Sunday, September 28, 2008

China encourages finance capitalists

As the Western capitalist world is forced by the current version of credit crisis to temporarily embrace some forms of stock market regulation, China is heading in the other direction and giving free rein to the finance capitalists it has created through restorationists policies.

China’s State Council has authorised a plan submitted by the China Securities Regulatory Commission to allow margin lending and short selling. The plan is expected to be formally announced either before, or just after, the October 1 holiday that celebrates the Communist Party’s liberation of the working class and peasants from imperialism, feudalism and bureaucrat-capitalism, a victory since squandered by the restorationists.

Margin loans are a fairly risky form of obtaining credit for investment. The loan is underwritten by the value of the investments and is good so long as the investments retain their market value. These are typically shares, securities and other financial products. If these investments fall below a certain value, the borrower will get a “margin call”, a requirement to increase the assets securing the loan. In the very likely event that the borrower lacks the cash to pay the lender (interest payments are already soaking up whatever cash store is at hand), then the borrower will either have to go deeper in debt or sell of part of his/her assets to pay out the lender.

This is the nature of the problem that engulfed ABC Learning’s Eddie Groves.

Short selling is the practice of selling a sufficient quantity of shares at, for example, $2 each in the hope that the price will drop, then buying back the shares at say, $1 each, and hoping that the market rebounds.

It is simple speculation by that section of the capitalist class that does not invest in production. It is notoriously the practice of hedge funds that either borrow stock that they do not own in order to short sell, or simply sell stock that doesn’t exist. To reduce the risk that they won’t be able to purchase stock at the cheaper price from the profit made by selling the same stock in name only, hedge funds often ramp down the market value of the stock at the same time that they are dumping it through their sales. They do this by spreading rumours about the future of the company holding the stock, or its directors or its capital value.

Shorting has been placed under a three month ban in countries like the US, the UK and Australia, and naked shorting, the sale of non-existent stock, may even stay banned.

But China is embracing these practices.

It has also scrapped the tax on stock purchases, further assisting accumulation by the rich.

And it has used public money held by the China Investment Corporation to buy back shares in three large state-owned banks in order to improve their liquidity.

China had previously curtailed unauthorised margin trading in 1997 and 2001, when banks were found to have illegally channelled money into the stock market.

Regulations will control some of the margin trades and shorting after October 1 by ensuring that only players with large enough assets to cover losses will be authorised to speculate.

But since when has this ever stopped a crisis?

Me, I’m off to re-read Mao Dun’s 1930s classic of the stock market parasites in Shanghai (the class that lost its power before the creation of the new Shanghai stock exchange above), and the workers’ struggles against them: Midnight.

Monday, September 22, 2008

Arkaroola: the case of the missing minerals

I am indebted to Bill Doyle and his excellent blog for the following post. (Bill is a great photographer and his site should be draped in awards and accolades for its promotion of SA environmental tourism!) His post reaffirms my concerns about the type of crony capitalism emerging in South Australia under the Rann-Foley regime. Keep in mind that Marathon's PR response to the discovery of its unauthorised dumping of wastes at Arkaroola was to elevate Labor Party heavy Chris Schacht from anonymous shareholder to director just so that he could work his connections to the advantage of the wilderness despoiler in which he has invested.

Wednesday, September 17, 2008

the case of the missing minerals

Last Thursday, Greens MLC Mark Parnell asked a series of interesting questions of Mineral Resources Development Minister Paul Holloway in the state's upper house -

...[A]ccording to the final investigation report, on 19 December 2007, Marathon requested the use of two new drill rigs in the sanctuary at Mount Gee so it could fast track its drilling program. In late December (one or two weeks later), PIRSA received the allegations of the inappropriate disposal of waste in pits at Mount Gee from the Leigh Creek police.The new drill rig request was granted by PIRSA on 10 January 2008, in spite of these outstanding allegations and in spite of the fact that its own team of three, and an EPA team of two inspectors, were due to travel to Arkaroola only five days later on 15 January 2008.My questions are:

1. Why, given the seriousness of the allegations, was the company granted an opportunity to actually accelerate its drilling program whilst those allegations were unresolved?

2. I refer to the unique fluorite occurrence which was damaged and removed by Marathon employees. I did inspect that site and the remaining fluorite is, in fact, incredibly beautiful. I also understand that it is very rare and very valuable. Where is the fluorite now that was taken, and what actions has PIRSA taken to find that fluorite and to return it to the Arkaroola sanctuary?

3. Will the Minister once and for all confirm that, when the clean up by the company is complete, the Government will finally cancel Marathon's exploration licence?

Let's have a look at the minister's responses -

ANSWER:The Hon. P. HOLLOWAY (Minister for Mineral Resources Development): In relation to the fluorite occurrence, that is referred to in the investigation. If the honourable member has a copy of the report, as he said, I would suggest that he read the detail there. As I understand it, and it is some time since I have read the report, there was obviously some dispute over who had taken this particular fluorite.Clearly, the expectation would be that it was someone within the company, but who exactly had done it and what had happened to it, of course, was somewhat indeterminate. It would be very difficult to track down exactly what had happened in relation to that, because there are also other people on the Arkaroola site who
—An honourable member interjecting:
The Hon. P. HOLLOWAY: Well, it may have been disturbed, but who actually took it is, of course, another matter. However, I believe that that matter is adequately covered in the report that the honourable member says he has in his possession.

You'll have noticed that the Minister had simply ignored the first question. It remains a very interesting one.

But his reply to the second doesn't leave us much the wiser than his ignoring the first did!

the case of the missing minerals

This PIRSA report that Mark refers to notably begs the question of exactly what happened to the missing chunks of the unique fluorite outcrop, a core of the nationally significant Mount Gee geological monument. This was, of course, the reason he asked the question in the first place!

Geology students all over the country will be keen to know the answer. As PIRSA's final report itself notes'[t]his unique mineral occurrence is well known to Australian geologists and mineralogists.' But in order to further beg the question the minister simply refers back to this same report that doesn't tell us!

He then alludes to the notion that 'other people', presumably with access to the site, might have been responsible for its ultimate disappearance.

This is remarkable! We're not exactly talking a handful of gemstones someone scooped into a lunchbox here! Here's what the report actually says -

Identifiable machinery tracks to the site and an excavated area of approximately 2.5 by 2m at the edge of a creek were recorded and photographed. From the track and excavation impact, it appears that a small excavator had been used to remove a substantial part of this unique fluorite vein occurrence, Mr Newell [from Marathon - BD ] was informed of this matter by PIRSA officers and he subsequently visited the site and confirmed verbally that the site had been accessed by a small excavator. There is no DEF authorisation for Marathon staff to excavate or remove material from this site.At the site, numerous tracks were observed immediately north and west of the investigation area, outside of designated zones used to access approved drill sites...

The report the goes on to state in its summary of investigation findings -

A Marathon representative inspected the fluorite vein and confirmed that the site had been damaged and had been accessed by mechanical digging equipment. The Marathon representative could not advise as to who damaged the site. Marathon's exploration operations are the only operations within Arkaroola that have this type of equipment available [emphasis mine - BD]. The evidence indicates that the following PIRSA approval conditions for the use of Declared Equipment dated 1 November 2006 have been breached:

A geological monument has been identified as an environmentally sensitive site within your proposed drilling area. The DEF has been circulated to the Geological Monument Subcommittee for comment/information. Comments received are attached below.

(i) The Subcommittee has no objections to the work as outlined in the Marathon Mt Gee DEF. The drilling project should not affect the Mt Gee geological monument FR1.2, as the track maintenance and drill pad work outlined in the DEF are on the east and west slopes of Mt Gee, whereas the quartz sinter, the subject of the monument nomination, is on the upper parts of the hill. [emphasis mine] They should be reminded, however, of the need to avoid any damage to the sinter area, as well as unnecessary damage to other natural outcrops closer to their operations.

The minister's notion that while a Marathon employee may have actually used machinery - which, as the report notes, was only locally available to Marathon's employees, and this excavation was subsequently admitted by the company anyway - to remove a large chunk of a rare mineral, but that 'other people' wandering around in this remote region may have made off with it I leave to the reader to contemplate...

So where exactly is the missing fluorite?

marathon's statement

While the report - which, we must remember, 'adequately covers' the issue according to the minister - doesn't detail Marathon's response to PIRSA, it's left to the company to tell us what they told them, via their own 'Learning from Waste in the Wilderness' document (how sweet and reassuring; the audacity of this would-be-innocuous, saccharine title - given the circumstances of its publication - never ceases to amaze me!) -

Marathon had management at the Mt Gee site that did not properly appreciate the appropriate sustainable development standards. This is exemplified by the damage an employee of Marathon Resources did to a fluorite vein located within the Mt Gee geological monument area. [emphasis mine] He used declared equipment within EL 3258 without written authorisation from PIRSA.

The region in general has a long history of gem and mineral fossicking, however, the actions of one of Marathon’s employees in causing damage to this significant Mt Gee fluorite occurrence was unacceptable. The occurrence is an important educational and research tool for tertiary geology students and a unique Australian environmental monument for Arkaroola Sanctuary’s international tourists.

Following damage to the Fluorite occurrence, Marathon conveyed to PIRSA the following:

‘In relation to Marathon’s involvement at this site, we have found that at some time during February 2007 a quantity of surface material was pulled from a badly eroded watercourse onto the bank with a small backhoe by a Marathon employee. The water course which is up to 1.0m deep and 1.5m wide at an inclination of +/- 14o has been eroded by water flow from a site excavated for exploration purposes by a party prior to Marathon Resources’ involvement on Mt Gee. The quantity of material pulled from the eroded gully is estimated by us as a result of a visit to the site on 12 February 2008 as less than 0.5m2 [sic - and note the variance with PIRSA's 'excavated area of approximately 2.5 by 2m' - BD] or no more than 250kg [! - emphasis mine]. We are advised that when the material was moved from the gully, no sampling took place. The Marathon Resources employee who removed the surface material... was on an activity not authorised by the Company... His action was not in accord with our environmental policy. We are assured that he did not then subsequently remove any samples and has not returned to the location since February 2007. It is evident from ...photographs that subsequent to the event of February 2007 a person or persons (and unknown to Marathon Resources) has/have made a further excavation of approximately 80 litres (4 standard buckets)(letter to PIRSA dated 27 February 2008).

The geological significance of the fluorite occurrence was not explicitly detailed in Marathon’s environmental control documentation. In order to ensure there is no further damage to this, or any other monument, Marathon’s employees need to be aware of the geological significance of the area and how their actions might directly impact on sensitive sites. Further, they need to be accountable for their actions at site level at all times.

So, are we to to assume, then, that this was an instance of 'fossicking'? If Marathon employees are indeed to be held accountable what disciplinary actions have been taken against the one responsible?

And PIRSA is satisfied? Is one admitted excavation by a Marathon employee and a remarkable follow-up effort by 'person or persons... unknown' really as far as investigating this matter can go? And, leaving aside whodunits, where's the stones? We aren't told.

How can Paul Holloway - the responsible minister overseeing a well-known, nationally significant mineral occurrence in a national Geological Monument - rest content with 'but who exactly had done it and what had happened to it, of course, was somewhat indeterminate...'?

Come to think of it, when gems go missing, isn't it usually regarded as a matter for police involvement?

it's OK - they have a plan!

And what's to be done about the damage. PIRSA is on the case -

In relation to the unauthorised sampling and damage to the fluorite occurrence at Mt Gee, the company is requested to consult with the landholders, PIRSA and other stakeholders in the development of a remediation plan for the damaged fluorite occurrence in the Mt Gee Geological Monument Area.

How, precisely, does one 'remediate' the removal of a large chunk of a rare mineral? Particularly given its mysterious apparent absence from the site. Buy some more on EBay? Then use Blu-tac? Superglue? Of course, my suggestions are absurd; but of late, sadly, farce just seems to pile upon farce when it comes to Mount Gee...

a bleak future for miners?

But, what of the overall question? What does the future hold for Mount Gee and the Arkaroola Wilderness Sanctuary? Paul Holloway does have something to say about that -

In relation to the future of drilling at Mount Gee, I have already answered that in an earlier question today, in that the exploration licence remains live until the exploration is finished. As to the future of it, that is something that will have to await until the clean up is finished. When I made my statement I think I mentioned a number of other conditions that Marathon Resources will have to meet before any further exploration will be permitted in that area. One of the obvious ones is its relationship with the landholders. The view I have expressed to any mineral explorer is that, if they do not have good relations with the landholders, the future of mining within those areas is likely to be bleak. [emphasis mine]

Well, it's not exactly the kind of definitive statement we'd all appreciate, but it has substantially more content than the other responses.

I scarcely need to reiterate how fervently the landholders in this instance simply wish the company would pack up all its 'Declared Equipment' and go home!

It's the state government's own legislative deficiencies that have forced the Spriggs into the absurd position of having to countenance this farce in the heart of their sanctuary. This same state government would surely not dare to attempt to pass off Marathon's employing a public relations consultant to deal with the Spriggs (in negotiations they don't want to have in the first place) as 'good' relations?

So this last response cannot bode well for the future for those who hope to mine in the heart of the Arkaroola Wilderness Sanctuary! But Paul Holloway must eventually stop shilly-shallying and publicly declare mining access ended.

New response to Wall Street crisis

NEW York Mayor Michael Bloomberg has outlawed extreme thrill seekers who dodge police to jump or hang from high buildings.

The Bill signed by Bloomberg "prohibits climbing, jumping or suspending oneself from structures without the approval of the police department and the owner of the structure".

The law targets freelance practioners of a sport known as BASE jumping, which stands for Building, Antenna, Span or Earth.

Climbers scale large objects, sometimes descending by parachute or wingsuit.

"Recent high-profile stunts in Manhattan have brought both the appeal and the danger of this hobby to light," the mayor's office said.

"Valuable city resources are dedicated to responding to these events - resources that could be better utilised to respond to other emergencies," the office said.

Crony capitalism pays.

Just ask Con Makris, the rags-to-riches billionaire Adelaide developer.

The South Australian Labor government has just announced approval for Makris’ plan to build a new shopping and residential complex on a large vacant site at North Adelaide (below).

The site has been vacant site 1989, with various development proposals running foul of the Adelaide City Council’s planning regulations.

Enter Con Makris. He bought the site in 2001 and, like his predecessors, submitted plans that were obviously outside the City Council’s guidelines. Those guidelines placed a three-storey limit on new buildings; in 2005 Makris submitted a plan for a nine-storey structure including a "seven-star luxury hotel" (Makris' words), upmarket retail shops, apartments, cinemas, restaurants and a three-level, 1100-space car park below ground level.

Makris’ purchase of the site coincided with the election of the Rann Labor government. In 2002, companies associated with Makris began making contributions to Labor’s campaign coffers. Since 2002, Makris companies have made donations worth $261,150 to the ALP. The Makris Group was the second-highest contributor to the ALP during the 2005-06 state election.

Labor is a party of capitalism and always has been. In recent years, and especially under Rann, it has decided to abandon the restrictions imposed on it by the pretence of a social-democratic reform agenda. It has decided to openly commit itself to being a party of business and development, free of any pangs as to its “historic association” with the trade union movement and what might once have been a social-democratic agenda around health, education, public services and so on.

It is now unashamedly and unapologetically a party that badges itself as “pro-business, pro-growth and pro-mining”. It has set up a crony capitalist fund-raising entity called Progressive Business SA Inc. to sell its decision-making capacity to the highest ruling class bidder.

Makris is a trail-blazer in this development, a blazing neon name which shows what can be achieved by making the right-sized donations to the Business and Development Party, aka Labor.

In May 2007, the government awarded “major development status” to Makris’ North Adelaide proposal. This means that the deal would be fast-tracked, that all “red-tape” impediments would be swept aside.

But still the Council remained obdurate. They were not, as has sometimes been alleged, “anti-development”, but they did have a set of values around city planning that they did not want violated just for the sake of developer profits.

So Rann had to get them out of the way.

In July 2008, the State government stripped Council of its powers to approve developments costing more than $10 million.
In September, the government gave Makris final approval for a six-storey structure at North Adelaide.

Makris immediately denied that he had any political influence with Rann and his Planning Minister Paul Holloway. Speaking of his donations to the government, he said, “Everyone does it. This happens all over the world, it’s just not here.”

He’s right. It does happen all over the world of capitalism. It’s just that such blatant purchasing of political favours is regarded as corrupt in some parts of the capitalist world, whilst in others, it is the only way of getting things done.

SA Labor, which vigorously opposes the establishment in SA of an Independent Commission Against Corruption, has decided to embrace corruption through crony ties with paying sections of the ruling class.

The Opposition Liberals are no better.

The reality is that the system of capitalism, even in its cleanest and least corrupt manifestations, is a system of exploitation that needs to be swept aside forever.

Sunday, September 21, 2008

On the Global Economic and Financial Crisis

Issued by the Commission on Socio-Economic Development and Social Equityof the International League of Peoples' Struggle, September 20, 2008

Prepared for the Commission by the IBON Foundation

The deep problems of the imperialist-dominated world capitalist systemare in very sharp focus today. The majority of humanity has long suffered unremitting poverty and exploitation – but the people are being pushed into even greater difficulties by the current episode of intense economic and financial crisis which is feared to be the worst since theGreat Depression of the 1930s. The current descent into greater socioeconomic turmoil doesn't just underscore the inevitability of crisis under capitalism. It also exposes how imperialism's dogged and vicious efforts to secure profits are precisely what create the conditions for ever greater instability. All this affirms how there can never be true socioeconomic development or equity for the people under the oppressive and exploitative capitalist system.
There has been a generalized growth slowdown of the global capitalist system in the nearly four decades since the early 1970s. The relatively high finance- and speculation-driven growth of the last few years hasn't been able to reverse this trend, aside from such hollow growth clearly being short-lived and unsustainable. The people in turn are further andfurther away from the false promises of prosperity through neoliberal "globalization". The number of those living on a conservative $2 (PPP) or less a day has doubled in the last three decades and stands at 2.8billion or nearly half the world's population. A billion people go hungry everyday and two billion do not even have clean water.

The current explosion of crisis appears to begin from financial excesses in the United States (US) which cause domestic troubles that have subsequent repercussions on the rest of the world. Yet while the sub-prime loan crisis in the US housing market is the most immediate trigger, this merely reflects the system-wide problem with world capitalism of an unprecedented reliance on paper profits and digitally conjured capital. There are initial estimates that financial losses could reach up toUS$30 trillion worldwide.

Monopoly capital has for decades been seeking to maintain its profits by forcing greater trade and investment liberalization on the neocolonies. But capitalism's basic crisis of overproduction is intractable and has even been exacerbated by this "globalization" offensive. Since these have been less and less effective imperialism has relied more and more on paper profits and digitally conjured capital. The financial crisis manifesting first of all in the US merely exposes world capitalism's system-wide problem of an unprecedented reliance on this largely fictitious capital.

The people are also now severely burdened by rapidly increasing energy and food prices. The giant transnational oil corporations have used their monopoly control to drive prices up which has been exacerbated by speculation in oil futures markets. Neoliberal "globalization" of agricultural production and trade has destroyed backward rural food systems and depleted food supplies aside from worsening the poverty of agricultural producers. Subsidized food imports flooded domestic markets at the same time as producers have found themselves ever more tied to overpriced inputs from big foreign agri-business. The rising energy prices themselves have driven up food prices even further.

Imperialist aggression

Imperialism has become increasingly aggressive in seeking to relieve its crisis and maintain its superprofits. The intensification of the global crisis in the 1970s and the severe profit squeeze on the advanced capitalist powers drove them to seek deeper inroads into neocolonial markets through their "globalization" offensive. The people of the world have since been challenged to confront the big powers' ever more calculating rapacity and increasing economic aggression to multiply their exploitation.
Monopoly capital forced greater trade and investment liberalization on the neocolonies to exploit their cheap neocolonial labor, to plunder their raw materials, and to capture their markets. Backward agricultural systems were overrun and vast numbers of the peasantry thrown into greater hardship. At the same time there were more vicious attacks on labor even in the advanced capitalist countries. An economic assault pressed down wages, salaries and benefits across the globe while political assaults pummeled unions and other organized workers. Usurious debt burdens were used to directly extract massive economic surpluses from the neocolonies. They were quickly plunged into a debt crisis in the early 1980s which has even been opportunistically used to increase imperialist economic and political control over them.
The 1990s also saw the expansion of global labor markets for capitalism to exploit. In particular the opening up of China, the former Soviet Union, Eastern Europe and the greater openness of various Southeast andSouth Asian economies effectively doubled the number of people for exploitation. Imperialism tapped these hundreds of millions both through setting up investment enclaves overseas as well as by directly bringing in migrant labor or taking advantage of displaced refugees. Social services and public utilities were turned into sinister opportunities for profit.

However the limits of these wide-scale efforts to support capitalists' profits – at the expense of deepening misery on a global scale – could not but assert themselves. The economic dispossession of large swaths of humanity further constricted opportunities for investments which in turn further accentuated the glut of finance capital. By the 1990s imperialism increasingly relied on getting its profits from purely financial schemes disconnected from any productive activity. Parasitic capital took advantage of advances in information and communications technology not just to facilitate its global production networks but also to fashion complex financial instruments for creating profits outside of any actual productive activity.
Imperialism sought to surmount its crisis with a bewildering array of financial instruments that created unprecedented debt- and speculation-driven illusions of prosperity and growth. Global financial assets include equities, private and government debt securities and bank deposits. These have bloated sixteen-fold from US$12 trillion in 1980 to an estimated US$190 trillion in 2007, over a third of which are in the US. In 2006 the value of global financial assets was equivalent to 350% of global gross domestic product (GDP). Superconductive finance capital destabilizes economies of entire regions at a time and there was a record US$8.2 trillion in cross-border capital flows just in 2006.
Previously unseen levels of profits were made from sheer speculation. But while seemingly increasing the capital stock these huge amounts ofcapital existed only digitally and were greatly diverging from real economic values. Yet the eventual economic impact of massive financial losses is very real.
The self-limiting and destructive nature of this conjured economic dynamic was soon exposed. The financial crisis that started in Asia in1997 and that quickly spread around the world, including to the US in 2000, showed up the vagaries of financial markets. The adverse effects on the real economy of footloose international capital rapidly crossing borders were clearly seen.

All those problems continued to mount in the 2000s and are now coming to a head. Global markets kept on constricting in the face of the imperialist economic offensive. The relentless "globalization" of trade and investment continues to destroy productive forces in neocolonial agriculture and industry: subsistence farming, backward agriculture and incipient manufacturing industry. The working people in the advanced capitalist economies continue to suffer low remuneration for their labors. Debt and speculation are used not just to generate financial profits but also to artificially inflate demand and counter stagnation. But the resulting shallow growth in construction, real estate, commercial trading and finance sectors cannot compensate for long the pressures narrowing global markets. Despite the supposedly rapid growth in the last few years there are shrinking opportunities for genuinely productive investment.

Global capitalism is fundamentally limited in how it deals with the crisis because this is rooted in the system's basic contradiction between private profit and social production, and in the resulting crisis of overproduction. Among the false solutions it is floating are neo-Keynesian New Deal-type fiscal stimulus, financial lifelines and bail-outs, and "reforming" the global financial architecture towards greater financial governance. These will all ultimately fail not justfor being limited efforts but more so because they pretend that theproblem is merely about financial excesses and resulting inadvertent instability. Yet the problem goes much deeper.

Imperialism's financial crisis

The situation of the US economy is illustrative and shows problems of the capitalist system in sharp relief. Real average and minimum wages started to steadily increase after the 1940s. These however became basically stagnant upon the onset of intensified crisis in the early1970s causing the share of wages and salaries in national income to steadily erode. By 2006 this had already reached its smallest share of national income on record. The share of corporate profits on the other hand has correspondingly been rising and by 2006 was at its highest since 1950.
There was a seemingly rapid accumulation of capital since the 1980s and particularly since the 1990s. US financial assets which were equivalent to less than four times GDP in 1980 had by 2007 soared to over nine times GDP. In the late 1990s the share of financial profits in total corporate profits conspicuously increased from less than 20% to over 40 percent. This is even as the financial services sector accounts for only 5% of US private sector jobs.
But since these were largely merely paper capital it is inevitable, albeit unpredictable, for the financial bubbles to burst. This is exactly what is happening where the bubble-driven finance, construction, real estate and retailing boom is now going bust. Combined household, corporate and public debts have risen to an unprecedented and clearly unsustainable US$51.1 trillion in 2007 which is equivalent to nearly four times US GDP of US$13.8 trillion. Public debt breaks down into federal (US$9.2 trillion) and state debt (US$2.2 trillion) while private debt is composed of financial sector debt (US$15.8 trillion), businesssector debt (US$10.1 trillion) and household sector debt (US$13.8trillion). Financial losses started in sub-prime loans but these will likely cascade into prime loans, commercial real estate loans, consumer credit, corporate credit and perhaps even much-vaunted public credit.

The depth of the problem has already invited comparisons with the US recession in 1927 that eventually led to the stock market crash in 1929 which marked the start of the Great Depression. On the ground, tens of millions of Americans are facing crushing personal debts and uncertainfutures. The number of Americans jobless or otherwise seeking more work has been rising particularly since the start of 2008 and now number some 15 million. Notable meanwhile is the resurgence in military production and rising militarism conspicuously accompanying rising competition between the imperialist powers.

In the 1990s the bulk of adverse effects occurred when financial crisis erupted that dragged down real economies. Today however the financial excesses have even greatly expanded into speculation in commodities which has resulted in ever more direct effects on the people through grossly higher oil and food prices. Among others this has driven oil industry profits to record highs with US$155 billion in profits in 2007, three-fourths of which are of just the top five oil firms. The speculation in food markets has also greatly aggravated the destruction of neocolonial food systems.

Continuing challenges

The people face great challenges in the struggle against the oppression and exploitation intrinsic to capitalism and that are deepening further. Imperialism's international mechanisms for the domination of worldtrade, investment and economic life continue to set global rules and distort national economies. They establish exploitative economic relations between advanced capitalist powers and neocolonies. The international finance institutions of the World Bank (WB), InternationalMonetary Fund (IMF) and other regional banks are thoroughly discredited but remain influential. Even if the talks at the World Trade Organization (WTO) have stalled it remains imperialism's most potentially expansive mechanism for pushing its plundering agenda.

Particularly important in the last few years are the bilateral and regional free trade agreements (FTAs) that the US, European Union (EU)and Japan are using to tighten their domination of individual countries and regions. From just a few dozen FTAs in the early 1990s there are now some 340 in various stages of talks as of mid-2007. And there is also how the US has for instance already seized and opened up economies through sheer military coercion and aggression.
In the neocolonies these burdensome socioeconomic policies are done with the compliance of increasingly subservient governments. They craft the domestic economic regimes most favorable for imperialism and its needfor profitable opportunities and outlets for its capital. They maneuver to deliver labor and natural resources to imperialism at the cheapest possible price. And they wield state force to stifle peoples' resistanceand to try and make the masses docile and submissive.

In the end the world remains divided into rich and poor, and into exploiter and exploited. On one hand are the strengthening of global monopolies and their increasing economic domination and ruthlessness. Forty-six of the world's 50 biggest transnational corporations are from the US, EU and Japan. Similarly, nine-tenths of global foreign direct investment outflows totaling US$1.2 trillion in 2006 were from the advanced capitalist countries. Investment payments and the servicing of neocolonial external debt – which reached US$3.4 trillion in 2007 –resulted in a massive net financial transfer from the neocolonies of US$670 billion just in 2006.

The greatest share of the world's income remains concentrated in the imperialist countries that, as of 2006, have only 16 percent of theworld's population but account for three-fourths of global GDP. Starkly,the world's 500 richest individuals had a net worth of US$2.6 trillion in 2005 which is equivalent to the annual national income of the world's 48 poorest countries or the world's poorest 416 million people.
Meanwhile the majority of humanity is chronically deprived with generation upon generation going through lifetimes of hunger and destitution. The world's working people have less and less options for decent living, they are losing jobs and livelihoods, and their incomes are collapsing on a massive scale. Some 1.5 billion people do not have or are otherwise lacking jobs in 2007 – the 190 million unemployed and1.3 billion so-called "working poor". Farmers, workers, indigenous communities, especially women and children, are driven into deeper misery. It is urgent for the people to achieve socioeconomic development, social equity and justice.

The people's struggle

Hundreds of millions of the people across the imperialist countries and in the neocolonies have risen up to expose and resist imperialism's economic aggression. The ranks of the oppressed working people that are mobilizing have broadened and prevented imperialism and neocolonial governments from easily pushing through with their plundering agenda. This strengthens the ability of the people to face the great challenges in the struggle against the oppression and exploitation intrinsic to capitalism.
The peoples' struggle for socioeconomic development against imperialism is integral to the overall struggle for national liberation, democracy and social liberation. This includes the commitment of the people of the exploited countries and nations to confront imperialist systems of plunder, exploitation and oppression, and to assert sovereignty and independence. All grossly unequal imperialist trade and investment deals and policies must be outrightly rejected. Alternative international relations of cooperation and solidarity between peoples must instead begin to be built. The efforts to build more progressive and democratic economies will be all the more effective the more peoples there are working together on a regional and global scale.
Neocolonial domestic economies must be rebuilt and drastically transformed so that our countries' natural resources and our peoples' labors serve the needs of the masses most of all. This means a socioeconomic program serving and thus wholeheartedly supported by the people. This shall redistribute wealth to peasants and workers and other basic sectors, beginning with true agrarian reform development that breaks feudal backwardness in the world's vast countryside. There must also be genuine national industrialization. The people's basic and vital needs for education, health and housing must be assured. We will take approaches as appropriate depending on the sizes, resources and economic strengths of our economies.

A humane, equitable and just path that does not exploit other peoples and economies and that is ecologically sound is being charted. The masses will be decisively in control of their lives, as well as at the center of building just and peaceful societies. The need to continue building and strengthening democratic mass movements is as urgent and vital as ever as well as underpins our movements for national liberation. The accelerating economic deterioration points in the direction of an upsurge in social and revolutionary movements worldwide.

Thursday, September 18, 2008

SPECULATIVE FICTIONS - Parasitism in the era of imperialism

Just over 12 months ago, the heartland of capitalism was rocked by what was tagged the “sub-prime crisis”.

The initial reaction by the capitalists was to blame the victims: the poor, the blacks, the Latinos, the unmarried mums who had taken out “sub-prime” or high risk NINJA loans (“no-income-no-job” applicants) in order to insinuate their way into the bourgeois ideal of home ownership.

You could tell the poor were being blamed because they were alleged to have bought “MacMansions”, shiny-looking but shoddily-built houses that symbolized social-climbing aspirations by those whose class status determined that they were over-reaching themselves socially.

Increasing numbers of these would-be home-owners found that once the introductory discount repayments were reset they were unable to meet the higher real and long-term repayments that were required.

The discount rate was the bait, deliberately placed on the hook by get-rich-quick loan companies, but what they hoped to reel in was not the homebuyer but the home-land package. The loan sharks were guaranteed winners. They either won through the income stream from repayments, or if these could no longer be maintained, they simply pocketed payments to date, repossessed the real estate and put it back on the market, its exchange value, of course, having increased in the meantime. The out-of-home home-buyer was simply released, thrown back into the cruel sea.

The scale of the victimization is revealed in figures that show that whilst such sub-prime mortgages represented only around 13 per cent of all outstanding US housing loans, more than half of these loans entered foreclosure in the last quarter of 2007[1].

Those figures are bad enough. They show how desperate and vulnerable the poor are in the world’s richest country (relative, it must be admitted, to the absolute misery of so many in the Third World).

But a double effect was at work here.

Money as finance capital continually searches for ways in which to more quickly and effectively make returns on its own value. The use value of capital resides in its ability to remake its own value over and over again for the benefit of its owner. If it is simply sitting in an account then apart from its interest-earning function, it is effectively dead capital, capital without a use, or a use restricted to the minor returns of interest payments.

The speculative and parasitic character of the finance capitalists is determined by their need to seek higher and higher returns on the capital they own. One option is to invest in the process of production and realize returns in the form of the surplus value created by workers through their labour power. But the rate of profit through the exercise of this option is restricted by part of the capital becoming constant capital (plant and machinery, raw materials) in production, and fixed capital (plant and machinery) in the distribution or flow of capital. There is a determined length of time in all of this before returns outvalue the investment.

A better option (for the owner of finance capital) is to use it in situations where its current value is gambled against the potential for a faster gain in the form of more capital. The stock market, an early development in speculation under capitalism, is precisely such a form of parasitic gambling. The purchaser of shares does no useful productive work, but hopes to benefit by dividend payments and eventual resale of the shares at a profit when their price rises. Purchase of various types of bonds with guaranteed rates of return is somewhat less speculative, but no less parasitic.

Technology has created a bewildering array of permutations on the original functions of the stock market. Futures trading, currency trading, swaps and naked shorting are rampant in the world of finance. Gains can be made in seconds.

The same applies to the onsale of a long-term but relatively low-level income stream (the loan repayment) for a quick buck, worth less than the eventual cumulative value of the income stream, but a profit nonetheless on the original outlay (the loan). The purchaser gets something at less than its eventual value, the seller gets something for more than its current value. Housing mortgages, as debt packages, are ideal bases for such sales because of the belief that the underlying asset, the real estate, is always going to be worth more than the temporary cessation of repayments if there is a foreclosure.

So, according to the parasitic and speculative logic of finance capitalism, sub-prime mortgages were sold, in many cases, as soon as they were written. And to make their sale more attractive, they were often parcelled together with a smaller number of prime, or less risky, mortgages or other types of debt. The structure of these packages, (called collateralised debt obligations or CDOs), and how they invariably represent very shaky houses of cards, is explained in an earlier post, Crisis, you can bank on that!. For a time there was frenetic trade in financial packages of debt. CDOs were sold, repackaged, sold again, and even became CDOs of nothing else but other CDOs!

Nor did it stop there. Insurers offered to guarantee the income streams from various types of quite complicated financial packages. We are familiar with different types or lines of insurance such as life insurance, property insurance, car insurance, third party insurance and so on. These are handled by multiline insurers. Specialist insurers who were only allowed to insure returns on financial packages emerged. Restricted to this one line of insurance, they were called monoline insurers.

Much of what they insured was credit default swaps (CDSs). As the name implies, one party which is getting income from various types of bonds, mortgages or corporate loans, purchases protection from the risk of those income sources running into difficulty, or defaulting, from a second party to which it pays premiums in return for accepting the exposure to the risk of a default. CDSs can in turn be repackaged and sold, over and over again, with no regulatory control on the ability of the purchaser to meet the debt obligations if things go haywire.

(Many Australian local government councils and super funds are sweating out the collapse of Lehman Brothers bank because many of the “dodgy structured debt packages…Lehman put councils into have Lehman as a default company”, meaning that they stand to lose millions in a “double whammy”.[2])

The scale of these innovations in speculation around essentially fictitious values of capital can be seen from the fact that the very first CDS was only issued in 1995 (by banker JP Morgan), and that by mid-2007, the value of the market had ballooned to an estimated $45 trillion – over twice the size of the US stock market![3]

Underpinning all of these multiple and inter-related houses of cards were sub-prime mortgages.

The reason that we append the word “crisis” to “sub-prime mortgage” is not that large numbers of workers defaulted on their loans – that was always an intended outcome under the profits-before-people regime of capitalism. The reason is that the uneven law of development saw real estate prices fall at a time when there had been a speculative boom in fictitious capital. Huge amounts of finance capital were revealed to have no basis in fact. They were simply over-produced and increasing numbers of paper representations of a commodity with a declining exchange value. This meant a real loss to the speculators and parasites of finance capitalism; hence their media and their economists and their politicians agreed that it was a “crisis”! Workers in crisis can be ignored, but not financiers, bankers and insurers!

Up until March 2008, and since the beginning of the sub-prime mortgage crisis in August 2007, the major global financial institutions of imperialism have reported write-downs (losses) of about $US190 billion[4]. This is money that no longer exists in the imperialist financial system. Since March many more billions would have disappeared.

As of September 2008, one of the biggest banks in the world, Lehman Brothers is bankrupt. Probably the largest insurer in the world, American International Insurer (AIG), has been saved from bankruptcy by the US Federal Reserve. It was too big to be allowed to fold or, as Murdoch’s Australian put it, “If AIG collapses, so does world insurance”. Another of the world’s biggest banks, Merrill Lynch, was saved from bankruptcy by a fire sale to another bank. US home loan specialist banks Freddie Mac and Fannie Mae were only spared from going down the gurgler by being effectively nationalised by the US government, leading to a chorus of derisive jibes about the free market always being prepared to privatise profits, but having to socialise (pass on to the people) the losses.

These spectacular crashes of some of the biggest financial institutions in the world follow from the rescue last year of British bank Northern Rock by the British taxpayer, the collapse in March of huge US bank Bear Stearns, and last year’s collapse of major hedge fund Carlyle Capital.

(As a measure of their addiction to speculation, Carlysle Capital was leveraged at 32:1, and Fannie and Freddie at 80:1. That is, they had $1 of real money to fall back on for every $32 and $80 respectively that they had loaned out.[5])

The greed of the imperialist bourgeoisie underpins the speculative fiction of finance capital. The crisis in which this system is currently enmeshed is testimony to the continuing relevance of Marx’s critique of capitalism and Lenin’s analysis of imperialism.

More than ever before, a party is required which can lead the workers through revolution to the destruction of this anarchic system of boom and bust exploitation and its replacement with the next stage of human existence, socialism.

[1] Reserve Bank of Australlia, Financial Stability Review, March 2008
[2] Councils on a limb over Lehman failure, Australian Financial Review, Sept 16 2008
[3], Credit Default Swaps: An Introduction
[4] Op cit, Reserve Bank of Australia
[5] Mike Whitney, The Tumbrils Roll at Dawn on Sept. 15, 2008

Wednesday, September 10, 2008

Marathon not popular - noone wants its waste

Arkaroola Wilderness Sanctuary despoiler Marathon Resources has suffered two humiliating rebuffs in its attempt to clean up the sites at which it had illegally dumped drilling and domestic wastes.

It is required by the terms of its government-approved rectification plan to remove “general waste” from Mt Gee West, Mt Gee East and Hodgkinsons to a licensed waste management facility.

The “general waste” includes burned plastic material and other miscellaneous food wastes, general personal protection equipment and other waste from Amdel Laboratories in Adelaide (including gloves, masks and disposable overalls), polystyrene tubing, and cardboard waste.

In its EL 3258 Rectification Plan (4th August 2008 – Version 4), Marathon claimed that these materials would go to the Leigh Creek Waste Management Facility and attached confirmation that the Leigh Creek facility would accept general waste from Marathon. Leigh Creek is a coal mining town south of Arkaroola (right) and is well-used to having to deal with waste from mining operations.

However, on August 28, the Leigh Creek facility changed its mind and said that it no longer wanted general waste from Marathon.

Marathon then moved in on the southern Flinders Ranges tourist town of Hawker, seeking permission to dump an initial 200kg of general waste at their solid waste landfill.

The Flinders Ranges Council chief executive and works manager gave their approval to Marathon, but the community (population 300) was tipped off about the approval, some leaflets were circulated critical of the plan, and the result was that the council had to meet and put the proposal to a formal vote which resulted in a 3-2 decision to block the plan.

So Marathon still has nowhere prepared to accept its waste materials.

This is despite the fact that those materials released for disposal in a licensed waste management facility must be checked for a radiation dose rate below 0.5╬╝Sv/h, allowing it to be described as “non-radioactive” in lay terms. General waste above this reading and hence deemed to be radioactive “must be stored at registered premises for future disposal.” There is no nuclear dump in SA at the moment.

This has led the Murdoch rag the Advertiser to editorially lecture the wider South Australian community about it being “Time to face the nuclear waste farce.”

It tries to trivialise the Hawker decision by pointing out that the Marathon waste was not “harmfully radioactive” and pointed out that “Radioactive waste is a part of modern life…the State Government has no site for the radioactive waste stored in some 134 sites around the metropolitan area.”

However, as a commentator in the internet share trading chat room Hot Copper put it, “ the decision was (not) made because the councillors thought some dusty old clothes were actually dangerous…

“This was not why they stopped it.
“Hawker is the Gateway to the Flinders Ranges and is very reliant on the tourism industry.As a community, they do not want to be seen as aiding Marathon in anyway.
“The council recognised they also have a duty to provide services, and the vote of 3 to 2 really indicates that two councillors thought that it was not council’s position to make a political statement on Mt Gee by refusing the rubbish. It does not show that 2 councillors support the project.
“The fact that this made the front page of the Advertiser pretty much demonstrates that every little thing they do from now on, will be publicised.”

By attaching the question of Marathon waste disposal to the absence of a nuclear waste dump in South Australia, the Advertiser is inadvertently helping to publicise the whole question of Marathon and its plans to mine uranium in the Arkaroola Wilderness Sanctuary.

Where will the first nuclear waste dump in SA be?

Who wants one?

And why is there still any question of Marathon possibly resuming its drilling and moving on to actually mining inside SA’ premier tourist icon?

For further information, please check the excellent and colourfully illustrated e-newsletter of the Friends of Arkaroola here:

Monday, September 08, 2008

SA Labor fosters crony capitalism

Crony capitalism, according to online dictionary, is a “description of capitalist society as being based on the close relationships between businessmen and the state. Instead of success being determined by a free market and the rule of law, the success of a business is dependent on the favouritism that is shown by the ruling government in the form of tax breaks, government grants and other incentives.”

In a sense, it could be said that crony capitalism emerges when the pretence of a “free market and the rule of law” wears thin and the reality of capitalist governments as mere executive committees of an actual ruling class is put, shamelessly and nakedly, on public display.

The government, which is entrusted by the ruling class to exercise certain powers for the benefit of the capitalist class as a whole, becomes puffed up with the arrogance of its ability to play sectional interests of the capitalist class off against each other, and emerges as a broker in the awarding of favours to those interests that pledge to reciprocate by maintaining it in office.

The reality of the state as the executive committee of the whole ruling class becomes tainted with the corruption of service to favoured sections of the elite.

Social democrats and crony capitalists getting into bed

Generally, crony capitalism has been associated with the most reactionary proponents of capitalist class rule. The Bush-Cheney regime in the United States is a byword for crony capitalism. The privatising apparatchiks of the countries of the former Soviet Union have taken crony capitalism to new heights. Reactionary governments in Mexico, South Korea, the Philippines and Indonesia took and are taking crony capitalism to new lows.

South Australia might seem far away from these homelands of crony capitalism. But its governing Labor Party, now in its eighth year of office, obviously sees no reason why the benefits of crony capitalism should be left to the open parties of big business.

Despite the affiliated membership of certain large trade unions, it is rapidly dropping any pretence to being a social-democratic or “labor” party and has proudly rebadged itself as “pro-business, pro-growth and pro-mining”.

The state’s 14,000 public school education workers (right) recently staged a 24-hour stoppage in order to force, successfully, a meeting with the Ministers responsible for negotiations over their new enterprise agreement.

Business leaders, on the other hand, are offered access to leading Ministers in return for payments to Labor Party coffers.

And not just any business leaders.

PPPs foster crony capitalism

Prominent among those hosting lunches and dinners for Labor politicians are companies bidding for government contracts for Public Private Partnership (PPP) projects.

PPPs create particularly favourable opportunities for crony capitalism. A privileged few big corporations “win” contracts for rock solid investment opportunities with the government as guarantor or profitability. In return, they talk up the “business-friendly” and “investment-friendly” credentials of the government.

Of course, who “wins” has no relationship to the capacity to attract business contributions to the government’s own bank accounts.

So it must be purely coincidence that two of the three contenders for the $134 million “super schools” PPP are hosting their own fund-raisers for the government.

Abigroup is putting on a luncheon for Premier Mike Rann and Treasurer Kevin Foley on November 20 which will only set you back $2000 per ticket. (Teachers interested in positions at the super schools are advised to line up for tickets in the far queue!)

Abigroup is a subsidiary of Bilfinger Berger AG, a German multinational. It is a partner in a consortium that includes European banker ABN Amro and facilities management company United Group Services.

If you are not interested in helping Abigroup win the contract, then perhaps a dinner in Melbourne with Rann and Foley on October 9 may be more to your taste. This one costs a mere $1500 per ticket. Mine host for the evening is the Plenary Group, a recently-established company operating in Canada as well as Australia. It specialises exclusively in PPP projects and is underwritten by the Deutsche Bank. Its consortium partners are SA builders Built Environs and Badge Constructions, together with notorious British catering company Scholarest.

The third consortium is looking distinctly unhealthy at this stage as its principal partner Babcock and Brown is in all sorts of financial strife with a year-to-date share price fall of 91.4 per cent. According to rumours circulating in Adelaide, they are in such bad shape that they have even had to cancel a planned $5 per head breakfast with Rann and Foley at the Hindley Street outlet of MacDonalds!

Other PPP-related fundraisers for the Labor Party included dinner with Health Minister John Hill provided by the Westpac Bank, one of the consortia bidding for the new $557 million new men’s and women’s prison. Consistent with the government’s social inclusion priorities, both public and private patients were able to purchase tickets for the August 28 function at a mere $1500 per head.

Which brings us back to Bilfinger Berger who are part of a rival consortium for the prisons project. They’re putting on a luncheon for Rann and Foley in Sydney on October 31 at $2000 per ticket.

Money doesn’t talk, it swears…

So rampant is this transition to crony capitalism under the Labor Party that Murdoch’s Advertiser reports “Business leaders say brochures arrive in the mail every week for events offering high-priced boardroom functions and cocktail briefings with state and federal Labor MPs. Some business leaders also say that they have been asked to host events.”

This brings out contradictions between the various sectional interests of the ruling class, or as the Advertiser put it, “The functions raise questions about the potential of buying influence or paying for the ear of the state’s most powerful people…”

Some might say that there is nothing new in all of this. It’s true, for example, that the pro-business Liberal Party has been past master at soliciting the financial support of powerful corporate interests. Former Prime Monster Howard was notorious for this sort of thing.

What is new is the way in which Labor is unashamedly stealing the pro-business mantle from the Liberals and their open cultivation of crony capitalism as their preferred means of keeping themselves in office.

These developments can only contribute to the further disillusionment of working people from the whole system, beginning with their rejection of Labor as any sort of alternative to the Liberals.

So long as they have faith in their own capacity to wage struggle independent of the two-party monopoly that is the bourgeois parliament, the conditions will exist for the growth of the revolutionary movement for the abolition of capitalism.

Sunday, September 07, 2008

Imperialist War Fair Stopped!

A Great Victory for Our Times!

As reported in a previous post, the Asia-Pacific Defence and Security Exhibition (APDSE) was to have been opened in Adelaide on Remembrance Day, November 11 2008.

However, the South Australian government has decided to cancel the event. Acting Premier and State Treasurer Kevin Foley cited the possibility of violent protest by “feral low-lives” as the reason.

Anti-war campaigners including the Adelaide Stop the War Fair Coalition, NoWar SA and OzPeace celebrated the victory of the cancellation of the exhibition describing it as a “huge victory for all South Australians who want peace, not war.”

The hypocrisy of the social-democratic State Labor government in all of this is just unbelievable.

It has actively promoted Adelaide as the ‘high-tech defence capital of the region” and boasts about the incentives it offers to armament and weapon systems companies to establish their headquarters in SA.

The neatly groomed and business-suited heads of these companies are very respectable bourgeois. Probably not one among them is a dreadlocked vegetarian.

But they are people whose every activity is designed to result in the deliberate and calculating infliction of violence onto others. And whilst there is just violence and unjust violence, theirs is invariably of the latter variety, targeted at countries seeking independence, nations seeking liberation, and people wanting to change their lives for the better through revolution and struggle.

Although they may dress like bankers’ nieces and insurance salesmen, the exhibitors at the imperialist war fair are the real feral lowlives, the absolute scum of humanity and enemies of the people.

And as far Kevin Foley, political patron of these arms merchants, labelling the anti-war and anti-imperialist masses as “feral lowlives”, it just goes to prove that it takes one to know one!

Wednesday, September 03, 2008

Masters of War come to Adelaide

Bob Dylan’s classic Masters of War is playing in my head as I write this.

(If it’s not playing in yours, go to then read on....)

For plans are well underway for the Asia Pacific Defence and Security Exhibition (APDSE) to be held in Adelaide from 11 – 13 November 2008.

The exhibition has been promoted by the SA government which shamelessly touts South Australia as the “defence state”.

Government literature boasts that SA “is the high-tech centre of Australia’s defence industry and the Asia-Pacific headquarters of some of the world’s leading defence companies” (South Australia: The DEFENCE industry choice).

Plans are also well underway for opposition to the exhibition.

Already some displeasure has been expressed - and from a most unlikely source.

The Returned Service League (RSL), Australia’s war veterans’ organisation is not opposed to the exhibition as such; indeed, it has booked a display stand.

However, State President Jock Statton was understandably outraged to discover that the masters of war were planning to open at 11.30 on November 11.

This was uncomfortably close to the time, the 11th hour on the 11th day of November, at which a minute’s silence is observed to honour the dead from the First World War and subsequent conflicts. Remembrance Day is a sacred event for the RSL.

“We couldn’t believe it,” Statton told the media, referring to the insensitivity of the organisers who include British-based BAE Systems and the Adelaide office of Britain’s Cranfield University. Statton described their involvement as “ironic because the UK lost almost one million lives during World War 1.” He said the RSL had called on the organisers to change the date of the exhibition, but they had refused to do so.

At least 40 exhibitors are believed to have booked space, including 17 from Australia, 7 from the UK, 5 from the US, 2 each from Germany, India and Malaysia, and 1 each from Canada, eastern Europe, France, Israel and Spain.

However, the APDSE website now states that “Due to hightened security restrictions, the exhibitor list will not be available on this site”.

On the Cranfield Univesrity website, two short courses are listed. Intriguingly, one is for the 3 days of the exhibition, presumably to enable “students” to claim back the costs of attendance as “fees for educational purposes”. The details of both courses are:

Resilience in Australia
Date: 11-13 November 2008; Duration: 3 days; Location: Adelaide; Price: AUD$2000
For further information please contact:
For details regarding the Asia Pacific Defence and Security Exhibition, please visit

Modelling and Simulation in Defence Communication Networks
Date: 25 - 27 November 2008; Duration: 3 days; Location: Adelaide; Price: TBC

Whatever else may happen in Adelaide between Nov 11 and November 13, the masters of war and profiteers from imperialist aggression won’t be in for much of an easy time!

Tuesday, September 02, 2008

Rock Star: The story of Reg Sprigg

Several books have been written about South Australian geologist and miner Reg Sprigg.

The latest, Rock Star: The Story of Reg Sprigg, promises to have more of an insider’s feel about it. Author Kristin Weidenbach is married to Reg’s son Doug who, with his sister Marg operates the Arkaroola Wildlife Sanctuary in the Northern Flinders Ranges.

Nearly 200 invited guests attended the book launch last night at the SA Museum. They were greeted by banners reading “Save Our Sanctuary” and calling for mining company Marathon Resources to be kicked out of Arkaroola. And with the exception of one or two Marathon people, they all enthusiastically took proffered leaflets calling for the honouring of the vision of Reg Sprigg (see below).

Significantly, Prof Ian Plimer, a noted advocate of uranium ming, stopped to offer words of encouragement.

"I'm all for uranium mining, as you know. But not here! Not in this place!"

The Sanctuary was created by Reg and his wife Griselda, with the support of long-time friends such as Sir Douglas Mawson, in recognition of the unique geological properties of the location.

As a staunch proponent of mineral exploration and the exploitation of resources such as gas, petroleum and uranium, Sprigg was nevertheless cognizant of the need to protect significant sites of geological and environmental importance, and established the Arkaroola Wildlife Sanctuary as the state’s first eco-tourism resort.

Unfortunately, this has not stopped other mining companies from trying to get in and extract uranium and other minerals from Arkaroola. The area around Mt Gee is honeycombed with exploratory drilling.

Marathon soiled its pants when it secretly buried a variety of wastes and drilling samples. Some were in 44-gallon drums. The most significant dump contained 22,800 plastic and calico bags.

When these were discovered, Marathon’s exploration licence was suspended indefinitely by the State government which described them as “cowboys”.

Marathon was required to clean up the site, and is trying to convince the Spriggs and the public that it has also cleaned up its act.

But it is running into trouble. Its government-approved clean up plan included taking the drums to the Leigh Creek Waste Facility. Despite the fact that Leigh Creek is itself a mining town (coal), it wanted nothing of the Marathon waste which includes low level radioactive material.

The nearby town of Hawker has apparently been approached by Marathon and must now decide if it wants to host SA’s first radioactive dump.

Marathon is also likely to have trouble with the so-called “grizzlies” – rigid framed mesh stands - through which they apparently intend to pour the contents of 22,800 bags, allowing them to separate soil from non-soil refuse.

This is going to be a nightmare for whoever they can sucker into operating the grizzlies. The dust would be unbearable even if it wasn’t radioactive. (A better method, although just as dusty, would be to use an oyster tumbler, but who am I to try and help them out!)

Anyway, the share price has been languishing at a very low 70 cents, so guess what, we get another “resource upgrade”! The last one was on June 10, so it’s pretty much time for another one so, just by coincidence, on the same day as the book launch, Marathon puts out some positive spin, some more incremental estimate increases designed to push the company line that this “confirms the Mt Gee uranium project as one of Australia’s largest undeveloped uranium deposits.”

And there’s more, but it “will only be determined by further drilling”! Hint, hint Premier Rann - we can make you and the state look good if you lift the suspension on our licence!

These guys are just unbelievable!

But it has pushed the share price up to just over a dollar today. That's business....

Here’s the leaflet from the book launch. The only change to note is that Shad Lynley is now one of Ken Talbot’s boys, so Denis Wood (one of the two who up until now have represented Talbot interests on the Marathon Board) has moved on as surplus to requirements.

No doubt back with more later........

Honour the Vision of Reg Sprigg:

No mining in Arkaroola!

Arkaroola was created by Reg and Griselda Sprigg as a privately-owned Wilderness Sanctuary in the northern Flinders Ranges and is one of the icons of tourism in this State.

It has a fragile eco-system and has been central to the successful program for saving the yellow-footed rock wallaby from extinction.

It is part of the traditional lands of the Adnyamathana people.

It is situated in the vicinity of the Paralana Fault Line and is subject to regular seismic activity.

Marathon Resources holds an exploration licence to drill in the Sanctuary. The licence was suspended indefinitely following Marathon’s violation of the terms of the license at three sites, Mt Gee, Mt Gee West and Hodgkinsons, and they are held responsible by PIRSA for damaging a unique fluorite occurrence at Mt Gee which they had been told to avoid in their drilling.

Approval was given last month to a plan that requires Marathon to remediate these sites. Marathon intends to seek the lifting of the suspension and wants to resume drilling.

We want the government to keep the suspension in place until the expiration of the current licence and then not to renew it. They must then protect Arkaroola with legislation that bans further exploration and any mining.

There are reasons for believing the government may go wobbly and not protect Arkaroola.

It is going all-out to woo the business community. It ignored its traditional support base over the WorkCover issue and badges itself as “pro-business, pro-mining and pro-growth”. It is just as likely to ignore environmental and tourism interests in order to prove its pro-mining credentials.

Marathon has powerful backers and retains people of influence on its Board.

Former State ALP President and Federal Minister, Chris Schacht has held shares in the company for several years. He helped overturn the SA ALP’s “no new mines” uranium policy. After the “dumping” scandal, he was given a Board position so that his contacts could be used to the company’s advantage.

One of its major shareholders is Ken Talbot of Queensland’s Macarthur Coal. He was under investigation for making payments of $300,000 to a Labor Minister who subsequently voted for a project that benefited Macarthur Coal’s Coppabella Mine Project. Two of his employees, both involved with the Coppabella project, work with Marathon.

Marathon has also had to answer several “please explain” letters from the Australian Stock Exchange which have hinted at insider trading and other market irregularities.

Although Marathon badges itself as a locally-owned company, another major shareholder is the China International Trade and Investment Corporation (CITIC). The Chinese paid a heavy price for their own liberation from imperialism and should not now start bankrolling activities that ignore the feelings of the Australian people.

A recent Board appointment is Dr John (Shad) Lynley, CEO of the Korean-owned Sun Metals Corporation which, according to Marathon, is “the world’s most efficient and environmentally sensitive zinc refinery successfully built and operated on the edge of the Great Barrier Reef.”

With Lynley’s input, Marathon has “set a new course for change”, apologizing profusely for its past mistakes. The “new course for change” includes feeding the community with the company’s new-found “concern” for the environment and seeking to “build a better relationship with Mr and Ms Sprigg.”

In other words, it has not given up and believes that the orientation of the government towards the business and mining community can be turned to its advantage and enable it to resume drilling and ultimately to win approval for mining.

We must keep the pressure on Rann, Foley, Holloway and co. to ensure Arkaroola’s protection.

Support the call to ban mining at Arkaroola!

Marathon must get out and stay out!

You can help by writing to the Premier, Mike Rann, in support of these demands, and by checking the following websites for information and updates including possible picketing of the Marathon AGM in November: (hit the Arkaroola link on the right hand side)

Construction Workers Demand Safety Before Profits

Around 100 construction workers walked off several city sites yesterday site to protest about the lack of safety standards of a key Adelaide builder Theo Samaras and to draw attention to the effect of the ABCC and no right of entry for unions on construction sites in South Australia.

This follows two dramatic accidents that put at risk the lives of workers and the public. The first was close to the Central Market when a crane lift fell 8 stories onto the street below, crashing just outside the office of a law firm. Then on a site on Gilles Street (below) last Friday another serious incident occurred when a sling broke resulting in a steel beam falling two stories on the Samaras site.

Both incidents were avoidable and both sites were known to the union as problems in relation to safety. In both cases the CFMEU had notified SafeworkSA, the company and the Adelaide City Council with concerns about on-going safety issues.

“A major problem with dealing with safety in the construction industry at the moment is that union officials are severely restricted in their access to assist with inspections and protect the lives and safety of our members” said Martin O’Malley, State Secretary of the CFMEU

“This particular builder is using the Federal Australian Building Construction Commission (ABCC) to keep unions off the site even though we have a large number of members. He uses it as his private security force so he can cut corners on safety. The ABCC must be abolished if we are to prevent accidents, injuries and deaths in our industry.”

“We are sick and tired of waiting for the State Government to introduce state laws which allow union right of entry for safety reasons. Most other states have these laws.”

“Right of entry will ensure that we can better protect the safety of our members and the public- a job we take seriously as one of our core responsibilities. We have been waiting two years for the law to be changed by the state government. Get on with it before someone dies!”


The ABCC was created by the former Howard Liberal government to intimidate building workers. It has draconian powers, including the capacity to gaol workers who refuse to be questioned by it about any matter it deems appropriate.

Victorian CFMEU Vice-President Noel Washington faces a mandatory six months gaol term for refusing to provide the ABCC with information about a lunchtime meeting of his members held off-site at a Melbourne construction job.

The incoming Federal Labor government promised employers to keep the ABCC intact until 2010 and has strongly backed its powers and its intimidatory tactics despite calls from 40 members of the Labor backbencher caucus to close the organisation now.

Opposition to the ABCC is growing. Popular Adelaide radio and TV personality Keith Conlon said last Thursday on radio station 5AA “…the Building Commission unrest and caucus is really serious…the fact is if you’re a building worker you have fewer legal rights facing the Building Commission than a terrorist does under Australia’s tough anti-terrorist laws…they’re builders, they’re not terrorists…”

Media from all TV stations turned up to the rally, showing there is interest in an issue normally denied media coverage.

Safety standards on construction sites have declined as bosses push for cutting corners knowing that any union opposition will be threatened by the ABCC.

Workers in attendance were encouraged to take on the role of safety rep in their sites as the safety at worksites is steadily deteriorating (being hampered by ABCC and no right of entry for unions).

CFMEU Assistant Secretary Aaron Cartledge told yesterday’s rally, “I’ve been in this game for twenty years and I reckon it’s (safety) almost as bad as I’ve ever seen”.

CFMEU State Secretary Martin O’Malley was joined by SA Unions Secretary Janet Giles, both of them highlighting the two recent incidents on Samaras jobs.

Samaras – Car parks and kid parks

Samaras has something of a reputation for steel fabrication construction, with construction sequenced so as to minimise construction time and cost. He has over-relied on prefabricated screens and balustrades in order to save costs on temporary handrails and screens, essential to worker safety during the construction process. The big push on the Gilles Street project, a multipurpose 11-story office and carpark, is to get it “completed just in time for the Christmas rush”, according to a statement by his steel supplier Bluescope.

In an odd twist to the story of the Gilles Street site, Samaras intends to incorporate a $1 million child care facility in the facility. However, it will not be a community-run facility, but a private business established together with Stepping Stone (SA) Childcare and Early Development Centres with spaces for 150 children.

Critics of the scheme cite the crisis-ridden ABC Learning Centre model of millionaire Eddie Groves. A sample of comments on the AdelaideNow website of Murdoch’s rag the Advertiser include:

“…is this going to be an ABC type centre profit before learning…fake grass no play equipment and underpaid overworked staff????? child care centres at least put the children first!!” (Craig of Hindmarsh)

“A child care centre in a high rise – surely that is a JOKE….Kids NEED real grass, trees, sand etc. Its bad enough that 95% of Child Care Centres use latex turf because they see it as ‘too difficult’ to maintain the real stuff….” (CCC of Adelaide)

“Tell it like it is CCC, this isn’t child CARE, it’s child parking…” (Robert of Murray Bridge)

“Even the Adelaide Zoo makes sure that there are outdoor pens for their animals - it makes you wonder…” (Sue of Adelaide)

Disband the ABCC Now!

Safety Before Profits!

Stop the further privatisation of child care!