U.S. Bosses’ ‘Solution’ for Economic Woes: Police State, Wider War

“We are at a moment of economic crisis, stemming from four key areas: falling housing prices, lack of confidence in creditworthiness, the weak dollar and high oil prices,” said Senator Charles Schumer. (New York Times, 11/10/07). He could have added plunging stocks, dwindling sales domestically and being bogged down in the quagmire of wars in Iraq and Afghanistan to his list of U.S. rulers’ woes. Hundred-dollar-a-barrel oil, GM’s $39-billion third-quarter loss, the growing subprime foreclosure epidemic and a rapidly-devaluing dollar all cut sharply into the bosses’ profits. The dominant liberal wing of U.S. capitalists is responding by concentrating control over their own class, increasing racist attacks on workers at home and expanding their murderous overseas oil wars.


Robert Rubin, a leading ruling-class strategist, took over as chairman of the giant Citigroup after it reported an $11-billion subprime-related loss. Rubin is co-chairman of the Council on Foreign Relations (CFR), the Rockefeller-funded think-tank that seeks to steer foreign policy in the interests of the biggest U.S. capitalists. Rubin’s CFR drafted plans, that Bush ignored, envisioning a massive occupation of Iraq accompanied by a six-million-barrel-a-day oil bonanza for Exxon Mobil and its allies. As Clinton’s treasury secretary, Rubin helped dismantle Welfare in order to pay for the bombing of Serbia and missile strikes to soften up Iraq. With Rubin at its helm, look for Citi to prove more responsive to the needs of U.S. imperialism.

The current profit slump has bosses squeezing more and more out of workers. Recent auto-industry contracts slash workers’ pay and benefits by more than 50%, with black workers hit the hardest (see article page 5). This increased racism is making it more difficult to recruit black and Latino youth into the military. Minimum-wage workers today receive 40% less in purchasing power than in 1968. Stepped-up deportations, concentration camp detentions and workplace terror raids force many immigrants to toil for even less than the minimum. Liberals want to increase the pressure. Earlier this month House Democrats introduced a bill that would “strengthen workplace enforcement of immigration laws.” Lower wages for black workers and immigrants depress pay rates for the entire working class. In the U.S., 38 million people now live in poverty.


A burgeoning racist police state helps enforce the rulers’ profit-driven attacks on workers. The 100,000 additional cops Bill Clinton put on the streets have been working overtime terrorizing, jailing and often killing workers. The cops’ victims are disproportionately black and Latino and increasingly women (see box). Community policing, which uses churches and schools to turn neighborhoods into networks of undercover agents and civilian stoolpigeons, has taken hold in cities nation-wide.

Along with cracking down domestically, U.S. rulers are counting on their (for now) unmatched military to launch a wider war for control of Mid-East oil and export routes to solve their many-sided economic problems. The euro may shame the dollar, but France has no aircraft carrier groups regularly plying the Persian Gulf or South China Sea. Germany has no troops stationed in Japan or South Korea. So now, among presidential hopefuls of both parties, permanent U.S. presence in oil-rich Iraq is a done deal, and debate has shifted to how best to confront oil- and gas-rich Iran.

Hillary Clinton, supporting the U.S. Iraq occupation has said that Iraq lies “right in the heart of the oil region” and so “it is directly in opposition to our interests” for it to become a failed state or a pawn of Iran. Michael Klare, a professor at Hampshire College, wrote in The Nation (11/12/07):

“Senior figures in both parties are calling for a reinvigorated U.S. military role in the protection of foreign energy deliveries….Perhaps the most explicit expression of this elite consensus is an independent task force report, “National Security Consequences of U.S. Oil Dependency”…released by the Council on Foreign Relations in October 2006. The report warns of mounting perils to the safe flow of foreign oil…It argues the need for a strong US military presence in key producing areas and in the sea lanes that carry foreign oil to American shores.”

U.S. rulers intend to muddle through their economic troubles by exploiting and killing millions of workers. They are getting away with murder, for the time being, without a serious military rival or a mass communist movement to challenge them. But both situations can change.

The U.S. empire is on a long-term collision course with China’s bosses, whose interests lie in allying with Europe or Russia or both. Such a coalition holds the potential for World War III. Building a base for communism among workers, soldiers and students, we can turn the cauldron of global conflict among the imperialists and their lackeys into a revolutionary storm to smash all war-makers.

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