Year in Review: 2008

In 2008, the crisis of world capitalism, long developing beneath the surface, erupted in the biggest financial upheaval since the 1929 stock market crash that ushered in the Great Depression. The WSWS had been analyzing the processes leading up to this event for more than a decade.


A collapse of global markets followed the bankruptcy of the giant Wall Street investment bank Lehman Brothers on September 15. In country after country, capitalist governments stepped in to prop up the financial system and the banks at the expense of the working class. Massive resources were placed at the disposal of the financial elite, to be paid for through the implementation of an historic attack on the working class, while the world economy plunged into the deepest slump since the 1930s. Mounting layoffs, falling wages and skyrocketing food prices created a social calamity on a global scale.

In the United States, the crisis hit in the midst of a presidential election campaign to determine who would replace the discredited and widely hated administration of George W. Bush. For the American population, the election of Barack Obama in November expressed an effort to reverse the previous eight years under Bush. For the ruling elite, however, Obama, the first African American president, provided a face-lift for the political system while extending and deepening all the policies of his predecessor, at home and abroad.

In response to the growing signs of a deep crisis of world capitalism, the International Committee of the Fourth International took a number of decisive actions. In August 2008, the Socialist Equality Party in the United States held its founding congress, approving documents that had been prepared in the course of the year. Two months later, the World Socialist Web Site launched a major redesign, the foundation for an immense expansion of the content and readership of the site.


The Great Crash of 2008

The financial collapse in the fall of 2008 was long in the making—the expression of a protracted global crisis, centered in the United States. The WSWS had anticipated this development, and in the year preceding the crash had explained the far-reaching significance of the turbulence in the US housing market. 

On January 11, 2008 the WSWS published a report by WSWS International Editorial Board Chairman David North to a national meeting of the SEP in the United States, “Notes on the political and economic crisis of the world capitalist system and the perspectives and tasks of the Socialist Equality Party.” It began:

2008 will be characterized by a significant intensification of the economic and political crisis of the world capitalist system. The turbulence in world financial markets is the expression of not merely a conjunctural downturn, but rather a profound systemic disorder which is already destabilizing international politics... 

Sixteen years after the dissolution of the Soviet Union, an event which supposedly signaled the definitive and irreversible triumph of global capitalism, the world economy is in a shambles.

North reviewed the relationship of the crisis to the changes in the structure of American capitalism and the ruling class:

The persistent tendency toward the creation of speculative bubbles arises out of deep-rooted contradictions in the development of the world capitalist system, especially bound up with the historical decline in the global position of American capitalism. The long-term decline in the profitability of US-based industry has propelled the drive by American financial institutions for alternative sources of high returns on investment. The mode of existence of the American ruling elite has been characterized for the last 30 years by the ever-wider separation of the process of wealth accumulation from the processes of industrial production.

The economic growth in the world economy in the years leading up to 2008 was inherently unstable, an instability that was centered in the relationship between the United States and China. As SEP National Secretary Nick Beams drew out in a report delivered to an SEP school in Australia, “To put it in a nutshell: The expanded growth of China (along with other countries) would not have been possible without the massive growth of debt in the US. But this growth of debt, which has sustained the US economy as well as global demand, has now resulted in a crisis.”

The escalating crisis throughout 2008 refuted claims from US government officials that the problems in the subprime mortgage market could be contained. On March 14, the US Federal Reserve took emergency action to prevent the collapse of Bear Stearns, the fifth largest US investment bank and one of the world’s largest finance and brokerage houses.

In a report published the following month on the global implications of the world financial crisis, Beams noted:

On that day, the world changed in a fundamental way. The nostrums delivered day in and day out by the various financial commentators, political leaders, academic economists and media pundits about the wonders and virtues of the ‘free market’—that it represented the highest, indeed the only possible form of social and economic organization—were proven to be completely worthless.

On July 13 the Federal Reserve Board and the US Treasury took emergency action to prop up the US mortgage giants Fannie Mae and Freddie Mac. The Democratic chairman of the Senate Banking Committee, Christopher Dodd, claimed that both institutions were in “good shape,” citing as proof, “The chairman of the Federal Reserve has said as much. The secretary of the treasury has said has much.” Given the experience of the past year, the WSWS explained, “such ‘boosterism’ will not cut much ice.”

The bailout of the mortgage giants was intended to prop up the financial markets, and in the process ensure the wealth of the financial aristocracy. The Bush administration—including Treasury Secretary Henry Paulson, former CEO of Goldman Sachs—worked behind the scenes with Wall Street banks to commit hundreds of billions of dollars in taxpayer money for this purpose.

The emergency measures were insufficient, and on September 7, the US government announced that it was effectively taking over both Fannie Mae and Freddie Mac, in the biggest government intervention in the American economy since the 1930s.

A further analysis on September 12 explained that the government takeover underscored the “profound and systemic nature of the crisis that precipitated the action.” A series of wild gyrations on stock markets, amid fears of an impending collapse of the investment bank Lehman Brothers and the country’s largest savings and loans bank Washington Mutual demonstrated that the rescue operation was a “stop-gap measure that does not begin to resolve the underlying crisis of American capitalism.”

Three days later, Lehman Brothers collapsed, to be followed the next day by an $85 billion  bailout of American International Group (AIG), the world’s largest insurance company. Global markets plunged amid signs of growing panic in US and European financial markets. The bailout of AIG represented a reversal of the policy the Bush administration had adopted when it allowed Lehman to go the wall.

The actions of the American ruling class, led by the Bush administration and supported by the Democratic Party, were desperate attempts to prop up the financial system, while at the same time utilizing the crisis to engineer an historically unprecedented transfer of wealth into its own pockets. Not only were those who created the crisis not held accountable, they were able to vastly enrich themselves. For example, much of the money handed to AIG was funneled directly into Wall Street titans like Goldman Sachs, who were paid in full for insurance contracts they held with the company. 

The criminal enterprise culminated in the $700 billion bank bailout dubbed the Troubled Asset Relief Program (TARP). The Socialist Equality Party denounced the bailout in a statement that declared it a plan for “an unprecedented transfer of public funds to the major banks and the American financial elite at the expense of the broad mass of the people… As in the aftermath of 9/11, [the financial aristocracy] is seeking to utilize the crisis to push through policies that would otherwise be considered entirely unacceptable.” 

The House of Representatives initially rejected the bailout, largely because of opposition by the right-wing of the Republican Party. This triggered a huge fall in the stock market, and a furious reaction in the ruling elite, summed up in a comment published by the Murdoch-owned Times of London under the headline “Congress is the Best Advert for Dictatorship.” 

In a subsequent comment the WSWS wrote: “The provocative language, drawing the logical conclusion of the anti-democratic sentiments being expressed more widely, ultimately expressed the objective ramifications to the economic crisis that is eating away at US and world capitalism.”

The TARP bill was subsequently passed and signed into law on October 3. Similar bailouts were enacted by the Labour government in Britain, the conservative German government of Angela Merkel, the Sarkozy government in France, and governments in Spain, Sweden, Greece, Ireland and throughout eastern Europe. Whether the ruling parties were liberal or conservative, far-right or social-democratic, they all took the same class standpoint: saving the banks and big investors and imposing the cost on working people.

But the repercussions of the collapse on Wall Street had already begun to spread throughout the world economy. The last quarter of 2008 saw one financial domino after another toppling:

  • The collapse and forced sale of Halifax Bank of Scotland, the largest British mortgage lender
  • The failure of Washington Mutual, the largest US savings and loan, taken over by JP Morgan Chase
  • Simultaneous bailouts of four European banks, including the Belgian-based Fortis, Hypo Real Estate in Germany, as well as smaller institutions in Britain and Iceland
  • The bailout of all six of the Ireland’s major banks at the expense of the population
  • The complete breakdown of the financial system in Iceland, with the government halting trading in bank shares and taking over the three largest banks
  • The biggest-ever one-day fall in the Australian stock exchange, wiping out nearly $100 billion in share values
  • The bailout of Citigroup, the largest US financial institution, at a cost of $249 billion
  • The collapse of Bernard L. Madoff Investment Securities, in the biggest single Ponzi scheme ever uncovered

On November 15, a meeting of the G-20 group of nations was convened in Washington amid calls for the remaking of the international financial system. The summit, the WSWS explained, “would provide no solutions to the rapidly deepening crisis. On the contrary, in the absence of any coherent program, it may well see the divisions among the major capitalist powers widen.” 

The year ended with the world economy in free-fall: mass layoffs, bankruptcies of companies and entire industries—the US auto industry in particular—and spreading unemployment, poverty and social misery. 


The 2008 US presidential election

The 2008 US election campaign, culminating in Barack Obama’s victory over John McCain in November and the reelection of a Democratic-controlled Congress, took place against the backdrop of the unfolding economic crisis and amidst mass hatred of the Bush administration. Bush left office with an approval rating in the low-twenties, making him the most widely despised president in US history.

Millions of working people hoped that the election would be an opportunity to change course—to end the wars in Iraq and Afghanistan, halt torture and the dismantling of democratic rights, and reverse an economic policy dictated by the wealthy. The central concern of the ruling class, however, was to pick a new president who could most effectively lead the US drive for world domination and defend the interests of Wall Street.  

While the Democratic Party had collaborated in all of the Bush administration’s policies, the two-party system in the United States meant that popular disaffection took the form of the election of the Democratic candidate. In the person of Barack Obama, the ruling class saw an opportunity to organize a highly coordinated marketing campaign around the slogans of “hope” and “change.” Obama’s status as the first African-American president meant that his election could be presented as a major historic milestone, even as he prepared to continue all the basic elements of US policy at home and abroad.

The Democratic Party went through a protracted nomination contest between Hillary Clinton and Obama. The differences between these two candidates were largely superficial. Both were defenders of the profit system and both appealed to forms of identity politics, with Clinton striving to become the first female president, and Obama the first African-American one. However, Obama’s ability to claim to have opposed the Iraq war, for which Clinton voted, proved a significant advantage. 

In “The two faces of Barack Obama,” the WSWS commented on the endorsement given by former Federal Reserve chief Paul Volcker, a figure closely associated with the Reagan-era assault on the working class:

Those like Volcker see the Illinois senator as a useful vehicle for effecting major changes aimed not at ameliorating the conditions of life for masses of working people, but rather at securing the global interests of American finance capital.

No doubt, they believe Obama, who would be America’s first African-American president, is best suited to confront the dangers posed by the continuing economic crisis and rising social tensions. Who better to demand even greater sacrifices from the working class, all in the name of national unity and “change?” At the same time, he would present a fresh face to the world, which they hope would help extricate US imperialism from the foreign policy debacles and growing global isolation that are the legacy of the Bush administration.

The European bourgeoisie’s “love affair with Obama,” which became increasingly apparent as the year wore on, was similarly rooted in the belief that he had “a surer grasp of how to project America’s military and economic power” and was “less likely to be unilateralist when doing so than Bush.” 

When Obama finally clinched the nomination he moved quickly to demonstrate his fealty to US imperialism and big business. He launched what the WSWS characterized as a “patriotism tour” to demonstrate his support for the US military and American imperialism. Shortly thereafter he made clear his support for Iraq’s continued occupation and reiterated his intention to escalate the war in Afghanistan. He supported Bush’s domestic wiretapping program. His selection of Senator Joseph Biden as his running mate was a similar rebuke to those who hoped Obama meant his calls for change.

Meanwhile, as the WSWS explained, Obama’s supporters in the liberal media and the middle-class radical groups continued to promote his candidacy on the grounds that the election of an African-American, regardless of how right-wing his policies, would represent a historic political transformation:

Obama is the product of identity politics, which came to prominence in the 1970s. This opportunist trend, promoted by sections of the ruling elite, elevated race or gender above class position and served to undermine any organized struggle of working and poor people against their social oppression. It became a way for a relatively small section of blacks, Latinos and women to advance themselves at the expense of the mass.

The general election contest between Obama and John McCain, who had secured the Republican nomination over Mitt Romney in February, avoided any discussion of the real issues. Obama and McCain’s third debate, taking place in the midst of the greatest economic crisis since the Great Depression, barely referred to the financial crash. Both candidates endorsed the $700 billion bailout of the banks, but Obama was more unreserved in his backing, which won him further favor on Wall Street. 

McCain, who had selected the far-right Alaskan Governor Sarah Palin as his running mate, saw his prospects evaporating. As its support eroded in the lead-up to the elections, the McCain-Palin ticket ever more openly sought to whip-up the ultra-right, appealing to semi-fascistic sentiments.

In opposition to the big business parties, the Socialist Equality Party ran its own ticket of Jerry White for president and Bill Van Auken for vice president. The SEP campaigned across the United States and internationally, making the case for socialism and warning that “neither the Democrats nor Republicans are presenting to the working class their real programs… The next administration will drive up unemployment, slash expenditures for desperately needed social programs, support the attacks of the corporations on wage levels and working conditions, and intensify government suppression of democratic rights.” 

As America went to the polls, the WSWS noted that although tens of millions were going to vote for Obama, “The policy of the incoming administration will not be guided by [their] illusions…but by the reality of a worldwide financial crisis.” 

This was quickly borne out. President-elect Obama vowed to slash the federal budget and promised Wall Street “whatever is required.” His economic team was made up of individuals with deep ties to the financial aristocracy. The cabinet Obama assembled demonstrated his unwavering loyalty to American imperialism. He retained Bush's secretary of defense, and appointed an unprecedented number of former 4-star generals to his staff.

In the aftermath of the election, the US media interpreted Obama’s victory in entirely racial terms, insisting that it represented a historical milestone. The WSWS rejected this position, noting that it was being utilized to suppress any discussion of popular expectations that Obama would reverse the policies of the Bush administration, which had nothing to do with race. The obsession with racial questions, which transformed Obama into a sign of “progress” irrespective of his actual policies, helped him implement his right-wing agenda.

One week after Obama’s reelection, the WSWS laid out the basic social dynamic that would characterize his administration.

What happens when the working class begins to fight for its social interests and comes into conflict with an Obama administration, when the class nature of the Obama administration is revealed and workers come forward to oppose it? Then the class basis of liberalism as a political standpoint of a section of the bourgeoisie and the petty-bourgeoisie will be revealed, and its fundamentally reactionary nature exposed.

Whatever the initial exhilaration over Obama’s victory, the deepening economic crisis will sooner rather than later make itself felt in the lives of tens of millions of Americans and begin to clarify the class interests that underlie the new administration. This will set the stage for a new period of class struggle in the United States.


The Founding Congress of the SEP (US)

In 2008, the International Committee of the Fourth International took a number of decisive steps in response to the capitalist crisis and in anticipation of growing class struggle all over the world. In August, only a few weeks before the financial crisis erupted, the Socialist Equality Party in the United States held its Founding Congress, a major event in the history of the Fourth International and the international workers movement. It would be followed in subsequent years by founding congresses of SEP sections in Australia, Germany, Britain and Sri Lanka.

As a WSWS report on the Congress explained:

The founding congress was the outcome of theoretical, political and organizational work within the United States and internationally that spanned more than a decade. The predecessor of the SEP, the Workers League, initiated the process of transforming itself into a party in June 1995. It shared the view of the International Committee of the Fourth International (ICFI) that the collapse of the Soviet Union in 1991 and the irrevocable discrediting of Stalinism, together with the political bankruptcy of the social-democratic and reformist parties and trade union organizations, would lead to a fundamental change in the relationship between the Trotskyist movement and militant sections of the working class and youth, radicalized by the deepening crisis of American and world capitalism.

The launching of the World Socialist Web Site in February 1998, which rapidly developed into the most widely read Internet-based socialist publication in the world, led to the expansion of the political influence of the ICFI and a significant influx of new members into the Socialist Equality Party. Moreover, the intensification of the political and economic crisis of world capitalism during the past decade substantiated the perspective upon which the formation of the SEP had been based.

In the years preceding the Founding Congress, the SEP had begun to attract a new layer of workers and youth to its banner. This was only the beginning. The Founding Congress was the response of the SEP to the growing crisis of the capitalist system, to prepare for the resurgence of Trotskyism and the perspective of world socialist revolution.

The Congress adopted two major documents, The Historical and International Foundations of the Socialist Equality Party and the Socialist Equality Party Statement of Principles, as well as a party constitution. In placing history at the center of the party’s foundation, the SEP emphasized that a new socialist movement had to be based on an assimilation of the experiences of the working class movement over more than a century. The historical document states:

Revolutionary socialist strategy can develop only on the basis of the lessons of past struggles. Above all, the education of socialists must be directed toward developing a detailed knowledge of the history of the Fourth International. The development of Marxism as the theoretical and political spearhead of socialist revolution has found its most advanced expression in the struggles waged by the Fourth International, since its founding in 1938, against Stalinism, reformism, the Pabloite revisions of Trotskyism, and all other forms of political opportunism.

Political agreement within the party on essential issues of program and tasks cannot be achieved without a common evaluation of the historical experiences of the 20th century and their central strategic lessons.

The SEP Statement of Principles was adopted as the basis of membership in the party. It elaborates the party’s position on such fundamental questions as the political independence of the working class, the nature of the capitalist crisis and the necessity for socialism, internationalism, the defense of democratic rights and the fight against war, and the role of the party in the fight for socialist consciousness. It states:

The program of the Socialist Equality Party expresses the interests of the working class, the leading and decisive international revolutionary social force in modern capitalist society. The central task of the SEP is to win the support of American workers for the program of international socialism. The SEP strives, on the basis of this program, to unify and mobilize the working class for the conquest of political power and the establishment of a workers’ state in the United States. It will create, thereby, the objective preconditions for the development of a genuinely democratic, egalitarian and socialist society. These objectives can be realized only within the framework of an international strategy, the goal of which is the global unification of the workers of all countries and the creation of a United Socialist States of the World.

The Congress elected a new leadership for the Socialist Equality Party, including David North as national chairman and Joseph Kishore as national secretary, as well as a new National Committee. 

The Congress also paid tribute to Eddie Benjamin, a long-time member of the Socialist Equality Party in the US, and its forerunner, the Workers League, who died suddenly of a heart attack on February 5, 2008, at the age of 55. Eddie was part of a remarkable generation of working class African-American youth who were won to revolutionary politics in the 1970s, in opposition to black nationalism and identity politics. 

Two months later, in October, the WSWS launched its redesigned web site. Among the many changes was the introduction of the daily perspectives column. The redesign was undertaken in response to the demands posed by a rapidly growing readership and in anticipation of major changes in the world economic and political situation. 

The first perspective column, written by David North, chairman of the International Editorial Board, summed up the WSWS’s assessment of the objective implications of the unfolding crisis and the role of the WSWS itself:

1. The global financial crisis, centered in the United States, marks a decisive turning point in the historical crisis of the world capitalist system. The Marxist analysis of the inherent and insoluble contradictions of the capitalist mode of production has received a stunning vindication.

2. The deepening economic crisis will exacerbate the already substantial tensions between the major imperialist and capitalist powers. The basic historical conflict between the internationally integrated development of the productive forces and the nation-state system will raise ever more openly the danger of global warfare. The efforts of the United States to offset the deterioration of its world economic position, dramatically exposed in the ongoing crisis, will assume an increasingly reckless and unrestrained militaristic character.

3. The worsening economic situation is leading inexorably to a renewed upsurge of class struggle on a world scale. The working class will resist with mounting determination the efforts of the old and corrupt bureaucratic organizations—political parties and trade unions—to block and betray its struggles.

4. A new audience for Marxist theory and the perspective and program of revolutionary socialism advanced by the International Committee of the Fourth International will emerge among newly radicalized workers, students, youth and intellectuals. Only a party that is based firmly on Marxist theory and defends unambiguously the heritage of Trotskyism will meet the challenges of a new revolutionary epoch.

Based on this assessment of the developing crisis, the International Editorial Board sees the redesign and relaunch of the World Socialist Web Site as a major step forward in the struggle for workers’ power and the establishment of socialism.

The Founding Congress of the SEP was a major advance in the political clarification of the international working class through the combined efforts of all sections of the International Committee of the Fourth International. 


War and militarism

The economic and political upheavals of 2008 took place against the backdrop of continued imperialist war in both Iraq and Afghanistan, increasingly aggressive US military strikes across the Afghan border into Pakistan, and mounting pressure against Iran, widely viewed as a likely target for either US or Israeli air strikes. 

In August 2008, war broke out between Russia and the former Soviet republic of Georgia, which was supported by the Bush administration. The Georgian Army undertook an offensive against the capital of the breakaway province South Ossetia. Russia retaliated decisively, and drove the Georgian Army back in five days. The US and most western powers backed Georgia unconditionally, unleashing a propaganda campaign against Russia in the name of defending the “national sovereignty and territorial integrity” of Georgia.

Underlying the military confrontation, which threatened to develop into a full scale conflict between the US and Russia, was US imperialism’s drive to isolate Russia and establish hegemony over the energy resources of Central Asia and their transit routes through the Caucasus. A WSWS commentary put the problems of the working class in the Caucasus in an international and historical perspective.

At the same time, the Bush administration’s military “surge” in Iraq failed to bring a military victory even though it dramatically increased the death toll among both the Iraqi population and the US occupation forces, as the WSWS noted at the beginning of the year.

In the course of 2008 there were major military operations in Mosul, Basra, Baghdad’s Sadr City, and Amarah. In June, American, British, and French oil companies received no-bid contracts to exploit Iraqi oil reserves.

Over the course of the year, drone strikes inside Pakistan dramatically increased. This escalation was carried out by the CIA and the military’s Joint Special Operations Command, with vocal support from then Senator Obama. A US airstrike on a Pakistani military post killed 11 soldiers. The US also increased drone strikes in Somalia, while NATO deployed an increasing number of military vessels in the Gulf of Aden.

The push by the United States for an increasingly harsh sanctions regime against Iran also escalated in 2008, with the Bush administration threatening war. During the presidential campaign, Hillary Clinton threatened to  “obliterate” Iran, while Barack Obama reiterated that “all options are on the table.”

The installation of Obama as US president became the occasion for a redirection of US military efforts in the region toward Afghanistan, long the “neglected” front in comparison to Iraq. In the course of trips during the summer to both war-torn countries, after his clinching the Democratic presidential nomination, Obama called for many of the troops being withdrawn from Iraq to be redeployed to Afghanistan.

After Obama’s victory in the November election, his retention of Bush’s defense secretary Robert Gates, a veteran of the CIA-backed insurgency in Afghanistan in the 1980s that gave rise to Al Qaeda in the first place, signaled a renewed focus on the Central Asian country.

The entire national security team assembled by Obama, including Hillary Clinton as secretary of state, retired NATO commander James Jones as national security adviser, as well as Gates, demonstrated that those who had voted for the Democrats hoping for an end to the wars of the Bush administration had been deceived.

By the end of the year, US military spokesmen revealed that the new administration would be doubling the number of American troops deployed in Afghanistan, in preparation for a furious escalation of the bloodshed in the spring of 2009.


Other world developments

Europe 

In March 2008, Kosovo declared independence from Serbia, nine years after the US-led NATO war against Belgrade. The WSWS exposed the fraudulent “humanitarian” posturing of the imperialist powers and their “left” apologists in the Balkans, with commentaries on the contrasting treatment of Kosovo Liberation Army leader Ramush Haradinaj and Bosnian Serb leader Radovan Karadzic. Although both were implicated in war crimes charges linked to “ethnic cleansing,” the Kosovan official was cleared, while the Serb was arrested.

In the general election in Spain later the same month, the ruling Socialist Workers Party of Premier José Luis Zapatero was re-elected, defeating the right-wing Popular Party. The Communist Party (PCE)-led United Left (IU) suffered big losses, after a split in the former Stalinist group.

In April, Prime Minister Silvio Berlusconi won a third term in office in Italy, despite his notorious corruption and widespread popular hatred. While Fausto Bertinotti, the long-time leader of the ex-Stalinist Rifondazione Comunista, blamed the Italian population for Berlusconi’s victory, the real responsibility lay with the bankruptcy of the so-called Left. Rifondazione joined the “center-left” government of Romano Prodi, keeping it in power for two years as it carried out attacks on the working class and continued the war in Afghanistan.

In Greece a general strike was held on October 21 protesting a proposed austerity budget and bank bailouts. In December the police murder of a 15-year-old student sparked mass protests, whose militancy shocked Europe’s ruling elite. The WSWS addressed the political issues posed by the mass protests, and noted that the sharp shift to the right by the socialist party (PASOK) and Communist Party (KKE) was leading to growing influence of the “radical left,” particularly SYRIZA. The WSWS warned that behind its rhetoric, SYRIZA puts forward policies that were “harmless to the ruling class.”

Canada

In late November-early December, Canada was convulsed by a major political-constitutional crisis, in one of the first political aftershocks of the 2008 global financial breakdown. Ultimately the minority Conservative government survived, after Prime Minister Stephen Harper prevailed on the Governor-General to shut down parliament, in what the WSWS characterized as a “constitutional coup.” 

The crisis began in September, when Harper, who had headed a minority government since February 2006, called a snap election in the hopes of concealing the full implications of the financial crisis. The SEP of Canada warned against the “anybody but Conservative” politics of the unions and the middle-class “left”, which aimed to line up workers behind a coalition of the Liberal Party and the social-democratic NDP.

Harper’s gambit failed, as the Conservatives were limited to a minority of seats. On December 1, after the Conservatives had rejected any measures to offset the rapid decline in the Canadian economy, the Liberals, NDP and Bloc Québécois announced that they had struck a deal to replace the minority Conservative regime with a Liberal-NDP coalition government.

The Conservatives, running roughshod over basic parliamentary norms, and supported by the most powerful section of Canadian capital, demanded the unelected Governor-General shut down parliament for a six-week period so as to prevent the Members of Parliament from exercising their constitutional right to defeat the government. The proponents of the coalition quickly acquiesced to this anti-democratic action.

Asia and Australia

In China in March and April, the government was rocked by a series of protests and riots in Tibet. The WSWS editorial board explained the class issues involved.

Two devastating natural disasters in Asia highlighted the extreme vulnerability of broad masses of the population in the region, while also exposing the self-interest of local and international authorities. In Burma, Cyclone Nargis hit on May 3, resulting in over 60,000 people dead and disappeared. Up to 2 million were left homeless. Later in May, a devastating 7.8 magnitude earthquake ravaged the Chinese province of Sichuan. The toll exceeded 80,000 dead and missing. Widespread anger led to protests over shoddy buildings in the impoverished towns and villages and corruption among officials.

In August, the Beijing Olympics were held amid a massive security operation, revealing a regime that saw itself under siege. The WSWS commented that the $US100 million opening ceremony blacked out much of the 20th century, as part of the attempt by the Chinese Communist Party to “refashion its image as a pro-business regime that has long repudiated its claims to a ‘socialist’ or ‘revolutionary’ tradition.”

There were major political events in the Indian subcontinent, largely driven by the pressure of US imperialism on both Pakistan and India. In July India’s Congress Party-led United Progressive Alliance (UPA) government narrowly survived a no-confidence vote, precipitated by its decision to effectively eject the Stalinist-led Left Front from its ranks, so it could cement a “strategic partnership” with US imperialism.

In September 2008, the Nuclear Supplier Group, at the US’s behest, lifted the embargo on civilian nuclear trade with India over strenuous objections from China. Washington’s real aim was to harness New Delhi to its strategy of isolating and, if need be, militarily thwarting China. Under the Indo-US nuclear accord, the US agreed to negotiate a unique status for India within the world civilian nuclear regulatory regime.

In late November, gunmen carried out coordinated terror attacks against multiple targets in the Indian city of Mumbai, resulting in the deaths of over 170 people and more than 300 wounded in a standoff with Indian security forces that lasted 59 hours. The Mumbai attacks resulted in a ratcheting up of tensions on the Indian subcontinent. With active encouragement from the United States, the Mumbai attacks were utilized within India to intensify the “war on terror.” At the end of December, the Indian parliament pushed through draconian “anti-terror” legislation. 

In Australia, the Labor government issued a formal apology to the aboriginal people, purportedly for genocidal crimes inflicted against them over the previous two centuries. The WSWS and SEP (Australia) warned that the “reconciliation” agenda would do nothing to overcome the terrible social conditions confronted by indigenous communities. The real aim was to facilitate Labor’s plan to draw in a layer of privileged indigenous leaders and utilize them to deepen the previous Howard government’s police-military intervention into indigenous communities.  

In a series of articles and on-the-spot reports, the WSWS exposed the brutal daily reality endured by the Aboriginal population and the crimes that the Australian ruling class had sought to cover up for decades. This culminated in a seven-part series on the conditions in the Northern Territory.


International struggles of the working class

Labor struggles in 2008 expressed the growing international resistance of workers to the relentless assault on their jobs, living standards and democratic rights, which was intensifying with the deepening world economic crisis. There were significant strikes in the US, Australia, Romania, Germany, Greece, France, Egypt, Turkey, and South Africa.

In the longest walkout in the US auto industry in decades, beginning on February 26 3,600 American Axle workers at plants in Michigan and New York waged a bitter three-month strike against the company’s demands to reduce hourly pay from $28 to as low as $11.50. The UAW kept workers in the dark and on poverty-level rations, with a strike benefit of only $200 a week—while sitting on a strike fund of nearly three-quarters of a billion dollars. 

The more than 44 articles which appeared on the WSWS were distributed widely on picket lines and to auto workers in the US and Canada. In addition, WSWS reporting teams produced more than a dozen videos of interviews with strikers.

The UAW betrayal at American Axle was used to lay the foundations for a frontal assault on the working class. It was the groundwork for the preparations made at the end of 2008 to bail out the US auto industry through the gutting of wages by 50 percent. A statement issued by the WSWS and the SEP (US) drew sharp lessons about the role of the “left” defenders of the trade unions:

The labor “lefts” play an absolutely critical role on behalf of the trade union bureaucracy, seeking to encourage illusions that the UAW and other unions can be reformed. While doing nothing to mobilize workers against the betrayal of the strike, these ex-radicals and union dissidents—including Wendy Thompson, the former local union president at the Detroit American Axle plant and a supporter of Labor Notes—repeatedly uphold the authority of the UAW, claiming the strike could be won by pressuring the union leadership to fight.

In March, striking public and private sector workers joined thousands of striking textile workers in Cairo calling for the national minimum wage to be raised to US$218 a month. The strikes marked the biggest wave of industrial militancy in Egypt since the late 1940s and early 1950s.

In April, 10,000 Romanian autoworkers at a Renault subsidiary demanded a wage increase of 42 percent.

A one-day general strike in South Africa the South African Congress of Trade Unions (COSATU) called out its two million members to protest rising prices of food and fuel in August. The WSWS warned that in doing so the aim of COSATU, which was working in close alliance with the government, was working to divert popular anger into contained protests.

In December, 250 workers occupied Republic Windows and Doors, a factory in Chicago that was about to close, in the first independent action of a section of the working class in the US in response to the unfolding economic crisis. 

In the UK, the WSWS provided extensive coverage of strikes, including those of teachers, with more than 200,000 taking part in a one-day action over pay, Scottish refinery workers, tanker truck drivers, and a half-million local government employees. In all these strikes, the same issue was posed: the official unions deliberately restricted both the scale and duration of the action, while seeking to conciliate with the employers and the Labour government.

A leaflet issued by the British SEP to the striking local government workers declared:

Workers must begin to take the initiative. They must build their own independent rank-and-file organizations of struggle, representing their interests and not those of a well-heeled bureaucracy. This means breaking from the trades unions and the Labour government they defend and building a genuine socialist leadership.

Public transport workers in Berlin went on strike for nearly two months, demanding a substantial wage rise. The strike in Berlin was part of a wider strike movement all over the country. It also affected other sectors of the public service and both airports and the entire railway system. The stoppage of the transit workers was directed against the Berlin municipal government consisting of the Social Democratic Party and the Left Party (the so-called Red-Red Coalition), which had imposed drastic wage cuts and destroyed many jobs in the public service.

The Verdi trade union quickly reduced its original wage demand and in the end sold out the strike. Nearly two-thirds of Verdi members at BVG voted against the contract. But the union leadership accepted and signed it notwithstanding. The WSWS published a statement in which it drew out the political lessons of the BVG strike. It explained the objective developments that have led to the decline of the unions and also the international socialist perspective of the WSWS.

In Australia, the Victorian State Council of the Australian Education Union (AEU) voted in May to accept a new industrial contract with the state Labor government that abandoned all the demands raised by teachers in the course of a year-long struggle, instituting a real wage cut for many, exacerbating job insecurity and compounding the crisis in classrooms. Opposition escalated, and the AEU launched a ferocious campaign to ram through the deal. 

The WSWS repeatedly exposed the union’s tactics of intimidation and incitement of divisions. The SEP (Australia) called on teachers to reject the sell-out. Despite significant rank-and-file opposition, the agreement was finally forced through. This paved the way for Labor Prime Minister Rudd to unveil a series of far reaching, right-wing reforms to the national education system.


Leon Trotsky and the 70th Anniversary of the Fourth International

The year 2008 was the 70th anniversary of the founding of the Fourth International under the leadership of Leon Trotsky. The Socialist Equality Party marked the occasion with meetings throughout the world. At the same time, the ICFI continued its campaign for historical truth and its defense of the historic traditions of Trotsky and the Trotskyist movement.

In the United States, the SEP held a number of meetings under the headline, “70th Anniversary of the Fourth International: Socialism and the Future of Humanity.” The meetings featured reports from a number of speakers, including a main report from David North published on the WSWS, “On the 70th anniversary of the founding of the Fourth International.” 

The theoretical and political foundation of the Fourth International was prepared by Trotsky over the preceding years. Reviewing the indispensable character of Trotsky’s writings of this period, North said that this was based on three elements: 

First, Trotsky was the last great representative of "classical Marxism"—that is, the representative of a theoretical and political school and tradition that traced itself directly back to Marx and Engels, and which trained and inspired the mass revolutionary workers' movement that emerged in the last decades of the 19th century. As explained in The Historical and International Foundations of the Socialist Equality Party, Trotsky embodied "a conception of revolutionary theory, rooted philosophically in materialism, directed outward toward the cognition of objective reality, oriented to the education and political mobilization of the working class, and strategically preoccupied with the revolutionary struggle against capitalism."

Second, Trotsky grasped more profoundly than any other political thinker of the 20th century the global dimensions and dynamics of the socialist revolution, the dialectical interaction of international socioeconomic processes and historically-determined national conditions. This understanding found expression in the theory of permanent revolution, first formulated by Trotsky in response to the problems raised by the 1905 Revolution in Russia—in which the relation between traditional bourgeois-democratic tasks and the implicitly socialist strivings of the working class, in a backward country, emerged in a manner that contradicted existing conceptions and required a new theoretical paradigm.

Third, Trotsky assimilated the essential political lessons of Lenin's struggle against Menshevik opportunism and centrism in the years between the split of 1903 and the revolutionary denouement of 1917.

The Socialist Equality Party in Australia, and Sri Lanka also held well-attended meetings on the 70th anniversary. In Australia, WSWS writer James Cogan delivered a report on the historical origins of the Fourth International, while Nick Beams reviewed the state of the world capitalist crisis in the context of the historical principles of the Trotskyist movement.

On November 20-23, the American Association for the Advancement of Slavic Studies held its annual convention. Among the panels was one devoted to “The Intellectual and Political Legacy of Leon Trotsky,” chaired by independent scholar Lars Lih. Among the panelists were North, Trotsky scholar Baruch Knei-Paz of the Hebrew University of Jerusalem, and WSWS writer Vladimir Volkov.

North’s report, “Leon Trotsky, Soviet Historiography, and the Fate of Classical Marxism,” reviewed the history of biographical writings on Trotsky, from Isaac Deutcher’s monumental trilogy in the 1950s and 1960s, to Knei-Paz’s The Social and Political Thought of Leon Trotsky in 1978, through the drying up of Trotsky scholarship beginning in the 1980s. Several recent biographies, including those of Ian Thatcher and Geoffrey Swain, had emerged, North noted, but these contained no new information and were devoted to slander and historical falsification.

In reviewing the causes behind these changes in Trotsky scholarship, North placed particular emphasis on the conflict between Trotsky’s worldview and the conceptions that have come to prevail in the left intelligentsia. Trotsky maintained

an irreconcilable commitment to philosophical materialism, belief in the law-governed character of the historical process, confidence in the power of human reason (to the extent that this faculty is understood materialistically) and its ability to discover objective truth, and, associated with this, belief in the progressive role of science. Trotsky was a determinist, an optimist, and an internationalist, convinced that the socialist revolution arose necessarily out of the insoluble contradictions of the world capitalist system. Above all, he insisted that there existed a revolutionary force within society, the working class, that would overthrow the capitalist system and lay the foundations for world socialism.

In October, the WSWS published an essay by North, The Political and Intellectual Odyssey of Alex Steiner, developing the defense of Marxism and philosophical materialism against the neo-utopian conceptions of the Frankfurt School and its offshoots.


Arts, culture, and science

Over the course of 2008, the WSWS wrote extensively on film, theater, music, and art history.

The year started and ended with explorations of the work of Trevor Griffiths, beginning with an interview with the British dramatist and review of his screenplay about American revolutionary Thomas Paine. Later in the year, Griffiths and WSWS arts editor David Walsh held a public discussion titled the writer and revolution, in which they discussed Griffiths’ work and the political issues that faced artists in the late 1960s and 1970s.

The year culminated with a series of talks by WSWS arts editor David Walsh in the UK. In “Art and socialism: the real premises,” Walsh argued for a genuine Marxist approach to artistic questions, against that promoted by either Stalinism or “left” postmodernism.

There are conflicting theories as to what constitutes revolutionary or “progressive” or “subversive” art. Our view is relatively straightforward: art is genuinely radical, above all, to the extent that it conveys, by its own means, the truth about life and reality, no matter how painful or complex that may be. Knowing and feeling the world deeply is a prerequisite for those who intend to make a radical change.

In the intervening months we reviewed many films and documentaries. Mike Nichols’ Charlie Wilson’s War stood out for its obnoxious celebration of US machinations in Afghanistan. Body of War, about a wounded war veteran, and Standard Operating Procedure, about torture at Abu Ghraib prison, exposed the brutality of the Iraq war despite having some significant weaknesses.

The WSWS critiqued works of well-known Hollywood and independent filmmakers, including Oliver Stone’s W, the Coen brothers’ Burn After Reading, Paul Thomas Anderson’s There Will be Blood, Ang Lee’s Lust, Caution, and Gus Van Sant’s Milk.

We also brought to readers’ attention many lesser known films, including Before the Rains, Frozen River, Young@Heart, and the comical Be Kind Rewind. Waltz with Bashir, a haunting animated drama about the 1982 Israeli invasion of Lebanon, deserves special mention.

David Walsh interviewed Mike Leigh in December, speaking with him about his film Happy Go Lucky. And the WSWS continued its coverage of film festivals around the world.

Writing on the deaths of actors Paul Newman, Richard Widmark, and Charlton Heston, and directors Sydney Pollack and Jules Dassin (blacklisted), the WSWS examined the history of American cinema and the lasting impact of the anti-communist witch hunts on Hollywood. We also noted the passing of British actors Paul Scofield and Ken Campbell, writer Hugo Claus, playwright Harold Pinter and artist Eartha Kitt, and painter Robert Rauschenberg. In response to the death of poet Adrian Mitchell, David Walsh penned a more personal comment.

In the field of painting, the WSWS reviewed exhibits of the work of Gustave Courbet and Alexander Rodchenko. The latter provided an opportunity to examine the legacy of the Russian revolution in Soviet art, a theme that we also took up in the fields of architecture and literature. At the end of the year, David Walsh interviewed David King about his remarkable work on the photographic history of the Russian Revolution and the USSR.

The WSWS grappled with questions of history and trends in modern drama through reviews of the plays Paris Commune and Adding Machine, and an exchange on the work of Bertolt Brecht.

On the sciences, the WSWS wrote a two-part series on a recently auctioned letter by Albert Einstein that definitively established the physicist’s commitment to atheism.