying global conflicts between the US and China. The pursuit of anti-Chinese politics is being pursued by the Democrats and Republicans alike as well as the so-called “conservative” and “liberal” media.

For example, on March 26, Republican Ohio Lieutenant Governor Jon Husted tweeted, “So it appears it was the Wuhan Virus after all?” with a link to a news report on Axios which quoted a statement by former Center for Disease Control and Prevention (CDC) Director Robert Redfield on CNN that day. Redfield said on CNN, “I’m of the point of view that I still think the most likely etiology of this pathology in Wuhan was from a laboratory.” Redfield added that the virus “escaped” from the Wuhan Institute of Virology as early as September or October of 2019, although he readily admitted he had no scientific evidence to back up the assertion.

The Axios report did little to clarify the issue, saying only that the World Health Organization (WHO) had said that it was “extremely unlikely” that the COVID-19 virus escaped from the Wuhan lab and then repeating the statement of the Biden administration that it had “deep concerns” about the WHO investigation and was demanding “transparency from Beijing.”

Following public outrage over Husted’s Twitter provocation that further encourages anti-Asian sentiments, the Lieutenant Governor doubled down on his comment on Wednesday getting to the crux of the political position of both governing parties in Washington DC, “To be clear, the tweet above referred only to the Chinese GOVERNMENT. A government of oppression that imprisons people of faith, silences dissenters and the media, manipulates its currency and steals our technology.”

On Monday, the Washington Post published an article on the WHO-China report stating, “the findings are far from conclusive and will be overshadowed by questions about China’s lack of transparency—and the WHO’s apparent inability to press for more.” Here the position of the Democratic Party-affiliated Post is indistinguishable from that of right-wing Republicans such as Husted.

There is widespread public outrage in the US against the expanding attacks on Asian-Americans and growing demands for equality and the defense of the democratic rights of all people regardless of ethnic or national origin. As explained here on the World Socialist Web Site, the “Wuhan lab” lie is connected to the geopolitical aims of American imperialism and is a central aspect of the Biden administration’s military escalation against China. Anti-Asian prejudice and all forms of racialist chauvinism are rooted in world capitalism and can only be defeated on the basis of the socialist unity of the international working class.

Bolsonaro sacks military command to consolidate authoritarian rule in Brazil

https://www.wsws.org/en/articles/2021/04/01/braz-a01.html




Tomas Castanheira
13 hours ago







In an action without precedent in the history of Brazil, the country’s fascistic President Jair Bolsonaro has fired his defense minister along with the uniformed commanders of the Army, Navy and Air Force. His unconcealed aim is to secure a total grip over the state in preparation for dictatorial measures against the working class under conditions of a catastrophic worsening of the COVID-19 pandemic and a deepening social and political crisis in Brazil.

Brazilian President Jair Bolsonao and Army commander Gen. Edson Pujol (Credit: AgênciaBrasil)



Bolsonaro’s conflict with the top echelons of the military has emerged in the context of his increasingly strident demands for a complete subordination of the Armed Forces to his government’s political agenda, in particular his genocidal herd immunity policy in relation to the COVID-19 pandemic. On the same day as the wholesale change in the senior command of the armed forces, Brazil set a record of 3,668 COVID-19 deaths, as its health care system confronts a nationwide collapse.

On different occasions in recent weeks, Bolsonaro has promoted a confrontation with any social distancing measures implemented by state and municipal governments in response to the record rise in COVID-19 infections and deaths. “My Army is not going into the streets to force people to stay at home,” he declared

On Monday, the government announced a cabinet reshuffle affecting six ministries, including the Government Secretariat, the Chief of Staff, Foreign Affairs, Defense, Justice, and the Office of the Attorney General. Defense Minister Gen. Fernando Azevedo e Silva was replaced by Gen. Braga Netto, who previously served as Bolsonaro’s chief of staff. After a brief meeting with Bolsonaro, Azevedo e Silva agreed to resign, although he was in fact fired by the president.

In his resignation letter, the general stated that as head of the defense ministry, “I preserved the Armed Forces as state institutions,” suggesting that after his removal, this may no longer prove the case.

Brazil's ousted military chiefs: Edson Pujol (Army), Ilques Barbosa (Navy) and Antônio Carlos Moretti Bermudez (Air Force) (Credit: AgênciaBrasil)

The commanders’ resignations were announced by Braga Netto as soon as he took over the defense ministry on Tuesday morning. The former commander of the Air Force, Antonio Carlos Moretti Bermudez, published a video following the meeting, with a statement that adopted the same theme as Azevedo e Silva. Bermudez declared that he worked for the Air Force as a “state institution” and for the “sovereignty of what is ours: the airspace.”

Tuesday was also marked by an offensive on the part of Bolsonaro’s allies in the House of Representatives. The leader of the Social Liberal Party (PSL) in the House, Major Vitor Hugo, tried to force a vote on a bill that defines public health emergencies—such as the COVID-19 pandemic— as a motive for decreeing a National Mobilization.

National Mobilizations, which today can be decreed in cases of war, allow the president to intervene in production at public and private companies and subject both civilians and military personnel to his orders. It represents a major concentration of power in the president’s hands. Even right-wing figures within the House defined the proposal as a “coup” attempt.

Bolsonaro’s unprecedented shakeup of his cabinet and the military high command was carried out on the eve of Wednesday’s 57th anniversary of Brazil’s 1964 US-backed military coup. Braga Netto’s first act as defense minister was to publish a military order of the day calling for the celebration of that political crime, which ushered in two decades of brutal dictatorship.

The order promoted the lie that the military coup was part of a “1964 movement” in response to a “real threat to peace and democracy.” This cynical “Bolsonarite” fantasy casts the coup as beginning with a popular movement in the streets that ended up being supported by the Brazilian ruling class and its state, with the armed forces “facing wear and tear” to “guarantee the democratic freedoms we enjoy today.”

In fact, the 1964 coup was directly engineered and promoted by US imperialism and the Brazilian ruling class. It was not the military that suffered “wear and tear,” but rather the tens of thousands of workers and students that it killed and tortured during the bloody dictatorship that lasted 21 years.

The order, which was read aloud to military personnel in barracks across Brazil on Wednesday morning, is directed at drawing fascistic lessons from this history. It states: “The current geopolitical scenario presents new challenges, such as environmental issues, cyber threats, food security, and pandemics. The Armed Forces are present, on the front lines, protecting the population.”

It is urgent that the Brazilian working class draw its own political lessons from this defeat. Arming itself politically against the increasingly dictatorial methods of the capitalist class is a matter of life and death.

In 1964, the political subordination of the workers to the bourgeois nationalist government of João Goulart, promoted by the Stalinist Communist Party, was instrumental in disarming working class resistance to the coup.

In 1985, when the dictatorship was officially ended, the political forces linked to the Workers Party (PT) worked for a smooth transition to a civilian bourgeois regime, opposing the “persecution” of the military and civilian officials responsible for the barbaric crimes committed against the working class. The political lie that this path represented a settling of accounts with the legacy of military dictatorship has been laid bare by Bolsonaro’s emergence from this political setup.

Today, the same forces historically behind these political betrayals seek to blind the working class to the imminent dangers of the current situation.

Different pseudo-left groups, especially the political heirs of Argentine revisionist Nahuel Moreno, have drawn the same conclusion from the events of the past week: “nothing to see here, move along.”

One of the most grotesque formulations was drawn by Valerio Arcary, one of the main leaders of the former Morenoite organization Convergencia Socialista, who held leading posts in the PT. Today, at the head of the “Resistance” tendency within the Socialism and Freedom Party (PSOL), Arcary ridiculed those who are “on the verge of a nervous breakdown” over Bolsonaro’s dictatorial actions, bluntly declaring: “What happened with the ministerial reform is not the antechamber of a self-coup in preparation. ... Big capital does not support a subversion of the regime.”

The same essential political view is held by the Morenoites of the Revolutionary Workers Movement (MRT), linked to the Argentine Socialist Workers Party (PTS). On their website, Esuqerda Diário, they describe Bolsonaro as without support within the military and “harried” by the center-right parties. The site advocates “a more sober conclusion than the analyses that exaggerate Bolsonaro’s coup plot at a moment of clear weakening and disintegration of his bases of support.”

The middle class complacency of these pseudo-left groups, stemming from their unshakable confidence in the eternal stability of the capitalist state, merit only contempt. Bolsonaro’s threats should be taken with the utmost seriousness by the Brazilian working class.

The political reality in Brazil is determined by the profound crisis of the world capitalist system, which is causing the breakdown of bourgeois democracies all over the world, and pushing the ruling class in every country toward dictatorial methods. The January 6 coup in the United States, openly hailed by Bolsonaro and closely followed by his son, Eduardo Bolsonaro, is the most acute expression of this international political shift.

The COVID-19 pandemic has raised the fundamental contradictions of capitalism to an explosive level. The brutal increase in social inequality, the devastating effects of the coronavirus throughout Brazil and the dead-end crisis of Brazilian capitalism are the objective driving forces of Bolsonaro’s coup plotting.

However, these same objective factors are creating the conditions for a powerful revolutionary movement of the working class in Brazil and around the world. The working class in Brazil cannot allow another fascist military coup. It must arm itself politically to prevent one.

The struggle against the threat of dictatorship must be joined with the fight to halt the COVID-19 pandemic, and to resolve the social crisis affecting millions of workers. The decisive question in preparing for the coming wave of revolutionary upheavals is the building of a socialist and internationalist leadership in the working class—that is, a Brazilian section of the International Committee of the Fourth International.

Obscene global vaccine profiteering by pharmaceutical companies

https://www.wsws.org/en/articles/2021/04/01/vacc-a01.html




Jean Shaoul
10 hours ago







Last week, British Prime Minister Boris Johnson told a private Zoom meeting of backbench Tory MPs, “The reason we have the vaccine success is because of capitalism, because of greed my friends… It was giant corporations that wanted to give good returns to shareholders. It was driven by big pharma.”

His obscene comments sum up the response of the ruling elite to the pandemic—an opportunity for profiteering on a huge scale, aided and abetted by imperialist governments that have protected Big Pharma’s monopoly profits.

The Pfizer-BioNTech vaccine (credit: WSWS media)

The reality is that the pharmaceutical companies were initially not interested in vaccine development. Zain Rizvi of the advocacy group Public Citizen told the Financial Times that the “immense scarcity” of vaccines was directly attributable to Big Pharma being “missing in action” as the coronavirus pandemic took off. The drug companies had years ago cut back on vaccine research and development in favour of blockbuster drugs to treat cancer and rare diseases, though the likelihood of a pandemic had long been discussed.

Even after the World Health Organisation (WHO) declared COVID-19 a pandemic on March 11 last year, three of the largest corporations, GSK, Sanofi and Merck, that dominated the vaccine market, were reluctant to get involved. They calculated that the pandemic would have run its course before a vaccine was ready and demonstrating once again the degree to which public health needs take second place to profits.

As the BBC reported in December, “Initially firms didn't rush in to fund vaccine projects. Creating vaccines, especially in the teeth of an acute health emergency, hasn't proved very profitable in the past.”

It was only after the governments of the European Union (EU), UK and US and agencies offered funding, including the main cost of running the “Phase 3” trials, assuming most of the risk in the process, that the industry started work on vaccine development, making rapid progress.

The profit gouging also began in earnest.

The US alone poured in an unprecedented $14 billion via Operation Warp Speed even though six of the Big Pharma, excluding Moderna, had combined revenues last year of $266 billion and profits of $46 billion, an 18 percent profit margin, and could easily have funded it themselves.

While GSK, Sanofi and Merck received over $2 billion from the US government to support the production of vaccines, Merck pulled out after disappointing early test results. GSK and Sanofi are working jointly on a vaccine. According to the People’s Vaccine Alliance, they are largely sitting on the sidelines, planning to produce Covid-19 vaccines for only 1.5 per cent of the global population in 2021.

Of the major vaccine producers, only Pfizer has a successful vaccine, produced jointly with the German company BioNTech using the new messenger RNA technology that requires storage at ultralow temperatures. The other major producers are new entrants to the field, the US-based biotech companies Moderna, whose vaccine also uses the RNA technology, and Novavax, whose vaccine can be stored in a normal refrigerator.

Moderna, the most expensive vaccine, received $2.5 billion from the US government. The campaigning group Public Citizen argues that this means, “Taxpayers are paying for 100 percent of Moderna’s COVID-19 vaccine development. All of it.” With the US government subsequently buying or reserving up to 500 million doses, Moderna is likely to make a whopping $8 billion profit.

While BioNTech/Pfizer’s vaccine was privately funded, the company received a €100 million development loan from the European Development Bank as well as a €365 million euro grant from the German government to help with manufacturing costs.

Public monies funded not only the development of the vaccines but also, via the universities and public laboratories, much of the science underpinning the vaccines. Crucially, all the vaccine development teams benefited from the initial research carried out by Professor Zhang Yongzhen at the Shanghai Public Health Clinical Centre where he had sequenced thousands of previously unknown viruses. The Centre made the first genomic sequencing of the COVID-19 virus freely available on the open-source site virological.org on the very day that Wuhan recorded its first Covid death. It was the release of Covid’s genetic code that allowed University of Oxford, Moderna and BioNTech to design their vaccines in short order.

The companies have made a killing from massive pre-orders by governments, far larger than their population requirements, even before their vaccines had obtained regulatory approval. The US government made $1.95 billion and $1.53 billion pre-payments for the BioNTech/Pfizer and Moderna vaccines respectively through Operation Warp Speed, in effect an interest free loan.

But that was not enough for Big Pharma. They lobbied hard to guarantee monopoly profits by insisting the World Trade Organisation reject India and South Africa’s call to waive patent protection for the vaccines and to allow developing countries to manufacture or import generic versions. Pfizer boss Albert Bourla said, “At this point in time, I think it’s nonsense, and… it’s also dangerous”.

The US, the EU and the UK fell in line. Similarly, the companies sought and got legal indemnities from the governments protecting them in the event of problems with the vaccine, while ensuring that their contracts remained secret.

All this translates into massive profits for the pharmaceutical corporations. BioNTech/Pfizer is expected to make $4 billion profit on $15 billion sales at around $19 a shot, a profit margin of nearly 30 percent according to the Financial Times, as the company strikes hard bargains with rich and poor countries alike. Moderna is projected to make $8 billion profits on sales of $18.4 billion with at least 700 million pre-ordered vaccines in 2021 at between $25 to $37 a shot. The company says production costs are just 20 percent of sales revenues. The ultimate beneficiaries are the giant investment funds that hold the companies’ shares.

As well as profits, the companies have had a massive free advertising campaign as their jabs have made them household names, while the science underpinning the vaccines can be put to treating and profiting from other diseases. Furthermore, according to figures from Morgan Stanley and Credit Suisse, should the advanced countries decide to offer annual booster jabs to cope with new, more resistant variants, as they do for flu, the pharmaceutical companies are set to rake in a further $10 billion or more a year.

The one company that bucked the trend was AstraZeneca, which is selling its jab at between $2 and $4 a dose after entering into an agreement with the University of Oxford that restricted its prices. Not having developed a vaccine of its own, it bought the rights to the jab developed by the university’s Jenner Institute, paying the university $90 million and a 6 percent share of future royalties. The university’s spinout company, whose directors include the leaders of the vaccine development team Professors Sarah Gilbert and Adrian Hill, will get 24 percent of the university’s share.

The scientists had initially wanted their vaccine to be produced on a non-exclusive, royalty-free basis, with the director of the Jenner Institute telling the media, “I personally don’t believe that in a time of pandemic there should be exclusive licenses.” He was echoing the words of Dr Jonas Salk, the inventor of the polio vaccine, who refused to patent the jab. When asked, “Who owns this patent?”, Salk famously replied, “Well, the people I would say. There is no patent. Could you patent the sun?”

In the event, the University of Oxford, stating that it needed to organize a massive global roll-out, entered into an exclusive deal with AstraZeneca, which agreed to sell the vaccine on a not-for-profit basis, claiming “We are absolutely committed to make the vaccine available to as many countries as possible at no profit during the period of the pandemic to support broad and equitable access around the world.”

Forgoing profits in the short term was viewed as good public relations and in any event ran counter to the terms of the deal that were not made public. According to the Financial Times, the contract allows the company to make 20 percent above the cost of manufacturing the vaccines and can raise the price when it deems the pandemic to be over, any time after the end of July. While these conditions appear to apply to the UK and EU, the company is also selling the vaccine to poorer countries, including Bangladesh, South Africa and Uganda, at higher prices.

Nevertheless, the AstraZeneca jab is the cheapest on the market, with the US corporation Johnson & Johnson more expensive despite also selling its vaccine at “cost price” during the pandemic, which is why the AstraZeneca vaccine has far larger shots under contract than any other vaccine producer. Its vaccine became the vaccine of choice for the world’s poorest countries and the WHO’s Covax scheme, particularly since it does not require storage at low temperatures.

Their prices at $2-$4 are far lower than Sanofi/GSK’s vaccine at $9.19, Pfizer/BioNTech’s at $14.59 and Moderna’s at $18, according to the pricelist negotiated by the EU. Other countries, including the US, are paying far higher prices, with the Pfizer jab reportedly costing $39 per person. While AstraZeneca’s expected profits are unknown, sales of $6.4 billion in 2021 and a 20 percent profit margin implies profits approaching $1.3 billion.

Unquestionably, AstraZeneca’s undercutting of the market has incurred the wrath of its rivals, causing uproar in France, Germany and the US. The EU threatened a ban on the export of the vaccine, yet another instance of the vaccine wars fueled by the conflicting interests of the rival companies, the major imperialist countries, as well as their rivals and client states.

The unrestrained drive for profits has put vaccines out of reach for most of the world’s population and will serve to massively increase global death rates as more virulent mutants proliferate.

The disastrous response of all the major capitalist powers and the pharmaceutical industry to the global COVID-19 pandemic confirms the necessity of abolishing the capitalist system that subjugates human health and every other basic need to private profit. The international working class must intervene to expropriate the pharmaceutical giants and every major industry sector, transforming these monopolies into publicly-owned and democratically-controlled utilities to serve the needs of humanity.