Big Business Strikes Back, in a New Form of the Class Struggle from Above, as Exemplified in Latin America By James Petras Al-Jazeerah, CCUN, November 6, 2018

Brazilian President-elect Jair Bolsonaro poses with military police in the Rio de Janeiro neighborhood of Cidade de Deus, October 18, 2018

 

Big Business Strikes Back: The Class Struggle from Above 

Introduction

Bankers, agro-business elites, commercial mega owners, manufacturing, real estate
and insurance bosses and their financial advisers, elite members of the ‘ruling class’,
have launched a full-scale attack on private and public wage and salary workers, and
small and medium size entrepreneurs (the members of the ‘popular classes’). The attack
has targeted income ,pensions, medical plans, workplace conditions, job security, rents,
mortgages, educational costs, taxation, undermining family and household cohesion.

Big business has weakened or abolished political and social organizations, which
challenge the distribution of income and profits and influence the rates of workplace
output.

In brief the ruling classes have intensified exploitation and oppression through
the ‘class struggle’ from above.

We will proceed by identifying the means, methods and socio-political conditions
which have advanced the class struggle from above and, conversely, reversed and
weakened the class struggle from below. 

Historical Context

The class struggle is the major determinant of the advances and regression of the
interests of the capitalist class. Following the Second World War, the popular classes
experienced steady advances in income, living standards, and work place representation.

However by the last decade of the 20th century the balance of power between the ruling
and popular classes began to shift ,as a new ‘neo-liberal’ development paradigm became
prevalent.

First and foremost, the state ceased to negotiate and conciliate relations between
rulers and the working class: the state concentrated on de-regulating the economy,
reducing corporate taxes, and eliminating labor’s role in politics and the division of
profits and income.

The concentration of state power and income was not uncontested and was not
uniform in all regions and countries. Moreover, counter-cyclical trends, reflecting shifts
in the balance of the class struggle precluded a linear process. In Europe, the Nordic and
Western European countries’ ruling classes advanced privatization of public enterprises,
reduced social welfare costs and benefits, and pillaged overseas resources but were
unable to break the state funded welfare system. In Latin America the advance and
regression of the power, income and welfare of the popular class, correlated with the
outcome of the class and state struggle.

The United States witnessed the ruling class take full control of the state, the
workplace and distribution of social expenditures.

In brief, by the end of the 20th century, the ruling class advanced in assuming a
dominant role in the class struggle.

Nevertheless, the class struggle from below retained its presence, and in some places,
namely in Latin America, the popular classes were able to secure a share of state power –
at least temporarily.

Popular Power: Contesting the Class Struggle from Above

Latin America is a prime example of the uneven trajectory of the class struggle.
Between the end of World War Two and the late 1940’s, the popular classes were
able to secure democratic rights, populist reforms and social organization. Guatemala,
Argentina, Uruguay, Brazil, Mexico, Venezuela were among the leading examples. By
the early 1950’s with the onset of the US imperialist ‘cold war’, in collaboration with the
regional ruling classes launched a violent class war from above, which took the form of
military coups in Guatemala, Peru, Argentina, Venezuela and Brazil. The populist class
struggle was defeated by the US backed military- business rulers who, temporarily
imposed US agro-mineral export economies.

The 1950’s were the ‘golden epoch’ for the advance of US multi-nationals and
Pentagon designed regional military alliances. But the class struggle from below rose
again and found expression in the growth of a progressive national populist
industrializing coalition,and the successful Cuban socialist regime and its followers in
revolutionary social movements in the rest of Latin America throughout the 1960’s.
The revolutionary popular class insurgency of the early 1960’s was countered by the
ruling class seizure of power backed by military-US led coups between1964-1976

which demolished the regimes and institutions of the popular classes in Brazil (1964),
Bolivia (1970), Chile (1973), Argentina (1976) , Peru (1973) and elsewhere.
Economic crises of the early 1980s reduced the role of the military and led to a
‘negotiated transition’ in which the ruling class advanced a neo-liberal agenda in
exchange for electoral participation under military and US tutelage.
Lacking direct military rule, the ruling class struggle succeeded in muting the
popular class struggle by co-opting the center-left political elites. The ruling class did not
or could not establish hegemony over the popular classes even as they proceeded with
their neo-liberal agenda.

With the advent of the 21st century a new cycle in the class struggle from below
burst forth. Three events intersected: the global crises of 2000 triggered regional
financial crashes, which in turn led to a collapse of industries and mass unemployment,
which intensified mass direct action and the ouster of the neo-liberal regimes.
Throughout the first decade of the 21st century, neo-liberalism was in retreat. The
popular class struggle and the rise of social movements displaced the neo-liberal regimes
but was incapable of replacing the ruling classes. Instead hybrid center-left electoral
regimes took power.

The new power configuration incorporated popular social movements, center-left
parties and neo-liberal business elites. Over the next decade the cross-class alliance
advanced largely because of the commodity boom which financed welfare programs,
increased employment, implemented poverty reduction programs and expanded

investments in infrastructure. Post-neoliberal regimes co-opted the leaders of the popular
classes, replaced ruling class political elites but did not displace the strategic structural
positions of the business ruling class.

The upsurge of the popular class struggle was contained and confined by the center
left political elite, while the ruling class marked time, making business deals to secure
lucrative state contracts via bribes to the ruling center-left allied with the conservative
political elite .

The end of the commodity boom, forced the center-left to curtail its social welfare
and infrastructure programs and fractured the alliance between big business leaders and
center-left political elites. The ensuing economic recession facilitated the return of the
neo-liberal political elite to power.

The big business ruling class learned their lessons from their previous experience with
weak and conciliating neo-liberal regimes. They sought authoritarian and, if possible
rabble rousing political leaders, who could dismantle the popular organizations, and
gutted popular welfare programs and democratic institutions, which previously blocked
the consolidation of the neo-liberal New Order.

The Neo-Liberal New Order

The neo-liberal “New Order” differed substantially from the past in several
significant features.

First neo-liberal programs under the New Order were based on highly repressive
leaders – they did not merely depend on ‘market discipline’ and state promoted programs.
Authoritarian political regimes established a framework to finance, protect and promote
the consolidation of neo-liberal systemic changes.

Secondly, political ascendancy of the New Order relied on a coalition of ruling class
elites, conservative upper middle-class property and professional groups and downwardly
mobile lower middle classes fearful of personal and economic insecurity and the
breakdown of the old social order.

Thirdly, the New Order was led by a demagogic leadership that called on direct
political intervention, by retired and active military and police officials backed by armed
landowner militia , lumpen street fighters ( private gangsters) willing to intimidate leftist
workers, landless peasants and unemployed trade unionists.

Fourthly the New Order elites mobilized the mass base of religious fundamentalists by
targeting ‘marginal groups’(gays, people of color, feminists, immigrants etc) who were
portrayed as enemies of the family, nation and religion.

Fifthly ,the New Order deflected popular discontent to leftist corruption, immorality
and impotence to combat crime in the streets.

The New Order is built on perpetuating neo-liberal ruling elites by destroying the
political, social and economic institutions and rules of the previous electoral
order(‘democracy’).

In a word , big business led class struggle from above was not interested in free market
‘reforms’, the want it all-power ,profits, and privilege-without obligations, regulations or
constrains.

The Future of the Neo-Liberal “New Order”

The authoritarian New Order has gained powerful patrons in rulers like US Presidents
Trump and Brazilian President Jair Bolsonaro. They have neo-liberal allies in Argentina,
Central America , Europe , Asia, and the Middle East. They have embraced a powerful
message of political-military bullying of traditional allies , economic warfare against
dynamic competitors and a glorified vision of national grandeur to its mass followers.
Initially, the business elites prosper, the stock markets rise, taxes are lowered and
state subsidies fuel euphoria and hopes among the masses that ‘their turn is next’. Profits
and police state ‘law and order’, link the business elite with the affluent middle class.
The combative popular classes are demoralized and disoriented by failed leaders and
the retreat of social movements and trade unions from the class struggle
In contrast the international alliance of the authoritarian big business neo-liberals has
a vision of global , regional and national power.

However sustaining their advance is conditional on dynamic economic growth and
overcoming cyclical economic crises; on subverting class struggle from below; on
finding substitute adversaries, as older ones lose thru mystifying appeals.

The corruption of upwardly mobile middle-class rabble rousers will disillusion their
voluntary followers. Arbitrary police and military repression usually extends to extortion
and intimidation beyond the drug slums to the middle and working-class neighborhoods.
The authoritarian New Order usually begins to decline through ‘internal rot’ – uber-
profiteering and flagrant abuse of work.

The rightist rhetoric turns against itself as its followers engage in invidious
distinctions. The ruling class looks to shed its authoritarian shock troops and replace
them with technocrats., free marketeers and malleable bourgeois politicians. The left and
center-left looks to attract a new generation of followers in the street protests and seeks to
form alliances with readily available opportunist politicians.

 A new political cycle takes shape – but will a new popular class struggle emerge?

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