Tudeh Party of Iran on:
“The deepening crisis of capitalism,
the role of the working class and
the Communists' tasks in the struggle for
workers' and peoples' rights”
The Tudeh Party of Iran would like to take this opportunity to thank the Working Group, and in particular our host, the fraternal Portuguese Communist Party, for facilitating the 15th International Meeting of the Communist and Workers Parties. We would like to take this opportunity to thank all fraternal parties for extending internationalist solidarity with the people of Iran in their complex struggle for peace, democracy and social justice.
The 15th IMCWP is taking place at a time when the world is going through a systemic crisis of capitalism manifested by the economic recession, wholesale collapse of economic systems of weaker capitalist countries, and acute social instability in the world. In this situation the threat of war and intervention is ever present. The presentations, discussions and collective conclusions on the most important issues confronting the working class of the world today could equip us all, based on the experience and assessments of each and every one of our parties, to contribute to the global struggle for peace, progress and socialism. We are of the view that the international working class movement, including the communist and workers parties, play a major role in articulating a real alternative for the current unjust and crisis ridden economic order and ensure that the world peace is safeguarded.
It is commonly acknowledged, even by the sober minded supporters of capitalism that the global financial crisis since 2008 remains unresolved and still there is no clear perception as to how and when this crisis may end. Many journalists, commentators and academics point to the fact that since too little has been done to prevent another crisis, it is highly likely that there will be another and more serious one.
The ascendency of finance capital and what is now referred to as “financialisation” lies at the heart of the current crisis of capitalism. The roots of the crisis can be traced to the crisis in the 1970s - following the so called “Nixon Shock” that removed fixed exchange rates, thus officially ending the existing Bretton Wood agreement governing international financial exchange. This was followed by Reagan and Thatcher initiating a series of financial deregulations with the aim of putting the finance sector in control of the macro economies of the USA and Britain. These deregulations were subsequently imposed worldwide. In the US, the finance sector’s share of 5% of the GDP increased to 8% and profits from finance of 7.5% grew to 40% of overall profits. In the UK, the financial sector before 2008 had the largest share of any industry in the economy with 13% of GDP. This finance backed globalisation economic restructuring also focused on a severely weakening workers’ position within the economy. Neoliberal restructuring ensured deregulation of trade and the creation of a “flexible labour market” for “competitiveness” which is effectively a race to the bottom for workers. At the same time re-regulation of trade union activities was imposed, e.g. legislation for limiting or even preventing strikes. The collapse of socialism during 1989-91 was another significant blow that further weakened the position of the working people. The last three decades of finance backed globalisation and neoliberal restructuring have had a massive transformative effect on capitalism’s growth and its methods for exploitation. As a result capitalism’s production capacity and its vast, fast global distribution have reached immense levels but, at the same time, capitalism has become unstable. Undoubtedly Marx and Engels would have pointed to their passage in the Communist Manifesto: “Modern bourgeois society, with its relations of production, of exchange and of property, a society that has conjured up such gigantic means of production and of exchange, is like the sorcerer who is no longer able to control the powers of the nether world whom he has called up by his spells”.
This deep financial deregulation based on the neoliberal economic model since 1980 and the current global monopolistic position of finance capital has far reaching economic and political effects. In the developed countries, concentration of astronomical financial capital in conjunction with the uncontrollable spread of various financial products known as “derivatives” dominate all aspects of the private and public sectors. Capitalism effectively has turned the world economy into a giant casino where the finance bourgeoisie always win.
It is obvious that the economies of the advanced capitalist countries have become unstable and unable to sustain stable growth. However, history and theory tells us that instability and crisis are integral parts of this system. Marxist theoreticians have always believed that instability and the crises of capitalism, no matter how deep, do not automatically lead to its total collapse and transition to socialism. Capitalism has demonstrated a significant capability of adapting to changing environments and has been able to absorb crashes and recover – it has been capable of transferring the material damage to the working class in different ways such as wars, austerity regimes and more aggressive exploitation of the people and the planet’s resources. As communists we are also well aware that intensification of economic problems and mass discontent form an element of the conditions necessary for the negation of capitalism. We have seen how easily economic discontent created by capitalism’s failure can in turn be exploited by the populism of the extreme right with devastating effects. The rise of fascism in Europe in the 1920s and 30s and now, due to the deep economic crisis since 2008 are clear examples. The emergence of fascist parties in Greece, Britain, Germany and other countries of Europe points to a clear and very real threat. It is a fact that a rightward political shift has taken place in all the key countries of the EU where ‘market economy dictatorship’ is being imposed on working people, in spite of massive failures by the very same market economy model. In the USA this is taking extreme forms. Recently the right attempted the so called “government shutdown” in order to eliminate any chance of extending basic healthcare provision to the poor and low waged.
The changes within the dominant capitalist economic system have in turn caused significant impact on the ‘means of production’ and the ‘productive forces’ which have ultimately effected the composition of the working class. The make-up of the working class is now no longer solely limited to the industrial male labourers that were identified by Marx and Engels in the 19th century. The working class is now far larger and is made up of a spectrum of labouring strata including employed and semi-employed workers, women and men. The neoliberal economic system is the most advanced method of exploitation in human history but it remains totally based on extraction of ‘surplus value’ and its conversion into private profit. At the heart of this process is the ownership and monopolisation of the main means of production. In the 21st century the parasitic financial bourgeoisie across the globe owns and / or controls the key means of the production. While this sector of bourgeoisie is only about 1% of the population, but it is a hugely powerful group with transnational capabilities in manipulating governments and policy makers. In the 21st century, advances in technologies such as those in transport, information, communication and biochemistry have been used to blur the links between the working class and the means of production. The rapid advances in technology and, in particular, the changes in the structure of ownership of the ‘means of production’ have created complex and highly composite processes of generating ‘surplus value’ and its conversion into private capital. Undoubtedly, during the last three decades, significant changes have been occurring but there remains an unchanged fundamental constant at the core of the capitalist mode of production, the discovery of which sets Marx apart from any other scientist of political economy. To date, in spite of all the immense changes around us, the antagonistic contradiction between the social nature of work and the private mode of ownership and profiteering remains the ultimate motive force for change and progress. And in fact this contradiction is intensifying globally.
However, the current crisis has certain common characteristics that are very important for us to recognise as they influence the struggle for change towards socialism at local, regional and global level. Survival of capitalism is directly linked to constant growth and increase in return on investment that is only possible by a combination of constant reduction in the cost of labour and the application of technology. In the 1970’s a combination of the falling rate of profit, strong trade union power pushing for wage increases and the rise of Opec oil prices plunged capitalism into a dangerous crisis. Consequently, in the 70’s capitalism had to adopt a risky “laissez-faire” neoliberal approach in order to save itself and this started in Chile after Pinochet’s bloody coup d’état by experimenting with what we can rightly call ‘free market dictatorship’. Chile served as a laboratory in which the economic model based on coercion and brutality was polished and refined, to be applied later in different forms across the world. This was a well-planned and executed attack on the material needs of the working people and was a deeply anti-democratic assault by a well organised small minority against the daily life of working people and against the will of the people. Politically, in the western countries it was done by covertly and overtly subverting the democratic norms and particularly by direct attack on working class parties and Trade Union organisation and power-base. The capitalist media played a major part in this process. Imperialist instruments such as the IMF and the World Bank were used in the developing countries to establish market economy adjustment. Local friendly dictators in the developing countries together with the comprador bourgeoisie implemented highly profitable neoliberal-oriented economic adjustments. The entry of former socialist countries into the capitalist “free world” in the early 1990s was greeted by advocates of the free market. Free market dictatorship over the last two decades has left working people of the former socialist countries in economic misery and has fostered the rise of the powerful, anti-democratic, corrupt and oligarchic bourgeoisie.
From the early 1980s the capitalist system, led by the USA and Britain, has made significant changes in order to revive the rate of profit and save itself from spiralling into deeper crisis. Since 2008, advanced capitalist economies seem unable even to agree or coordinate a system-wide remedy. And, to date, most ameliorative actions have been focused not on resolving the crisis but on containing it at national level. Various levels of Quantitative Easing and austerity programmes make up the core of the Western countries’ policies and those of many other smaller economies. The UN Development Programme reports that 133 countries out of 190 have cut public spending.
Quantitative Easing (QE) is the issue of electronic money. Since 2008 in the Eurozone, QE stands at $4 trillion in the form of various bailouts, while direct QE in the US and UK totals to another $4 trillion. Herein lies a fundamental question:”Why, when the obvious rational way out of this crisis is public spending for national investment and increasing public employment, are the major capitalist countries still unable or unwilling to steer away from the failed neoliberal model?” One significant part of the answer is that finance-backed globalisation has penetrated the core of these economies and the political establishment it is therefore unwilling and / or unable to confront the hugely powerful transnational bourgeoisie. It is important to note that all commodity markets are hostage to finance capital and a highly lucrative assortment of speculative financial derivatives such as SWAPs and Options. In 2008, the nominal value of these products was estimated at £600 trillion while the total world GDP was approximately one tenth of this. In capitalist countries all macro-level economic decisions in the public and private sectors are hostage to the credit ratings. Therefore, in the current situation, there are five very important implications that we should note:
1) It is likely that the powerful advanced capitalist countries will continue with a free market centric political economy in the hope of surviving the current crisis.
2) Whether this path will lead to any kind of economic recovery is wholly unknown and difficult to predict at this stage. But it is certain that it will be socially damaging for most classes and strata and all the costs will be transferred to the working people.
3) Perpetuation of free market dictatorship will require even more subversion of democratic rights and social freedoms and it will push the ruling classes of major western countries further towards anti-democratic governance.
4) Continuation of the free market-centric model in the major capitalist countries will fail unless it is also implemented across the globe. The free market needs a monopolistic world in which it’s political, economic and cultural spheres are homogenised and are subservient to the market forces with a constant drive towards private profiteering. In essence, there must not be a strong planned economy anywhere in the world.
5) Continuation of the free market-centric model will be based on higher and higher consumption which is environmentally unsustainable. Already there are clear signs of global warming which are effectively ignored by those with vested interest in the free market-centric model.
Locally, regionally and globally these five spheres are the key battleground for the communists and other progressive forces. We believe the struggle for progress and socialism takes different forms but there are common fundamental principles and objectives that will ultimately define our success or failure. The key task ahead of the communists is the fusion of the struggle for democratic rights and social justice. There is an important organic link that needs to be constantly re-enforced and built into our struggle in order to shift the balance of forces in favour of progressive change. Global capitalism, with its political operators and Media Empire, is a very strong, resourceful and ruthless opponent. Looking at the present specific situation, the facts clearly point to the imbalance of forces in favour of capitalism. Therefore it is vital to mobilise the widest possible fronts at national and international levels for defeating capitalism. Globalisation of finance and dictatorship of Free Market have created a number of common denominators at local, regional and global levels. It is the objective necessity and not a theoretical exercise that tell us we must use the common interest of classes and strata that are negatively impacted by the financial globalisation. The only way to challenge and successfully defeat capitalism and to pave the way forward towards socialism is by building necessary alliances based on concrete and specific situations and achievable goals in the interest of the working class. This struggle will have key stages and each stage’s specific objective and subjective factors will determine those achievable goals and the form of the tactical alliance to bring about a qualitative leap jump
Iran- A case study
Iran is currently going through a very sensitive period, in which the people's movement for peace, democracy and social justice has reached a critical stage.
The theocratic regime that has turned the country into a prison for democrats and those seeking change, has proven itself incapable of offering any viable solution for the country’s economic, social and political problems. The neo-liberal economic policies of the regime are in line with the prescriptions of the IMF and the World Bank. The wide and devastating economic sanctions by the US and its EU allies has paralysed the economy, has interrupted the normal functioning of production units and factories , and has resulted in waves of unemployment and high commodity prices. The removal of subsidies from basic goods and services, including energy carriers, has condemned ordinary people, especially those living in urban centres, to economic hardship. Privatisation has been steadily spreading to every aspect of the economy and now even parts of the oil industry are privatised.
Despite savagely suppressing all progressive and democratic forces of the country and marginalising advocates of meaningful reforms within the structures of the regime, the theocracy still faces a serious crisis of political legitimacy.
The possibility of a social explosion has been ever increasing in a country ravaged by repression, economic crisis, wide spread sanctions and threats of foreign intervention. It was in such a climate that the regime approached the presidential elections of 14th June 2013 with a carefully planned process and outcome. The carefully engineered election resulted in the election of Hassan Rouhani, a self proclaimed moderate, and a trusted advocate of theocratic regime. The new president’s main objective has been the removal of crippling sanctions and normalising diplomatic ties with the US.
Rohani has been open about his mandate “to create a new era of relations between the people of Iran and the rest of the world”. He has further pointed out that the conservative religious leadership had given him "complete authority" to make a deal with the US.
The easing of international tension, especially if it brings about the lifting of economic sanctions will be welcomed by most sections of our society. The country has a dollar based ‘import led’ economy, relying on the export of crude oil. This has made it an easy target so far as US sanctions are concerned. Iran’s economy is structurally distorted and a typical ‘Rentier Economy’ which is hostage to the powerful interests of parasitic speculators in finance and property. Their destructive, non-productive activities are powered by the export of crude oil in return for the import of vast quantities of consumer and agricultural goods. An unholy alliance between the powerful bureaucratic bourgeoisie and merchant capitalists has ensured the continuation of this lucrative system.
Also, with the support and encouragement of the IMF during the last two decades, Iran has undergone waves of neoliberal-oriented economic restructuring. Mass privatisation and the removal of energy subsidies during Ahmadinejad’s time in office have put enormous downward pressure on each and every strata of working people. During the last two years, Iran’s sick economy, coupled with the impact of economic sanctions, has created huge resentment and prepared the ground for mass uprisings. It is not an exaggeration to say that in the last 24 months there have been hundreds of strikes and industrial protests. However, because of the repressive policies of the regime towards trade unions, they remain isolated and have easily been brought under control.
The main contradiction in Iran is between the people and the interests of the powerful political elite and economic oligarchies, who are the custodians of a highly lucrative, unjust and corrupt political economy. This contradiction cannot be resolved by cosmetic changes the regime plans and poses a growing threat to the survival of the ruling dictatorship. The power structure in Iran is complex and, by accommodating various competing factions, has reached a mature level of intra relationship. The key power factions strongly compete and confront each other but they nonetheless close rank under the absolute rule of the ‘supreme leader’ when faced by any serious external challenge. They know that if there is danger of “regime change”, it is from the Iranian people seeking fundamental socio-economic change and democratisation. This is why the regime relate all its internal contradictions and problems to forces beyond its borders and it is now looking to the west as a natural ally by seeking a deal to shore up its position.
The neoliberal economic plans of Rouhani’s government are a continuation of the dominant trend of 25 years and are aimed at smoothing the path to some form of reconciliation with the west. Neoliberal economic restructuring has already created a large and powerful private financial sector. It is important to note that Rouhani’s cabinet is composed of well-practiced neoliberal right wing reformists.
Economic interests will play a major part in any reconciliation between the US and the Iranian regime. However, it will be a complex process for Rouhani given that the key political factions and dominant oligarchies will demand guarantees of their economic interests. The most powerful bureaucratic bourgeoisie is composed of the senior commanders of the Revolutionary Guards. Under the pretext of privatisation they have developed huge economic interests. In the run up to Rouhani’s UN speech, the Revolutionary Guards’ expectations were managed by the supreme leader when he appealed directly for “heroic flexibility”, i.e. compromise.
The Tudeh Part of Iran supports the lowering of tension between the US and Iran. It has for years called for a negotiated resolution of all disputes on the basis of international law and the UN Charter. However, we demand that all negotiations to be transparent and in accordance with the vital interests of the people. The theocratic regime has placed our country in a weak economic and political position. The US and its allies must be prevented from attempting to exploit this opportunity to push their imperialist “New Middle East Plan” forward.
In Iran transition from dictatorship to a national democratic stage is the next key step forward. This is a revolutionary transformation and will require a broad alliance of classes and strata with common interest in national economic development and fundamental democratisation. This united front cannot succeed if it is unable to fuse the democratic freedoms with social and economic justice and a key element here is the right to organise effectively and freedom for independent trade unions to fight for the key demands of the working class. Therefore, the core of any Popular United Front for fundamental change will consist of a working class that in turn is composed of wide-ranging labouring sections of the society. In Iran, the transition to a national democratic stage will in itself inevitably require tactical alliances that might even involve sections of the national industrial productive bourgeoisie whose interests are threatened by neoliberalism, the comprador bourgeoisie and the dominant despotic financial oligarchs. Here we need to remember Lenin’s saying: ‘We all categorise bourgeois revolution and socialist revolution, we all insist on the absolute necessity of strictly distinguishing between them. However, can it be denied that in the course of history individual particular elements of the two revolutions become interwoven?’ (Selected Works, Volume 1, p.482, pp. 511-2).
Fighting against the forces that have subjected Iran to the most destructive neoliberal policies and the ruling oligarchic bourgeoisie is at the forefront of the Tudeh Party of Iran’s struggle. Our long term strategic goal is to support the development of the necessary conditions in Iran for fundamental socio-economic changes. We believe that the success of the people’s struggle for democracy and social justice will prepare the conditions for the continuation of the people’s fight for the transition towards socialism. We are fully aware that achieving this goal is also dependent on the favourable balance of forces regionally and internationally. We believe our country’s future is dependent on how the progressive forces in Iran would effectively address the above mentioned implications. In this respect the Tudeh Party of Iran in its recent congress (February 2013) has clearly formulated its policies. Our struggle for change has already started. In this most difficult and uneven struggle maximum, unconditional international solidarity is most urgently needed.
Long live internationalism!
Forward to the struggle for peace and progress!
Long Live Socialism!