In recent weeks we have seen an increase in the number of Sri Lankan Tamils seeking asylum in Australia. Most of these people have been travelling by boat via Indonesia and Malaysia. This has put the refugee issue back on the main stage for the first time since the 2004 Federal election.

When the Rudd Labor Government came to power in November 2007, many people expected a more humane approach towards people fleeing persecution but it seems once again Rudd is proving to be little different to his predecessor Howard.

The Labor Party – like the Coalition – is happy to play to the worst racial prejudices of some layers of the population and thereby deflect attention away from the economic crisis. The contradiction between Rudd encouraging an Australian population of 35 million, yet saying ‘No’ to a relative handful of refugees has been lost on the mainstream media.

In early November a boat carrying Tamil asylum seekers sank near the Cocos Islands in the Indian Ocean. Tragically 12 people are missing feared drowned. At the same time Rudd is refusing to allow several other groups of Tamil asylum seekers from Sri Lanka permission to land on Australian soil. He recently stated: “I make absolutely no apology whatsoever for taking a hard line on illegal immigration to Australia.”

In an attempt to prove his hard line credentials, Rudd has pressured Indonesian President Susilo Bambang Yudhoyono to accept 78 Sri Lankans for processing in Indonesia. These people were aboard a boat picked up by Australian authorities in an Indonesian search and rescue area on their way to Australia. At the moment all 78 remain on the Australian customs ship Oceanic Viking off Tanjung Pinang and are refusing to leave.

Just prior to this incident, the Indonesian navy intercepted another boat carrying 255 Sri Lankans also heading for Australia. This vessel is now moored in Merak, West Java and its passengers are also refusing to disembark. Rudd is currently demanding that the Tamils be dealt with by Indonesia despite the fact that Indonesia has refused to sign international refugee conventions.

These people have explained that the reason they are refusing to leave their boats is because they fear being locked up in Indonesia. Detention centres in Indonesia are hell
holes that are dirty and overcrowded. It has been reported that in previous cases even people who have been deemed refugees by the UN have been detained in Indonesia for years on end. These people want nothing more than to come to Australia in the hope that they will be afforded some basic human rights.

The rise in the number of people seeking asylum in Australia coincides with a growth of people fleeing conflicts in Afghanistan and Sri Lanka. It is estimated that almost three-quarters of Australia’s refugees come from these two countries.

In Sri Lanka the situation facing the Tamil minority is dire. Since the government declared the end of the war in May 2009 over 300,000 people have been forcefully detained in concentration-style camps and denied the right to return to their homes.

Among those incarcerated, without proper access to food, shelter and medicine, are more than 30,000 children. While the government was prepared to pour an estimated $5 million per day into its war effort, little is spent to protect those in the camps against the oncoming monsoon floods which threaten a humanitarian catastrophe.

While the Rajapakse regime in Sri Lanka continues the brutal oppression of the Tamil people, the Rudd Government in Australia offers him unconditional support. The 2009-10 Australian budget estimate for aid to Sri Lanka is $35 million. It is highly unlikely that any of this will get to the Tamils in need.

Rudd has not only supported Rajapakse in his war against the Tamils but he has also contributed to the war effort in Afghanistan. At the moment about 1550 Australian troops are serving in Afghanistan. These troops are only fuelling the Taliban insurgency which is leading to more and more people having to flee their homes. Not only is Rudd refusing to act in a humane way towards the victims of these conflicts but he is contributing to the root causes of the refugee problem.

Recent surveys have suggested that high numbers of Australians are concerned about the economy and about asylum seekers coming to Australia by boat. While socialists understand that people want to maintain their standard of living, we also have to be clear that it is not asylum seekers that are undermining our living conditions.

It has not been refugees that have been sacking people, cutting hours or reducing services. It has not been asylum seekers who have been refusing pay rises, putting up interest rates and increasing prices. It has been the bosses and the profiteers who have decided that it will be ordinary people who will pay the price for the economic downturn.

In Australia it is working people that are bearing the brunt of the capitalist crisis. Similarly in Sri Lanka, Afghanistan and around the world it is ordinary people who are suffering because of a system that creates war and poverty by putting profits before all else.

The facts are that boat people make up less than 0.01% of all new arrivals to Australia. The numbers of people coming to Australia by boat are tiny compared with the 14,000 “unlawful non-citizens” who, authorities say, came to Australia in 2007-08 after arriving by air and overstaying their visas.

This is why Rudd’s refugee policy is racist. Fundamentally Labor’s immigration policies are the same as Howard’s. Both Labor, and Coalition governments in the past, have tried to divert attention away from their anti-working class agendas and have used the tiny numbers of boat people as a political football. While Howard was quite open about discriminating against people, Rudd claims to be “tough” but “humane”. Nothing could be further from the truth.

The Socialist Party stands in solidarity with the Tamil refugees who are refusing to leave the boats in Indonesia. We salute your brave stand and call on workers and trade unions in Australia and Indonesia to support your struggle. We also support the stance taken by some Australian trade unions, supporting the refugees and calling on Rudd to take a more humane approach. We in the Socialist Party go further, however.

We demand that the Rudd Government allow the Tamil asylum seekers to immediately come to Australia and be processed as genuine refugees. They should not be detained but should be supported by the government. The current detention policy must be completely abolished. This includes off-shore processing and the closure of all detention centres including Christmas Island.

While we will do all we can to support refugees and campaign against discriminatory immigration laws, we also have to be clear that ultimately it is the capitalist system that creates war, poverty and refugees. The system allows capital to move freely across borders while ordinary people are forced to stay where they can be best exploited.

A socialist system that was based on public ownership, planning and democratic control would produce things on the basis of human need and not private profit. This would allow us to provide jobs, homes and food for all – including refugees. Poverty and want could be eliminated and war and environmental destruction would become a thing of the past.

We urge Australian workers to not only stand in solidarity with the Tamil asylum seekers but to join us in the fight against capitalism and war.

For the past few months the capitalist press has bombarded us with stories about alcohol-fuelled street violence in Australia’s major cities. Socialists accept that crime and late night anti-social behaviour is a problem in many areas. We wholeheartedly understand people’s concerns.

After all it is working class people that are most likely to be victims of anti-social behaviour and therefore they are rightly worried about safety on our streets. However if we are serious about reducing anti-social behaviour we first need to look at the facts and understand the reasons why it occurs.

The first point to make is that according to the latest police statistics, crime in many major cities has actually decreased. For example statistics released by the Victoria Police earlier this year show that crime has gone down for the last eight years running.

The overall crime rate has now fallen 25.5 per cent since 2000/01. While assaults have risen by 5.4 per cent in 2008/09, half of the increases were related to family violence and not street violence.

There has been a statistical increase in public behaviour offences but even the Police Commissioner Simon Overland admits that these increases are due to increased enforcement and the introduction of Penalty Infringement Notices for a range of minor offences.

In a nutshell there is no evidence to suggest a real increase in street crime or anti-social behaviour in the city centres. While the capitalist media has been happy to run an unsubstantiated fear campaign about working class anti-social behaviour, criminal activity carried out by the capitalist class continues to go unreported.

The theft of workers wages, big business tax fraud and people being killed at work due a negligent bosses are much less important than drunken youths according to the mainstream papers. Even the pubs and nightclubs who profit from selling excessive amounts of alcohol have mostly avoided criticism.

Most commentators have also failed to look at the root causes of crime and alcohol fuelled violence. Studies have shown that the biggest factors likely to trigger violence and criminal activity were prolonged economic deprivation, family stress, school exclusion and drug or alcohol abuse. All of these issues effect working class people disproportionately and are getting worse as a result of the economic downturn.

It is clear that the best way to undermine crime and anti-social behavior is to improve people’s living conditions. Unfortunately government policies are perpetuating a system which will let more people fall into poverty. ‘Anti-social’ policies like cuts and privatisation continue unabated under both State and Federal governments.

All of the main parties are united in their calls for a law and order approach to the ‘problems’. Many papers are urging governments to put more police on the streets while some states like NSW have introduced new laws against public drunkenness. Local laws are also being considered by some Councils in Victoria.

New laws and more police on the streets do absolutely nothing to undermine the conditions which lead to crime and anti-social behaviour. The law and order approach is more about shifting responsibility for social problems onto ordinary people. Socialists argue that those who determine the quality of housing, schools and healthcare should take responsibility for the social problems that exist.

A program of investment in public services would be much more effective at reducing anti-social behaviour and crime than law and order. Free 24 hour public transport in the city centres would be a good start as it would ensure people could get home quickly and safely. Other options like providing free quality entertainment for young people in the suburbs should also be implemented.

But ultimately if we are to seriously reduce crime and anti-social behaviour it will be necessary to build an alternative form of society. A socialist society that can meet the needs of all and eradicate poverty and alienation would be the best way to cut across drunken behaviour and the many other social problems that exist.

200 rally to save Solar Systems factory!

A few hundred people rallied in inner northern Melbourne today against the closure of the Solar Systems factory. The rally heard speakers from local environment groups, the manufacturing workers union, internet lobby group Get Up and the Greens. A Solar Systems worker who was recently made redundant also addressed the crowd.

The company claims it can not continue to keep the factory open because of the lack of private investment. Basically, the capitalist market system has failed this enterprise. Despite runaway climate change the market system puts profits before all else- including the development of clean energy technology.

The economic crisis has shown the bankruptcy of this market ideology. While capitalism wreaks havoc on the environment and decimates millions of jobs, governments around the world have handed over trillions of dollars to bail out greedy bankers and inept employers. At the same time the profiteers who created the problems continue to receive huge payouts!

In light of this, it was disappointing that all of the speakers at the rally put forward pro-market ‘solutions’ to save the company. Bailing out the company with tax-payer funded hand outs is also not a genuine solution. This type of corporate welfare means ordinary people end up paying for an environmental and economic crisis that they did not create.

It also doesn’t guarantee a future for renewable energy. It simply puts key decision making power in the hands of those whose main motive is profit making, not accountability to workers and local communities.

A real response to climate change is needed immediately. The unfortunate reality is that neither lobbying Labor MPs nor voting for the Greens in at the next Federal election will keep this factory open or guarantee a legitimate response to the climate emergency.

The Socialist Party fully supports the campaign but argues that we will have to look outside of the market framework if we are to save Solar Systems – let alone stop global warming.

Save Solar Systems – Nationalise now!

The construction of Australia’s first large-scale solar power plant in Mildura has been put on hold. Solar Systems – a private company who were supposed to build the plant – went into voluntary administration in early September putting the future of the project in doubt.

The company claims that it can not continue to operate due to a lack of private investment. As a result the Abbotsford Solar Systems plant has been closed and more than 100 workers have been made redundant. This factory was set to manufacture solar panels for the Mildura project.

Against the backdrop of climate change, there is a desperate need to move away from burning fossil fuels and towards renewable technology like solar. The problem is that private investors want to make profits – not stop global warming.

If there are more profits to be made elsewhere investors will put their money into something else. This shows why the private sector can not be trusted to provide secure employment or address the problems of climate change.

What sort of system do we live under where jobs and clean energy technology can be thrown on the scrap heap even when there’s a social need for them?

One option that has been put forward is to prop up the failing company with tax-payer funded subsidies. This is not a viable solution as it is expensive and leaves important decisions about the future of our planet in the hands of profiteers. If we are serious about protecting both jobs and the environment we need to look at who owns and controls industry.

If Solar Systems can not continue to operate the government must be forced to step in and nationalise the company under democratic workers’ control. This would ensure that the Mildura solar project could go ahead and be a step towards developing a new, democratically planned and publicly-owned, green sector of the economy.

The only way we will force the government to accept this course of action will be on the back of a strong campaign that includes trade unions, environment groups, and local residents. The Socialist Party urges all of our supporters to get involved.

We demand:

- that the Solar Systems factory be reopened and all workers reinstated
- the nationalisation of the plant under democratic workers’ control
- that the plant becomes a building block for a new publicly owned green sector to provide more jobs and improve the environment

One year on from the biggest financial crisis for 80 years most people are hoping that the worst is over. It is true that the stimulus packages introduced by the Rudd government have cushioned the effects of the crisis and postponed a significant increase in unemployment. This has meant that while many workers are concerned about the future most are not yet feeling the full effects of the downturn.

While many workers have had their hours cut, the effects have been offset by low interest rates. Many have been convinced by employers that if they make some sacrifices now they will ride out the recession largely unscathed and return to good times soon. Unfortunately in the coming months things will get worse for ordinary people not better. Interest rates will go up and unemployment will continue to rise.

The Rudd government will support bosses who want to further slash hours and they have already said they will be looking to recover money spent on the stimulus measures by making cuts to welfare and services. In essence Rudd’s plan is to protect profits at the expense of jobs, wages and living conditions.

The trigger to the crisis was a rise in US ‘sub-prime’ mortgage defaults. In order to provide housing, some people were forced to take out loans that had very little chance of paying back. This led to the failure of several lenders including Fannie Mae and Freddie Mac. They were soon followed by the collapse of Lehman Brothers and since then more than 100 US banks have folded.

Because of the interconnection of the global finance industry the toxic debts spread rapidly to every corner of the globe. Lenders became reluctant to make loans and economic activity slowed. This sent many economies around the world into recession and has now led to the worst economic crisis since the 1930s depression.

Over the following months, governments and central banks tried to restore lending and activity by slashing interest rates, making emergency loans to banks and injecting billions of dollars of ‘stimulus’ into the world economy. The US alone pumped $787 billion (USD) into the economy while Australia spent $42 billion (AUD)!

This was the main economic difference between the 1930s crash and the crisis today. Terrified of the possibility of a deep depression and all the possible social and political consequences, ruling classes around the world reacted quickly, especially after Lehman Brothers collapsed. Governments around the world have since pledged about $2 trillion in stimulus measures.

Despite all the spin about ‘green shoots’ coming from the capitalist press, the economic crisis is far from over. Even if the economy does return to growth the outlook is for low growth that will persist for some time. There is also a big risk of a double-dip recession. No matter what the growth levels, the main thing is that jobs will be harder to find, interest rates will go up and the boom/bust cycle will go on if capitalism is allowed to continue.

Unfortunately the trade unions do not have a plan to protect their members from the effects of the crisis. Some are actually assisting employers to make cuts. This, coupled with the absence of a mass party that could give political representation to workers, has meant that the debate about the economy has been dominated by big business.

The lack of leadership on the industrial and political fronts has impacted on consciousness and has meant that in these early stages of the crisis the working class has not played a decisive role.

The Socialist Party believes that this situation can not be maintained. Worsening economic conditions will force more and more people to question the validity of the capitalist system. Sooner rather than later this change in consciousness will lead to a change in people’s attitudes to the government, to the trade union leaders and to struggle.

The role of socialists in the coming months will be to support those who are struggling against the effects of the crisis while campaigning for proper representation in the form of fighting unions and a new workers party. While more bad economic news can be expected, with proper leadership much more could be done to ensure that workers are not forced to pay for a crisis that they didn’t create.

More than 30 people attended a protest outside the 7-Eleven store on Domain Rd, South Yarra last Friday evening. The action was organised by UNITE, the union campaigning against the underpayment of wages in 7-Eleven stores.

The protest targeted this particular store because Eddie Chan has interests in the business. Until recently Chan also owned the Moorabool Street 7-Eleven store in Geelong where he paid his workers only half of the wages they were owed.

UNITE estimates that workers employed by Chan are owed more than $100,000. So far Chan has refused to pay up despite being ordered to do so by the Fair Work Ombudsman.

Hundreds of leaflets were handed out to South Yarra locals and the front of the store was draped with banners and placards explaining the situation. The overwhelming majority of local residents were shocked to hear that people who have worked in the store had been paid as little as $10 an hour and others had done unpaid trials for up to 2 months.

While the local residents were very supportive of the campaign, the local police were shocked to see a protest in the quiet, leafy streets of South Yarra. The police turned up to the action and brought with them a riot van and members of the Critical Incident Response Team!

Some locals thought that they had come to arrest Eddie Chan but unfortunately they had come to tell UNITE members not to block the entrance to the store, not to hand out leaflets and not to talk to people!

The protesters were not deterred and insisted that it was their right to inform people about the dodgy practices that Eddie Chan was involved in. Once the police saw that UNITE were getting support from the local community they retreated.

The point was made from the microphone that the person breaking the law in this dispute was Eddie Chan. When a boss steals more than $100,000 from his workers people have to take to the streets for the matter to be taken seriously, yet when UNITE hands out a few leaflets on the street the authorities are swift to act.

UNITE is not only calling on Chan to pay back the money owed. The Fair Work Ombudsman must pursue Chan and prosecute him for breeches of workplace law. Anything less would be a green light to other employers who want to undermine minimum wages and conditions.

The action was successful in highlighting the issue to South Yarra locals and the dispute was covered in the Geelong Advertiser and Sunday Herald Sun. UNITE has pledged to continue the campaign until Chan pays up and 7-Eleven stops the widespread underpayment of workers.

Lies and misinformation

On Saturday September 19 an article written by Nick Wade was published in the Geelong Advertiser titled ‘Geelong 7-Eleven wage row’.

The article featured extensive quotes from Eddie Chan’s lawyer Andrew Senia. Senia claimed in the article that “no complaints had ever been made directly to Mr Chan, only allegations made through the media “some time” after the alleged incidents occurred.”

This is completely false. UNITE officials have met with representatives of Eddie Chan and 7-Eleven head office on many occasions. We have handed over the details of the complaints to Chan’s representatives and demanded that he pays the money owed to the workers. 7-Eleven head office have also told us that they have encouraged Chan to pay up but he has refused.

UNITE has documentation of Chan’s representatives admitting to the underpayment of wages. It is unfortunate that Nick Wade did not contact us before publishing the article as we could have shown him this evidence. A phone call to the Fair Work Ombudsman would also have confirmed the underpayment.

The article also stated that the Domain Road, South Yarra store is owned by members of Chan’s family. Regardless of whose name the business is under, UNITE understands that Chan refers to this store as ‘his’, and regularly organises the staffing. Despite being caught out, Chan and his family are still profiting under the name of 7-Eleven.

Eddie Chan and 7-Eleven need to understand that dodgy accounting and dishonest lawyers will not discourage us from continuing the campaign. Its time to stop with the games and pay the workers the money they are owed.

Safety not profits!

The Rudd-Gillard government was elected in 2007 with a mandate to improve workers rights. Since then they have done exactly the opposite and pandered solely to the needs of the bosses. Labor has kept the vast bulk of WorkChoices, maintained the ABCC and now they want to water down hard won OH&S laws.

The government has established Safe Work Australia and they plan to draft a new ‘harmonised’ national OH&S law that will replace the nine existing laws across all states and territories.

The idea of harmonising the laws is not inherently bad, but what Labor are trying to do is reduce OH&S standards nationally to the lowest common denominator. Under the current proposals workers in some states, including Victoria, will lose out.

In Australia as many as 8000 workers are estimated to die each year from work related incidents or illnesses. On top of this there are 689,500 injuries and illnesses in workplaces each year. The idea that Rudd wants to weaken OH&S laws against this backdrop is a sick joke.

In Victoria the proposals will weaken rights to attend training, place restrictions on issuing Provisional Improvement Notices (PINs) and directing a cease-work, as well as making it easier for bosses to disqualify elected OH&S Reps. The employers support these changes because it will tip the balance of power in the workplace even further in their direction.

As any worker will know, safety for a boss is an afterthought. Their main concern is increasing profits. Spending money to make workplaces safe only gets in the way of profits and they often fight tooth and nail against the most basic of improvements.

The reason that the Rudd-Gillard government is not using this opportunity to improve laws across the country is because they are in the pockets of employers. Time and time again they put the needs of bosses before the needs of working people. It’s time for the union movement to wake up and break ties with this big business party.

With the onset of economic crisis, more and more bosses will be attempting to cut corners. Now is the time for safety standards to be improved not watered down. We need a campaign of industrial action to protect and improve OH&S legislation. We can not allow the Labor Party to wind back our right to go to work and come home in the same condition.

In recent weeks the Prime Minister of New Zealand, John Key, has flagged an end to the country’s recession. A National Bank of New Zealand business survey has also outlined a return to positive growth after the nation recorded negative growth since the first quarter of 2008. Does this mean the worst is now over?

While the economic shocks to New Zealand have not been as severe as in other advanced capitalist countries, there is no doubt that the crisis has started to affect the lives of many working people. Official unemployment is at a ten year high of 6 %. In June, the Reserve Bank of New Zealand predicted the jobless rate could rise to as high as 7.2 % by the middle of 2010. With many firms still looking to shed staff, even this figure could be an understatement.

The New Zealand economy is largely dependent on global trade and it is for this reason that it has been hit hard by the downturn. The World Trade Organisation (WTO) estimates that global trade will contract by a massive 10 % this year – the biggest fall since World War Two.

Most serious analysts agree that this is the most serious crisis to hit the world economy in 80 years. In fact, even the International Monetary Fund has stated that “The world economy is entering a major downturn in the face of the most dangerous financial shock in mature financial markets since the 1930s”.

Capitalist economists like Barry Eichengreen and Kevin O’Rourke point out that world industrial production continues to track closely to the 1930s fall and that world stock markets are still following paths far below the ones they followed during the Great Depression.

They note that the US continues to see industrial output fall approximately in line with what happened in the 1929 crisis and that Japan’s industrial output is much lower than at the equivalent stage in the Great Depression.

In April, Eichengreen and O’Rourke stated that “globally we are tracking or doing even worse than the Great Depression, whether the matrix is industrial production, exports or equity valuations.”

The main economic difference between the 1930s crash and the crisis today is the ruling class response. Terrified of the possibility of a deep depression and all the possible social and political consequences, ruling classes around the world reacted by acting quickly, especially after the Bush administration let Lehman Brothers collapse.

Trillions of dollars have been pumped into economies around the world to keep them afloat. There has also been a turn towards more state intervention to save the system. While not solving the underlying causes, these measures have, for now, acted to temper the decline, at least in most of the main imperialist countries.

There is a real possibility that after the immediate effect of the different stimulus packages there will be a further downturn or a “double dip” recession. Given that most countries are now deep in debt there will be limits as to how much they can intervene a second time around.

Stimulus package

The total amount spent by the New Zealand government is about $500 million NZ dollars. Government debt is expected to balloon to nearly 40 % of GDP by 2013 as a result of the money outlaid. The bill for this debt will be sent to future generations of workers.

Some countries have been forced to nationalise, in a state capitalist manner, banks or failing companies while others like New Zealand, have resorted to stimulus packages that include investment in infrastructure projects like schools, bridges and homes.

While the stimulus package has had some effect in slowing the process, it will not be able to solve the fundamental problem: the lack of demand and the lack of profitable markets. If New Zealand is to dig out of recession the question for capitalism is from which sector of the economy will this new demand come?

Market opportunities inside New Zealand are limited by the country’s small population and consumer spending has fallen sharply over the past year as workers remain cautious about the future. Despite a long period of aggressive interest rate cuts, consumer borrowing is down 3 % on a year ago. With rising unemployment and high levels of household debt it is unlikely that workers are about to go out on a spending spree anytime soon.

The manufacturing sector in New Zealand is small and only accounts for about 14 % of GDP. However, the government is hoping that the food manufacturing sector and agriculture will be able to provide the economy with a boost from an increase in exports.

New Zealand’s main trading partners are Australia, the US, the EU and China. The Australian market is the destination of 19 % of New Zealand’s exports. Because the New Zealand dollar has surged in recent months exports are now much more expensive. Even if the dollar does drop in the near future the question is to what extent consumers in these countries will be able to purchase New Zealand goods given the global downturn?

The markets in the US and the EU are in serious decline and there is no prospect of a quick recovery. The introduction of export subsidies by the EU and the US could also have serious implications for the New Zealand economy. While Australia has managed to stay out of technical recession in the current quarter, its overall position is quite weak and consumer spending down. It is likely that Australia will follow the rest of the world into recession sooner rather than later.

China is also reliant on consumer demand in the US and EU. With these countries in decline it is forcing thousands of Chinese factories to close and throwing millions of workers on the scrap heap. Rising unemployment and cuts to the income of the middle class means that it is unlikely that Chinese consumers can drag New Zealand out of recession.

Ruling class no clear strategy

The reality is that the New Zealand ruling class has no clear strategy to climb out of this crisis. They are trying to make workers pay for the crisis through job losses, reduced hours and cuts. The main problem they face is that while they need to increase demand they are actually reducing demand by attacking jobs. This is one of the reasons why any return to growth is likely to be weak and short lived.

Given that capitalism is an unplanned system it is impossible to predict the future with any precision. We can say with some certainty however that the impact of this crisis will take on a drawn out character. Even when there is an economic upturn, it will be weak and high levels of unemployment and poor growth will persist for some time. The last world boom relied on debt to extend the market. There is no sign of ‘normal’ bank lending returning any time soon. In short, there is more bad news to come.

This does not mean that the system is about to collapse. The reason that John Key and the capitalists are so optimistic about the future is because no mass alternative has been posed. The impact of the collapse of Stalinism and the move to the right in the Labour Party has meant that there is a political vacuum to the left of Labour. This has resonated in the trade unions and at this stage most are not showing any sign of fighting back.

It is for this reason that an independent working class analysis of the economy is so important. Economic developments are the driving force behind changes that lead to an increase in class struggle. They are important because of the effect that they have on material conditions and on consciousness. For this reason a ‘wait and see’ approach will not suffice. Workers need to be fully aware of developments in order to be able to respond quickly.

The attacks on jobs and living standards are bound to provoke a reaction from working people in New Zealand at a certain point. While an economic crisis can have a temporary “stunning” effect on some workers, in the coming period we can expect an increase in defensive battles as workers try desperately to hold on to what they have. Even when there is a slight return to growth this could mean an increase in struggle as workers attempt to claw back some of what has been lost during the recession.

Despite the lack of organised opposition, the situation for capitalism in New Zealand is quite weak and unstable. The system is incapable of providing working families with a decent future. When workers begin to realise that there will be no return to past ‘good times’ this will further contribute to the instability that exists.

It is important that workers are prepared for the unfolding situation and that the workers’ movement outlines a strategy to ensure that working class people are not made to pay for a crisis that they did not create.

Australia & New Zealand push neo-colonial agenda

The 40th annual Pacific Islands Forum took place in the Queensland city of Cairns on August 5-6. Fifteen heads of state from the region met to discuss a range of issues including a new regional free trade agreement, the situation in Fiji and climate change.

The forum is supposed to “enhance the economic and social well-being of the people of the South Pacific” but, in reality, Australia and New Zealand control the forum and use it as a tool to advance their interests in the region. An example of Australia and New Zealand’s dominance was the ‘discussion’ that took place about climate change.

Climate change

Rising sea levels due to climate change threaten many of the low-lying Pacific islands. Around 4 million people live on the islands but the population is expected to double in the coming decades. At least half of these people live within 1.5 kilometres of the coast and rising sea levels could force millions to relocate.

While ordinary people in the Pacific contribute very little to the causes of climate change they are set to suffer the most. High levels of poverty mean that, for many, their options will be severely limited.

In the lead up to the Forum many of the small island nations had called on Australia and New Zealand to reduce their ‘greenhouse gas’ emissions by 45 per cent by 2020. Australian Prime Minister, Kevin Rudd, and New Zealand Prime Minister John Key baulked at these calls and instead forced through the pathetic target of a 50 per cent reduction by 2050.

The reason why such ineffectual targets were set is because both Key and Rudd are more influenced by the coal industry bosses than they are by the Pacific island nations. They are representatives of big business and see their job as protecting profits rather than protecting the environment.

Fiji suspended

Fiji had its membership from the Forum suspended in May after Prime Minister and military leader, Frank Bainimarama, abandoned plans to hold elections. In 2008 the forum demanded that Fiji commit to holding a general election by March 2009. Bainimarama rejected this deadline and subsequently Fiji became the first country to ever be suspended from the Forum.

Fiji’s suspension was largely driven by Australia. While Kevin Rudd claims that he is concerned about democratic rights and the welfare of ordinary Fijians, his real concern is the absence of a compliant regime in Fiji. This is setting back Australian imperialist interests in the region.

Fiji plays an important role in the regional economy and is a key trading hub for countries like Kiribati, Tuvalu and Tonga. As relations between Fiji and Australia have broken down Bainimarama has been building closer ties with China. While Australia maintains sanctions against Fiji, it is estimated that China loaned Fiji $185 million in 2007 and $102 million in 2008.

The Australian newspaper has also reported that China gave $254 million in secretive aid to Pacific island countries last year which places it on a par with other major donors including Europe, Japan and New Zealand. While Australia is still the major donor in the region, the influence of other powers is of major concern as it cuts across the ability of Australian bosses to exploit Pacific markets.

Regional trade ‘agreement’

The signing of interim trade agreements between the European Union, Fiji and Papua New Guinea, coupled with China’s attempts to extend its influence in the Pacific, forced Rudd and Key to speed up negotiations for a new regional free trade agreement. Australia and New Zealand see the Pacific Agreement on Closer Economic Relations (PACER-Plus) as a way of securing important markets.

Despite their reluctance, Pacific island countries were forced to commit to beginning formal negotiations at the Forum. Most countries had not wanted to start negotiations for some years but it was made clear to them that financial aid would be linked to their co-operation.

Rudd and Key claim that a more integrated regional economy will benefit the small nations and help raise many out of poverty. The Pacific island leaders have concerns that PACER-Plus will not benefit their own local ruling elites but the deal will also have negative impacts on workers and the poor.

The agreement will require Pacific nations to eliminate tariffs and reduce taxes making imports from Australia and New Zealand much cheaper. This will severely undermine local manufacturing. Some economists estimate that under PACER-Plus three quarters of Pacific manufacturing could close down, impacting on thousands of jobs.

Fiji, Samoa, Vanuatu and Papua New Guinea stand to lose millions of dollars from tariff cuts while other countries such as the Cook Islands, Kiribati and Tonga stand to lose at least 10 per cent of their annual government revenue. This will put pressure on the state leading to inevitable cuts to the public sector and increased taxes on working people.

The agreement will also require Pacific governments to open certain parts of the economy to the private sector and remove restrictions on foreign investments. This would be a boon for private investors in Australia and New Zealand, while leading to increased costs and reduced services for the majority on the islands.

PACER-Plus would also undermine the rights of local Indigenous people to have access to their land. Mining companies in particular would like to see the sweeping aside of traditional land ownership in favour of private and transferable ownership schemes. This would allow easier access to land on the islands with an abundance of natural resources.

Far from providing for the majority, free trade will only increase the gap between rich and poor. PACER-Plus will be good news for Australian and New Zealand exporters and investors but deliver more poverty and fewer rights for local people.

Because of Australia and New Zealand’s dominance, the Pacific Islands Forum lacks credibility in the eyes of many. Nevertheless, it is being used by Rudd and Key to counter China’s influence and extend the base of Australian and New Zealand capitalism.

The labour movement should oppose the neo-colonial agenda being pushed at the Pacific Islands Forum as it only benefits a rich few. Just as the representatives of the bosses in the region plan to build closer relations, so should workers and the poor.

Developing a working class and a socialist alternative to capitalist plunder and exploitation is the only way to ensure that the small Pacific islands are not further driven into poverty or wiped off the map due to climate change. Developing strong labour movement links and extending solidarity is our immediate task.

While the government is busy telling workers to tighten their belts, they have announced plans to increase defence spending by more than 20 per cent. The reasons outlined for this enormous increase have been explained in the government’s Defence White Paper which was released in May.

The paper claims that China poses a significant strategic risk to Australia and that a military build up is required in order to head off a possible conflict. At the same time we have seen scandals surrounding the Defence Department and the replacement of Joel Fitzgibbon who was the Labor Minister for Defence.

Fitzgibbon was forced to resign after it was revealed he had failed to declare two paid trips to China as a guest of a Chinese-Australian businesswoman. The reality is that his removal was less about travel rorts and more about divisions within the Defence Department about how to deal with China. These divisions are a reflection of the debates taking place within the Australian ruling class.

Australian capitalism faces a serious strategic dilemma against the backdrop of the rise of China and the economic decline of the US. On the one hand China is becoming a threat to Australia’s economic influence in the region as they are building relations with countries like Fiji, East Timor and Papua New Guinea. Australian capitalism sees these countries as key markets.

On the other hand China is Australia’s fast growing trading partner. On the back of mining exports, China has been responsible for a significant amount of Australia’s recent economic growth. While one section of the ruling class is making mega profits from China, another section sees China as cutting across their ability to plunder the region.

For some time the Australian ruling class has aligned itself with US imperialism as the best way of exercising control in the Asia Pacific. In exchange for supporting US military adventures around the globe, Australia has been charged with the responsibility of being the ‘deputy sheriff’ of the region. With the rise of China this position is now somewhat under threat.

The Rudd Government sees the military build up as an important part of protecting the profits of the Australian ruling class. The problem is that many in the ruling class are concerned that they soon may be forced to decide between aligning with either China or the US. Aligning with one or the other would be a disaster for profits and with Australia being militarily dependent on the US and the economically dependent on China, a neutral stance is not an option.

As the economic crisis intensifies China and the US will be jostling for control of more markets and resources. Rivalries will increase and it is possible that skirmishes will take place in the region. The whole situation highlights the reactionary role of capitalism and the inability of the system to take society forward.

Workers and young people in Australia should oppose this military build up as it is only aimed at serving the needs of the big business elite. In a saner world the billions of dollars spent on military spending would be spent on improving people’s lives. Ordinary Australians need to look towards socialist solutions which promote co-operation and solidarity rather than conflict and super-exploitation in the region.

The Bligh State Labor Government in Queensland is set to sell off $15 billion worth of public assets. The Government claims that with most of their trading partners in recession, they need to raise billions of dollars in order to maintain government services and their AAA credit rating.

The vast majority of Queenslanders oppose the plan which would include the sell off of Queensland Rail and the port authorities. In fact a recent poll found that Labor’s support has nosedived from 42.2 per cent in March to 36 per cent now. Despite this public opposition, the Labor Party conference held in early June acknowledged that the asset sales would go ahead.

The Queensland Council of Unions has announced a state-wide campaign against the plan but so far nothing in the way of co-ordinated industrial action or mass rallies has been announced.

Even the Deputy leader of the Opposition, Lawrence Springborg, cast scorn on the trade union leaders for not opposing the sell offs strongly enough. Springborg recently said “The unions at the weekend proved themselves to be a gutless bunch of fairies that wilted like a lemon meringue pie as soon as the pressure went on them. Rank and file union members are disgusted in their gutless union leadership that has absolutely rolled over to the Labor Party and put their own self interests first.”

While those who oppose the privatisation would no doubt agree with Springborg’s comments, it has to be said that the Liberal National Party (LNP) opposition are no better than Labor. The LNP would no doubt maintain and extend any privatisations that Labor carried out as they have in other states.

The rationale that the Bligh Government has put forward for wanting to sell the assets is that with falling revenue, they want to be able to continue to pay for government services and to maintain their AAA credit rating. This argument makes no sense.

Firstly in the context of an economic downturn, the returns from the asset sales are going to be much less than what the assets are actually worth. This means private investors will buy at bargain prices and make a fortune selling back services that the public used to own.

While the sales will lead to a one off cash boost to the budget, the money the state collects from taxes on these private companies will be a fraction of what they could generate in public hands. While it may mean that the states credit rating stays in tact, privatisation will not mean more revenue to be spent on government services.

In fact the Government has already announced that side by side with the sell off they are planning cuts. Once any assets are in private hands profits will be put before all else. This will mean further cuts to services, cuts to maintenance and cuts to jobs, wages and conditions.

It is important that rank and file members of the trade unions put pressure on the union leaders to ensure that an effective mass campaign against the plan is carried out. Privatisations can be stopped but not by simply begging the Labor Party for a better deal. A campaign industrial action must be waged in defence of public ownership.

With the Bligh Government making it clear that they represent interests opposed to the majority of ordinary people, the trade unions also need to reassess their support for the Labor Party. Union member’s money would be much better spent opposing Labor rather than propping up a party that wants to sell off the state.