E.M.S. Birth Centenary

EMS on Planning

Marxism, as is well-known, does not see ‘theory’ and ‘praxis’ as two separate entities. The journey from the abstract to the concrete, from ‘theory’ to ‘praxis’ is as much a theoretical effort as an effort of praxis. E.M.S. Namboodiripad’s theoretical greatness therefore lay in the fact that he developed this theory-praxis totality in the context of rthe reality of the Indian society. And one very significant feature of this reality that he had to grapple with was that India was a planned economy, which created the illusion in the minds of many that India was in some sense a socialist economy, rather like the Soviet Union. Even those who did not share this piece of naivete, saw Nehruvian India nonetheless as pursuing some sort of a non-capitalist path of development, with the renowned economist Michael Kalecki developing a theory of “intermediate regimes” to explain the phenomenon.

EMS critiqued Kalecki’s theory that saw quite correctly the policy of non-alignment in foreign policy and of building a state capitalist sector (the ‘public sector’) in the realm of the economy, as assertions against imperialism, but that attributed such assertions, quite wrongly, to state power being in the hands of the petty bourgeoisie, a denouement that, Kalecki argued, was a novel phenomenon in human history. EMS was very clear that the Indian state was led by the big bourgeoisie, who, since they appeared late on the historical scene, had to enter into an alliance with the landlord class, even while pursuing the capitalist path of development. The so-called novel features of Indian state policy, like non-alignment and state capitalism, arose not because the Indian state was a petty bourgeois state, but because, even Indian bourgeoisie which had been discriminated against under colonial rule, which had joined the anti-colonial struggle, had imposed its leadership upon it, and had even managed to retain this leadership against the nascent challenge of the proletariat, was interested in pursuing a relatively autonomous path of capitalist develop-ment vis-à-vis imperialism.

The pursuit of the capitalist path in economies like India, he argued, was historically doomed, because it occurred at a time when world capitalism had entered into a period of general crisis. The tragedy of the Indian bourgeoisie, as EMS saw it, lay in the fact that it was embarking on the capitalist path of development in a period of general crisis for world capitalism. The bourgeoisie’s inability to smash feudal landlordism and undertake thorough-going land reforms, as had happened in Europe in the heyday of bourgeois ascendancy, was a reflection of this fact: the Third World bourgeoisie in the period of general crisis could not afford to alienate the landlord class whose political support it needed to ward off the challenge of the proletariat.

This in turn arrested the scope of the bourgeois transformation of society, restrained the development of productive forces in agriculture, restricted the size of the domestic market, kept the economy crisis-prone, imposed enormous burdens on the people, and gave perpetual shakiness to the foundation of bourgeois democracy, as was demonstrated during the Emergency. The crisis of Indian planning, according to EMS, arose because of this fundamentally doomed nature of the Indian bourgeoisie’s historical project. As opposed to this project, EMS advocated the establishment of a state of workers and peasants that would complete the bourgeois revolution of India, which the bourgeoisie itself could not, and take the country forward along a road that eventually led to socialism.¨

The question naturally arises: how do we evaluate EMS’s theory from the vantage point of today? He critiqued the Nehruvian state, the Nehruvian development path and the Nehruvian planning and did so on the premise that world capitalism was in a general crisis. But Nehrvianism has been replaced by neo-liberalism, as the Indian bourgeoisie has made common cause with imperialism. Indian planning now has become synonymous with the promotion of the private sector, including the MNCs, and the pushing of the Indian economy into the vortex of globalised finance, where the state’s help is enlisted for the defence and protection of the interests of international finance capital. All this has happened moreover in a world where the collapse of the Soviet Union has made all talk of the general crisis of capitalism appear anachronistic.

What is missed in all this, however, is that the existence of the Soviet Union was not the cuase of the general crisis of capitalism, but its symptom. And the bourgeoisie’s making common cause with imperialism, getting integrated with multinational capital and globalised finance, has brought in its train an agrarian crisis of gigantic proportions, followed by an inflationary crisis that reflects the squeeze on petty production, in a scenario that is reminiscent of the period of the thirties and the forties.

World capitalism that had survived till now by enlisting the support of the peasantry, whose conservative attachment to petty property was exploited by it to thwart the emergence of worker-peasant alliances, is now finding this crucial support slipping away from it. EMS’s vision of the correct path of development of the people and his prognosis of how it can be reached, not only remains as true today as it ever was, but perhaps even closer to realisation, in a historical sense, than ever before.

by Prabhat Patnaik. [Courtesy: The Kaumudi (E.M.S. Namboodripad Global Edition in English—October-December 2008)]

Afterimages

A hundred ways of looking at Che Guevara.

On October 9, 1967, a Bolivian army communiqué from La Paz announced that Ernesto "Che" Guevara, the Argentine-born Cuban revolutionary comandante turned itinerant guerrilla, had been hunted down by soldiers and killed in battle. The New York Times responded editorially, and with evident satisfaction, that if the report proved true, "as now seems probable," then "a myth as well as a man has been laid to rest." It was not the Times's most accurate prediction.

Photographs of Che's lifeless body soon appeared in newspapers around the globe, putting to rest doubts about his death. Perhaps the most famous image was one taken by Freddy Alborta, showing Che's corpse being displayed to the press by Bolivian army officers. Yet controversy over the circumstances of Che's death continued to brew. Was he killed in combat, or in cold-blooded execution? The latter. Did the soldiers who killed him amputate and preserve his hands and then cremate the body? His amputated hands were smuggled to Cuba in 1970, and his bones were discovered by a Cuban forensic team in Bolivia in 1997 and returned to Cuba for state burial.
In Che's Afterlife: The Legacy of an Image, Michael Casey reports that local peasant women who paraded by Che's corpse on October 9 with the permission of triumphant Bolivian officers "surreptitiously clipped locks of hair from Che's head, saving themselves a future talisman." A few weeks later, the journalist and novelist Jose Yglesias, reporting on Che's death for The Nation, indulged his readers with a different sort of memorabilia. Yglesias wrote that like the relics of St. Teresa of Avila, a sixteenth-century Carmelite nun and mystic, Che's hands "may well be with us for a long time to strengthen the nonreligious but barefoot Order--like Saint Teresa's stoical Carmelites--of the guerrillas of South America." The mythic appeal of the slain revolutionary, known to many today in Latin America as "San Ernesto," has only grown in subsequent years. "Unwittingly, the Bolivian military delivered the world a lasting and sympathetic picture of the man they'd hunted down," Casey writes. "They gave it a crucified Che." Indeed, John Berger and other art critics have argued that Freddy Alborta's photo of Che's corpse bears a startling resemblance to Renaissance depictions of Jesus Christ at the moment he was brought down from the cross by the Romans.
Che hardly ever sat for a bad photo--even in death. But of all surviving photographs of him, one in particular stands out: the head-and-shoulders portrait of a bearded, longhaired, 31-year-old Che, wearing a bomber jacket and his trademark beret emblazoned with the comandante star. Casey makes this image the central concern of Che's Afterlife, and in the book's opening chapter he offers a vivid re-creation of the "frozen millisecond" when the photo was taken. The date was March 5, 1960; the location a spot near Havana's Colón cemetery; the occasion a public funeral sponsored by the revolutionary government. The previous day a French munitions ship delivering arms to Cuba had mysteriously blown up in Havana harbor, killing scores of people and wounding hundreds. CIA involvement was suspected but never proven. Che, who had been at a meeting nearby in downtown Havana when the ship exploded, rushed to the docks and helped provide medical aid to the wounded and the dying.
On March 5, Che was standing on the speaker's platform while Castro harangued the crowd. He was gazing upon the assembly when photographer Alberto "Korda" Díaz Gutiérrez snapped a picture of him for Revolucíon, the official newspaper of Castro's 26th of July Movement. At the moment the shutter clicked, Che was hunched inside his bomber jacket against the unseasonable cold of that March day. The tension in his posture, combined with his piercing gaze ("angry and grieved" was the impression that Korda had of his subject's mood), made for a formally dynamic image. Citing art historian David Kunzle, Casey notes the "aesthetic magnets" of hair, beard and star, all of which both "steer the eye's attention" when looking at the photograph and "provide reference points for derivative art," allowing for simplified forms of "mass reproduction as a two-tone icon."
Korda knew he had taken a good picture, but his editors failed to agree: the photograph did not run in the following day's Revolucíon. Over the next few years it would enjoy only a few low-key appearances in Cuban periodicals. Eventually, someone in a position of influence recognized the image's iconic possibilities. Shortly before Che's death, the photo--by then known as "Guerrillero Heroico"--was made a centerpiece of official Cuban propaganda. It adorned the hall at an international gathering of artists and writers in Havana in May 1967 and later that summer was displayed at the founding meeting of the Organization of Latin American Solidarity (OLAS). Korda's "Guerrillero Heroico" became routinely coupled with Che's famous slogan calling on the international left to "create two, three...many Vietnams." In the aftermath of Che's death, the Korda photo, or various graphic derivations, became a staple of radical newspapers and left-wing poster art in North and South America and Western Europe. And in an ironic post-1960s development, the image took on yet another life--this time as a marketing device, used to sell everything from air fresheners to condoms to an ice cream bar called Cherry Guevara.
Michael Casey, bureau chief for Dow Jones Newswires in Buenos Aires and a frequent correspondent for the Wall Street Journal, seems especially to relish the commercial taint of recent appropriations of Che's image, the "commoditization of an anticapitalist rebel who opposed all that his hyper-commercialized image now represents." As Casey sees it, the issue is not that Che's image is without continuing political appeal but that it has too many diverse meanings to be the symbol of any coherent ideology. As one would expect, the Korda photo remains "the symbol of choice" for contemporary Latin American rebels, "wherever regional activists give the middle finger to the U.S.-backed free market system." It has also shown up in recent years as movement iconography in Palestine, Nepal, East Timor and many other locales caught up in radical insurgencies. But its appeal is not limited to conventional left-wing movements; it has been embraced, for instance, by "U.S.-backed Christian rebels in Sudan who are fighting a Muslim regime." He argues shrewdly that the contemporary meaning of Che's image ultimately isn't about communism or anti-imperialism: it's about attitude, and it's about sacrifice. "A man, a teacher, lays down a code of personal conduct from which to build a just society, a utopia, and then proceeds to live and die according to it."
In Che's Afterlife, we learn almost as much about the photographer who captured the image "Guerrillero Heroico" as we do of its subject. Before the revolution, Korda established a reputation as Cuba's best fashion photographer, and his studio became "a meeting place for the beautiful people of Havana." As someone who devoted his leisure hours to collecting models, actresses and fine automobiles (an MG convertible and a Porsche), Korda might have seemed a likely prospect for an early exodus to Miami after Castro and Che's triumph in 1959; instead, he "made a surprisingly smooth transition from the world of glamorous models and film stars to that of Castro's scrappy soldiers." But perhaps the transition wasn't a surprise since, as Casey suggests, revolutionary Havana retained a streak of hedonism for a few years amid the asceticism of the new order: "If Korda's extravagant lifestyle ran counter to the discipline of Che Guevera," he writes, "it was in keeping with the mood of the early years of the revolution." Revolución, where many of Korda's photos appeared, favored a freewheeling iconoclasm, with "a bright, distinctly American aesthetic" that "borrowed some of the sex appeal of pre-revolutionary Cuba and planted it in the framework of what many assumed would be a politically liberating new era."
Unfortunately, that promise would go unrealized as Communist Cuba hardened in the shadow of its Soviet big brother. In the early days of the new regime--and in a moment most at odds with the Guerrillero Heroico legend--Che did a stint as a prison commander at La Cabaña fort in Havana, where a number of political prisoners were executed. (Estimates of the victims range widely, from a few hundred to many thousands.) Many of Revolución's editors and writers would themselves become exiles before the decade was over. As for Korda, he remained a revolutionary true believer throughout the difficult years that followed. He also became a savvy enough legal tactician to succeed in reclaiming the property rights of his famous photo and some of the profits generated by its unexpected commercial success in the late twentieth century. In a September 2000 legal settlement, an ad agency in Britain agreed to pay $75,000 for unauthorized use of "Guerrillero Heroico" in a Smirnoff vodka advertisement, and Korda donated the money to the Cuban healthcare system. The court's decision removed the photo from the public domain, establishing the aging photographer as the clear copyright owner. Korda died the next year, leaving various Cuban heirs to squabble over the newly valuable estate.
Casey has gotten hold of a good story and has some interesting things to say about it. His later chapters, exploring the meaning of Che's "afterlife" in contemporary Argentina, Venezuela, Bolivia and Miami, are his most original, packed with reports of fascinating encounters with Che admirers, cultists, exploiters and vilifiers. Particularly gripping is his interview in Miami with Felix Rodríguez, a CIA agent sent to Bolivia in 1967 to train the troops fighting against Che's small band of guerrillas, who encountered the commander in captivity on his last day alive. According to Rodríguez's autobiography, Shadow Warrior (1989), after failing to persuade the Bolivians to spare their captive's life, he embraced Che before his execution. "His moment of truth had come, and he was conducting himself like a man. He was facing death with courage and grace." Casey is agnostic on the question of whether the CIA really wanted Che kept alive, though he signals some skepticism by noting that Rodríguez had spent "a life that constantly skirted the shadier moments of US history," including the Bay of Pigs, attempts on Castro's life and involvement with the Nicaragua Contras. In his interview with Casey, Rodríguez reiterates his admiration for the doomed revolutionary: "Look at what people write: The far right say that he was crying, which wasn't true. And then on the other hand, you have the far left saying that I tried to slap him in the face and that he spat on me, which is also not true.... The man conducted himself with respect to the very end. No matter what, everybody has to respect that."
There's much to like about Che's Afterlife, but the book would have benefited greatly from a sturdier historical frame. Perhaps reflecting his training as a business reporter, Casey seems overly enamored with the language of advertising and consumption. The popularization of Che's image, he writes, was "one of the Cuban revolution's greatest marketing accomplishments." On October 18, 1967, standing before an enormous reproduction of "Guerrillero Heroico" in downtown Havana, Castro delivered a speech eulogizing Che as a role model and hero. Casey describes the event as a "brand launch":
There, in the Plaza de la Revolución, the Cuban revolution's world headquarters, its leader converted the hitherto little-known Korda image into a powerful mnemonic, a lasting logo. Castro combined the Cuban revolution, Che's stellar qualities, and the Guerrillero Heroico image into a single attractive product.... Just as urban sneaker-wearing teenagers seem susceptible these days to advertisers who encourage them to identify with brands such as Nike or Tommy Hilfiger, in late 1967 radicalized students across the Western world were ripe for the Che brand.
The flaw of Casey's approach is not its irreverence or its cynicism--both of which might seem to be merited by the less than inspiring outcome of the Cuban Communist experiment--but rather its ahistoricism. Che was not, in fact, an unknown "brand" in student circles in the Western world that burst upon the scene in October 1967 like a hot new rock group (or a snazzy and well-promoted pair of sneakers). There is no indication in Che's Afterlife that Casey has read Where the Boys Are: Cuba, Cold War America and the Making of a New Left (1993), in which historian Van Gosse argues for the inspirational role of the Cuban Revolution for at least some American New Leftists at the very start of the 1960s. Casey does not mention either C. Wright Mills's influential and bestselling polemic Listen, Yankee: The Revolution in Cuba (1960), widely read in student circles in those years, or Malcolm X's praise of Che as "one of the most revolutionary men in this country right now," when the Cuban leader visited New York City in 1964 and denounced racism in South Africa and the American South in an address to the United Nations.
Casey's determination to pinpoint the moment of the "brand launch" of "Guerrillero Heroico" is simply irrelevant to the actual political history of the 1960s. Even though the image had gone unpublished outside obscure Cuban newspapers, the mainstream American media, as well as the radical press, had kept Che's name and face in the public eye for years: from his days as Castro's sidekick, to his disappearance from view in Cuba in 1965, to his life as an international man of mystery until October 9, 1967. The New York Times Magazine, for instance, ran a four-page feature story in 1966 with the headline ¿Dónde Está? Whatever Became of Che? Although critical of Che's politics, the article--unmentioned in Casey's account--quoted a recent graduate of Santo Domingo University in the Dominican Republic who called the vanished revolutionary "the purest of the pure," someone who "hasn't been corrupted by power." The Dominican student concluded, "I bet right now he is fighting the oligarchs and the yanquis not far from our country." The subsequent launch of the Che brand is already encapsulated in those words, which have nothing whatsoever to do with the marketing instincts of the Castro regime.
Casey also displays an uncertain grasp of US history in the late 1960s, claiming that "the culture and politics of the '68 youth movement in the United States were dominated by the antiwar, pro-peace hippies." Casey believes that the version of Che embraced by the American left in 1968 had been thoroughly defanged by peaceniks. There were certainly lots of hippies involved in antiwar activism in 1968; but there were also lots of intensely political radicals in groups like Students for a Democratic Society (SDS) and the Student Nonviolent Coordinating Committee (SNCC)--the first unmentioned in Che's Afterlife, the second appearing only in a footnote. And, for better or worse, these radicals already knew a great deal about Comandante Guevera, and they weren't engaged in any of the "softening" Casey attributes to the hippie peaceniks. Greg Calvert, SDS national secretary, told a reporter from the New York Times in May 1967 that "Che's message is applicable to urban America as far as the psychology of guerrilla action goes.... Che sure lives in our hearts." Two months later, in July 1967, SNCC chair Stokely Carmichael traveled to Havana, where he was elected as an honorary delegate to the founding meeting of OLAS. According to the account published in the Times, "Mr. Carmichael said that he had decided to come to Cuba because of a message last April attributed to the vanished Cuban guerrilla leader, Maj. Ernesto ('Che') Guevara. This message called on Latin-American revolutionaries to create two, three or more Vietnams. He said that the guerrilla leader was an inspiration to American Negroes." Following the Columbia University student strike in April 1968, SDS founder Tom Hayden adapted Che's "two, three" Vietnams slogan to the struggle on American campuses in a manifesto published in Ramparts calling for the creation of "Two, Three, Many Columbias."
Casey also lacks a basic understanding of the chronology of the era. "Especially after the death of Martin Luther King on April 4, 1968," he writes, "civil rights leaders such as Stokely Carmichael, Eldrige [sic] Cleaver, and Malcolm X became vocal advocates of a more militant struggle for black Americans." Malcolm, of course, had been assassinated more than three years before King (and shortly after praising Che), while Carmichael and Cleaver had been vocal advocates of "militant struggle" for quite some time before April 1968. For the sake of his pet marketing analysis, Casey seems to want to infantilize and trivialize all '60s radicals, depicting them as just so many naïve groupies bowled over by the Guerrillero Heroico consumer style: "Guevara the warrior fit the hippie stereotype of beauty--strong and handsome, but sensitive and loving at the same time." No doubt there were youthful communards who pinned silk-screened posters of Che on the wall next to one of Jimi Hendrix and couldn't quite tell the two apart after a few tokes of Panama Red. But is that really the appeal and meaning Che held for Carmichael or Hayden--neither one a hippie softie--or their numerous followers?
Casey can't answer the question, because his study lacks a comparative dimension. Che's image was not uniquely popular among Western radicals in the 1960s--it was not the undisputed "defining icon" of the era, as Casey would have it. There was the famous photo of Malcolm X in full rhetorical flight, finger pointing in accusation. There was Huey Newton sitting in a wicker chair, with a rifle in one hand and an African spear in the other. There were anonymous Vietcong soldiers, men and women, clutching AK-47s, the Guerrilleros Heroicos of another struggle, their images a regular feature in the pages of New Left Notes and similar publications. There were even enough posters of Chairman Mao to provoke the Beatles to sing in 1968, "If you go carrying pictures of Chairman Mao/You ain't going to make it with anyone, anyhow." Could John Lennon not think of anything to rhyme with "Che"?
Jose Yglesias died in 1995, late enough to have watched the Che myth evolve through its later manifestations but too soon to have seen an undoubted expert on the subject also use religious imagery to define Che's legacy. On the occasion of John Paul II's 1998 visit to Cuba, where he preached in a Havana plaza dominated by a steel sculpture of the "Guerrillero Heroico" visage, a journalist is reported to have asked the pope for his thoughts on Che Guevara, a "protagonist in recent Cuban history." His Holiness is said to have replied, "He is now before God's Tribunal. Let's let our Lord judge his merits. I am certain that he wanted to serve the poor."
Che was a hard man--a fighter, a zealot, an idealist with blood on his hands. History is full of similar figures--Oliver Cromwell, John Brown, Leon Trotsky. And yet I still understand why some of their examples, and especially Che's, might appeal to contemporary young activists (and ones far less bloody-minded than I once was). Even Casey rejects the idea that those drawn to Korda's photo in the twenty-first century can be classified simply as the useful idiots of a failed totalitarian experiment or, contradicting his earlier emphasis on style and marketing, as passive consumers of Che's charismatic appeal: "It is not only Guevara's high cheekbones, long eyelashes and cool bomber jacket that make this photo desirable. Its appeal also lies in its spirituality, in its ability to feed people's longings for a better world and to encourage them to dream of defeating death.... Korda's Che keeps hope alive."

By Maurice Isserman, The Nation
Che's Afterlife: The Legacy of an Image by Michael Casey

Che - 81st birthday

‘And let us develop a true proletarian internationalism;

with international proletarian armies, the flag under which we fight would be the sacred cause of redeeming humanity.
To die under the flag of Vietnam, of Venezuela, of Guatemala, of Laos, of Guinea, of Colombia, of Bolivia, of Brazil - to name only a few scenes of today's armed struggle-would be equally glorious and desirable for an American, an Asian, an African, even a European.
Each spilt drop of blood, in any country under whose flag one has not been born, is an experience passed on to those who survive, to be added later to the liberation struggle of his own country. And each nation liberated is a phase won in the battle for the liberation of one's own country.’

Che Guevara's 81st birthday Marked in Bolivia

La Higuera, Bolivia, Jun 14 (Prensa Latina) Bolivians and Cubans on Sunday paid tribute to guerrilla commander Ernesto Che Guevara on his 81st birthday at the same place where he was murdered in October, 1967. A group of Cuban working in Bolivia, members of the Che Guevara foundation, and local authorities gathered at this distant place to honor the legendary guerrilla, born on June 14, 1928 in the Argentinean city of Rosario.La Higuera (Spanish: "The Fig Tree") is a small village in Bolivia located in the Province of Vallegrande, in the Department of Santa Cruz.Situated some 150 km southwest of Santa Cruz de la Sierra, the village lies at an elevation of 1950 m. Its population (according to the 2001 census) is 119, mainly indigenous Guarani people.On October 8, 1967 Che Guevara was captured by the Bolivian Army in the nearby ravine Quebrada del Churo, ending his campaign to create a liberation movement in South America, but the guerrilla’s example has remained alive.A monument and a memorial at the schoolhouse were he was murdered in La Higuera are a stop in the Che Guevara Trail inaugurated in 2004 to honor the Heroic Guerrilla, as he is also known.In Sunday’s tribute, Cuban teachers, social workers and health personnel working in Bolivia will be recognized for their work.Before travelling to La Higuera, the convoy made a stopover in the eastern Bolivian town of Vallegrande, where Che Guavara’s body was placed on display and afterwards secretly buried under an airstrip. His remains were found 30 years later and brought to Cuba, together with most member of his guerrilla force.

The New Co-op Capitalism

The New Co-op Capitalism
by Noreena Hertz

The first full crisis of globalization means the start of a kinder, more selfless economic system.

There are some who say this current global financial recession, this recession/depression that is being felt in London and New York, in Shanghai and Sao Paolo, will not have an impact on the nature of capitalism. That five years from now, well, capitalism will basically look like it did six months ago.

I understand this caution about predicting anything new, a reluctance to call the past era one of capitalism’s demise. But I do not agree with it. I believe the conditions are in place for a markedly different economic model to emerge from the carnage this economic crisis has wrought.

Under Gucci Capitalism, mandating corporations to do things for a greater public good was rare. Under Co-op Capitalism, mandates rather than voluntary measures will increasingly be the norm.

For what we are seeing today is not just a variant of the Russian crisis, the dot-com crisis, the Japanese crisis. This first full crisis of globalization, this first collective lose-lose, this first blue- and white- and multicolor-collared recession is so profound, is going to negatively affect so many people all over the world, is so obviously a manifestation of what happens when private institutions are allowed to put their profits before all else, and is so obviously linked to the flawed doctrine of the past 30 years, that to navigate it successfully will, I believe, demand a different operating environment.

I have named the past era of capitalism, Gucci Capitalism. It was an ideology born in the mid-1980s—the love child of Ronald Reagan and Margaret Thatcher, with Milton Friedman its fairy godfather and Bernard Madoff its poster boy. An era whose fundamental assumptions were markets should be left to self-regulate, governments should be laissez-faire, and human beings are nothing more than rational utility maximizers. A time when a conspiracy of marketers, credit-card companies, banks, and advertisers fueled a particular narrative—that it was less shameful to be in debt than not to have the latest pair of Nike sneakers or Gucci handbag.

No wonder, with this its underlying ethos, regulators were too weak, bankers too powerful, checks and balances were not in place, whistleblowers ignored. No wonder, with this the driving force in society, it wasn’t a matter of if but when the whole pack of cards would come tumbling down. Gucci Capitalism was as lacking in real values as its name suggests. Unsurprisingly, it is now under attack from both left and right. Even one of its most prominent cheerleaders, Alan Greenspan, claims to have been blinded by its ideology. But attacks of self-awareness can be short-lived. Is there enough evidence to point to the emergence of a significantly different alternative economic model?

I believe there is, that the conditions are in place for a new form of capitalism to arise from the debris of the past: Co-op Capitalism, with values of cooperation, collaboration, and collective interest at its core.

There are five key reasons why I believe this is so.

First, the public is angry and the media is on its side. While initially this anger was directed at bankers, it will soon shift to big business more generally, at companies that pay their executives millions of dollars while laying off workers. At companies that are still recording significant profits and are unwilling to share any of that bounty with those of their customers who are finding life tough. At investors who take over companies with little of their own monies by pledging the companies’ own pension funds, and then walk away with impunity when the company files for Chapter 11. We are already seeing a rise in public protest in the form of demonstrations and web-based campaigns and boycotts. Anticipate more of this in the coming months unless political and business leaders make explicit that they are on the public’s side.

Second, there is now a mandate for government to intervene that simply was absent over the past three decades. In a recent survey conducted in the US, more than half of those polled now say the free market should not be allowed to function independently. This is a seismic shift. Again, it is banks that are the first to see the impact of this, with interventions ranging from nationalization to the capping of executive salaries. Although I don’t predict or condone such wholesale micromanagement by government of the private sector as a whole, any company that could be perceived to be acting against the public good now risks standing in the line of fire.

Obvious industries to be targeted first are the fast-food industry and Big Pharma. With health costs soaring, and governments needing to rein in expenditure, predict more pressure on fast-food companies to take responsibility for the obesity crisis and on pharmaceutical companies to deliver affordable medicines. Under Gucci Capitalism, mandating corporations to do things for a greater public good was rare. Under Co-op Capitalism, mandates rather than voluntary measures will increasingly be the norm. No wonder some of the smartest companies are pre-empting this and swiftly pledging to make necessary changes unbidden. Both PepsiCo and Mars, for example, are hurrying to shift their product mix toward healthier lines.

The third reason why the time is now ripe for a new form of capitalism is that the downside of globalization has finally been exposed. Just how quickly the financial crisis infected country after country—Taiwan is now expecting its GDP to fall 11 percent—shows us all too clearly how in an interconnected world we stand or fall together.

Under Gucci Capitalism, I felt it was always quite likely that the chances of collective fall were higher than collective ascent. That was because the only body truly protected in the international arena was business. Under the aegis of the World Trade Organization, companies could feel secure that they could sell their goods all over the globe.

While the rights of global business were well cared for under Gucci Capitalism, no comparable mechanisms were set up to address the global problems that businesses were culpable for: climate change, infringements of labor and human rights, or the negative consequences of relocating business in terms of job losses and ghost towns. Instead these were dealt with, if at all, by a patchwork of weak separate bills and bodies that lacked teeth, clout, and resources.

Discussions are already under way about the creation of a global financial-regulatory system. The financial crisis revealed the limitations of trying to regulate a global industry nationally. But this is just the beginning. If Co-op Capitalism is capitalism’s next incarnation, expect the establishment of new WTO-type global institutions or the integration of new toothsome global rules into existing bodies—this time with a mission to address the myriad problems that are generated by business and affect the general public both domestically and overseas.

Without minimizing the difficulties of bringing nations together, it is not unprecedented. It was the international cooperation fostered at Bretton Woods that stopped us from falling off a collective precipice 65 years back, while more recently the Montreal Protocol, an initiative initially resisted by the CFC industry but now ratified by 194 countries, succeeded in stopping the widening of the hole in the ozone layer.

The fourth reason why we are heading toward a new era of capitalism: A new configuration of geopolitical forces is emerging as a result of the rise of China, Brazil, and India and the emergence of the G20, a new credible, cohesive, and powerful body that demands to be heard, and has limited if any allegiance at all to Gucci Capitalism. I anticipate a period in which the intellectual and practical hegemony of Gucci Capitalism will be directly challenged. And in which voice will be horse-traded for cooperation, with limitations on CO2 emissions, for example, exchanged for greater power within such institutions as the World Bank and IMF.

Combine this with a new US administration that even before the crisis talked about spreading the wealth and is committed to a multilateral ideal, and a Continental Europe that, having been hit particularly hard by the global recession, has a strong incentive to distance itself from an ideology that it neither spawned nor ever sat that well with its inherent communitarian values, and we have all the ingredients in place for a significant ideological shift.

Fifth and finally, it is not just at an intergovernmental level that we see the signs of more cooperation. The assumption of Gucci Capitalism that we as individuals were selfish, super-individualistic beings who only cared about maximizing our wealth, salaries, and resources is proving to be more an expediency of mainstream economists than an accurate depiction of mankind.

While it is true that over the past few decades there has been a growing obsession with material worth, this may be more a case of nurture than nature. Anthropological studies show that societies that have less share more, while recent work in behavioral economics has confirmed that benevolence is not alien to human nature. So while under Gucci Capitalism there was a tendency to bowl alone, it might just not be the case that we are essentially individualistic.

More likely is that we are entering an age of pulling together, as was the case during the Great Depression and the Blitz, and that this will be one of this era’s key defining characteristics.

It’s early days to show mass manifestation of this, but there are a few things we can point to: the meteoric rise of the global “freecycle” movement, whose members give stuff away for free rather than sell their goods on eBay; or the rise in Japan of “job sharing,” where employees, rather than witnessing their colleagues’ sackings, are choosing to work fewer hours themselves to minimize the collective blow.

All are manifestations of the new Co-op Capitalism.

We are now at a most critical juncture, when leaders in business, in government, in society have a choice to make: to embrace the Co-op agenda, with its calls for multilateralism, and global institutions to protect our environment and our citizens. This agenda has a renewed idea of government as an institution whose primary allegiance is to humanity as a whole, however rich or able. And it has a renewed idea of business as a force for innovation and improving the state of the world, which needs reining in where the pursuit of profit conflicts with society’s interests, and helping out when the short-term finances for innovating for our future are not there.

Or instead we could choose a very different path: the path of naked self-interest, the path of dog-eat-dog, in which reward is decoupled from responsibility. Those leaders currently calling for economic protectionism should be clear about the consequences of such a path. If China sees its imports banned, it will be less likely to agree to concerted CO2 emissions reductions. If the UK attempts to give jobs only to British workers, its already hemorrhaging manufacturing base may find itself with nowhere to export. This is a path that treads a thin line, as history should remind us, between economic nationalism and xenophobia.

This is a critical juncture, a dangerous one even, because the stakes are so high and there’s everything to fight for.

My hope is that our leaders have sufficient vision, and we the public have sufficient ambition, to turn the wreckage before us into an opportunity to join forces to push for a more supervised, more equitable, economic system. One that tends to fair rules, social justice, and sustainability, and reconnects the economy with what is right and just. That we choose to pull together not apart to co-create a better future, and really mean it when we say yes “we” can, and put the emphasis on the “we” when that is what we say. That we choose the open-source version of capitalism, the multiplayer version in which one only wins when all parties work together in pursuit of a common good. That we choose to shop not at Gucci, but at the co-op.

Noreena Hertz is a fellow of the Judge Business School, University of Cambridge, UK, and visiting professor of globalization at Erasmus University, Netherlands. She is the author of the bestsellers The Silent Takeover and IOU: The Debt Threat.

REFLECTIONS OF FIDEL

Obama’s speech in Cairo

ON Thursday, June 4, at the Al-Azhar Islamic University in Cairo, Obama gave a speech of special interest for those of us who are carefully following his political actions, given the tremendous power of the superpower that he is leading. I am using his own words to note what, in my judgment, were the basic ideas that he expressed, thus synthesizing his speech in the interest of time. We need to know not just that he spoke, but also what he spoke about.
"We meet at a time of tension between the United States and Muslims around the world, tension rooted in historical forces that go beyond any current policy debate…
"The relationship between Islam and the West includes centuries of co-existence and co-operation, but also conflict and religious wars."
"…colonialism denied rights and opportunities to many Muslims… the Cold War in which Muslim-majority countries were too often treated as proxies without regard to their own aspirations."
"Violent extremists have exploited these tensions…"
"…has led some in my country to view Islam as inevitably hostile not only to America and Western countries, but also to human rights."
"I have come here to seek a new beginning between the United States and Muslims around the world; one based upon mutual interest and mutual respect…"
"…they overlap, and share common principles of justice and progress; tolerance and the dignity of all human beings."
"No single speech can eradicate years of mistrust, nor can I answer in the time that I have all the complex questions that brought us to this point." "As the Holy Quran tells us: ‘Be conscious of God and speak always the truth.’"
"I am a Christian, but my father came from a Kenyan family that includes generations of Muslims. As a boy, I spent several years in Indonesia and heard the call of the azaan at the break of dawn and the fall of dusk. As a young man, I worked in Chicago communities where many found dignity and peace in their Muslim faith."
"It was Islam at places like Al-Azhar University that carried the light of learning through so many centuries, paving the way for Europe's Renaissance and Enlightenment."
"…since our founding, American Muslims have enriched the United States."
"They have fought in our wars, served in government, stood for civil rights…"
"And I consider it part of my responsibility as president of the United States to fight against negative stereotypes of Islam wherever they appear."
"…America is not the crude stereotype of a self-interested empire."
"The dream of opportunity for all people has not come true for everyone in America…"
"Words alone cannot meet the needs of our people."
"When a new flu infects one human being, all are at risk."
"When one nation pursues a nuclear weapon, the risk of nuclear attack rises for all nations."
"…any world order that elevates one nation or group of people over another will inevitably fail."
"In Ankara, I made clear that America is not and never will be at war with Islam."
"…we reject the same thing that people of all faiths reject: the killing of innocent men, women, and children."
"…some question or justify the events of 9/11."
"The victims were innocent men, women and children from America…"
"Make no mistake: We do not want to keep our troops in Afghanistan. We seek no military bases there. It is agonizing for America to lose our young men and women. It is costly and politically difficult to continue this conflict. We would gladly bring every single one of our troops home if we could be confident that there were not violent extremists in Afghanistan and Pakistan determined to kill as many Americans as they possibly can."
"The Holy Quran teaches that whoever kills an innocent, it is as if he has killed all mankind; and whoever saves a person, it is as if he has saved all mankind."
"Unlike Afghanistan, Iraq was a war of choice that provoked strong differences in my country and around the world."
"…I also believe that events in Iraq have reminded America of the need to use diplomacy and build international consensus to resolve our problems whenever possible."
"Today, America has a dual responsibility: to help Iraq forge a better future - and to leave Iraq to Iraqis."
"I have made it clear to the Iraqi people that we pursue no bases, and no claim on their territory or resources."
"Iraq's sovereignty is its own. That is why I ordered the removal of our combat brigades by next August. "
"…combat troops from Iraqi cities by July, and to remove all our troops from Iraq by 2012."
"…9/11 was an enormous trauma to our country."
"…in some cases, it led us to act contrary to our ideals."
"I have unequivocally prohibited the use of torture by the United States, and I have ordered the prison at Guantánamo Bay closed by early next year."
"America will defend itself respectful of the sovereignty of nations and the rule of law. "The second major source of tension that we need to discuss is the situation between Israelis, Palestinians and the Arab world."
"America's strong bonds with Israel are well-known. This bond is unbreakable."
"On the other hand, it is also undeniable that the Palestinian people, Muslims and Christians, have suffered in pursuit of a homeland. For more than 60 years they have endured the pain of dislocation."
"Many wait in refugee camps in the West Bank, Gaza, and neighboring lands for a life of peace and security that they have never been able to lead."
"…let there be no doubt: the situation for the Palestinian people is intolerable. America will not turn our backs on the legitimate Palestinian aspiration for dignity, opportunity, and a state of their own."
"…two peoples with legitimate aspirations, each with a painful history that makes compromise elusive."
"It is easy to point fingers, for Palestinians to point to the displacement brought by Israel's founding, and for Israelis to point to the constant hostility and attacks throughout its history from within its borders."
"But if we see this conflict only from one side or the other, then we will be blind to the truth…"
"…the only resolution is for the aspirations of both sides to be met through two states, where Israelis and Palestinians each live in peace and security."
"For centuries, black people in America suffered the lash of the whip as slaves and the humiliation of segregation. But it was not violence that won full and equal rights."
"Hamas must put an end to violence, recognize past agreements, and recognize Israel's right to exist."
"…Israelis must acknowledge that just as Israel's right to exist cannot be denied, neither can Palestine's. The United States does not accept the legitimacy of continued Israeli settlements."
"This construction violates previous agreements and undermines efforts to achieve peace. It is time for these settlements to stop."
"Israel must also live up to its obligations to ensure that Palestinians can live, and work, and develop their society."
"Progress in the daily lives of the Palestinian people must be part of a road to peace, and Israel must take concrete steps to enable such progress."
"The Arab-Israeli conflict should no longer be used to distract the people of Arab nations from other problems."
"The third source of tension is our shared interest in the rights and responsibilities of nations on nuclear weapons."
"In the middle of the Cold War, the United States played a role in the overthrow of a democratically elected Iranian government."
"Since the Islamic Revolution, Iran has played a role in acts of hostage-taking and violence against US troops and civilians."
"Rather than remain trapped in the past, I have made it clear to Iran's leaders and people that my country is prepared to move forward. The question, now, is not what Iran is against, but rather what future it wants to build."
"It will be hard to overcome decades of mistrust, but we will proceed with courage, rectitude and resolve. There will be many issues to discuss between our two countries, and we are willing to move forward without preconditions on the basis of mutual respect."
"I understand those who protest that some countries have weapons that others do not. No single nation should pick and choose which nations hold nuclear weapons. That is why I strongly reaffirmed America's commitment to seek a world in which no nations hold nuclear weapons."
"…any nation - including Iran - should have the right to access peaceful nuclear power if it complies with its responsibilities under the nuclear Non-Proliferation Treaty."
The fundamental objective of his visit to that Islamic University of Egypt is contained in these first three issues. One cannot blame the new president of the United States for the situation created in the Middle East. It is evident that he wishes to find a way out of the colossal mess created there by his predecessors and on account of the very development of events over the last 100 years.
Not even Obama could have imagined, when he was working in the African-American communities of Chicago, that the terrible effects of a financial crisis would be added to the factors that made possible his election as president in a heavily racist society.
He is assuming the post at an exceptionally complex moment for his country and the world. He is trying to solve problems that he possibly considers less complex than they really are. Centuries of colonial and capitalist exploitation have given rise to a world in which a handful of superdeveloped and rich countries coexists with another immensely poor majority, which supply raw materials and a workforce. If you add China and India, two genuinely emerging nations, the struggle for natural resources and markets is shaping an entirely new situation on the planet where human survival itself is still to be resolved.
Obama’s African roots, his modest origins and his amazing ascent are arousing hopes in many people who, like shipwrecked souls, are seeking salvation in the midst of the storm.
His affirmation that "any world order that elevates one nation or group of people over another will inevitably fail" is correct; or when he states that "people of all faiths reject the killing of innocent men, women, and children;" or ratifies before the world his opposition to the use of torture.
Generally speaking, a number of the statements I have noted are correct in theory; he clearly perceives the need for all countries, without exception of course, to renounce nuclear weapons. Well-known and influential figures in the United States see in this a great danger, as technology and the sciences generalize access to radioactive material and ways of utilizing it, including in small quantities.
It is still early days to pass judgments on his degree of commitment to the ideas he is proposing and up to what point he is determined to sustain, for example, the intention to seek a peace agreement on just bases and with guarantees for all states in the Middle East.
The current president’s greatest difficulty is that the principles that he is preaching are in contradiction with the policy that the superpower has followed for close to seven decades, since the end of the final hostilities of World War II in August 1945. At this point, I will leave aside the aggressive and expansionist policy applied to the peoples of Latin America and in particular to Cuba, when it [the United States] was still far from being the most powerful nation in the world. Every one of the norms that Obama preached in Cairo is in contradiction with the interventions and wars promoted by the United States. The first of them was the famous Cold War, which he mentions in his speech, unleashed by the government of his country. The ideological differences with the USSR did not justify the hostility toward that state, which contributed more than 25 million lives to the struggle against Nazism. Obama would not be remembering in these days the 65th anniversary of the Normandy landings and the liberation of Europe without the blood shed by millions of soldiers who died fighting against the elite troops of Nazism. It was soldiers from the Soviet army who liberated the survivors of the famous Osviecim concentration camp. The world did not know what was going on, in spite of the fact that more than a few people in Western official circles were aware of the facts. Thus, millions of Russian children, women and the elderly lost their lives as a consequence of the brutal Nazi invasion seeking vital space. The West made concessions to Hitler and conspired to launch it: at the end of the day it launched it to occupy and colonize Slav territory. In World War II the Soviets were allies of the United States and not its enemies.
Two atomic bombs were dropped to test their effects on two defenseless cities, Hiroshima and Nagasaki. Those who perished there were, in the majority, Japanese children, women and elderly people.
If one analyzes the wars promoted, backed or carried out by the United States in China, Korea, Vietnam, Laos, Cambodia, many children, women and the elderly were among the millions who died.
The colonial wars of France and Portugal after World War II had the support of the United States; the coup d’états and interventions in Central America, Panama, the Dominican Republic, Grenada, Chile, Paraguay, Uruguay, Peru and Argentina were all promoted and supported by the United States.
Israel was not a nuclear power. The creation of a state on territory from which the Jews were expelled to their exodus by the Roman Empire 2,000 years ago, was supported in good faith by the USSR and many other countries in the world. At the triumph of the Cuban Revolution we had relations with that state for more than 10 years, until its wars of conquest against the Palestinians and other Arab peoples led us to breaking them off. Total respect for the Jewish cult and religious activity has been maintained without any interruption whatsoever.
The United States never opposed Israel’s conquest of Arab territories, nor did it protest at the terrorist methods employed against the Palestinians. On the contrary, it created a nuclear power there, one of the most advanced in the world, right in the heart of Arab and Muslim territory, thus creating one of the most dangerous points of the planet in the Middle East.
The superpower likewise used Israel to supply nuclear weapons to the apartheid army of South Africa, in order to use them against the Cuban troops who, alongside the Angolan and Namibian forces, were defending the People’s Republic of Angola. These are relatively recent events that the current president of the United States is undoubtedly aware of. Thus, we are not so distant from the aggressiveness and danger that the Israeli nuclear power signifies for peace.
After the three initial points, Obama devoted his speech in Cairo to philosophizing and to establishing a professorship on U.S. foreign policy:
"The fourth issue that I will address is democracy," he said.
"…let me be clear: no system of government can or should be imposed upon one nation by any other."
"America does not presume to know what is best for everyone, just as we would not presume to pick the outcome of a peaceful election."
"I do have an unyielding belief that all people yearn for certain things: the ability to speak your mind and have a say in how you are governed; confidence in the rule of law and the equal administration of justice…"
"Those are not just American ideas, they are human rights, and that is why we will support them everywhere."
"The fifth issue that we must address together is religious freedom."
"Islam has a proud tradition of tolerance… I saw it firsthand as a child in Indonesia, where devout Christians worshipped freely in an overwhelmingly Muslim country."
"Among some Muslims, there is a disturbing tendency to measure one's own faith by the rejection of another's."
"…And fault lines must be closed among Muslims as well, as the divisions between Sunni and Shia have led to tragic violence, particularly in Iraq."
"…it is important for Western countries to avoid impeding Muslim citizens from practicing religion as they see fit for instance, by dictating what clothes a Muslim woman should wear. We cannot disguise hostility towards any religion behind the pretence of liberalism."
"I reject the view of some in the West that a woman who chooses to cover her hair is somehow less equal, but I do believe that a woman who is denied an education is denied equality. And it is no coincidence that countries where women are well-educated are far more likely to be prosperous."
"…the struggle for women's equality continues in many aspects of American life, and in countries around the world."
"Our daughters can contribute just as much to society as our sons, and our common prosperity will be advanced by allowing all humanity, men and women, to reach their full potential."
"The internet and television can bring knowledge and information, but also offensive sexuality and mindless violence. Trade can bring new wealth and opportunities, but also huge disruptions and changing communities."
"…invest in online learning for teachers and children around the world; and create a new online network, so a teenager in Kansas can communicate instantly with a teenager in Cairo."
"…we have a responsibility to join together on behalf of the world we seek - a world where extremists no longer threaten our people, and American troops have come home; a world where Israelis and Palestinians are each secure in a state of their own, and nuclear energy is used for peaceful purposes…"
"That is the world we seek. But we can only achieve it together."
"It is easier to start wars than to end them."
"…do unto others as we would have them do unto us."
"We have the power to make the world we seek, but only if we have the courage to make a new beginning, keeping in mind what has been written."
"The Holy Quran tells us, ‘O mankind! We have created you male and a female; and we have made you into nations and tribes so that you may know one another.’"
"The Talmud tells us: ‘The whole of the Torah is for the purpose of promoting peace.’"
"The Holy Bible tells us, ‘Blessed are the peacemakers, for they shall be called sons of God.’"
"The people of the world can live together in peace."
As can be appreciated, on approaching the fourth issue of his speech at Al-Azhar University, Obama falls into a contradiction. After beginning his words with an apothegm, as is his habit, by affirming: "no system of government can or should be imposed upon one nation by any other," a principle enshrined in the Charter of the United Nations as a fundamental element of international law, he immediately contradicts himself with a declaration of faith which converts the United States into the supreme judge of democratic values and human rights.
He goes on to allude to issues related to economic development and equality of opportunity. He makes promises to the Arab world; he points to advantages and contradictions. It would really appear to be a public relations campaign with the Muslim countries on the part of the United States which, in any event, is better than threatening to bombard and destroy them.
At the end of the speech, there is quite a mix of issues.
Taking into account the length of the speech, without using written notes, the number of lapses is negligible in comparison with his predecessor, who made mistakes in every paragraph. He has a great capacity for communication.
I am accustomed to observing with interest historical, political and religious ceremonies.
That of Al-Azhar University seemed to me an unreal scene. Not even Pope Benedict XVI would have uttered phrases more ecumenical than those of Obama. For one second I imagined pious Muslim, Catholic, Christian or Jewish believers, or those of any other religion, listening to the president in the wide hall of Al-Azhar University. At any specific moment, they wouldn’t have known if they were in a Catholic cathedral, a Christian church, a mosque or a synagogue.
He left early for Germany. For three days he toured points of political significance. He participated in and spoke at all the commemorative events. He visited museums, received his family and dined in famous restaurants. He possesses an impressive capacity for work. A long time will pass before a similar case is seen.

OBAMA'S VIETNAM

What’s good for GM…

The bankruptcy of General Motors is a major turning point in the history of economic and political life in the United States.

The industrial giant—once the largest and most profitable enterprise in the world—defined American capitalism for much of the 20th century. Its massive presence in the US economy inspired the famous 1953 remark by GM Chief Executive Charles Wilson: “What was good for the country was good for General Motors and vice versa.”

Wilson’s statement, however self-serving, seemed to ring true when GM employed half a million American workers, whose living standards were rising, and the auto industry was at the center of a vast manufacturing infrastructure that accounted for 60 percent of all corporate profits in the US.

The collapse of GM symbolizes the decline and crisis of American capitalism and the predominant role that financial speculation has come to play in the US and world economy. The forced bankruptcy of GM is the starkest demonstration of the subordination of all social interests to the financial aristocracy that rules America.

The bankruptcy filing triggered a 221 point jump on the New York stock exchange, even as it was announced that GM would be removed from the Dow Jones Industrial Average’s list of 30 top stocks, where it had held a place since 1925. The rally was a celebration by the financial elite over the destruction of tens of thousands of jobs and the extortion of wage and benefit concessions from auto workers, whose hard-fought living standards have long been seen as an unacceptable obstacle to profits.

“GM going through bankruptcy is a very positive thing for the auto industry: They should emerge as a reasonable competitor,” Len Blum, managing director at investment banking firm Westwood Capital LLC in New York, told Bloomberg News. “The only thing that’s been holding GM back is labor contracts and relationships with debtors and franchisees. All that should be cleansed in a bankruptcy.”

The “cleansing” demanded by big investors will have a devastating social impact. GM will close 14 plants in Michigan, Ohio, Indiana and other states already hit by high levels of unemployment and social distress. Some 23,000 hourly workers and 8,000 salaried employees will lose their jobs and 2,100 dealerships will close, affecting up to 100,000 workers.

In his remarks after the bankruptcy filing, President Obama bent over backwards to assure Wall Street that the government—which is assuming a majority stake in GM in exchange for nearly $50 billion in public funding—would do nothing to impinge on the private property or prerogatives of the financial elite. “What we are not doing—what I have no interest in doing—is running GM,” he said.

The company “will be run by a private board of directors and management team,” he insisted, making it clear that they would be experts in downsizing and cost-cutting. “They—and not the government—will call the shots and make the decisions about how to turn this company around,” he continued. “The federal government will refrain from exercising its rights as a shareholder. ... In short, our goal is to get GM back on its feet, take a hands-off approach, and get out quickly.”

For years the American ruling class excoriated “nationalization” for its association with socialism and sang the praises of the capitalist free market. Now the federal government is essentially taking over GM.

This has nothing to do with socialism or genuine nationalization, however. The government is not intervening to uphold public interests and guarantee employment and decent living standards for workers. On the contrary, it is an intervention by the capitalist state to create the best profit-making conditions for US and international investors.


Obama feigned sympathy for the workers he was throwing onto the street, declaring, “I know you’ve already seen more than your fair share of hard times. I will not pretend the hard times are over. Difficult days lie ahead. More jobs will be lost. More plants will close. More dealerships will shut their doors, and so will many parts suppliers.”

He then cynically claimed that the workers losing their jobs were serving a greater, patriotic cause. “I want you to know that what you’re doing is making a sacrifice for the next generation—a sacrifice you may not have chosen to make, but a sacrifice you were nevertheless called to make so that your children and all of our children can grow up in an America that still makes things, that still builds cars, that still strives for a better future.”

This is a contemptible lie. The bankruptcy of GM will only accelerate the process of deindustrialization, which has been carried out by the ruling elite over the last three decades as it increasingly turned to financial speculation to amass its vast fortunes.

In the Obama administration, the American ruling class has found its most ruthless representative, led by a Democratic president who has gone even further than his Republican predecessor in the assault on the working class. While handing over trillions in public assets to cover the bad gambling debts of the financial elite, it demands unending “sacrifice” from workers. The destruction of the jobs and living standards of GM and Chrysler workers will now be used to set a precedent for sweeping attacks on every section of the working class.


From the beginning, the White House has relied on the United Auto Workers to block any resistance by workers. The UAW—which emerged seven decades ago in the bitter sit-down strikes against the exploitation of GM workers—has been complicit in returning auto workers to conditions not seen since the 1930s. In return for functioning as a corporate-government overseer, the proprietors of this organization are receiving billions of dollars in shares and a 17.5 percent stake in the “New GM.”


The transformation of the UAW into a business—whose material interests are antithetical to the “members” it claims to represent—is the outcome of decades of anti-socialism and support for the profit system.

The government takeover of GM and the bailout of the Wall Street banks constitute an implicit acknowledgement of the failure of the so-called free market system and the subordination of economic life to private profit.

In opposition to the government’s plans to exploit the crisis to create new conditions for the exploitation of the working class and new riches for those who profit from this exploitation, the Socialist Equality Party calls for the genuine nationalization of the auto industry and its conversion into a public utility under the democratic control of working people.

The vast productive forces of the US auto industry—built up by the labor of generations of workers—must be defended and integrated into the global economy under the democratic control and on the basis of the international cooperation of all producers. Only in this way can the jobs and living standards of auto workers around the world be secured.

In order to break the back of the financial dictatorship, the banks must be nationalized and placed under public ownership and the ill-gotten gains of the financial aristocracy confiscated to meet the needs of society as a whole.

Such a program is anathema to the two parties of big business as well as the UAW. The reorganization of economic life on the basis of human needs, not profit, requires a fight to unite the entire working class in a struggle for political power and a workers’ government.

Jerry White