Thousands hit the streets in Haiti once again on Monday, September 26, protesting amid the economic, political and social crisis in Haiti, demanding the resignation of de-facto Prime Minister and acting President Ariel Henry. In the capital of Port-au-Prince, protesters organized two massive simultaneous marches to Henry’s official residence. Citizens gathered at the Champs-de-Mars public square and at the Airport Crossing, renamed by protesters as the Resistance Crossing, from there marching to the Prime Minister’s residence. Similar massive rallies were held in the Carrefour and Gonaïves communes. Demonstrations, protests, roadblocks, and sit-ins denouncing the Henry government were organized in almost all main cities.
On Monday, August 22, thousands of Haitians took to the streets across the country to protest against rampant insecurity, chronic gang violence and a rising cost of living. The protesters demanded the resignation of Prime Minister and acting President Ariel Henry, arguing that under his management, the economic and social crisis deepened in the Caribbean country. In the capital of Port-au-Prince, members of several civil society organizations, popular movements, trade unions, and opposition parties held a massive rally, condemning fuel shortages and soaring prices of essential commodities and basic services. Protesters blocked roads with burning tires in and around the capital. Haiti’s central bank reported that inflation had reached 29% and hit a 10-year high.
Sri Lanka, an island-nation of 22 million people, has been the center of political and economic turmoil since the United National Party government defaulted on $51 billion in foreign debt during May. For months the country has experienced severe shortages of fuel, food and other commodities amid an inflationary spiral. Motorists have lined up for blocks to get fuel and cooking oil. A failed agricultural fertilizer policy has been cited as the cause behind the decline in agricultural production. The shortages of fuel have hampered the production and marketing of agricultural products such as tea which is exported from Sri Lanka. Due to the lack of fuel, trucks which transport these agricultural commodities for internal marketing and export have been drastically reduced. Workers and small business operators have lined up sometimes for two days in order to purchase limited amounts of fuel.
Rising housing costs have made housing largely inaccessible and unaffordable to most Americans, but have acutely impacted communities of color and low- to moderate-income families over the past several decades. The median asking rent in the United States rose above $2,000 for the first time in June 2022. Given that the U.S. Department of Housing and Urban Development (HUD) sets the standard of affordability at 30% of household income, $2,000 per month would only be “affordable” for households earning at least $80,000 per year—well above the median U.S. household income ($67,521). A growing housing supply shortage is a key contributor to the housing affordability crisis. Following the Great Recession, the share of homes being built fell significantly, causing buyer demand to exceed housing production.
The government of Ghana has initiated talks with the International Monetary Fund (IMF) for a potential bailout program. A delegation of the IMF concluded a week-long visit to Accra on July 13 and met with officials including Finance Minister Ken Ofori-Atta and Vice President Dr. Mahamudu Bawumia. The proposal has been severely criticized by the Ghanaian left, especially the Socialist Movement of Ghana (SMG), and trade unions. In a statement released after the visit, IMF Mission Chief Carlo Sdralevich stated, “The IMF team held initial discussions on a comprehensive reform package to restore macroeconomic stability and anchor debt sustainability…The discussions focused on improving fiscal balances in a sustainable way while protecting the vulnerable and poor; ensuring credibility of the monetary policy and exchange rate regimes; preserving financial sector stability; and designing reforms to enhance growth, create jobs, and strengthen governance.”
After more than two weeks of mobilizations and strikes and several attempts by the national government to fragment the movement, the people of Panama continue their struggle to demand immediate solutions to the cost of living crisis. On July 19, the People United for Life Alliance announced that it would partake in dialogues mediated by the Catholic Church. The organizations part of the Alliance which drafted the list of 32 demands for the national government and organized the series of national mobilizations that began on July 1, have in the meanwhile continued their nationwide protests. On July 18 and 19, thousands mobilized in cities and towns across Panama, maintaining road blockades and organizing pickets outside public institutions.
The US-led sanctions campaign against Russia has done nothing to stop the war in Ukraine or hurt Vladimir Putin, but the toll continues to mount on Western economies and there are increasing signs that Europe is facing a major economic crisis. The euro has reached a 20-year low against the dollar, inflation is at a record-high 8.6%, and economists are predicting a recession if the EU is cut off from Russian gas. Russia has already stopped supplying some EU members for their refusal to pay in rubles, something Putin required in retaliation for sanctions that targeted Russia’s use of the dollar and euro. The Nord Stream 1 natural gas pipeline that connects Russia and Germany is currently shut down for routine maintenance, but there are growing fears that the pipeline might not come back into service.
On Friday, April 22, thousands of workers demonstrated in major cities across Belgium protesting the worsening cost of living crisis and calling for a rise in wages. The call for the mobilization was given by major trade unions like the General Labor Federation of Belgium (ABVV/FGTB), Confederation of Christian Trade Unions (ACV/CSC), General Confederation of Liberal Trade Unions of Belgium (ACLVB/CGSLB), and political parties including the Workers’ Party of Belgium (PTB/PVDA). Various student/youth groups expressed support and solidarity with the workers’ mobilization. The protesting workers have called for a revision of the 1996 Wage Margin Act. The act establishes a strict procedure for the Belgian social partners to negotiate a maximum average wage increase and thus effectively prevents any real increase in wages in the country.
To anyone paying attention, the American economy sure feels a lot like a casino. The stock market has become increasingly gamified, and the consequences are felt by all of us, every day—even those of us who aren’t even invited to play. There’s actually a term for our financial system that uses these words: casino capitalism. What many don’t know, however, is that behind this new form of capitalism is a flesh-and-bones man with a certain sort of gambling addiction. His name is Bill Gross, and his is the story that Mary Childs, co-host of NPR’s “Planet Money” podcast, tells so compellingly in her book, “The Bond King.” Titled after the investment banker’s moniker, Childs’ book explains how Gross remade the bond market into a gambler’s paradise, and went on not only to found the investment firm Pimco, but to rig the entire U.S. economy in his favor.
Because only fools believe they can predict the short-term fluctuations of the economy, let’s follow in the style of Descartes and just retreat to the most basic possible prediction that we are certain will come true. Which is: The current boom in asset prices — high prices not just in one asset, but in stocks, financial assets, real estate, luxury goods, crypto, NFTs and any other hastily invented place where money can flow — will come to an end. Whether that end comes tomorrow or in six months or in a year or in five years is impossible to know for sure, but we do know that the economy moves in cycles, and the current cycle is (very far) on the upside. And what goes up will, inevitably, come down.
For the end of the year, Clearing the FOG speaks with economist Richard Wolff about the current state of United States capitalism. Wolff explains that the United States is experiencing the greatest crisis in its history - a severe economic crisis at the same time as a pandemic, as well as the climate crisis. This is unprecedented. Unlike the great depression in the last century, when the wealth divide shrank, inequality is worsening. On top of that, US empire is in decline. Wolff discusses the current state of inflation and supply chain disruption and the forces behind them. Instead of facing up to these realities and learning from the experiences of other countries, such as China, and even our own past, the ruling class is in denial and continues on the same path that created the current situation. Wolff talks about what we need to focus on going forward.
In March 2020, as the first wave of coronavirus infections all but shut down the U.S. economy, Congress responded with rare speed, passing a $2.2 trillion relief package called the CARES Act. The centerpiece of the law was an emergency payment to over 150 million American households that needed help. Congress used a simple filter to determine who was eligible for assistance: The full $1,200 was limited to single taxpayers who’d reported $75,000 a year or less in income on their previous tax return. Married couples got $2,400 if they had reported less than $150,000 in income. Money was sent automatically to those who qualified. Ira Rennert, worth $3.7 billion according to Forbes, did not appear to need the cash infusion offered by the CARES Act.
While wages for many Americans have rebounded to pre-pandemic levels, earnings for Black workers declined in the first quarter of 2021, growing the wage gap to its highest level since before the pandemic, according to a new analysis. In a report of earnings data by the Ludwig Institute for Shared Economic Prosperity (LISEP) real median earnings have increased by 1 percent for the first quarter of 2021, driven in large part by a 1.6 percent increase in real earnings by Hispanic workers, while real earnings for white workers remained virtually unchanged. Wages for white earners have fully recovered to pre-pandemic levels and are currently 0.3 percent higher in real terms than in December 2019.
This past week the US Commerce Department released its early estimates for US GDP for the 1st Quarter 2021, January through March. If we are to believe the numbers, the US economy grew a respectable 6.4% during the period. But did it really? And does it represent a strong recovery underway? Or just a rebound, as the economy reopens in the services sector; and once the reopening concludes, will the economy flatten out again—as it did with last summer’s 2020 partial reopening that collapsed in late 2020? The first thing for readers to understand is the 6.4% is not really 6.4% for the first three months of 2021. The US is one of the few countries that reports its GDP figures in an ‘Annual Rate’ (AR) percentage. Most other advanced economies do not.
Like all previous economic systems in recorded history, capitalism is on track to repeat the same three-step trip: birth, evolution, and death. The timing and other specifics of each system’s trip differ. Births and evolutions are commonly experienced as positive, celebrated for their progress and promise. The declines and deaths, however, are often denied and usually feel difficult and depressing. Notwithstanding endlessly glib political speeches about bright futures, U.S. capitalism has reached and passed its peak. Like the British Empire after World War I, the trip now is painful. Signs of decline accumulate. The last 40 years of slow economic growth have seen the top 10 percent take nearly all of it. The other 90 percent suffered constricted real wage growth that drove them to borrow massively (for homes, cars, credit cards, and college expenses).