Month: January, 2012
Excerpts from Lenin’s “To the Party”
worker | January 31, 2012 | 11:29 pm | Action | Comments closed

By James Thompson

Some people may argue that Leninism is an anachronism that is not applicable to the current situation. However, Lenin’s article “To the Party” (Lenin, V. I., Collected works, Progress Publishers, Moscow, 1977, volume 7, pages 452 through 459) provides a thoughtful analysis of a crisis in the party in August, 1904. The parallels between the situation then and now will be readily apparent to people concerned about the welfare of the party today.

“Comrades, the grave crisis in our Party life is dragging on and on, and no end is in sight. The strife keeps growing, breeding dispute after dispute, and the Party’s positive work all along the line is hampered by it to the utmost. The energies of the Party, still young and not yet consolidated, are being grievously dissipated.

Yet the present historical juncture makes vast demands on the Party, vaster than ever before. The revolutionary unrest among the working class is growing, and so is the ferment among other sections of society; the war and crisis, starvation and unemployment are with elemental and inevitable force undermining the foundations of the autocracy. A shameful end to the shameful war is not far off; and it is bound to heightened the revolutionary unrest still more, it is bound to bring the working-class face-to-face with its enemies, and it will require of the Social-Democrats tremendous effort, a colossal exertion of energy to organize the last decisive fight against the autocracy.

Is our party equal to these demands in its present condition? Every honest man will unhesitatingly answer: No!

The unity of the party has been deeply undermined, its internal struggle has gone beyond all party bounds. Organized discipline has been shaken to its very foundations, and the Party’s capacity for harmonious and united action is fading into a mere dream.

Nonetheless, we regard the Party’s sickness as a matter of growing pains. We consider that the underlying cause of the crisis is the transition from the circle form to party forms of the life of Social- Democracy; the essence of its internal struggle is a conflict between the circle spirit and the party spirit. And, consequently, only by shaking off this sickness can our Party become a real party.

Under the name of the Party “minority” there have united a variety of elements who are linked by a conscious or unconscious desire to preserve circle relationships, pre-party forms of organization.

Certain prominent figures in the more influential of the inner circles, unaccustomed to the organizational self-limitations which Party discipline demands, are inclined from force of habit to confuse their own circle interests with the general Party interests, with which in the. Of the circles they may in many cases indeed have coincided. A number of these people (part of the former Iskra editorial board, part of the former Organizing Committee, the members of the former Yuzhny Rabochy group, and others) have been the leaders in a struggle on behalf of the circle spirit as against the party spirit.

Their allies prove to be all those elements to in theory or practice had deviated from the principles of strict Social Democracy (the Economists, Rabocheye Dyelo-ists, etc.), for only the circle atmosphere could preserve the ideological individuality and the influence of these elements, whereas the Party atmosphere threatened to absorb them or deprive them of all influence. Lastly, the opposition Congress have in general been drawn chiefly from those elements in our Party which consist primarily of intellectuals. The intelligentsia is always more individualistic than the proletariat, owing to its very conditions of life and work, which do not directly involve a large-scale combination of efforts, do not directly educated through organized collective labor. The intellectual elements therefore find it harder to adapt themselves to the discipline of Party life, and those of them who are not equal to it naturally raise the standard of revolt against the necessary organizational limitations, and elevate their instinctive anarchism to a principle of struggle, misnaming it a desire for “autonomy”, a demand for “tolerance”, etc.

The section of the Party abroad, where the circles are comparatively long-lived, where theoreticians of various shades are gathered, and where the intelligentsia decidedly predominates, was found to be most inclined to the views of the “minority”, which there as a result soon proved to be the actual majority. Russia, on the other hand, where the voice of the organized proletarians is louder, where the Party intelligentsia too, being in closer and more direct contact with them, is trained in a more proletarian spirit, and where the exigencies of the immediate struggle make the need for organized unity more strongly felt, came out in vigorous opposition to the circle spirit and the disruptive anarchistic tendencies. He gave quite clear expression to this attitude in numerous statements by committees and other Party organizations.

The struggle developed and grew increasingly acute. And to what lengths has it not gone!

The Party organ, of which the “minority” managed to seize control against the will of the Congress and thanks to personal concessions by the editors elected at the Congress, has become an organ of struggle against the party!

It is now least of all the ideological leader of the Party and its struggle against the autocracy and the bourgeoisie, and most of all the leader of circle opposition to the party spirit. On the other hand, conscious that it’s fundamental position is indefensible from the standpoint of the Party’s interests, it is busy searching out real and imaginary differences to provide an ideological screen for that position; and in the search, seizing on one slogan one day and on another the next, it is turning more and more for its material to the Right wing of the Party-the former opponents of Iskra is even busier searching out and denouncing mistakes on the part of their adherents, magnifying every real slip to monstrous proportions and trying to lay the blame for it on the Party majority as a whole, and seizing on every insinuation and peace of circle gossip that could prove damaging to its opponents, often enough not even troubling about their verisimilitude, let alone verifying their truth. In this course the men of the new Iskra have gone so far as to impute to members of the majority absolutely nonexistent and in fact impossible crimes-and not only of a political nature (as when they accuse the Central Committee of forcibly ejecting individuals and breaking up organizations), but even crimes against, and ethics (as one prominent figures in the Party are accused of forgery or moral complicity and forgery). Never before has the party been immersed in such a sea of mud as the émigré minority have stirred up in the present controversy.

How could all of this happened?

The mode of action of each of the sides corresponded to its fundamental trend. The Party majority, anxious at all costs to preserve the Party’s unity and organizational cohesion, thought only by loyal Party means, and more than once made concessions for the sake of reaching a reconciliation. The minority, following an anarchistic trend, showed no concern for peace and unity in the Party. They turned every concession into a weapon with which to continue the fight. Of all the minority’s demands, only one has not now been met-that discord should be brought into the Party’s Central Committee by the co-optation of minority men forcibly foisted upon it; yet the attacks of the minority are more vicious than ever. Having gained control of the Central Organ and the Party Council, the minority do not scruple to exploit in their circle interests the very discipline that they are in fact fighting.

The position has become intolerable, impossible; to allow it to drag on any longer would be a positive crime.

The first means of ending it, in our opinion, his complete clarity and frankness in Party relations. Amidst all this mud and fog there is no finding the true path. Every party trend, every group must openly and definitely state what it thinks of the present position in the Party and what solution it desires. And that is what we are proposing to all comrades, to the representatives of all shades in the party. The practical way out of the crisis, we consider, is the immediate summoning of the Third Party Congress. It alone can clarify the situation, settle the disputes, and confine the struggle within proper bounds. Without a Congress all we can expect it’s the progressive disintegration of the Party.

All the arguments brought against a Congress are, we maintain, totally invalid.

We are told that a Congress would lead to a split. But why? If the minority are irreconcilable in their anarchistic leanings, if they are prepared to have a split rather than submit to the Party, and they have already virtually seceded from it, and to defer the inevitable formal split would be more than irrational: chained together, both sides would more and more senselessly dissipate their strength in wrangling and squabbling, exhausting themselves morally and growing ever pettier and shallower. But we do not grant the possibility of a split. In face of the real strength of the organized Party, the anarchistically minded elements are bound to, and we think well, bow in submission, for by their very nature they are incapable of constituting an independent force. It is argued that a reconciliation is possible without a Congress. But what sort of reconciliation? Total surrender to the circle spirit, co-optation of the minority to the Central Committee, which would complete the disorganization of the central institutions. That would make the Party nothing but a name, and the Party majority would be compelled to start the struggle anew. And the minority? They have used every concession hitherto won only as a buttress for their disruptive activities; even from their point of view, the struggle has far outgrown the bounds of a squabble over co-optation; how then can they discontinue it? And still less will they do so if they have not gained all their demands. We are told that a Congress will not achieve its purpose because the differences have not yet been clarified. But are they being clarified now, is not the confusion growing worse confounded? Differences are not being clarified, but deliberately searched out and manufactured, and only a Congress can put an end to this. It alone, by bringing the contending parties face-to-face and making them frankly and definitely state their objects, can thoroughly clarified the mutual relations between the different trends and forces in the Party. But, the minority declare, the Congress may be manipulated by the breaking up of organizations. That is a lying insinuation, we reply, an insinuation unsupported by a single fact. If there were any such facts, we may be sure that the minority, being in possession of the Party organ, would have given them wide publicity, and, controlling the Party Council as they do, would have had ample opportunity to correct them. Lastly, the recent Council resolution, which points to no such facts in the past, completely rules out their possibility in the future. Who is now going to believe this far-fetched insinuation? Fears are expressed that a Congress would divert too much of our forces and funds from positive work. What a bitter mockery! Can any greater die version of forces and funds be imagined than that which the strife is producing? A Congress is imperative! It would be imperative even if Party life had proceeded normally, in view of the exceptional historical juncture and the new tasks with which the world events may confront the Party. It is doubly imperative in the present Party crisis, in order to find an honest and reasonable way out of it, to preserve the forces of the Party and uphold its honor and dignity.

What must the Third Congress do to put an end to the strife and restore Party life to normal? Most essential for this, in our view, are the following reforms, which we shall advocate and work for by every available loyal means:
I. The editorship of the Central Organ to be handed over to the adherents of the Party majority. The need for this, in view of the manifest inability of the present editorial board to conduct the Central Organ as required by the general party interests, has been sufficiently demonstrated. The organ of a circle cannot and must not be the organ of the Party.
II. The relationship of the local organization abroad (the League) to the all-Russia central body, the Central Committee, to be clearly defined. The present position of the League, which has converted itself into a second Party leadership and manages its associated groups without any control, completely ignoring the Central Committee, is obviously abnormal and must be ended.
III. The Rules to provide guarantees that party struggles are conducted by Party methods. That this reform is essential as shown by the entire experience of the post-Congress struggle. It is necessary to include in the Party Rules guarantees of the rights of any minority, so that the disagreements, dissatisfactions, and irritations that will constantly and unavoidably arise may be diverted from the old, philistine, circle channels of rows and squabbling into the still unaccustomed channels of a constitutional and dignified struggle for one’s convictions. Among the conditions needed for such a change would class the following. The minority should be allowed one or more writers’ groups, with the right to be represented at congresses; the widest formal guarantees should be given as regards publication of Party literature criticizing the activities of the central Party institutions. The right of the committees to receive (through the general Party transport system) the particular Party publications they desire should be formally recognized. The limits of the Central Committee’s right to influence the personal composition of the committees should be precisely defined. We consider it highly important that the arrangements for publication of minority literature which the Central Committee proposed to the minority of the Second Congress should be incorporated in the Rules, in order that the fantasy of a “state of siege” invented by the minority themselves may be dispelled, and that the inevitable internal struggles and the Party may be conducted in seemly forms and not allowed to interfere with positive work.
We do not here elaborate our proposals in detail, for we are not putting forward draft Rules, but only a general program of struggle for Party unity. We shall therefore only briefly indicate certain specific amendments to the Rules which are in our opinion desirable, without in any way binding ourselves as regards subsequent elaboration of the Rules, in the light of further experience. For example, it is necessary to reform the Party Council, as an institution which, in its present form, has proved in practice to be unfit for its function of coordinating and exercising supreme supervision over the activities of the central bodies. It should be made a body entirely elected by the Congress, instead of being a court where the Congress-elected fifth member sits as arbiter over the central bodies, which defend themselves to their delegates. Further, Paragraph 1 of the Rules should be revised, in line with the criticisms voiced in the Party, to define the Party’s boundaries more precisely, etc.

In putting forward this program of struggle for Party unity, we invite the representatives of all other shades and all Party organizations to make a clear statement of their own programs, so as to permit of serious and systematic, conscious and methodical preparation for a Congress. An issue involving the very life, the honor and dignity of the Party is at stake: is it an ideological and material force capable of sufficient rational self-organization to act as the real leader of our country’s revolutionary working-class movement? By all their actions, the émigré minority answer: No! And they continue to act in this way with confident assurance, banking on the remoteness of Russia, the frequent changes of workers there, and the indispensability of their own leaders and literary forces. Our Party is coming into being!-we answer, seeing the growing political understanding of the advanced workers, the vigorous activity of the committees in general Party life. Our Party is coming into being, we have ever more numerous young forces capable of replacing or reinvigorating old literary bodies which forfeit the Party’s confidence; we have ever more revolutionaries who prize the consistent Party trend above any circle of former leaders.
Our party is coming into being, and no subterfuges or delays can hold back its decided and final verdict.

From these forces in our Party we derive our certainty of victory.

Comrades, reprint and distribute this appeal!”

And so we shall!

Houston activists support steelworkers in Greece
worker | January 30, 2012 | 9:05 pm | Action | Comments closed

Check out this interesting article:

And now for something completely different: U.S. Republican party lunatics take center stage
worker | January 27, 2012 | 10:12 pm | Action | Comments closed

By James Thompson

The Republican party campaign in this country has brought lunacy to a new level. First, let’s look at one definition of “lunatic” provided by Wikipedia: “Lunatic” is an informal term referring to people who are considered mentally ill, dangerous, foolish or unpredictable; conditions once called lunacy. The term may be considered insulting in serious contexts, though is sometimes used in friendly jest. The word derives from lunaticus meaning “of the moon” or “moonstruck”.

Newt Gingrich, like a roach exposed to sunlight, has been running around expelling a lot of hot air and has been commanding a lot of the nation’s attention since his victory over Willard Romney in South Carolina in the Republican Presidential primary. Some have noted that South Carolina was the state in which the Civil War started. As a result of Newt’s antics, some pundits have recently examined Newt’s writings and have found much fertile ground for endless jest. It turns out that Gingrich has written various articles and presented papers to Science Fiction conferences advocating a variety of preposterous schemes to establish U.S. domination of the Moon. Some have even proposed that Gingrich could be the first President of the Moon. Better that he be President of the Moon than the United States.

Gingrich’s right wing ideology and racist tactics are just starting to be exhumed from his past campaigns in which he was buried and disgraced by his ridiculous world (and perhaps universal) view. He has slandered a wide variety of racial groups on this planet, most notably Palestinians, African Americans and Latinos. Although some have noted that people in the U.S. have the short term memory of a flea, who can forget that he was forced to resign as Speaker of the House in total disgrace just a few years ago. Nevertheless, Newt’s longings for the Moon qualify him as a lunatic without qualifications to be President of the U.S. He can have the Moon, but please leave us earthlings alone. Who would want to answer “Newt” to any alien asking to be taken to our leader?

So, as Newt is poised to fall into disgrace yet another time as he reaps universal level profits from his book sales and lobbying activities, who might take his place in the Republican lineup?

Willard Romney aka Mitt Romney postures as every man’s working man (we must wonder what women think) and presents himself as being out of work. In the meantime, he fights to hide his tax returns which reveal the unlimited treasures he has gleaned from capitalism in the U.S.A. Headlines scream that Romney paid only 15% annual taxes which is much more than many corporations. He also has a history of slashing jobs and simultaneously collecting huge bonuses and other remuneration from large corporations. Hooray for the job cutter! How many would vote for him. Probably 1% of the population.

Ron Paul has distinguished himself among the Republicans as standing for bringing the troops home from the Middle East right away. However, he also has a long history of unmitigated racism and advocates shutting down our social safety net. He advocates stopping Medicare, Medicaid and Social Security. He wants to privatize our toenails. Here’s another 1 %er.

All the rest are just a blur of clowns with weird positions that ultimately favor the wealthy. Only the KKK and Aryan Nation could really get behind any of the Republican nominees in good faith.

So, let’s keep laughing at these clowns, but let’s not forget to vote against them in 2012. If one of them actually won, the 99% might find itself exiled to the Moon. Who would be our President then?

Ideological fightback website
worker | January 27, 2012 | 9:14 pm | Action | Comments closed

There are some interesting articles on this website from a unique perspective. Check it out:

North Devon: anti-imperialists campaigning together
worker | January 27, 2012 | 8:38 pm | Action | Comments closed


An initiative of Chilean Socialist José Mateo and British Communist Gerrard Sables led to the founding of North Devon Liberation the only local branch of Liberation the long time campaigning body against imperialism. Liberation was formerly the Movement for Colonial Freedom.

On Saturday 14 January to celebrate a year of campaigning the branch held a musical event. Jorge Morales thrilled the 50 or so gathered in Barnstaple’s historic Guildhall with songs from Chile. Cahit Baylav member of Liberation’s national steering committee read out the message of support from Jeremy Corbyn our national president and told us how in Turkey they had sung Chilean revolutionary songs in Turkish. He then entertained us with his violin and performed a duet with his wife Akgül. Gerrard then told of the history of Liberation in North Devon and made the collection of £236.

Breaking Boundaries is a Latin American quartet comprising Colombian singer Ludz, Chilean singer Patricia, Bolivian guitarist and vocalist Milton and Peter on guitar and vocals who had come from the Outer Hebrides for the event. they had the audience clapping and stamping in appreciation.

Dave Clinch played us out and we went for a splendid meal cooked by our good friend Belal whose excellent curry was devoured.

All in all a great afternoon’s entertainment and one which has made us many new friends.

Joe Hill
worker | January 23, 2012 | 9:21 pm | Action | Comments closed

Check out this article about the famous labor leader and organizer, Joe Hill, who prior to his death commanded working people, “Don’t mourn, organize!”

Theater of the absurd
worker | January 23, 2012 | 9:15 pm | Action | Comments closed


Talented artists are gifted with the ability to take some commonplace belief or unquestioned assumption and reveal underlying nonsense. Still others craft inventive works that expose fatuity lurking behind pomposity and platitudes.

But consider some of the events transpiring over the last few weeks. Reality is indeed stranger than fiction. These events rival any work of literature in illustrating hypocrisy and proud ignorance. And the real-life actors in this public theater know no shame or regret.

The Republican primary medicine show is low entertainment. Its candidates and their stage hands have amused liberal, but spineless commentators and shocked international observers with the primary debate inanities.

Within the arena of right-wing ultimate fighting, Gingrich has assailed Romney’s money making career as “vulture capitalism.” Romney sups at the table of Bain Capital, a private equity fund that preys on vulnerable businesses weighed by debt and burdened by marginally criminal mismanagement. Bain buys these businesses at a heavily discounted price by leveraging their substantial assets and then guts the victims chiefly of their employees, imposing a new draconian labor discipline, and reselling the polished product at an enormous profit. Indeed, “vulture capitalism” is the appropriate term for this parasitic process widely practiced among ambitious capitalists in the US.

But wait! This exposé came from Newt Gingrich? Not from Paul Krugman? Joseph Stiglitz? Or any of the other economists or pundits arrayed around the liberal wing of the Democratic Party? None of the Party’s shrewd operatives rallied around President Obama? Or the President himself?

No, this exposé of vulture capitalism came from one of the icons of the ultra-right. Further, the ultra-right fed on the revelation that Romney only paid taxes at a rate of 15% or less compared to the much higher rates paid by most citizens.

Surely this is class warfare initiated from the right. And just as surely no prominent Democrat – representing the presumed Party of working people – joined the chorus. As David Bromwich noted, in The New York Review of Books (2-9-2012), “Gingrich… fleetingly placed himself to the left of President Obama, who has been careful to portray the financial collapse as a disaster without a villain.” Isn’t this an indictment of the hypocrisy and deception of the two-party circus?

Yes. Exposing a sector of capitalism as illegitimate is beyond the pale, beyond the two-party discourse, even though no one but Romney has rushed to defend it. Everyone knows that private equity firms – that have worked their black magic on over 3,200 firms – engage in wholesale destructive behavior (apologists call it “constructive destruction”) yet no one will say it – except Gingrich.

Similarly, Ron Paul, the only candidate in years with a set of internally consistent principles, has dared to challenge the two-party consensus on aggressive imperialism, arguing that the US should abandon its occupations and wars and let the rest of the world (including Iran) go its own way. Paul, the only Republican right-wing ideologue who believes what he says, stands for an anachronistic Republicanism favored by the Party before the New Deal. The target of liberal derision because of his appearance and mannerisms and discounted by conservatives because of his slender fund-raising, Paul continues to have his campaign energized by poll results and young volunteers impressed with his integrity. And he dares to speak heresy.

Of course those who respect the man’s integrity should consider the consequences of his free market and barely-breathing government principles before jumping on his bandwagon. Nineteenth-century nostrums are not the solution to twenty-first-century problems, regardless of Paul’s honesty.

It is incredible, however, that no one among the left of the Democratic Party’s luminaries has either defended Paul’s anti-imperialism or, at least, used it as a spring board for a tepid critique of US policies regarding Israel, Iran, or the rest of the Middle East. Again, writing in the New York Review of Books, David Bromwich ventures: “In addressing such issues, he has no rival among Republicans, and, after the death of Robert Byrd and the defeat of Russ Feingold, none among Democrats of national stature. On issues of national security and war, he is the American politician who speaks to Americans as if they were grownups interested in their own condition…”

But who speaks for “grownups” on the other urgent issues? Certainly not the Democrats. This is surely a measure of the untenable, unpopular and unsustainable US two-party system and its money-driven pre-election entertainment.


Hungary has its own Ron Paul in the body of conservative Prime Minister Viktor Orban. A political maverick born of the anti-Communist scramble for power after Hungary’s socialist government crumbled, Orban won election in 2010 representing the right-wing, nationalist Fidesz Party. Lacking Paul’s principles or any principles at all, Orban delights in playing to nationalist sentiments and defying the EU and the IMF. I wrote earlier of the outrage created by Orban when he dared to tax banks to reduce Hungary’s deficit. As I sarcastically noted, austerity programs to lower the deficit on the backs of working people are prescribed by these august bodies, but raising revenue by taxing banks is strictly forbidden, even though the deficit-lowering results would be the same! So much for the independence and objectivity of the EU and the IMF.

Orban struck again late last year securing a parliamentary law that slightly limits the powers of Hungary’s Central Bank. Like most Central Banks, Hungary’s enjoys a special status buffering it from any popular or governmental influence. In essence, capitalist Central banks are enormously powerful economic actors that are isolated from any kind of democratic control, pressure, or oversight. And the EU, the IMF, and capitalism, in general, want to keep it that way. It is capitalism’s ultimate economic tool immunized from the will of the people.

Orban’s parliament would place a government minister on the Bank’s monetary council, seemingly a small step towards democratizing the Bank, as well as requiring the Bank to share its meeting agenda with the parliament, another small step towards transparency. The move was met by righteous indignation from the European Commission (threatening to sue), the IMF (threatening to withhold funds) and the entire global financial hierarchy. They charged indignantly that the new law compromised the Central Bank’s “independence”.

Of course the question is independence from whom. Currently the Bank is independent from any sort of Hungarian popular governance, but it is hardly independent from outside influence, particularly the IMF, the EU, and financial markets. This is a strange sort of independence advocated and protected by foreign financial forces. To quote the famed philosopher, Humpty Dumpty: “When I use a word… it means just what I choose it to mean—neither more nor less.” Financial elites occupy the same fantasy world created by Lewis Carroll.


US workers can breathe easier. The wholesale destruction of their living standards, benefits, and wages, coupled with a dramatic increase in the rate of exploitation over the last decade is paying dividends. But not dividends for them.

Recently Caterpillar Inc locked out its Canadian workers in London, Ontario, contending that the workers need to cut their pay dramatically. They point to the fact that Caterpillar pays its workers 50% less in Lagrange, Illinois. Quoting The Wall Street Journal (US: A Cheaper Labor Pool 1-6-2012): “…[B]ut instead of pointing to the usual models of cheap and pliant labor, such as China and Mexico, it is using a more surprising example: the US.”

So the tables are turning and today we find that US workers are setting miserable standards of pay and benefits against their Canadian and European counterparts. They, in turn, could repeat the same sad misguided tactic popular in the US by blaming poorly paid “foreigners” – in this case US workers or their government’s policies — for the pressure on their living standards. US hourly compensation costs in manufacturing rose only 39% over the last decade, while average comparable labor costs grew by 74% in OECD countries and 91% in Canada.

Put differently, labor costs per unit of output in the US are 13% less than they were in manufacturing a decade earlier. In Germany they rose 2.3%, the Republic of Korea 15%, and Canada 18%. These figures are most telling because they reflect—assuming roughly similar levels of productive force development – differences in the relative rates of exploitation. Clearly US workers have surrendered far more than their international brothers and sisters while being squeezed much harder in the work place.

Instead of the divisive and diversionary tactic of blaming foreign governments or foreign workers for job losses or pay cuts – typically China – it’s time to target the trans-national corporations that exploit labor cost differentials to increase profits. Like the machine-breakers of yore, workers and their trade union leaders must correctly identify the enemy and embrace class struggle unionism if they have any hope of stopping this destructive game of competition to see who can offer the best wage deal to rapacious corporations.


Speaking of China, the Western media reported on January 17 an ominous drop in fourth quarter GDP in the Peoples Republic of China; quoting Reuters: “Growth of 8.9% over a year earlier was slightly [my emphasis] stronger than the 8.7% forecast by economists in a Reuters poll, but the data on Tuesday raised concerns about the immediate outlook and how much support China can offer a struggling global economy… Growth for all of 2012 slipped to 9.2%, a pace last seen in 2009… from 10.4% in 2010.”

While it is true that the PRC GDP growth dropped slightly (5%) from the 3rd to the 4th quarter, it meant that that the PRC GDP would double, at that rate, in a little over eight years rather than a bit more than seven and a half – not a bad performance either way for the world’s second largest economy. Put into perspective, the OECD estimates that from 2011 through 2013 the collective OECD states (including PRC) will only average less than 2% growth. At that rate, it would take the entire OECD over 37 years to double its economic output!

But the Reuters report, like so many other media accounts of PRC 4th quarter GDP performance, masks two implicit points:

1. The Chinese economy is vigorous even in the midst of world wide economic turmoil (2009, for example, and now).

2. Most importantly, economic wizards concede that the health of the global capitalist economy depends critically on the continued vigor of that economy.

So it’s not the future of the Chinese people that so worries the pundits, but the impact of the Chinese economic engine on capitalism’s future. At the same time, they continue to demonize the policies that fuel that powerful engine. Strange, indeed.

Zoltan Zigedy

Posted By zoltan zigedy to ZZ’s blog at 1/23/2012 11:57:00 AM