Some Comments on Partha Chatterjee’s theoretical framework

Posted by Dipankar Basu October 31, 2008 at 2:07 am in Agrarian Question, Economy, India

Political Economy of Contemporary India

Dipankar Basu and Debarshi Das

Sifting through the divergent viewpoints thrown up by attempts to make sense of the recent political history of West Bengal, one is led to the conclusion that the tumultuous events have taken many, if not most, by surprise. With the benefit of hindsight one can probably say this: a combination of an insensitive state power, an arrogant ruling party, lapping-it-up corporate interests, and cheerleaders-of-corporate-sector-doubling-up-as-media orchestrated a veritable assault – a perfect storm. Yet the peasantry, initially without the guiding hand of a political party – indeed at times against the writ of the party – fought on. Through this episode Indian political economy seems to have stumbled upon the peasantry while it was looking for a short-cut to economic growth through SEZs.

At the level of political practice this serendipity demonstrates lack of an organic link between the representatives of people and those they claim to represent. The Trinamul Congress, whose manoeuvrings range from rightist alliances at worst to unprincipled populism at best, was slow to react; but it learnt the ropes eventually. A nagging doubt remains though, as to whether it would not, at the end of the day, appropriate the movement and sell it off to the highest bidder. The charge is of course more serious against the communist parties. If confusion of politics was not bad enough, the largest party of the state failed to gauge the pulse of the people whose land it was taking. The Congress Party has perhaps been the most rudderless of the lot – veering towards resistance at one moment, getting pulled back by the central leadership at the very next.

At the level of theorisation too, things are in a flux. A case in point is noted political scientist Partha Chatterjee’s article in Economic and Political Weekly[1], which tries to present a novel reading of contemporary Indian reality and a new framework to comprehend it with. We shall present his position briefly and then examine it critically in our own attempt to throw some light on contemporary Indian reality.

Partha Chatterjee’s Analysis

Partha Chatterjee (PC henceforth), by his own admission, used to perceive the Indian peasantry as being endowed with a change-resisting character. External agencies such as the state or market forces were sought to be barricaded away, often successfully. But that has changed over the last twenty five years. Liberalisation of the economy, it’s incorporation into networks of the global flow of goods, services and capital, and more recently events like Singur, Nandigram, Kalinganagar, etc. have compelled PC, and Kalyan Sanyal, whose book he often refers to, to reconsider such a position.

Reconsideration of the earlier position leads him to discover that the state was not that external to rural society after all; that the rural economy has come fully under the sway of capital, and that the rural poor do leave villages for cities due to social, and economic compulsions [2]. These new trends, according to PC, have emerged and consolidated themselves over the last three decades. Another concomitant and noteworthy development is that market forces seem to have gained phenomenal power. The balance of state power between corporate capital and the landed elite has decidedly tilted in favour of the former. The managerial-bureaucratic class, i.e, the urban middle class, has also aligned itself with the interests of big capital. Straddling all these changes and in a sense providing an overarching theme of current economic reality in India is the process of primitive accumulation of capital.

Sanyal however avers, and PC concurs, that the primitive accumulation of capital that is underway in India today is very different from the classical variety of the same process. One of the major differences, according to PC, is that the dispossessed, separated from the means of production, can no longer find gainful employment in industry due to limitations of present day capital-intensive technology [3]. This is bad news for the ruling dispensation as social unrest may break out. Old tactics of armed repression is ruled out, because the globally accepted norm is to provide succor to the victims of primitive accumulation and not shoot them down. Compulsions of electoral democracy, which demands that even voters bereft of livelihood be heard, is an additional constraint. Thus, caught between the pressures of the global discourse on development and the demands of electoral democracy, the State adopts the role of transferring resources from the accumulating economy of corporate capital to the dispossessed masses, thereby reversing the effects of primitive accumulation.

We are therefore left with a curious situation. Corporate capital is dispossessing millions through primitive accumulation, but the dispossessed are neither getting absorbed into industry nor getting socially transformed, as they were supposed to, through proletarianisation. This floating mass of labour, this enormous but shifting population of potential workers have instead become a constituent of what PC calls “political society”. Owners of small capital - PC prefers the term non-corporate capital – along with small and marginal peasants, artisans, and small producers are important constituents of political society.

But political society, according to PC, is different from civil society; corporate capital hegemonises the urban middle class which forms civil society. Its support for pro-capital policies is unstinting. Demand for civil and democratic rights define its political agenda. Political society, on the other hand, is hardly a constitutionally valid entity. Its constituents do not enjoy the rights due to citizens; hence they do not qualify for membership of civil society. The economic precariousness of political society, accentuated by primitive accumulation, forces it to use various ploys to negotiate with the State. For the State, on the other hand, electoral compulsions of representative democracy is a binding constraint. Thus the State often looks the other way when negotiations with political society violates established civil society rules (urban squatters, and street vendors are a case in point, as PC mentions). But in the agrarian economy the degree of political consolidation is lower; therefore dependence on the hand-outs of the State is more pronounced. This does not however imply, PC mentions, that they are incapable of rallying on emotive issues and thereby nullifying the government’s machinations to divide and break. It is in the dynamic interaction between the civil and political society – which often coincide with corporate and non-corporate capital for PC – and in the success of the State in holding the two together through measures of “governmentality” that PC identifies the fate of the present political regime.

Some Comments

There are many points which are commendable about the article: acute observations, theoretical insights, incisive analysis and a crisp clear prose. For instance, some of the important observations worth highlighting and thinking about are: landed elite losing ground vis-à-vis the bourgeoisie, the breath-taking ease with which the urban middle class traded Nehruvian consensus for the Washington consensus, the accompanying depoliticization, and the rising friction between this class and the poor etc. These observations underline the sharp analytical prowess of one of the foremost social scientists of the country. But there are surprises and disappointments too and to these we now turn.

The biggest problem with PC’s analysis, we feel, is the questionable theoretical framework that he works in, a framework that he has borrowed from Kalyan Sanyal (KS henceforth). KS starts his analysis by pointing out that what is going on in contemporary India can be fruitfully understood as the primary (or primitive) accumulation of capital, in the sense in which Marx used that term in Volume 1 of Capital. We fully agree with him here; in fact one of us had argued along those lines some time ago [4]. The defining feature of the process of primary capital accumulation – forcible separation of primary producers from the means of production - is difficult to miss in developments in contemporary India. KS notes that all previous attempts at theorizing primary capital accumulation have been embedded in what he calls a narrative of transition. Thus, primary capital accumulation has always been seen, according to KS, as marking a transition, a transition from one mode of production to another, either a transition from feudalism to capitalism, or “from pre-capitalist backwardness to socialist modernity.” But “under present conditions of postcolonial development within a globalised economy, the narrative of transition is no longer valid”; that is “although capitalist growth in a postcolonial society such as India is inevitably accompanied by the primitive accumulation of capital, the social changes that are brought about cannot be understood as a transition.” And why is that so? This is because it is no longer acceptable, or so KS believes, that people dispossessed and displaced due to primitive accumulation should be left with no means of subsistence. And what makes the destitution and poverty of the people displaced by primary accumulation unacceptable? The current international context marked by the dominance of the discourse of development and human rights.

Alongside the process of primary accumulation, therefore, KS discovers a parallel and related process: intervention of the State to reverse the effects of primitive accumulation. Government agencies, in other words, step in to create conditions for ensuring the “basic means of livelihood” to those who have been dispossessed and displaced by the process of primary accumulation of capital. Thus there is, according to KS, two processes going on in parallel, “primitive accumulation” and a “process of the reversal of the effects of primitive accumulation.” It is the conjunction of these two parallel processes, according to KS, that invalidates the narrative of transition associated with the primary accumulation of capital.

The implication of this assertion, the assertion that the primary accumulation of capital can no longer be understood in terms of a narrative of transition, is stupendous. It means that current political economic processes underway in India will continue indefinitely; historical change, for KS, seems to have been stalled. Since current day reality cannot be understood as a process of transition, this would then seem to imply that Indian reality will remain unchanged in its essentials for a long time to come, if not forever. In more concrete terms, this will mean the presence of the huge mass of working people parked in the no man’s land between agriculture and industry for an indefinite amount of time, a population that has been simultaneously dispossessed by the primary accumulation of capital and provided an alternative “means of livelihood” by the postcolonial State.

As a description of contemporary Indian reality, this account probably has some intuitive appeal. After all it can hardly be denied that one of the most important characteristics of contemporary India is the huge population of what economists have called “surplus labour”: the huge population of working people who find stable, well-paying employment neither in agriculture nor in industry nor in services. Though KS’s analysis apparently attempts to understand this phenomenon of “surplus labour”, by all accounts the defining characteristic of contemporary Indian reality, it is, we believe, seriously flawed.

First: the Indian economy has been characterized by surplus labour for the past two centuries, it is not a new phenomenon; the primitive accumulation of capital was initiated under the long shadow of colonialism and ever since that time dispossession has been going on without commensurate absorption of the displaced labour in industry. In that sense the current scenario has a historical dimension that KS, and thereby PC, completely misses when he (a) locates the beginnings of this process somewhere in the recent past, and (b) identifies the supposed ameliorative interventions of the State in reversing the effects of primary accumulation in the current conjuncture as one of the crucial factors to reckon with.

To be sure, PC, identifies three factors that are different today from the time when Western Europe underwent primary accumulation of capital. First, there were opportunities for international migration of the surplus labour that are totally absent today; second, the technology of the early industrial period was far less capital intensive than current technology and hence had the capacity to absorb far more of the surplus agricultural labour than is possible today; third, the State did not intervene in Western Europe to reverse the effects of primary accumulation as it is doing today in India. Though the first two factors were present in Western Europe and contributed to mitigating the problem of surplus labour, they are not necessary. Japan and the Soviet Union had taken care of primary accumulation, and had industrialized, without having to export surplus labour to its colonies and using much more capital intensive technology that was used during the industrial revolution in Western Europe; South Korea had taken care of primary capital accumulation, and had industrialized, with much more capital intensive technology than Britain had used during its own industrialization and without the assistance of international outmigration of its surplus labour. Therefore, the absence of opportunities for international migration and the use of technologies with relatively higher capital intensity cannot explain the absence of industrialization and the continued existence of surplus labour in India. The answer lies somewhere else, in the domain of capital accumulation. In a dynamic context, the rate of absorption of labour, i.e., the growth rate of the demand for labour, depends on the rate of accumulation of industrial capital. Neither the lack of international migration, nor the increasing capital intensity of technology nor the ameliorative interventions of the State can explain the burgeoning ranks of surplus labour; it is the absence of a sufficiently rapid rate of growth of industrial capital in India that is responsible for the continued existence of surplus labour. This crucial factors is totally missing in KS’s and PC’s analysis

The primacy of capital accumulation becomes obvious once we look back at history and realize that dispossession without proletarianization is not a novel phenomenon. One just needs to recall that one of the principal issues raised by the Mode of Production Debate [5] was why India did not make the transition to capitalism despite being sucked into the global network of trade and commerce with the onset of colonialism. The answer, of course, is now well known. As colonial incursion willfully destroyed the socio-economic fabric of the country, peasants were evicted and deindustrialization, facilitated by the trade policy of the colonial State, exacerbated the pressure on land. But the economic surplus which was being generated in the process was largely siphoned off to the metropolis. Thus, in the colony, processes leading up to the formation of productive capital were conspicuous by their absence. Petty producers who were getting alienated from the means of production were joining the ranks of paupers, not those of the working class. Without a strong capital accumulation process, the excess labour could not be absorbed into profitable industrial activities; that is the historical basis of “surplus labour” in the Indian economy. One may refer to the mode of production in India using any term one wishes, as pre-capitalist, or semi-feudal, or semi-capitalist, or postcolonial, or something else, but the main point remains beyond dispute: absence of the growth of industrial capital and a concomitant growth of the industrial working class.

Somewhat related to this point about “dispossession without proletarianization” is the implicit assumption in PC’s analysis that peasant society had been stuck in splendid isolation till about the beginning of the era of liberalization; this is one of our major points of criticism of PC’s analysis that we wish our readers to ponder. The trend of viewing the peasantry in this manner, especially the middle peasants who are not very much dependent on the labour market for selling or buying labour, owes a great deal to the work of the Russian economist Chayanov [6]. But the putative efficiency of the peasantry sits oddly with the massive and recurrent famines India underwent as colonial rule tethered the country to global commodity markets. This position about the supposed insularity of the peasantry seems even more unconvincing when one recalls the state’s successful promotion of Green Revolution in north and northwest India starting in the mid-sixties. Nor does it seem consistent with Operation Barga in West Bengal, another orchestration of political parties and the state machinery, which was leaving a deep impact on rural Bengal right at the time when Subaltern Studies was undergoing its genesis.

To move on to another major problem in PC’s theoretical framework recall that one of the crucial links in PC’s chain of argument relates to the supposed interventions of the State in reversing the effects of primary accumulation; this, to our mind, is the weakest link in the whole chain of arguments that PC offers in his paper; there are both theoretical and empirical problems with this argument.

First:

PC, and many other scholars (including KS), we feel, seem to have misunderstood the notion of primary accumulation of capital. Primary accumulation of capital, as understood by Marx (in Volume 1 of Capital), is the forced separation of producers from the means of production. Whether this “free”, evicted (peasant) labour gets absorbed in industrial activity is a different question, it is not part of the process of primary accumulation. It depends on the pace of capital accumulation, as we have already pointed out. So, the assertion – implicit in PC’s analysis - that the “classical” pattern of primary accumulation led to industrial development is false. Primary accumulation led to the creation of a class of “free” labourers, period. What led to the industrial revolution and the rapid growth in the demand for labour and the strengthening of capitalism and thereby the absorption of surplus labour, was the rapid pace of capital accumulation and technical progress. Thus, distinguishing between the “classical” pattern of primary accumulation in Europe and the present pattern of primary accumulation in India does not seem be analytically useful.

Second:

PC’s whole analysis seems to be curiously oblivious of the neoliberal turn in the global economy, a fact that is amply reflected in policy changes in India too; we feel this is one of the biggest lacunae in PC’s analytical framework. The fact that radical scholars and activists have spent so much time and effort studying neoliberalism, understanding its genesis, structure and functioning must surely be known to a scholar of the stature of PC; the fact that he has ignored this vast scholarship, experience and political practice and has instead advanced the thesis of ameliorative state intervention is very significant and points towards a deep problem in his theoretical framework. After all, one of the defining characteristics of the State under neoliberalism is its gradual retreat from the provision of public goods and social services, especially those services that might benefit the poor and dispossessed. In the face of this well-known and well-documented fact, when PC asserts that the State has stepped in to do exactly the opposite, i.e., reverse the deleterious consequences of primary accumulation, one is more than surprised, one is appalled. Let us present some empirical evidence to dispel the illusion, if any, of the lately humane State, responsive to the needs of the poor, bowing before the pressure of the international discourse on poverty alleviation.

a. Distribution of subsidised food through ration shops is an old institution – not a device to make the pain of the poor bearable in the era of neoliberalism. During the last couple of decades, the decades of neoliberalism, the universal public distribution system (PDS) has been systematically dismantled; that is the hallmark of post-liberalisation India, not the strengthening of the PDS and increasing its reach. Priority sector lending, another device built by the Nehruvian state to help farming and related activities, is in a sorry state. In the last fifteen year 4,750 rural bank branches have been closed down: at the rate of one rural bank branch each day. During the year 2006 one branch was shutting down every six hours! [7]

b. The tale of microcredit institutions, an example of what PC considers the States intervention to reverse the effects of primitive accumulation, doing the job of offering palliatives has been questioned by many. The interest rates charged by micro credit institutions are often almost usurious. The motivation to harvest the middle ground between low interest rates of public sector banks (which are vanishing) and the exorbitantly high ones of village mahajans seems to be behind the coming together of corporate banks and NGOs in the micro credit venture. This serves two purposes. One, banks earn as much as 25% return, much higher than the organised sector return,[8] with an excellent repayment rate; a lucrative arbitrage channel thus opens up. Two, this credit model is then peddled as people-oriented, and opposed to a bureaucratic public sector model. This is then used to justify withdrawal of the state from its basic responsibilities towards socially and economically vulnerable sections of the population. That someone as perceptive as PC has fallen for the micro credit argument signals that the powers that be have been largely successful.

c. Contrary to the claim of the article, “social sector expenditure” has nosedived over the past few years. In 1996, rural development expenditure as a proportion of net domestic product was 2.6%. During the pre-liberalisation seventh plan (1985 to 1989) the figure was much higher at 4% [9]. From the mid 1980s to 2000-01 public development expenditure as a percentage of the GDP fell from 16% to 6%. The effects have of course been disastrous, especially in the farming sector where strong crowding-in effects of public investment is a well known fact. The growth rate of all crops fell from 3.8% in the 1980s to 1.8% in the 1990s, while total agricultural investment expenditure as percentage of the GDP fell from 1.6% to 1.3% [10]. Using a constant calorie norm of 2200 calorie per day, head count poverty ratio has risen from 56.4% to 69.5% between 1973-74 and 2004-05.

d. Guaranteed public work for the rural poor was attempted to be scuttled from the very top, i.e., by the officials of the State at the very highest levels. Social democratic proclivities of official communist parties, rather than the tactical calculations of the bourgeoisie, saw it through to some extent. To this day the corporate media loses no opportunity in tarnishing the National Rural Employment Guarantee Act [10] as useless, wasteful and distortionary.

In short, any substantial evidence of the State taking steps to make primitive accumulation bearable, to reverse its effects by providing alternative means of livelihood to the dispossessed population, seems to be totally missing. PC seems to be oblivious of the fact that the phase of neoliberalism is characterised precisely by the opposite: withdrawal of the state from the economy and social sectors, not its intervention in favour of the dispossessed.

Third:

The analytical handle of political society did not seem to have served any great purpose. What was meant by this term was essentially what has been called the unorganised sector, the sector of the economy comprising of petty agricultural producers, tenants, village artisans, street vendors, small scale manufacturers, etc. Admittedly they are less equal than the rest but that is a derivative of their economic position in the country rather than being a defining feature of its own. Since this “unorganized” sector employs nearly 92% of the Indian work force, a close scrutiny of its structure and dynamics is long overdue. But did coining a new term serve any goal? Not one that we can see. In the bargain PC, of course, seems to have missed two crucial points.

a. Labour has gone out of the discourse and PC’s analysis seems to endorse this trend. Recall that PC uses the term “non-corporate capital” for an economic representation of political society. Reading PC’s descriptions of it, one cannot help suggesting that “labour” rather than “capital” should have been emphasized. After all nearly 40% of the agrarian population are landless labourers [12]; of the landowners, about 86% come under the category of small and marginal farmers, and they supplement income from land with labour income. Simple back-of-the-envelope calculations tell us that at least 55% of the country’s population could be counted within political society – this is the contribution of agricultural sector alone. To get an idea of the size of political society one needs to add the fast increasing chunk of casual labourers in manufacturing and services, petty manufacturers, and self-employed groups of the service sector. Their income source, as we have noted, owes more to labour than to capital. Hence the term “non-corporate capital” seems inappropriate, both as a matter of description and analysis.

In this context one needs to understand what PC mentions about the resistance to forcible acquisition of land. When land was being taken away, some of the villagers did not participate in agitations while some of them resisted fiercely. But PC forgets to examine who did what. Closer examination of these struggles reveal that peasants with little or no land at all – sharecroppers, farm labourers – were the ones who fought on [13], [14]. This perhaps illustrates that using a class-neutral term may not be very illuminating for socio-political analysis.

b. While describing maneuvers of political society in negotiations with the neoliberal state PC uses illustrations of urban labour: squatters, hawkers, etc. This leads him to conclude that demands of political society mostly fall outside the domain of the legally permitted. But what about demands such as payment of minimum wage, subsidised inputs and credit, support price for crops, right to livelihood, right over resources like forest produce, water? Surely these demands, on which political society has plenty of stakes, are entirely legal. One suspects that the urban bias in PC’s analysis and illustrations has pushed the article to dubious conclusions.

Conclusion:

As landholdings have undergone fragmentation and aspirations for urban comforts have soared, agriculture has ceased to be the site of intense class conflict. For the foreseeable future the big question of political economy will be to understand how corporate capital, with hegemony over the state and civil society, negotiates with the clingers-on of a moribund peasant society. Aside from the shortcomings of PC’s analysis, which we have critically examined, resistance at Singur, Nandigram, Kalinganagar perhaps signals that all is not yet over with the agrarian question. Managing political society through governmentality is hardly an answer. Land remains a vital issue on which livelihoods, and therefore lives, are staked. There are no shortcuts – employments would have to be found for the evicted if corporate capital has to reproduce itself without hitch. Moreover, electoral compulsions of representative democracy need not be met through resource transfer as PC has suggested. In a polity where parties deliver anti-neoliberal rhetoric before elections and do precious little once in power [15], actual transfer of resources is neither necessary nor efficient.

Notes and references:

1. Partha Chatterjee (2008): “Democracy and Economic Transformation in India”, Economic and Political Weekly, Vol. 43 No. 16 April 19 - April 25.

2. PC also hypothesises that the rural poor do not face an exploiter in the village any longer; or that since taxes on land or produce are insignificant, the state is not an extracting agent of the peasantry. Both these claims are questionable, but we shall let them pass.

3. Kalyan Sanyal (2008) “Amader Gorib Oder Gorib” (Bengali), Anandabazar Patrika, May 20.

4. See http://radicalnotes.com/content/view/32/39/

5. Utsa Patnaik (1990) Agrarian Relations and Accumulation: The ‘Mode of Production’ Debate in India, (edited) Sameeksha Trust and Oxford University Press, Bombay.

6. Utsa Patnaik (1979) “Neo-populism and Marxism: The Chayanovian View of the Agrarian Question and its Fundamental Fallacy”, Journal of Peasant Studies, Vol. 6, No. 4, reprinted in The Long Transition, Tulika, New Delhi, 1999 provides a detailed criticism.

7. Sainath (2008) “4,750 rural bank branches closed down in 15 years”, The Hindu, March 28.

8. Mritiunjoy Mohanty (2006) “Microcredit, NGOs and poverty alleviation”, The Hindu, Nov 15.

9. Utsa Patnaik (2008) “Neoliberal Roots”, Frontline, Vol. 25, Issue 06, March 15-28.

10. Utsa Patnaik (2003) “Food Stocks and Hunger: The Causes of Agrarian Distress”, Social Scientist, Vol. 31, No. 7/8, 15-41.

11. Jean Drèze (2008) “Employment guarantee: beyond propaganda”, The Hindu, Jan 11, 2008.

12. There is ambiguity whether PC categorises landless labourers under political society or ‘marginal groups’. He mentions marginal groups are low caste or tribal people. By this count the landless are mostly marginal. But then he mentions marginals do not participate in agriculture; they are dependent of forest produce or pastoral activities. Going by the second stronger criterion we shall include the landless in political society.

13. Parthasarathi Banerjee (2006) “West Bengal: Land Acquisition and Peasant Resistance at Singur”, Economic and Political Weekly, Vol. 41, No. 46, November 18 - November 24.

14. Tanika Sarkar (2007) “Celebrate the Resistance”, Hardnews, April.

15. K C Suri (2004) “Democracy, Economic Reforms and Election Results in India”, Economic and Political Weekly, Vol. 39, No. 51, December 18 - December 24.

Courtesy:Sanhati

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Philippines: Free Labor Rights Lawyer

Posted by Radical Notes October 29, 2008 at 11:50 am in Philippines, State Terrorism, Labour

Continuing Harassment of Leftist Activists

(New York, October 29, 2008) – The Philippine authorities should immediately release Remigio Saladero, Jr., a labor lawyer who was arrested on charges that appeared to be politically motivated, Human Rights Watch said today.

Philippine police arrested Saladero on October 23, 2008, at his law office in Antipolo City, in Rizal province, his attorney said. The police showed a 2006 arrest warrant for a case of multiple murder and attempted murder in Oriental Mindoro province that bore the name – Remegio Saladero alias Ka Patrick – and a different address. They also confiscated Saladero’s computer hard drive, laptop and mobile phone.

“Suddenly arresting a well-established activist lawyer for a two-year-old multiple murder case in another province should set off alarm bells,” said Elaine Pearson, deputy Asia director at Human Rights Watch. “This smacks of harassment, pure and simple.”

Saladero’s lawyer told Human Rights Watch that he was allowed to meet with Saladero in jail only after Saladero had been interrogated for six hours, even though he was entitled to legal counsel from the start of the interrogation. He is currently being held in the Calapan City provincial jail.

Human Rights Watch is concerned that Saladero was arrested because of the groups and individuals he has represented. His clients include hundreds of workers who have brought wrongful dismissal cases and suspected members of the New People’s Army (NPA), the armed wing of the Communist Party of the Philippines. Saladero is the board chairperson of the Pro-Labor Legal Assistance Center (PLACE) and chief legal counsel for Kilusang Mayo Uno (KMU), an alliance of trade unions.

Human Rights Watch urged the United States and the European Union to monitor Saladero’s case closely and to call for his immediate release.

In recent years, the government of President Gloria Macapagal Arroyo has come under intense international and domestic criticism over hundreds of extrajudicial killings and enforced disappearances of leftist activists, journalists, lawyers and clergy by members of the Armed Forces of the Philippines and the Philippine National Police.

In response to the criticism, the number of such killings dropped sharply, but convictions of perpetrators for serious crimes of this type remain negligible. Local activists have also expressed concern that the continuing harassment and arrests of activists on trumped-up charges shows that the government is only changing its tactics.

Several other cases bear similarities to Saladero’s arrest, and courts have subsequently declared the arrests illegal. In August 2008, a judge in Tagaytay City found the arrest and detention of the so-called “Tagaytay Five,” who had been advocates for farmers’ concerns, unlawful, and ordered their release. Security forces had arrested and detained the five – Riel Custodio, Axel Pinpin, Aristides Sarmiento, Enrico Ybanez and Michael Masayes – in a joint military-police operation in April 2006 and forced them to admit they were members of the New People’s Army.

In May 2007 armed men abducted a church pastor, Berlin Guerrero, in Laguna province. Several days later, he resurfaced in police custody and he was charged with being an NPA leader. In September 2008, the Court of Appeals in Manila dismissed charges of sedition and murder against him, and ordered his immediate release.

The United Nations Declaration on Human Rights Defenders sets out a series of principles and rights, based on human rights standards enshrined in international instruments. The declaration states that everyone has the right to promote the protection and realization of human rights.

“Saladero’s arrest shows the Philippine government is not sincere in its pledges to stop harassing lawyers and activists,” Pearson said. “It’s not just Saladero’s rights that are undermined, but the rights of all Filipinos ever in need of a lawyer.”

Courtesy: Human Rights Watch

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The struggle intensifies in Nepal

Posted by Radical Notes October 28, 2008 at 1:24 am in Nepal, National Self-Determination

Red Star

The political conflict in Nepal is sharpening. The conflict between two different types of forces, one wants to go forward from the present transitional phase, and the other wants to stop things where they are at present. This conflict has emerged just before the process of drafting a new constitution.

Three years ago, the CPN (Maoist) and seven other political parties had reached an agreement to restructure the country through the Constituent Assembly (CA). Later, when the King surrendered and the seven parties came to power, the CPN (Maoist) agreed to a ceasefire and to hold negotiations. As the CPN (Maoist) is a Revolutionary Communist Party, its goals are clear; forward to a People’s Republic to Socialism and ultimately Communism. But the CPN (Maoist) had agreed to struggle peacefully and try to achieve its political goals according to the people. They had clearly stated that a Federal Democratic Republic will be a transitional phase and will proceed forward by peaceful means. A large majority of the Nepali people approved of the Maoist agendas and the CPN-(Maoist) wants to establish a more people’s oriented republic, a republic orientated towards the people.

The CPN (Maoist) have clearly stated that the party wants to write a constitution that is more accountable to the people. At the same time, Maoist leaders clarified that the Republic will not be a like previous and traditional Communist led states. The Maoist has agreed to multi-party competition. The Maoist wants to establish a Republic and parties can compete within the constitutional framework. The Nepali Congress and some other forces do not want to move a single inch from the failed British Westminster model. This model of ‘democracy’ had been exercised in Nepal for more than 15 years but has failed.

The Nepali Congress leaders are alleging that the Maoist want to establish a ‘totalitarian’ system. This is a common allegation of the bourgeois and the so-called ‘democrats’. In Nepal, the NC and some other parties do not even want to hear People’s Republic and Socialism. If the NC have the right to believe in ‘democracy’, then why do the NC leaders think that the CPN (Maoist) or any other forces do not have a right to follow a different ideology? The CPN (Maoist) has never said that the NC cannot believe in democracy. This single fact proves that the NC is really a totalitarian party that wants to stop others following any other ideology. They can argue about the means to achieve the goals but they can’t demand others to abandon their ideology and goals.

The capitalist economic system is facing a grave crisis worldwide at present. The crisis had raised questions about the capitalist system and ‘multi-party democracy.’ The economy of the US, the role model of capitalism, is on the brink of collapse. Slowly, large sections of the world population are beginning to see socialism as an alternative once again. The countries where socialist system were exercised are not affected so badly. Likewise, countries which are following some sort of socialist methods are also not gripped by the crisis. The Guardian daily (UK) reports that many Germans are attracted to Marx’s writings amidst the financial crisis in Germany too. Marx’s books have been sold a record high. The whole world is debating about the capitalist system, but the bourgeois in Nepal seem unable to learn anything. They don’t want the lesson-the capitalist system generates crisis periodically-but they demand the Communists abandon their ideology.

The NC leaders also oppose the agreement that has already been made about army integration. The essence of the 12-point understanding, as well as other political agreements made after that such as the Comprehensive Peace Accord and the Interim Constitution, is an agreement to restructure the state. The restructure of the security sector is fundamental to restructuring the state, and this demands the integration of the two different armies. But the NC and some other parties are demanding that the People’s Liberation Army that fought for the Republic be dissolved, while the Nepal Army that fought for the King and against the republic be strengthened. For the political change, the NA should be dissolved and the PLA be made the official military force. However, the Maoist didn’t demand this, instead they agreed to integrate both and develop a national army. The NC and other parties who are opposing army integration want to drag the country back to conflict.

Courtesy: Red Star

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Class in Making?

Posted by Radical Notes October 26, 2008 at 1:19 am in Photos, Labour, Economy

October 24, 2008. Around 150-200 teachers from various computer teaching institutions (especially Aptech) whose accreditation has been withdrawn by the Delhi Government demonstrated at Jantar Mantar, New Delhi. The event was organised by a local NGO. They were demanding the reopening of the closed institutions and the reinstatement of the teachers who are presently unemployed. Their demands also included the determination of the salaries and benefits for the teachers according to the minimum wages set by the government, as teachers were/are getting just Rs. 2500-2750 in these institutions (including in CompCom).

The first level of consciousness - “We are also Human!”

The second level of consciousness - “Down with the Delhi Government!”

The third level of counsciousness - “The nexus between the company and the government!”

And the Sectionalist Contradiction - “Illiterates are getting 4000 and the computer teachers just 2500!”

SLIDESHOW

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Parliament March against “Encounter” and Profiling

Posted by Radical Notes October 25, 2008 at 1:50 am in Photos, State Terrorism

On October 24, 2008, Jamia Teachers Solidarity Group organised a rally to Parliament in New Delhi to protest against profiling of minorities in the country and to demand a judicial enquiry in the Jamia “Encounter”.

Along with various political activists, teachers and students from all three major universities in Delhi - Jamia Millia Islamia, Delhi University and Jawaharlal Nehru University attended the rally.

CPI(ML) Liberation General Secretary Dipankar Bhattacharya was also present and later addressed the rally.

Shabnam Hashmi of ANHAD, an NGO working against communalism also addressed the rally. She was among the first people who probed and questioned the “encounter.

For more photos of the event CLICK

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Worse than They Want You to Think - A Marxist Analysis of the Economic Crisis

Posted by Radical Notes October 23, 2008 at 11:39 pm in Finance, Economy

In the past few weeks, since we announced this talk, recognition has increased substantially that the United States, and now the world, are caught up in the most serious financial crisis since the Great Depression.  Because Marxists are famous for "predicting five out of the last three recessions", I need to point that the term crisis does not mean collapse, nor does it mean slump (recession, depression, downturn).  While the US is probably in the midst of a recession, the downturn has been - thus far - a relatively mild one. For instance, payroll employment has fallen nine months in a row, but the total decline, 760,000, is well less than half of the decline that occurred during the first nine months of the last recession, in 2001, which itself was relatively mild.

In contrast to this, a crisis is a rupture or disruption in the network of relationships that keep the capitalist economy operating in the normal way.  The present crisis is characterized above all by an acute crisis of confidence that loans will be repaid, which has in turn caused an acute crisis of liquidity - an official at the Boston Fed recently termed it a "liquidity lock" - the inability of businesses to get cash for their short-term, day-to-day needs.  Some major credit markets have been essentially "frozen"; which means that lending has been dropping rapidly or even coming to a halt.  But the business sector depends crucially on credit, not only to finance new investments, but just to get from today to tomorrow.  General Electric, for instance, has to produce before it can sell, so in the meantime it regularly borrows heavily by issuing commercial paper in order to pay its suppliers and workers.  If it doesn't obtain credit, the workers don't get paid and the suppliers can't pay off the debts they owe, and so on.  So the economy would be in danger of complete collapse if this situation were to persist for any length of time.  

Now, many liberals and leftists have told us that the $700 billion-plus bailout was not needed, or that it is meant to provide windfall profits to the financial industry, or that the money could be spent differently, for instance to protect homeowners against foreclosure, or invest in infrastructure.  But the crisis is much worse than they want you to think, and that's because they've been focusing on the wrong issues.  They've focused on the slump - which is not yet terribly severe and which can perhaps be dealt with in many different ways - and/or on the bank failures and bankruptcies in the financial sector.  

The really acute, immediate crisis, however, the one that could lead to outright economic collapse, is the crisis of confidence that has caused the liquidity lock.  These liberals and leftists have proposed no alternative policies to deal with this crisis, and that's because, if one wants to save the capitalist system, there basically aren't any alternatives that differ, except in the details, from what the Treasury and the Fed and foreign governments are now doing - namely making the liquidity flow, the cash flow, especially by the Fed stepping in to become the lender of last resort in the commercial paper market and by the Treasury twisting the arms of the banks to take the bailout money and then turn around and lend it out.  There's only one alternative to crisis of confidence and the liquidity lock that differs from this in more than details - a new, human, socio-economic system, socialism. 

I want to illustrate some of what I've been talking about above by looking at a couple of graphs.  I haven't found decent data on the decline in the volume of short-term lending, so I'm forced to try to illustrate the problem by looking at interest-rate figures.  Figure 1 is the so-called TED Spread, the difference between the rate of interest that a bank can get by lending to another bank for 3 months (the 3-month LIBOR in terms of US dollars) and the rate of interest it can get by lending to the U.S. Treasury for 3 months.  Lending to the Treasury is safer.  So the difference between these rates, the TED Spread, is essentially a measure of the willingness or unwillingness to take on risk - the extra interest a bank demands before it will take on the extra risk of lending to another bank instead of lending to the U.S. government. 

Through the 1st third of last month, the TED Spread was slightly more than 1 percentage point, which is already about double its usual level.  But after the government had to take over Fannie Mae and Freddie Mac, and Lehman Bros. was allowed to collapse, and the government had to buy AIG, and so forth and so on … the spread rose and, after temporarily declining a bit, kept rising and rising, reaching over 4.5%, until last week, when the most recent of the bailout measures and other emergency measures were announced.  As of today, as a result of the bailout and related measures, it had fallen back down, to below 3%.

Figure 2 is the interest rate on 4-week Treasury bills.  Again, for financial institutions, lending to the U.S. government in this manner is safer than putting the money in the bank, because the bank might fail and, until very recently, big institutions' deposits in the banks weren't government-insured.  And it's safer than buying short-term commercial paper.  So when they became afraid to lend to private entities, financial institutions became willing to obtain ridiculously little interest by lending to the U.S. government.  The greater the fear of private-sector lending, the lower the interest rate they were willing to accept.  And so the interest rate on 4-week T-bills has been, again and again, next to nothing for much of the past month.  For instance, much of last week, it was 5 hundredths of 1 percent, meaning that, if you bought a $10,000 T-bill, 4 weeks later, you'd earn 42 cents interest.  But this is what institutions have been willing to do with their cash, because they've been so afraid of the alternatives.  (The latest figure, not shown above, is that the interest rate has risen to 0.42%, as the bailout and related measures begin to restore confidence.)

Now let's consider some of what's been coming from the left.  In the Oct. 27, 2008 issue of The Nation (pp. 4 - 5), the historian Howard Zinn wrote,

"It is sad to see both major parties agree to spend $700 billion of taxpayer money to bail out huge financial institutions that are notable for two characteristics:  incompetence and greed. …

"A simple and powerful alternative would be to take that huge sum of money, $700 billion, and give it directly to the people who need it. Let the government declare a moratorium on foreclosures and help homeowners pay off their mortgages. Create a federal jobs program to guarantee work to people who want and need jobs".

This is all well and good, and these are measures worth fighting for to help working people as the slump in the economy worsens.  But how do they address the crisis of confidence and the liquidity lock?   Of course, one could say, "forget trying to restore confidence," but that is basically to say, "forget trying to save capitalism," and Zinn didn't say that.

Barbara Ehrenreich, the well-known writer and erstwhile revolutionary socialist, at least faced the fact that what is on the line is the capitalist system itself, not just incompetent and greedy and huge financial institutions.  She recently opined that there's no alternative to capitalism "ready at hand," so she hopes it survives the current crisis:  "I'm hoping that capitalism survives this one, if only because there's no alternative ready at hand.  At the very least, we should get some regulation and serious oversight out of any bail-out deal …." (Huffington Post, Oct. 1, 2008)

And then there's the left-liberal economist Dean Baker, who was for the bailout before he was against it.  On Sept. 20, he wrote,

"There is a real risk that the banking system will freeze up, preventing ordinary business transactions, like meeting payrolls. This would quickly lead to an economic disaster with mass layoffs and plunging output.

"The Fed and Treasury are right to take steps to avert this disaster. … there is an urgency to put a bailout program in place …." ("Progressive conditions for a bailout," p. 243.  Real-world Economics Review, No. 47)

In this statement, Baker characterizes the liquidity lock and its implications much in the manner that I characterized it earlier.  But then, 9 days later, he reversed course:

"The bail-out is a big victory for those who want to redistribute income upward. It takes money from school teachers and cab drivers and gives it to incredibly rich Wall Street bankers. …

"This upward redistribution was done under the cover of crisis, just like the war in Iraq. But there is no serious crisis story. Yes the economy is in a recession that is getting worse, but the bail-out will not get us out of the recession, or even be much help in alleviating it." ("Wall St held a gun to our heads")

Portraying the bailout as a program to make the rich richer, Baker says correctly that it won't do much to alleviate or end the recession.  But that doesn't mean its purpose is to make the rich richer, either.  What about the system's need to getting the liquidity flowing again - which he was acutely aware of 9 days before? 

Well, Baker says, the government can just take over the banks:  "In the event the banking system really did freeze up, then the Federal Reserve would step in and take over the major banks."  But the government must either take over the banks by buying them, which brings us back to a bailout costing hundreds of billions of dollars - or more, depending on how extensive the nationalization is.  Or the government can take over the banks without compensation.  That's a lovely way of dealing with a lack of confidence on the capitalists' part.  And it's a lovely way of getting credit flowing again.  In order to lend, banks, even nationalized banks, need people and institutions to lend to them and/or invest in them.  But I know that I wouldn't want to lend to or invest in any institution that has shown a willingness to expropriate without compensation.  Once again, of course, one can say, "forget trying to restore confidence and forget the sanctity of property rights" - in other words, "forget trying to save capitalism" - but Baker didn't go there.

I want to turn now to the roots of this crisis.   My view is basically that the crisis has its roots in the economic slump of the 1970s, from which the global economy never fully recovered - not in the way in which the destruction of capital in and through the Great Depression and World War II led to a post-war boom.  Policymakers here and abroad have understandably been afraid of a repeat of the Great Depression. So they've continually taken measures to slow down and prevent the destruction of capital (a plummeting of the value of capital assets as well as physical destruction of capital). 

But the destruction of capital is not only a consequence of an economic slump; it is also the mechanism leading to the next boom.(1)  For instance, if there's a business that can generate $3 million in profit annually, but the value of the capital invested in the business is $100 million, the rate of profit is a measly 3%.  But if the destruction of capital values enables a new owner to acquire the business for only $10 million instead of $100 million, the new owner's rate of profit is a more-than-respectable 30%.  That's a tremendous spur to a new boom.  

But such a massive destruction of capital as took place in the Depression and then in World War II hasn't taken place, and so there's been a partial recovery only, brought about largely through

(1) declining real wages for most workers and other austerity measures, as well as exporting the crisis into the 3d world, and

(2) a mountain of debt - mortgage, consumer, government, corporate - to paper over the sluggishness and mitigate the effects of the declining real wages.

Because of this excessive run-up of debt, there have been persistent debt crises.  These will continue until

(a) sufficient capital is destroyed to once again make investment truly profitable.  (The present crisis may well end up being this moment.).  Or

(b) there's such a panic that lending stops and the economy crashes, ushering in chaos or fascism or warlordism or whatever, or

(c) capitalism is replaced by a new human, socialist society.

Bubbles are thus, according to the above, an inevitable result of efforts to "grow the economy," by means of debt, faster than is warranted by the underlying flow of new value generated in production. The more sophisticated and widespread the credit markets, the greater is the degree to which "forced expansion" (Karl Marx, Capital, vol. 3, Chap. 30; p. 621 of Penguin ed.) can take place, but also the greater the degree of ultimate contraction when the law of value eventually makes its presence felt. So a bubble is kind of like a rubber band stretching and snapping back.

Figure 3 depicts what's meant by a bubble.  Imagine that demand for assets such as homes or stock shares increases, without a corresponding increase in new value being produced.  This causes the prices of these assets to rise; and on paper, people's and businesses' wealth increases, so they now have the means to borrow more, and they may become "irrationally exuberant"; and all of this leads to a further increase in demand, and so forth and so on.

The debt-induced bubble that's resulted in the present crisis is of course the housing sector bubble.  Paradoxically, it came about because of the weakness of the U.S. economy. First stock prices plunged sharply as the "dot.com" stock market bubble burst. Then the economy went into recession in 2001, and it was weakened further by the 9/11 attacks later that year. In order to allay the fears of financial collapse that followed the attacks, the Fed lowered short-term interest rates. Even after the recession ended a couple of months later, employment kept falling, through the middle of 2003, so the Fed kept lowering short-term lending rates. For three full years, starting in October of 2002, the real (ie inflation-adjusted) federal funds rate was actually negative (see figure 4). This allowed banks to borrow funds from other banks, lend them out, and then pay back less than they had borrowed once inflation was taken into account.

This "cheap money, easy credit" strategy created a new bubble. With stock prices having recently collapsed, this time the flood of money flowed at first largely into the housing market. Loan funds were so ready to hand that working class people whose applications for mortgage loans would normally have been rejected were now able to obtain them.

As Figure 4 shows, the trajectory of the mortgage borrowing to income ratio during the 2000-4 period is an almost perfect mirror image of the trajectory of the real federal funds rate. This is a clear indication of the close link between the explosion of mortgage borrowing and the easy credit conditions. And with new borrowing increasing so rapidly, the ratio of outstanding mortgage debt to after-tax income, which had risen only modestly during the 1990s, jumped from 71 percent in 2000 to 103 percent in 2005 (see figure 5).

The additional money flooding the housing market in turn caused home prices to skyrocket. Indeed, total mortgage debt and home prices (as measured by the Case-Shiller Home Price Index) rose at almost exactly the same rates between start of 2000 and the end of 2005 - 100 percent and 102 percent, respectively.

Those of us who attempt, following Marx, to understand capitalism's economic crises as disturbances rooted in its system of production - value production - always face the problem that the market and production are not linked in a simple cause and effect manner. As a general rule, it is not the case that particular disturbance in the sphere of production causes an economic crisis. Instead, what occurs in the sphere of production conditions and sets limits to what occurs in the market. And it is indisputable that, in this sense, the US housing crisis has its roots in the system of production. The increases in home prices were far in excess of the flow of value from new production that alone could guarantee repayment of the mortgages in the long run. The new value created in production is ultimately the sole source of all income - including homeowners' wages, salaries and other income - and therefore it is the sole basis upon which the repayment of mortgages ultimately rests.

But from 2000 to 2005, the rise in after-tax income was barely one third of the rise in home prices. This is precisely why the real-estate bubble proved to be a bubble. A rise in asset prices or expansion of credit is never excessive in itself. It is excessive only in relation to the underlying flow of value. Non-Marxist economists and financial analysts may use different language to describe these relationships, but they do not dispute them. Indeed, it is commonplace to assess whether homes are over or under-priced by looking at whether their prices are high or low in relation to the underlying flow of income.

Now, some players in the mortgage market did realise that something was amiss but nonetheless sought to quickly reap lush profits and then protect themselves before the day of reckoning arrived. But there was a good reason (or what seemed at the time to be a good reason) why others failed to perceive that the boom times were unsustainable: home prices in the US had never fallen on a national level, at least not since the Great Depression.

So it was "natural" to assume that home prices would keep rising. This assumption served to allay misgivings over the fact that a lot of money was being lent out to homeowners who were less than creditworthy, and in the form of risky subprime mortgages. Had home prices continued to go up, homeowners who had trouble making mortgage payments would have been able to get the additional funds they needed by borrowing against the increase in the value of their homes, and the crisis would have been averted.

Even if home prices had leveled off or fallen only slightly, there probably would have been no crisis. In the light of the historical record the bond-rating agencies assumed, as their worst case scenario, that home prices would dip by a few percent. It was because of this assumption that they gave high ratings to a huge amount of pooled and repackaged mortgage debt (mortgage backed securities) that included subprime mortgages and the like. Today these securities are called "toxic" - very few investors are willing to touch them. But if the bond-rating agencies had been right about the worst case scenario, the investors who thought that they were buying safe, investment grade securities would indeed have reaped a decent profit.

As we now know, however, the bond-raters were wrong, massively wrong, and thus there has been a massive mortgage market crisis.  According to the latest Case-Shiller Index figures, between the peak in July 2006 and July of this year, US home prices fell by 19.5 percent.  And because the mortgages were pooled and resold as mortgage-backed securities, the mortgage market crisis has spread throughout the financial system and become a generalized financial crisis.

I now want to say a bit about who or what is to blame.  We're hearing a lot about greed, but capitalists are always greedy.  But we don't always have massive crises.  So what explains the fact that we have one now?

There's also a lot of talk about lax regulation and insufficient regulation.  I know of no better answer to this notion than the answer recently given by Joseph Stiglitz.  In a Sept. 17 article, "How to prevent the next Wall Street crisis" , Stiglitz, a Nobel Laureate and former World Bank chief economist, proposed a six-point program chock-full of regulations and laws.  But he then acknowledged:  "These reforms will not guarantee that we will not have another crisis."  So why the title "How to prevent the next Wall Street crisis"? 

Stiglitz went on explain why his proposed reforms are no guarantee:  "The ingenuity of those in the financial markets is impressive. Eventually, they will figure out how to circumvent whatever regulations are imposed."  Yes.  So why the 6-point program?

He then wrote, "But these reforms will make another crisis of this kind less likely, and, should it occur, make it less severe than it otherwise would be."  Hmm.  If the financial markets will eventually circumvent whatever regulations are imposed, then why isn't another crisis equally likely with these regulations as without them? And why won't it be as severe with them as without them?

Finally, I want to say a few words about the significance of the various government interventions we've seen this year - the government's forced dismantling of Bear Stearns, the nationalization of Freddie Mac, Fannie Mae, and AIG, and the bailout money that's being used to partially nationalize the banking system.  Some commentators portray this, as I noted earlier, as an effort to make the rich richer.  Others depict it as some sort of progressive turn, an ideological shift away from the "free market."  I think both notions are seriously mistaken. 

What we are witnessing is a new manifestation of state-capitalism. It isn't the state-capitalism of the former USSR, characterized by central "planning" and the dominance of state property; it is state-capitalism in the sense in which Raya Dunayevskaya used the term  to refer to a new global stage of capitalism, characterized by permanent state intervention, that arose in the 1930s with the New Deal and similar policy regimes (Marxism and Freedom, Humanity Books, 2000, pp. 258ff.).  The purpose of the New Deal, just like the purpose of the latest government interventions, was to save the capitalist system from itself.

Because many liberal and left commentators choose to focus on the distributional implications of these interventions - who will the government rescue, rich investors and lenders or average homeowners facing foreclosure? - let me stress that I mean "save the capitalist system" in the literal sense. The purpose of these interventions is not to make the rich richer, or even to protect their wealth, but to save the system as such.

Consider the takeover of Bear Stearns.  It was in serious trouble but there were other ways of dealing with its troubles than by the government forcing it to be sold to JP MorganChase.   Had Bear Stearns been able to borrow from the Fed, it could have overcome the cash-flow problem it faced.  But the Fed waited until the following day to announce that it would now lend to Wall Street firms. Or, if Bear Stearns had been allowed to file for bankruptcy, it could have continued to operate, and its owners' shares of stock would not have been acquired at a fraction of their market value. Instead the Fed forced it to be sold off.

Thus the takeover was definitely not a way of bailing out Bear Stearns' owners. Nor was the Fed out to enrich the owners of JP Morgan Chase. (The Fed selected it as the new owner of Bear Stearns' assets because it was the only financial firm big enough to buy them.) Instead the Fed acted as it did in order to send a clear signal to the financial world that the US government would do whatever it could to prevent the failure of any institution that is "too big to fail", because such a failure could ultimately bring the financial system crashing down.

And consider the government's rescue of Fannie Mae and Freddie Mac.  This came about because of a sharp decline in their share prices.  But the government didn't rescue them in order to prop up the price of their share prices.  Their share prices continued to decline after the rescue plan was announced, precisely because the government's motivation was not to bail out their shareholders. Indeed, the shareholders aren't receiving any money from the government. Only those institutions and investors that lent to them are being compensated for their losses, and the government had been seriously considering not compensating some of these lenders (the holders of subordinated debt).  Just as in the Bear Stearns case, the point of the intervention was to restore confidence in the financial system by assuring lenders that, if all else fails, the US government will be there to pay back the monies that are owed to them.

The new manifestation of state-capitalism we are witnessing is essentially non-ideological in character.  Henry Paulson is certainly no champion of government regulation or nationalization.  But at this moment of acute systemic crisis, ideological scruples simply have to be set aside.  The be-all and end-all priority is to serve the interests of capitalism - capitalism itself, as distinct from capitalists.  As Marx noted, "The capitalist functions only as personified capital …. [T]he rule of the capitalist over the worker is [actually] the rule of things [capital] over man, … of the product [capital] over the producer" (Results of the Immediate Process of Production," in Penguin ed. of Capital, vol. 1, pp. 989 - 90, emphasis in original).  The goal is the continued self-expansion of capital, of value that begets value to beget value, the accumulation of value for the sake of the accumulation of value - not for the sake of the consumption of the rich.

Of course, we are indeed witnessing a movement away from "free-market" capitalism, and back to more government control and even temporary ownership.  But this is a pragmatic matter rather than an ideological one.  There's nothing inherently progressive about it.  The government is simply doing what it must, whatever it must, to prevent a collapse of the system. 

The recent state capitalist interventions are perhaps best described as the latest phase of what Marx called "the abolition of the capitalist mode of production within the capitalist mode of production itself". There is nothing private about the system any more except the titles to property. As I've been stressing here, the government is not even intervening on behalf of private interests: it is intervening on behalf of the system itself. Such total alienation of an economic system from human interests of any sort is a clear sign that it needs to perish and make way for a higher social order.

The current economic crisis is bringing misery to tens of millions of working people. But it is also bringing us a new opportunity to get rid of a system that is continually rocked by such crises. The financial crisis has caused so much panic in the financial world that the fundamental instability of capitalism is being acknowledged openly on the front pages and the op-ed columns of leading newspapers. Great numbers of people are already searching for an explanation of what has gone wrong.  Many of them may be ready to consider a whole different way of life, and many more will be ready to consider this as the recession in the real economy deepens.  Revolutionary socialists need to be prepared, not just prepared to organize, but prepared with a clear understanding of how capitalism works, and why it cannot be made to work for the vast majority. And we need to get serious about working out how an alternative to capitalism - one that is not just a different form of capitalism - might be a real possibility.

Andrew J Kliman is Professor of Economics at Pace University (US). This talk was delivered at The New SPACE (The New School for Pluralistic Anti-Capitalist Education), New York City, October 21, 2008. It is to be posted on the New SPACE website .  An audio recording which includes the discussion that followed will be made available soon.  The talk draws in part on Andrew Kliman, "Trying to Save Capitalism from Itself" (April 25)  which is also available at The Hobgoblin and Andrew Kliman, "A crisis for the centre of the system" (Aug. 23) published in International Socialism, No. 120 ).

Note:

(1) Addition, October 22:  In discussion following this talk, questions were raised about how my discussion of capital destruction is related to Marx's "law of the tendential fall in the rate of profit."  To address this, let me quote from pages 30-31 of my book Reclaiming Marx's "Capital":  A refutation of the myth of inconsistency (Lexington Books, 2007): 

"what Marx meant by the "tendency" of the rate of profit to fall was not an empirical trend, but what would occur in the absence of the various "counteracting influences," such as the tendency of the rate of surplus-value to rise.

"He singled out one of these counteracting influences, the recurrent devaluation of means of production, for special consideration. Like the tendential fall in the rate of profit itself, and the tendency of the rate of surplus-value to rise, the devaluation of means of production is a consequence of increasing productivity. Capitalists incur losses (including losses on financial investments) as a result of this devaluation; a portion of the capital value advanced in the past is wiped out. In this way (as well as by means of their tendency to cause the price of output to fall), increases in productivity tend eventually to produce economic crises. Yet since the advanced capital value is the denominator of the rate of profit, the annihilation of existing capital value acts to raise the rate of profit and thus  helps to bring the economy out of the crisis" (see Marx [Capital, vol. 3], chap. 15, esp. pp. 356-58, 362-63 [of the Penguin ed.]).

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Correspondence - A Magazine for “Exchange of Perceptions of Reality”

Posted by Radical Notes October 22, 2008 at 12:05 pm in Book Announcement

ISSUE: 0001

A group of students from Delhi has published the first issue of their magazine called Correspondence. The Table of Contents and the editorial are given below. For the pdf version of the magazine CLICK. Please contact the editors for the hardcopies - submissions.correspondence@gmail.com.

Coverpage and Table of Contents

Editorial –Paresh Chandra p.1

On Permanent Revolution –Kumarila
Trotsky’s concept of permanent revolution is dialectical to the very core viewing revolution as a continuum embedding the particular in general and appearance in essence, with the latter necessarily getting represented through the former. p.3

Discovering Nuclear Energy for Justifying Bad Deal –Prabir Purkayastha
Not only is nuclear power more expensive, it will also have adverse effects on the entire electricity sector. Going in for huge investments for imported nuclear power plants – three times the cost of similar coal fired units — would mean starving the Indian economy of other investments. p.6

The Art of Naming: Meditations on Queer Activism in Delhi–Akhil Katyal
Queer activism, here and now in Delhi, as I have lived through for the past three years, is composed of varied definitional excursions that are precisely that, definitional excursions, baggy monsters, simplifying technologies that take enormous and complicated raw material, lets say of the morass of human sexuality and try to produce, indeed with success, finished products, peculiarly sexualized individuals, gay or straight. p.10

Q&A with Mahesh Rangarajan: On Ramanujan’s 300 Ramayanas and the Controversy –Paresh Chandra and Bhumika Chauhan
Mahesh Rangarajan, member of faculty of the Department of History, University of Delhi, speaks about Ramanujan’s essay and the protest that followed the decision to include it in the syllabus of a BA Honors course. p.13

Failure, Consumerism and a Counter Strategy - The IP College Protests: an Insider’s Diagnosis — Paresh Chandra
Without the clause of class-consciousness that makes the connection between career and exploitation plain resistance becomes a perverse (the usual) form of consumerism, the commodity bought and consumed is “peace of mind” and the cost is a few days out in the sun. p.16

Changing Class Character of the Campus: New Challenges of the Student-Youth Movement –Abhinav Sinha
To counter the contraction of the space for students’ politics on campus we need to think about a unified student-youth movement which will have equal and free education for all and employment for all as its central demands. Only such a movement will have the strength and potency to achieve such aims. p.19

Beyond the Veil of Identity Politics – Preliminary Explorations through Categories of Caste and Class in Indian society –Ravi Kumar
Identity politics, based on the principle of homogenizations, segregation of social realities into unconnected, autonomous modules, has allowed the expansion of capital, thwarting any possibility of resistance against the system. p.22

Q&A with Lal Khan: On Can Partition Be Undone — Paramita Ghosh
The interview brings out some of the important issues dealt in the book ‘Crisis in the Indian Subcontinent - Partition… Can it be undone?’ along with Khan’s perspective on the political situation and transformation in the subcontinent. p.26

Final Pages

———————–

EDITORIAL: Struggle and Dialogue –Paresh Chandra

It had already been decided that I needed to rework the editorial. Now I have to mention the Delhi blasts, though the addition might seem strained. I was returning from the University when I heard. A friend sent me a message. I had boarded the metro at the University at six and came out at IP in thirty-five minutes. I spent the next half-hour calling friends who were likely to be out. It will sound clichéd but the incident did drive most other thoughts out of my head. Five blasts all over the city and many bombs diffused. Apparently an Islamic outfit took responsibility.

The paranoia that an incident like this creates is huge. Blame is thrown on the police, on the Home Ministry, on Shivraj Patil’s softness on ‘terrorism’. Solution plans fly from all over the place. I distinctly remember how I annoyed I was with the manner in which a RJ kept repeating how such incidents can be averted if we like responsible citizens inform ‘concerned authorities the moment we see unattended objects’. The most interesting solution was proposed by possibly the biggest terrorist in the country—re-invoke POTA. For a moment I bracket out the interests of Hindutva in the re-invocation of the act and concentrate on other aspects. Everybody is bent on treating it as a ‘law and order’ problem. A few decades ago my criticism could have been different (discussions of socio-economic causes of acts of violence have becomes so common that they are not considered serious anymore) but I now feel that mere common sense and experience should be enough to teach us that the problem lies somewhere else. I do not suggest that law and order are not in question, nor am I taking the ‘terrorists-are-also-humans’ stand. I merely wish to point out the fact that stricter laws and greater protection have never ever helped in curbing acts of violence. However I do not wish to go into diatribes against this blindness nor is my agenda to offer an alternative solution (I have none to offer)—I seek to make a different point, or rather I wish to target a different bunch of people.

The situation of the Left in the country is very interesting. If I try to put my finger on the stand of the Left at large on issues like terrorism and communalism I am struck by a sorry realization—there is no stand to pinpoint. The Left is so stuck in the creation of counter-discourses or participation in discourses that are already ideologically compromised that its own discourses cease to exist. Try to locate a few genuine attempts in the country to understand fundamentalism and fundamentalist militancy (to name one issue) from a Left perspective and you will understand what I’m talking about. The ‘mainstream’ left is the busy guardian of bourgeois secularism and the not so mainstream left is busy attacking the mainstream left. When an incident like this one takes place the only thing the Left leaders can do is offer condolence. And because they themselves do not have anything to offer all they can do is try and counter what the Right offers—in this case it will probably be POTA.

* * *

Struggle provides us with what is perhaps our only real chance of continued freedom from reification. It entails the forging of alliances that can help transcend the experiences of fragmented modern existence. The process of changing society is also the most effective manner of transforming our own existence and the only way of bringing about fundamental change is struggle. This magazine is a medium to take forward the idea of struggle. The revivification of struggle (in all its possibilities) needs us to first understand what threatens this idea and then strategise to counter these threats. This magazine is an attempt at doing just that—it will try to bring together counter-hegemonic perspectives on important questions and help provide the sense of community essential for the participants in counter-hegemony. Without this community an idea will hold no bearing on reality—it will become a force only when shared by persons. In this editorial I will lay out some of my thoughts on the situation making some observations regarding problems that I think important.

I was in conversation with a person whom I know to be more than a mere sympathizer of the Left and I am using some of his words when I say that these are depressing times for those people in India who want to believe in the validity of a Left politics, with the organised Left in danger of succumbing completely to the social democratic “Third Way” and the fringe Left more often than not caught in the mires of sectarianisms and adventurisms. It is easy in such circumstances to give in to the lure of consumerism and it becomes compulsive to “enjoy one’s condition”; the easiest thing indeed is to give up the idea of struggle and go out to shop. This consumerism too is not limited to the mall but seeps into and becomes the defining signifier of all actions and social phenomena, even resistance. Trapped in the tri-partite struggle between i) the inertia of a long history of anti-establishment struggle ii) the apparent uselessness of this struggle and iii) the desire to join the system (that one cannot fight) by choosing a career, some call a truce and resistance is chosen as a career option—a symptom of this is the manner in which instead of the Party being a means for struggle, struggle becomes solely a way of “building” the Party (it is important to emphasize the word ‘solely’ because it alone signifies where the problem lies).

We discuss at length the importance of looking at things dialectically. In theory dialectics is something we have a copyright over, but it is hard to maintain it in practise. I do not deny that in concrete political engagements it is not that easy to constantly double check with what’s on paper but to completely lose sight of it is not altogether advisable. I feel that one needs to be vary of this ontological blindness that advertises itself on the name ‘practicality’ and allows not only actions that one would otherwise completely condemn but also disables faculties that the original idea had provided us with. But then we also need to question if the problem is that we understand and do not practise our ideas or whether there is a problem in our understanding of ideas that we call ours. I don’t think the former is possible.

A great sign of decay is the manner in which people are scared of ideas. Doubt is losing its self-reflexivity and is changing into callous lack of trust; conviction is being transformed into prejudice. Both acceptance and rejection lose their Hegelian essence and begin to precede understanding. The process is a vicious circle—because conviction comes before understanding it is shaky, because conviction is set on weak grounds one is afraid of the other’s convictions lest they be stronger and since one cuts communication from the other, one’s own convictions seem unquestioned, and since our own convictions go unquestioned there seems no need to engage with the other’s convictions. A fundamental lesson of dialectical materialism that no idea is completely false and all ideas are only partially true—seems lost.

There is need for a struggle to make struggle more dialogic—dialogue here refers to the capacity to be able to incorporate the other’s voice into one’s own without dominating it; it refers to the removal from language of the violence that destroys the heteroglossic nature of correspondence. Reviving dialogue is one of the most important tasks that face us. We must remember that though internal strife may affect the establishment, fear of revolt and the need to maintain a net profit keeps it together, united against us. On the other hand by keeping a large percentage of the working population unemployed capital makes sure that at all times every worker steps in the market against every other worker. Resistance to the establishment starts off with a huge disadvantage. If we have to counter this disadvantage we cannot allow dialogue to disappear from our interactions with each other, just as we cannot afford a non-dialectical approach unless a skewed and limited picture of reality is what we wish to achieve. Without dialogue neither solidarity nor true criticism can exist. Fear of ideas is a characteristic of hegemonic authority—hegemony has this funny property of being in a constant state of decay. Hegemony is also by definition based on violence and is opposed to dialogue. Resistance on the other hand is a process that survives and disseminates through collective action, solidarity and dialogue.

The preservation of dialogue and a dialectical understanding of things require us to stay in touch with our reality. It is vital that we grasp all that is typical and get rid of all that is superfluous. The commodification of resistance and the concomitant monologising of the space of protest is a sign of the failure of forms of resistance to comprehend the nature of capital. This will indeed be the eventual fate of all forms of resistance that lose what is actually the fundamental link that will allow them to truly engage with capitalist reality, the link with class struggle and the struggle for the interests of the working class. Capital is a result of exploitation—it exists on the production of surplus value and production of surplus value requires labour power. Any struggle as a result, to be a struggle against the system of capital needs to create and preserve its link with the “actual” producers (workers). Capital makes use of various methods to hide this essential logic of its running, to hide this essential fact, the key that has to be grasped to get rid of the chains that bind us. Perceiving the true nature of determination in capitalism would allow us to look through the various illusions that we have to confront each day and this in turn allow the re-establishment of productive ties between fellow beings.

To facilitate the re-establishment of such ties and to allow exchange of perceptions of reality, dialogue is needed. The role of this magazine is to participate in the building of this dialogue—to encourage discussion by actively participating in various discourses and by allowing discussion within its folds is the idea that will underlie its working. It will try to start a dialogue of ideas between individuals, between different organisational streams and also between the reified parts of the same whole that take the form of various disciplines in formal education today. The basic idea is to achieve the true likeness of the elephant and overcome our subjective blindness.

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Statement on the NHRC report on Salwa Judum

Posted by Radical Notes October 21, 2008 at 12:58 am in Chhattisgarh, State Terrorism, India

Issued by Campaign for Peace and Justice in Chhattisgarh

Since 2005 the Chhattisgarh government has claimed that the Salwa Judum is a “peaceful people’s movement”, that “the villagers are never forced to join the camps”. They claimed that no minors were appointed as SPOs. It also resisted any independent enquiry, saying “There is no failure on part of state of Chhattisgarh and therefore independent investigation is uncalled for and unwarranted.” The NHRC investigation into Salwa Judum which was carried out on the orders of the Supreme Court found that this claim by the Chhattisgarh government regarding Salwa Judum was patently false. They found prima facie evidence of large scale burning of villages, large numbers of missing people, the fact that many people had been forced into camps against their will (though most they claim have subsequently returned), and the appointment of minors as SPOs in the initial stages at least. Some Nelasnar camp residents, they note, “left the village due to atrocities committed by the Naga police.” This one example is clearly the proverbial tip of the iceberg. The NHRC investigation revealed that SPOs have been involved in “certain incidents of atrocities against the tribals” and in some instances (e.g Matwada camp killings), the security forces and SPOs seemed to be prima-facie responsible for extra judicial killings. They have also not ruled out the possibility that, as in the Matwada case, other FIRs registered could be false.

However, given the powers and responsibility of the NHRC, it has manifestly failed to bring out the full truth of what is happening in Dantewada district, Chhattisgarh. The National Human Rights Commission is a statutory body, mandated to be an autonomous overseer of human rights across the country. The current report is unfortunately a negation of this responsibility.

There are inherent infirmities in the present report (i) the composition of the team which consisted solely of police, (ii) the process of public enquiry, which involved SPOs and Salwa Judum activists acting as translators, coupled with intimidation of witnesses (iii) the manner in which conclusions have been arrived at by the NHRC’s investigating team. It is these which has led the NHRC investigation team to downplay its own findings on the atrocities committed by the SPOs and Salwa Judum activists and concentrate on the violence of the Naxalites. Curiously despite being so focused on the Naxalites, the report nowhere mentions that the state is already seized of this problem, having sent more than ten battalions of paramilitaries to the district, and spent crores of rupees on battling Naxalism. It did not need an investigation by the NHRC to uncover the Naxalite ‘problem’.

1. Composition of the team and method of enquiry: The investigation team comprised solely of police officers. It did not have any representative of the local tribal communities or even any of the NGOs associated with the NHRC who had asked to be associated with it. The team went to various Salwa Judum camps and villages in an armed convoy which included Salwa Judum leaders and members, Special Police Officers (SPOs) and the Superintendent Police of Dantewada. Concerns that the arrival of a convoy of anti-mine tanks, preceded by road clearing exercises, would do little to instill confidence in villagers who were already terrified by the violence of the Salwa Judum and security forces, had earlier been raised with the NHRC and have been fully borne out by the findings of the investigating team itself. The NHRC report itself acknowledges at least two instances, in Pusbaka and Chikurubatti villages, where the villagers ran away seeing the police/CRPF accompanying the team.

2. Flawed Investigation - insufficient and biased acceptance of evidence:
It is not just the petitioners who have been raising the issue of human rights violations by Salwa Judum and security forced in Dantewada and Bijapur. Several independent civil and democratic rights groups have been consistently raising questions about the manner in which the government has armed civilians and the impunity with which the militarized nexus of Salwa Judum, Police, SPOs and the CRPF has unleashed violence on the local population. This is also probably the only instance where several government agencies, including the Planning Commission, the Administrative Reforms Commission, National Commission for Women and the National Commission for Protection of Child Rights, have also condemned the counter-insurgency strategy employed by the government. The NCPCR report based on a fact-finding by Prof. Shanta Sinha, Mr. JM Lyngdoh (former CEC) and Mr Venkat Reddy, based on testimonies of at least 35 victims in Cherla, noted that “many people shared accounts of family members being killed and women raped by the Salwa Judum” and again, based on a public hearing in Kirandul, “There were numerous accounts of family members being killed for resisting the Salwa Judum”. The NHRC has unfortunately chosen to ignore all such reports.

Though NHRC report claims to reach several conclusions, it summarily rejects several of the complaints in the petition by saying that they have “not been substantiated”, based either on insufficient evidence or a specious acceptance of the police version. Some instances are:

i) The NHRC has made registration of FIRs as the bench mark of ascertaining whether an incident of violence took place or not. The NHRC seems to have charily ignored the fact that in cases where state agencies are responsible for human rights violations people would be unable to lodge FIRs for fear of their life or that false FIRs may have been lodged by the police themselves falsely implicating others. This even though the report itself admits at least one instance where a villager was killed by Salwa Judum activists no FIR has been registered.

ii) The report uncritically accepts the police version of the cases and makes that the basis for “substantiation” or otherwise. This even as the report itself has had to admit at least one instance- in the Matwada case which was highlighted due to the efforts of local groups, that false FIR has been filed by the police blaming Naxals for an incident which was prima facie committed by Salwa Judum and security.

iii) In at least two cases, the NHRC visited the wrong village – of the same name but in a different thana. In the case of Polampalli in Usur thana, which was used as a test case to say that rape was not substantiated, despite the correct details being mentioned in the petition, the NHRC team visited Polampalli in Dornapal thana.

iv) The NHRC team has ignored the evidence provided by independent journalists and others which contradicted the police version and accepted the police version at face value. In the Santoshpur case for instance, at least 4 independent journalists have separately and one after another confirmed to the killing of Kodiya Bojja by SPOs, based on interviews with next of kin soon after incident. NHRC however uncritically accepts police version that he was killed by Naxalites.

v) Most strikingly, all testimonies given by IDPs in Andhra Pradesh regarding killings of their relatives by Salwa Judum and SPOs have been discarded, while all testimonies given by camp residents and villagers regarding killing by Naxalites has been accepted at face value. The AP testimonies have been ignored even when they are corroborated by the evidence of burnt and abandoned villages (e.g. Kottacheru, Lingagiri etc.)

3. Several misleading conclusions: It is not clear how NHRC came to its conclusion that no village was being discriminated against for not joining Salwa Judum camps when it notes that rations are available only in camp and that Salwa Judum is identified with the camps, and that “the only government agency active in the area is the police”. The National Commission for the Protection of Child Rights had noted in its fact-finding report, that ‘A big problem is that schools and Anganwadi teachers have been shifted from the villages to the camps leading to a concentration of service-providers in camps and no services available to those who are still living in villages.’

4. The NHRC avers to some instances where security forces and SPOs seem to be prima facie responsible for extra judicial killings. It states that it came across certain cases in which the “excesses” have been committed by ‘public servants’ and where the State has proceeded against those “who failed to operate within the four corners of the law”.

However it does not give details of any such instances. Till date, the Dantewada and Bijapur district administrations, the Chhattisgarh Police and the Chhattisgarh Government have not accepted or made public the cases where Police Officers, Special Police Officers or CRPF personnel in Dantewada and Bijapur have been proceeded against for violation of law.

5. Justifies Vigilantism: Most worrying however is the manner in which the NHRC report openly justifies Salwa Judum on the grounds that people cannot be denied the right to defend themselves against the atrocities perpetrated by Naxalites thus condoning civil vigilantism and arming one section of the society against the other, which in fact represents abdication of the State itself. Justice Rajendra Babu, Chairperson, NHRC had said in one interview, “The NHRC has not given a clean chit to Salwa Judum. What we said in our report to the Supreme Court was that the problems afflicting Chhattisgarh are not law and order problems but socio-economic ones.” Burning villages, and extra-judicial killings are surely law and order problems. Meanwhile the Raman Singh government which has come under a lot of criticism for its support to Salwa Judum is going all out to publicise this biased report as a vindication of its disastrous strategy.

We hope that the Supreme Court and the wider public sees the biases the report evidently demonstrates. At the same time, even the limited findings by the NHRC are sufficient to indict Salwa Judum and SPOs as an extra-constitutional, vigilante force which must be disbanded forthwith. Those who wish to must be allowed to return home, and all victims, whether of Salwa Judum or Naxalites must be given compensation on an equal footing. A judicial enquiry is essential to establish the scale of victimization and prosecute those who are guilty.

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A Report on the Workers’ Struggle in Graziano Trasmissioni

Posted by Radical Notes October 18, 2008 at 12:20 am in Labour, India

Rajesh Tyagi

This report is based upon an interview of two workers of Graziano Trasmissioni, namely Kapil Kumar and Ajay Dwivedi. Kapil belongs to Saharanpur, Uttar Pradesh (UP) and had joined in 2003 as apprentice, after completing his ITI. He worked 8/9 months under contractor, which was a sham and then was given permanent appointment in 2004. Ajay Dwivedi was employed in 2006.

Graziano Trasmissioni at Noida is a subsidiary of a multinational company based in Italy.

The company had started its operations in Noida, UP, in 2003 with a capital of less than 20 crore rupees, which grew over to more than 240 crores in 2008. This extraordinary accumulation of wealth is the result of the super exploitation of the workers employed at this establishment.

Lalit Kishore Chaudhary, its Chief Executive Officer (CEO) has been instrumental in the establishment and growth of the company.

Industrial activity in the establishment continued round the clock, initially in two shifts of 12 hours each, i.e. 6 am to 6 pm and then 6 pm to 6 am. Though working hours were limited to 8 hours and the workers were paid overtime for an additional 4 hours, but overtime was made compulsory for workers. No weekly off day was being given. Those refusing to comply were thrown out of employment.

Initially 350 permanent workers were employed as Operators cum settlers, with 80 Trainees/apprentices. About 500 persons work under the labour contractors mostly for the job of packaging.

The very first dispute arose as the employers used to make deductions from the wages on false pretexts.

On 233 December 2007 the first protest of workers started on the issue of demand for a rise in wages and against the deduction of wages by the employers on the ground that the entry card was not properly punched. Though it used to happen due to a technical fault in the punching system, while subsequent punchings in the day were duly recorded, yet the employers in order to harass the workmen used to deduct the wages, on this false pretext. The workers protested.

Getting wind of the workers being organised and striving to form a union, 3 workers were barred by the employers from entering the premises and one Manoj Kumar was terminated. The management refused to recognise the union, while the authorities at Kanpur kept the application of the workers pending in collusion with the employers.

4.12.2007. Protesting against the high handedness of employers, 100 more workers were locked out by pasting a notice of the lockout outside the gate.

7.12.2007. A settlement took place between the parties, only to be repudiated by the employers later on. The workers’ protest went on.

AITUC, the trade union front of the Communist Party of India, with whom the workers were affiliated, agreed with management to restore normalcy first and then negotiate, which the workers rejected. After this the AITUC abandoned the workers.

24.1.2008. In the face of the struggle of the workers, the employers were constrained to enter into a written settlement with them in the presence of the Deputy Labour Commissioner (DLC), Noida etc. On behalf of the workers 5 elected representatives participated, among them – Rajender, Kailash Joshi, Pankesh Sharma, Ram Charan and Mohinder. A homogenous wage revision was agreed upon with an increment of Rs. 1200/- in the current year, Rs. 1000/- in the second year and Rs. 800/- in the third year.

February 2008. However, immediately after this settlement, the employers brought in 400 workers under the local contractors namely Virendra Bhati, Manish and one Bhardwaj. These contractors with a force of 400 at their disposal, started to bully the workers. From 2008, these 400 workers began to reside inside the factory premises. The said contractors had also gathered iron rods, sticks and other weapons inside the premises, to terrorise the workers and obviously to deal with the agitating workers, if need be. Apart from this a whole battalion of armed goons in the name of ‘security’ was also employed under a contractor. It became clear, thus, that the employers were planning to throw out the permanent workers and to substitute them with these contract workers.

May 2008. To pick up a dispute and provoke the workers the employers refused to employ 5 worker Trainees/ apprentices and ousted them from the premises on the pretext that they had handled the job of ‘settling’ of the machine without instructions. It was pointed out that no such written instructions for ‘settling’ job were given to any of the workers. The same was part of the ordinary job duty. The workers then insisted that from then onwards instructions for ‘settling’ jobs were to be issued in writing. The workers also demanded that the 5 ousted workers be taken back.

Instead of taking the 5 workers back on the rolls, the employers suspended 27 more workers. The Production Manager Amar Singh Baghel was also ousted on the charge of being in collusion with workers.

The employers had intentionally switched off the reverse exhaust fans inside the workshop which resulted in an immense increase in the indoor temperature. To ensure that no workman even took a breath during duty hours, CCTV cameras were installed, and violators were immediately ousted.

The workers protested against the aforesaid unfair labour practices and made complaints to the concerned authorities but without any result. Authorities acted hand in glove with the employers. The workers also demanded 3 shifts of 8 hours instead of the two of 12 hours each. Everything fell on the deaf ears of the employers and the competent authorities.

30-31/5/2008. A disturbance started on the instigation by Virender Bhati, the local muscleman of the employers under cover of being a contractor. A totally false police complaint was made by the employers against the workers for affray, and 30 more of them were locked out. Workers could be released after depositing personal bonds of Rs.1,00,000/- (one lakh) each, with the Sub-Divisional Magistrate (SDM), NOIDA, which is very unusual and extremely excessive amount.

19.6.2008. Instead of paying any heed to the legitimate grievances of workers, and in order to harass and terrorise the workers, 35 more of them were locked out. With this a total 97 workers were ousted, while 192 continued inside out of the permanent workers. By this time the workers were affiliated to CITU, the trade union front of the CPI(M), which agreed to the proposal of the employers that first of all normalcy be restored and the protest outside the gate be ended, and then after a month the employers would think of reinstating the workers. The workers did not agree to this and then the CITU also abandoned the workers. However, the protest of the workers continued.

In the meanwhile workers affiliated to the HMS, the trade union front of the Rashtriya Lok Dal, with one Virender Sirohi as their leader.

1.7.2008. A meeting between the employers and HMS took place in the office of the DLC, in which Sirohi agreed to normal working on the 2nd, 3rd and 4th of July, 2008.

2.7.2008. The employers instead of complying with this locked out the remaining 192 workmen as well. The workers were constrained to resume their protest. A dharna took place at the DLC office for 7 days, then 3 days before the District Magistrate (DM) office, a march was undertaken from Surajpur Chowk to the DM office and finally a dharna at the Italian embassy was organised, but the entire machinery remained totally insensitive towards the cause of the workers.

Several times the dispute was negotiated at the DLC office or the police station, but only to be repudiated by the employers on one or the other pretext or intrigue.

11.7.2008. A settlement was arrived at the DLC, Noida Office, in the presence of the SDM and CO Dadri.

13.7.2008. The workers joined work at the factory pursuant to the settlement and to show their bonafides.

The next meeting was fixed at the DLC office on 16.7.2008.

16.7.2008. Out of the 27 suspended workers the employers reinstated only 12, while they terminated the services of 15 workers. This was apparently a device to divide and crush the workers, one by one.

55 more were notified to be reinstated, but were locked out the very next day on the pretext of their coming late at 9 am instead of 6 am.

The employers also obtained an injunction form the Court preventing the workers from agitating within 300 metres of the factory premises.

The Labour Commissioner came to Ghaziabad from Kanpur. The workers met him and complained about the partial and callous attitude of the DLC, Noida. The Commissioner entrusted the matter to the DLC, Ghaziabad.

4.9.2008. A meeting took place at the DLC office, Ghaziabad took.

16.9.2008. Another meeting took place in the office of the DLC, Ghaziabad between the employers and the HMS. None of the elected representatives of the workmen was present in the meeting. It was agreed that the workers would tender an apology. The DLC, Noida directed the workers to tender an apology on or before 22.9.2008.

18.9.2008. The workers went to tender an apology but the employers told them that they would call the workers on 22.9.2008. The DLC refused to take the apology in his office.

22.9.2008. As the workers gathered to tender apology, they were told that two workers at a time would go inside the ‘time office’ to tender apology. Inside the time office, armed security and local goons had already taken up their positions. The workers were told to specifically admit in their apology that they had indulged in sabotage and violence. Some workers wrote this down, but the others refused. Anil Sharma, a time officer slapped one of the workmen for refusing to write the apology in the desired format. A scuffle started and the workman was beaten up by the security personnel.

On hearing the commotion, the workmen present outside entered inside. Unable to prevent the workmen, one of the managers ordered the security and goons present inside to attack the workmen. They attacked and the securityman fired from his gun at the workmen. Several workmen, about 34, were injured in the scuffle.

Jagmohan Sharma, Station Officer, Bisrakh Police Station remained present with his force but did not intervene on the behest of the employers who had conspired to beat up the workmen. He has since been suspended for ‘dereliction of duty’.

People from both sides were then rounded up by the local police, but those on the side of employers were let off while the workers were kept in custody. Later, it transpired that the CEO of the company had also got one head injury, allegedly in the scuffle, which proved fatal. It is also stated that some of the goons engaged by the employers to deal with the workmen, had double crossed them and acting at the behest of some rival industrialists had killed the CEO, taking benefit of the chaos perpetuated by the employers.

However, the employers who were desperate to dismiss the regular workmen got an opportunity to implicate the workmen in the murder and thereby get rid of them. The local capitalists, corporate media, bureaucracy, all avowed enemies of working class, united to defame the workers and implicate them. 63 workers have been implicated for conspiring and participating in the killing of the CEO while 74 other have