2-28-06, 2:00 pm

With every passing day it becomes ever clearer that the regime of George W. Bush has been wounded severely both domestically as a result of his criminal negligence in the aftermath of Hurricane Katrina and globally, as a result of the illegal invasion of Iraq. Simultaneously, the left continues to surge in Latin America while China continues to take gigantic strides, which has become increasingly worrisome to Washington. In sum, the crisis of US imperialism shows few signs of abating.

When the otherwise conservative Representative John Murtha of Pennsylvania, endorsed a US troop withdrawal from Iraq, one more signal was provided that this war might turn out to be the most significant blunder by US imperialism in decades. Murtha, the leather-necked former Marine, crystallized a growing sentiment in his own Democratic Party and amongst independents. Perhaps Murtha has been following various trends, for it is apparent that leading indicators spell doom for the US occupation of Iraq. For example, the military is falling far behind in its effort to recruit and re-enlist soldiers for some of the most vital combat positions. According to the Government Accountability Office, the Army, National Guard and Marines signed up as few as a third of the Special Forces soldiers, intelligence specialists and translators that they had aimed for in the last year.

African Americans have made up a shrinking share of enlisted troops since 2000, declining by 15 percent in the Army, 23 percent in the Marines and 11 percent in the Air Force. These drop-offs are largely attributable to the war. But African Americans are not alone. Last year only three residents in Manhattan’s posh Upper East Side – the city’s richest area – joined the Army, Air Force or Navy.

The war has also become a public relations disaster for US imperialism with the stomach-turning reports of torture, secret prisons, illegal kidnappings, etc. Italian prosecutors have requested the extradition of 22 US nationals believed to be CIA operatives on charges that they abducted an Egyptian Islamic cleric off the streets of Milan in early 2003, then flew him to Cairo where he later said he was tortured. Presumably he was treated so harshly because of his alleged knowledge about the “terrorism” that we are told caused the US to invade Iraq and Afghanistan. During the storm-tossed December 2005 visit to Europe of Secretary of State Condoleezza Rice, she was bombarded with questions concerning alleged secret prisons established by US imperialism in Romania and Poland – an ironic coda given that supposedly these nations had been “liberated” from the specter of the so-called Soviet “gulag.”

There have been credible charges that US forces in Iraq have used ghastly weapons called white phosphorous. According to Italian television, US forces used this chemical in Falluja in 2004. Packed into an artillery shell it explodes over a battlefield in a white glare that can illuminate an enemy’s positions. It also rains balls of flaming chemicals, which cling to anything they touch and burn until their oxygen supply is cut off. They can burn for hours inside a human body. In 1983 an international convention banned its use against civilians, and, like torture, this was one of the many crimes ascribed to the late, unlamented regime of Saddam Hussein, who was accused of dropping white phosphorous on Kurdish rebels and civilians in 1991.

These scandals and war crimes are beginning to harm the bottom line of US based transnational corporations. Tourism, a major industry in the US, especially in New York, Florida and California, is down; inbound travel from other nations is off at least 1.5 percent in terms of market share from 2000 levels. One share point is 7.6 million visits and a hefty $12 billion in sales. “That’s the equivalent of 153,000 jobs and a lot of tax dollars,” says Keith Reinhard, who chairs the elite advertising agency DDB Worldwide. He adds that 37 percent of the British intelligentsia say they will avoid buying US brands because of the “cultural identity” of the US. This is hurting Marlboro cigarettes, McDonald’s hamburgers and the Barbie doll in particular.
As whatever prestige held by US imperialism continues to decline, an accompanying trend has grown that has outraged conservatives. The Supreme Court is looking more to international law and legal precedents of other nations when ruling on some of the most contentious domestic issues, e.g. the juvenile death penalty and gay rights. Courts are also refusing to stay out of the area that has caused the most outrage in the international community – the treatment of prisoners at Guantánamo, Cuba and elsewhere. Last year the high court ordered the administration to give terrorism suspects the right to dispute their detention in federal court and said that the president had to provide a fair hearing to US citizens captured as terror suspects broad. This has sparked howls of outrage from the ultra right, which recognizes that its dastardly schemes are supported by only a distinct minority in this nation and opposed by an overwhelming majority abroad, and when the latter weighs in it becomes exceedingly difficult for the White House to move even more to the right. Informed observers recognize, for example, that the international community’s opposition to Jim Crow was a major reason why US-style apartheid began to crumble.

This confluence of the courts, the global and the White House came to an abrupt collision when Bush administration official David H. Safavian was arrested for transgressions committed in conjunction with lobbying work he did with Jack Abramoff, whose specialty has been looting Native American nations of their casino profits and funneling his ill-gotten gains to Israeli extremists. Safavian was arrested for lying and obstructing an investigation into Abramoff’s dealings with the federal government but what captured the attention of many was Safavian’s alleged lobbying for Muslim leader, Abdurahman Alamoudi, who is known to have close ties to both Hamas and Hezbollah. Safavian’s firm also did lobbying work for Jamal Barzinji who, according to the US Customs Service, was the “officer or director” of entities in northern Virginia “controlled by individuals who have shown support for terrorists or terrorist fronts.”

Thus, two of the factors weakening the Bush regime – the Iraq war and the culture of corruption – both have keen global manifestations. This is why it is worthwhile to pay close attention to the outrage expressed globally in the wake of the inept handling of relief efforts in the aftermath of Hurricane Katrina. The Zimbabwe Herald charged that “the fact that New Orleans is a southern town predominantly populated by African-Americans…explains why President George W. Bush did not see the need to cut short his holidays.” That nation’s ministry of information asserted that “the position of the black people [in the US] has always been a very sad case.” Lest one think that this was merely a case of Zimbabwe scoring points against one of its key antagonists, note that a Rwandan official said, “my initial reaction is that there was a racist element” in the poor relief effort. A Kenyan official said that “given the history of the [US], everything points at racial profiling.” Writing in Kenya’s Daily Nation, another writer said, “the images, and even the disproportionately high number of visibly impoverished blacks among the refugees, could easily have been a re-enactment of a scene from the pigeonholed African continent…” The African Union, the continent’s premier body, avowed that “we are not indifferent. Hurricane Katrina struck a … region which is inhabited by our Diaspora.”

But it was not just Africa and Africans who denounced what they saw unfold on the US Gulf Coast. Spain’s Razon said that “it is clear that the USA’s international image is being damaged in a way that it has never known before.” France’s Le Progres observed that “Katrina has shown that the emperor has no clothes.” Switzerland’s Le Temps, captured the sentiments of legions when it noted that the sea walls would not have burst in New Orleans if the funds meant for strengthening them had not been cut to help the war effort in Iraq and the war on terror… and would George Bush have left his holiday ranch more quickly if the disaster had not first struck the most disadvantaged populations of the black South?

Thus, like the debacle that is the Iraq invasion, the cruelly incompetent handling of Katrina has been a bruising black eye for US imperialism, weakening allegiances that were thought to be rock-solid. This has been particularly true in the case of Israel, which has been trying to improve relations with China, not least due to the perception that US imperialism is not up to meeting all of its obligations at a time when the most determined Washington hawks are bent on launching a new cold war targeting Beijing. In April 2005, the Pentagon took the unusual step of suspending some information sharing with Israel on a new fighter-jet until US concerns are allayed over Israeli military technology transfers to China.

To be sure, Israel is not the only ally of US imperialism that is being treated shabbily. Representative Henry Hyde (R-IL) is determined to thwart the White House’s promises to improve technology cooperation with Great Britain and Australia. The administration did so by blocking a promised waiver of arms trade controls on the grounds of the inadequacy of London’s and Canberra’s own arms trade controls. Hyde’s move presumably could lead Britain and Australia to also turn to Beijing.

Actually, US imperialists fear that its “allies” may be encroaching on one of its prized domains – serving as the preeminent merchants of death. The value of military weapons sales in 2004 globally reached the highest level since 2000 with the US once again dominating weapons sales, signing deals worth $12.4 billion in 2004, or 33.5 percent of all contracts worldwide. But that was down from $15.1 billion in 2003. Russia was second; Britain was third, and Israel was fourth: So handcuffing the latter two can provide a bonanza for US imperialism, the issue of “alliance” notwithstanding.

But Israel may be even more vulnerable to Washington’s pressure than Britain or Australia due to its extreme dependence on US imperialism and its general isolation. According to Middle East expert Stephen Zunes, between 1974 and 1989 alone, $16.4 billion in US military loans to Israel were converted to grants. In fact, he says, Congress has eventually forgiven all past US loans to Israel. Annually, US nationals make tax-deductible contributions to Israel to the tune of hundreds of millions of dollars. Total US aid to Israel is approximately one-third of the US foreign-aid budget. This trans-Atlantic dollar flow was designed to advance US imperialism’s interests. “Israel has helped defeat radical nationalist movements” in the region and, Zunes notes, has been a “testing ground for US made weaponry.” Besides, Israel, at Washington’s behest, has funneled US arms to third parties, e.g. apartheid South Africa, Nicaraguan Contras, etc.

Former Israeli General Matti Pelled says that this US “aid” is “little more than an American subsidy to US arms manufacturers,” considering that the bulk of US military aid to Israel is used to buy weapons from US companies. Moreover, arms to Israel creates more demand for weaponry in Arab states. According to Zunes, the “Aerospace Industry Association,” which promotes massive arms shipments, is “even more influential” than its better known counterpart lobby, the American Israel Public Affairs Committee, in that the former has given twice as much money to political campaigns as the latter. In addition, US arms shipments push Israel toward intransigence and complicate the peace process.

On the other hand, the Iraqi invasion has exposed the glaring weaknesses of the alleged US security blanket that supposedly protects Israel. This fact had a disturbingly contradictory impact on the administration of war criminal, Prime Minister Ariel Sharon. Prior to his health problems, Sharon broke with his ultra-right Likud Party in order to form another party just to its left. He engineered a withdrawal from Gaza in order to deepen Israel’s grip on the West Bank. And in a maneuver that may serve to paper over the fraying ties between Israel and its patron in Washington, Sharon’s government reportedly prepared attack plans for both Iran and Syria.

The regime in Teheran is developing nuclear energy that its opponents fear could be the basis for developing nuclear weapons, which is of concern to both the US and Israel. Damascus is already under US sanctions as a result of the Syria Accountability Act of 2003 and is accused by Washington of providing sanctuary to Iraqi guerillas. “If one has a problem, expand it,” is said to be Rumsfeld’s motto. By that illogic, a joint US-Israeli assault on Iran and Syria could at once bring Washington and its erstwhile ally closer together, while disabling two of the staunchest opponents of the Israeli occupation of Palestinian land and the US occupation of Iraq.

Moreover, such an attack would place both the European Union and Japan in a tight corner. Just recently Brussels sharply criticized Israeli policies in East Jerusalem; at the same time, France has sought to paper over its differences with Washington over the Iraq war by joining enthusiastically with US imperialism in threatening Syria. Japan continues to invest in the bountiful energy industry of Iran. Thus, attacking Syria could possibly bridge a gulf between the EU and Israel and between France and the US, while attacking Iran could hamper Japan in its ongoing competition with US imperialism.

China also has invested heavily in Iranian energy, and given the growing tension between Washington and Beijing, an attack on Teheran would provide an added bonus, it is thought, of hindering the Chinese juggernaut. This is not as fanciful as it may sound. In 1997, China negotiated a $1.3 billion contract with Saddam Hussein to develop the al-Ahdab oil field in central Iraq. By 2001, China was negotiating for rights to develop a much larger Halfayah field. The US invasion wiped out the Chinese stake in Iraq’s oil fields, and led China to ink a $70 billion contract to import Iranian oil. This led in turn to an $836 million contract for China to help build Teheran’s subway system, an expanding Chinese auto manufacturing presence in Iran and a host of other mega-deals.

Unable to assault China directly, the most hawkish acolytes of US imperialism are interested in attacking that which powers the Chinese economy: its sources of energy. Thus, concern is growing over the Saudi-China relationship which blossomed when both joined with Washington in opposing the Soviet intervention in Afghanistan. In that context, Beijing secretly sold Riyadh medium-range missiles in the 1980’s. More recently, a Chinese company was one of the first foreigners to gain gas exploration rights in the kingdom. It is hard to say if the deteriorating US-Saudi relationship is a cause or effect of this escalating China-Saudi tie. In any case, China became the world’s third largest importer of oil in 2003 and has brokered deals with regimes despised by US imperialism, especially energy-rich Venezuela.

In fact, it is easy to assert that the old cold war between Moscow and Washington has been replaced by a new one between Beijing and Washington, though US imperialism is not as united nowadays as it was in the past, especially since the financial tie between these two giant nations is so profound.

One major component of this financial tie is the movement of US-based manufacturing to China. Thus, when auto supplier Delphi declared bankruptcy in order to void union contracts, the Wall Street Journal almost joyfully reported last October that this company “pays its US unionized workers $27 an hour. Throw in health and retirement benefits, and the cost is more like $65. In China,” it gleefully noted, “Delphi pays its workers roughly $3 an hour, about a third of which goes to medical and pension benefits.” Delphi has poured $500 million in investments into China since 1993, where it has joined General Motors in assisting Beijing in its stated goal of becoming the world’s number one automaker by 2020. Reputedly, GM is considering following Delphi into bankruptcy court in order to negate its own union contracts.

It would be a mistake, however, to assume that the tie between the US and China is replete with concord. A recent shocking speech by the newly installed head of the US Security and Exchange Commission, former conservative GOP Congressman, Christopher Cox, is suggestive of the contrary. Cox told a room packed with Chinese regulators and politicians that their country’s “capitalism” was in danger of meeting the same fate as the Qing dynasty, which ended in a tidal wave of bloodshed in 1911. As the Financial Times put it, Mr. Cox’s remarks laid bare an anger among the US financial elite at China’s determination to shield its capital markets and companies from foreign influence. Noting a “significant drop in the amount of money Chinese companies have raised” in the US this year, he accused them of “seeking to avoid higher regulatory standards.”

In other words, Cox expressed the alarm of US-based financial interests that investment appeared to be shifting away from New York. Increasingly, Chinese companies are turning to Hong Kong and London in order to raise capital.

Likewise, many US consumer products are struggling in the Chinese market where they have trouble measuring up to European brands and even some Chinese brands (not to mention those of South Korea and Japan). This contributes to a staggering trade deficit in China’s favor. Outgoing Federal Reserve Chair Alan Greenspan has suggested that a steep decline in the value of the dollar was the most likely way that the overall US trade deficit would narrow, by making US imports more expensive and its exports less costly. Few nations in world history, however, have skyrocketed to prosperity by debasing its currency.

In November 2005, the US Treasury Department chose not to increase pressure on China to revalue its currency upwards, provoking an angry reaction from US manufacturers and some lawmakers. Meanwhile, during this same month the influential Washington-sponsored US-China Economic and Security Review Commission, sharply criticized China’s trade practices and endorsed sanctions including a tariff on imports unless Beijing takes forceful steps to allow its currency to move in line with “market forces.”

China is presenting a challenge the likes of which the US has not faced in some decades. According to economist Richard Freeman, cochair of the Harvard Trade Union Program, the collapse of the USSR has contributed to an “effective doubling of the global labor force” as Russian, Chinese, Indian and other workers have made an “entry…into the global economy,” while “the effective supply of capital, on the other hand, has virtually remained unchanged. With such a massive increase in the supply of labor, its relative share of the returns from production inevitably decline.” The “entry of “China, India and the former Soviet bloc to the global capitalist economy is a turning point in economic history,” he says.

Now whether one accepts Freeman’s analysis or not, it is apparent that the rise of China is bound to have a significant impact on the fortunes of US imperialism and those who have supported it. Certainly Donald Rumsfeld seems to think so. That is why he negotiated the “Joint Statement of the US-Japan Security Consultative Committee” in February 2005, which highlighted the status of Taiwan, the mention of which China considered an unacceptable interference in their internal affairs. Then, in a major policy address in June in Singapore, Rumsfeld alleged a Chinese military buildup reminiscent of Reagan-era accusations against the Soviet Union. Interestingly, last August China and Russia held their first joint military exercises. Tensions were ratcheted up further when alleged Chinese spies were arrested in Los Angeles last November. They were accused of snatching sensitive data on Aegis battle management systems that are at the core of US Navy destroyers and cruisers – vessels that would be essential if Washington sought to aid Taiwan in a conflict with Beijing.

China is also outpacing the US in gaining access to Africa’s labor and resources. Since 2000, Chinese trade with Africa has more than tripled, reaching nearly $30 billion in 2004. Beijing has signed at least 40 oil agreements with various African nations. Medical teams from China are training counterparts in numerous African countries and providing free equipment and drugs to help fight AIDS, malaria and other scourges. Demand from China has led to record-high prices of copper, thus benefiting Zambia. As gold reaches similar record-high prices, South Africa is bound to benefit. China’s African dealings have prompted some US companies to step up business there. Hence, last November, ExxonMobil announced that it will spend $24 billion in Africa over the next decade to boost production. The focus will be on Nigeria and Angola.

In a similar fashion, the rise in the price of oil has benefited Venezuela, a nation that is leading a remarkable resurgence of the left in South America. Chile elected another Socialist leader, while Evo Morales, the militant leftist, won handily in Bolivia. But it is Hugo Chávez of Caracas who is stirring concern in Washington, with his provision of subsidized heating oil to poor and working-class families in the Bronx, Massachusetts and Maine, and subsidized barrels of oil to struggling Caribbean states like Jamaica. Particularly noteworthy was his October decision to transfer about half of the nation’s $30.4 billion in foreign reserves out of US Treasuries and US banks into European banks. Venezuela’s open economic and political friendship with Cuba has also helped dent the US attempt to impose complete isolation on that island country and has strengthened Latin America’s shift to the left.

Nevertheless, despite such acts of aggression, US imperialism faces an unprecedented crisis, bogged down in Iraq, exposed domestically as a result of Katrina and corruption scandals, challenged vigorously by China, Cuba and Venezuela, among many on a growing list. In short, the crisis of US imperialism continues unabated.



--Gerald Horne is a contributing editor of Political Affairs. Please send your letters to the editor to pa-letters@politicalaffairs.net.