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Israel is making southern Lebanon unliveable—exactly as outlined in the document it submitted to the international community years before regarding the 6 to 8 kilometers border zone—a document the media is unaware of.
Twenty years after the adoption of UN Security Council Resolution SCR1701, Israel has violated it more than 50,000 times since its adoption in 2006. Israel has violated all signed agreements, and all international norms with absolutely no consequences.
Israel currently occupies and controls 20% of Lebanon, systematically demolished more than 81 villages—Ancient villages where Jesus Christ once walked, villages that have stood the test of time for centuries and centuries, with prehistoric and Roman-era roots—destroyed homes, roads, bridges, and all infrastructure, as well as farmland, forests, valleys, hills, and entire ecosystems.
According to Article Il of the UN Genocide Convention, genocide involves specific acts committed with the “intent to destroy, in whole or in part, a national, ethnical, racial or religious group.”
Israel is engaged in the deliberate destruction of the means of life in southern Lebanon which itself is evidence of genocide. Wiping out entire villages is not military necessity. It is the deliberate destruction of civilian infrastructure. These are war crimes under international law: Wanton devastation not justified by military necessity.
The war in Lebanon has reached a point where it can no longer be described as anything other than genocide and ecocide. When Israel flattens an entire villages, the rest of the world has one clear obligation—cut off that military's access to weapons.
Don't be fooled by current leaders statements calling for an end to the genocide in Gaza and Lebanon. If they really wanted to end it, they would have stopped military aid to Israel.
World leaders must move beyond expressing deep concern and strong condemnation of Israel’s genocide to taking steps to stop it , and that means immediately ending all military aid to Israel.
Israel is committing another genocide in Lebanon with complete impunity, so regularly that the world has lost interest—just like it has lost interest in Gaza.
Lebanon is the second most-documented genocide in history after Palestine, yet the most denied.
* Mohamad Safa, is a former UN representative for the Patriotic Vision Association (PVA).
FT has a firewall and I couldn't get the article. RM
Shaiel Ben-Ephraim
This investigation by the Financial Times is staggering in its findings and in its scope and methodological rigor. Some of the findings, backed up by incredible levels of forensic evidence:
1) Israel completed much of its systematic destruction across Israeli-occupied southern Lebanon after Israeli forces took control of already-emptied villages in mid-April, and after the April 17 ceasefire. The ceasefire was used to make these areas completely uninhabitable.
2) The scale of destruction is incredible. Roughly 85,000 housing units damaged or destroyed (likely an undercount); 62 villages and farms inside the "yellow line" occupation zone, covering ~6% of Lebanon and extending ~10km inland, with ~270,000 residents barred from returning. Over 20% of the south's farmland and forest destroyed, ancient olive groves worst hit. All Litani river bridges destroyed; at least 2,500km of water infrastructure gone.
3) This is stated policy and an intentional plan to make an entire area uninhabitable and never allow the population to return. Defence minister Israel Katz explicitly invoked the "Rafah and Beit Hanoun model" and later boasted of destroying "24 Lebanese villages… not house by house, but entire villages."
4) This is without a doubt a war crime. Destruction of property requires immediate military necessity and not speculative ideas that Hezbollah may use a building some day. Not allowing the return amounts to the ethnic cleansing of the area.
The lack of any real consequences for Gaza, meant that Israel felt free to do the same in Lebanon. It is now doing the same in the West Bank. This will stop unless we stop it.
WAPE 2026: Adam Smith, imperialism and financialisation – and an award
Last week, the 19th Congress of the World Association of Political Economy (WAPE) took place at the University of Greenwich, London. WAPE is a Chinese-run academic economics organisation, linking up with Marxist economists globally. “Even though that might seem like bias, the WAPE forums and journals still provide an important outlet to discuss all the developments in the world capitalist economy from a Marxist perspective. Marxist economists from all over the world are welcome to join WAPE and attend WAPE forums.” (WAPE mission statement).
The theme of this conference was the contribution of Adam Smith to political economy, because it is 250 years since Smith published his An Inquiry Into the Nature and Causes of the Wealth of Nations – and in effect, pioneered political economy (now called economics by the mainstream).
The Chair of WAPE, Chen Enfu, from the Chinese Academy of Social Sciences, in addressing the conference on Adam Smith’s theory of national wealth said that, while Smith has become the guru of ‘laisser-faire’, free market economics, in reality, he did not merely advocate free markets but also explained the development of modern economies within the framework of the social division of labour, moral norms and the role of the state.
In Wealth of Nations, Adam Smith argues that, as each individual pursues his or her own economic activity, the individual is unaware that the combination of all these individual actions produces a market for production and consumption that is not under his or her control but leads ‘invisibly’ to a better outcome for all. Behind this was Smith’s great insight that modern industry is based on a division of labour: when the production of commodity is broken down into discrete parts where human labour specializes instead of workers doing every part of the process, productivity rises and costs and prices fall.
But as Dogan Gocmen of Dokuz Eylut University explained in his keynote address to the conference, there is the apparent contradiction in Smith’s views. In his earlier work, The Theory of Moral Sentiments (1759), Smith articulated an ethical critique of the commercial society as analysed in the” Wealth of Nations”. So Gocmen argued it would be wrong to think that Adam Smith’s view consisted merely that the ‘invisible hand’ of the market should rule.
There were many sessions during the conference on Smith’s contribution to political economy and many presentations aimed to ‘save Smith from neoliberalism’, as Stavros Mavroudeas put it in his presentation. Adam Smith became the man that Chicago University economists like George Stigler and Milton Friedman turned to as their theoretical mentor for the ‘free market’; and was lauded by right-wing free market politicians like Margaret Thatcher, inspiring them to adopt policies to reduce the size of government and state and ‘let the market rule’ in all aspects of social organization. And global free market economists like Friedrich Hayek and the Austrian school of free market economics look to Smith for their basic approach. There is even a ‘think-tank’ based in the UK named after him that claims to develop economic policy based on clear ‘free market’ principles. Its slogan is “Using free markets to create a richer, freer, happier world.” But Smith was not some raging free market evangelist that denied the role of government or for that matter considered that human behaviour was driven by material self-interest and nothing else. That is a myth created by today’s free marketeers that Smith was opposed to government and to moral behaviour over material interest.
However, as Cheng Enfu said, while Marx recognised Adam Smith’s theoretical acheivements, in particular, his identification of labour as the fundamental source of the creation of wealth, Smith’s version of the labour theory of value was contradictory. He adhered to the view that labour created value, but also Smith reverted to a theory of value based on ‘factors of production’ ie rent from landlords, profits from capitalists and wages from labour, rather than all value being created by labour and then appropriated by landlords, bankers and capitalists.
Smith’s’ ‘factors of production’ theory now dominates modern mainstream economics and his labour theory of value has been put in the bin. As Marx said: “Adam Smith’s ‘contradictions are of significance because they contain problems which it is true he does not solve, but which he reveals by contradicting himself. His correct instinct in this connection is best shown by the fact that his successors take opposing stands based on one aspect of his teaching or the other.” Theories of Surplus Value I, 151. Marx also criticised Smith for treating the capitalist mode of production as a utopia, an eternal and natural order, denying its historic transitory chraracter as in Marx’s materialist conception of history.
While the ideas of Adam Smith were the theme of this year’s conference, the over 150 attendees from all parts of the world and the over 100 papers presented discussed many other subjects, including the nature of knowledge, imperialism, AI and technological innovation, value theory, and of course, China.
As usual, it is not possible to cover all these papers in this short post. I shall concentrate on the sessions where I made a presentation and others that I attended. There was a session on the Marxist theory of the circuit of capital. Here there was a disagreement between Alan Freeman and Guido de Marco on one side, who reckon Marx had a disequilibrium theory of value morphing into prices of production and into the circulation of capital; and on the other side, Fred Moseley who argues that market prices and the circuit of capital are bound by a long-term equiibrium prices of production. I won’t go into the ins and outs of this debate and its implications in this post. Instead, let me refer readers to a new book edited by Freeman and De Marco entitled Money, Value and Marx’s Circuit of Capital where various authors present their arguments on the circuit of capital.
My own presentation was in a session on imperialist exploitation, in which I argued that under the rule of imperialism, the poor countries of the world would never close the gap with the richer Global North, either in per capita income, productivity or human development. Only China stood a chance of doing so. None of the BRICS will catch up to the current high-income country level in the next 20 years, except China. China would reach that by 2041 and would match the projected level for the high-income countries by 2046.
China will match the current level of ‘human development’ (HDI) in the rich economies by 2039, but it would take until 2046 for China to reach the projected average rich country HDI in that year. Every other BRIC country will fail to meet either of those targets in a generation.
The main reason is that wealth (value) is being persistently transferred from the South to the North; AND profitability in the Global South is falling faster than labour productivity growth is rising, thus lowering investment growth. China may be the exception because its investment growth is less determined by profitability than in any other major Global South economy.
In the same session, Michael Tyrala of Hong Kong University presented some astonishing facts about the level of offshore tax dodging and its impact on the ability of governments, particularly in poor countries, to develop their economies. According to conservative estimates, as of 2015, somewhere between $7.6-36 trillion of untaxed financial wealth has been parked offshore, growing by somewhere between $200-850 billion annually, disproportionately affecting developing countries. This stash represents 8-38% of total global financial wealth and 3-14% of the $250 trillion total global financial and non-financial wealth. That compares with official development assistance (ODA) by the OECD countries of just $153 bn.
It seems that 73% of the Fortune 500 multinationals and 98% of the FTSE 100 operate tax haven subsidiaries. According to research published by the IMF, an estimated “$12 trillion, or almost 40 percent of all foreign direct investment positions globally – are completely artificial”, consisting of “financial investment passing through empty corporate shells with no real activity”, likely for tax purposes, and this “phantom FDI keeps soaring, outpacing the growth of genuine FDI”. (Damgaard, Elkjaer and Johannesen 2018; 2019).
International tax avoidance and evasion by high net worth individuals and multi-nationals ravage potential national government tax revenues, exacerbate income and wealth inequality (around 50% of all wealth in tax havens is owned by the 0.01%, and around 77% by the 0.1%.) and gives an unfair competitive advantage to the wealthiest companies, the tax rates of which are conservatively estimated to be some 4-8.5% lower than those of similar domestic-only operations, SMEs, and startups, stifling innovation. As for regulation, forget it.
In another session on financialisation, I was to present a paper but was unable to do so because of illness. (The slides for my paper are here https://thenextrecession.wordpress.com/wp-content/uploads/2026/08/financialisation-or-profitability.pdf). Financialisation, like neoliberalism, is a buzz word among leftists and heterodox economists. Many argue that ‘financialisation’ has created a new source of income that does not come from the exploitation of labour, but from the rise of finance capital, monopoly control and the gouging money out workers and productive capitalists, in other words, from rent not profit. But despite the claims of the ‘financialisation school’, the empirical evidence is just not there. There is an array of empirical studies that show financial income is not a significant form of corporate income and profits from production remain overwhelmingly dominant.
In contrast, Marxist theory argues that financial investment is a counteracting factor to the tendency for the rate of profit to fall in capitalist accumulation. Marx called this investment in ‘fictitious capital’, which is when capital is accumulated in financial and speculative sectors seeks to reap higher rates of profit compared to productive sectors. where there is a fall in the rate of profit.
In the session, Mavroudeas and Pontis argued that a large part of financialization literature treats fictitious capital as ‘virtual capital’: namely an autonomous sphere that generates profits independently of production and exploits through ‘dispossession’ rather than through the extraction of surplus-value from human labour. But this is a Keynesian view. For Marx, fictitious capital is a specific function of interest-bearing capital. It is a wager on the future extraction of surplus-value and thus remains geared, despite several layers of separation, to the sphere of production. Fictitious does not mean virtual: financial profits remain a redistribution of surplus-value.
To finish, let me tell readers that the WAPE Council this year gave me an award for my ‘significant contribution to Marxian economics’ – with a very heavy bronze globe! I shall be publishing my acceptance speech some time soon.
A very interesting and important discussion with Sangita Myska who was fired from her radio show on LBC after an interview with an Israeli official and having criticised Israeli policies on more than one occasion.
It reveals the level of influence of the Israeli government and supporters of Israel and the gen*cidal war it is waging against the Palestinian people in Gaza, the occupied West Bank and now Lebanon. The control and outright censorship of the western media, the BBC and US outlets for example, when it comes to the policies of the Xionist regime in Israel has led to the formation of independent media organizations like Double Down News as well as Middle East Eye, Breakaway News here in the US and other outlets. Please look for them, subscribe to them and support them.
Ms Myska makes the point that she's just "mainstream", they are not exactly radicals, this is how dangerous the assault on free speech and public discourse about the Israeli Apartheid regime's gen*cide has become. Sadly, James O'Brien of LBC, who has made some important contributions to the media and is very popular did not support Ms Myska and actually accused her of anti-semitism. I've lost any respect I had for him on hearing that.
I recall as a kid, scenes on the nightly news of the US assault on the Vietnamese people. It was there for us all to see. They learned from this as people find such violence abhorrent and increased opposition to the war. It was a similar situation, massive bombing from the air on a peasant nation. The US even poured herbicide on the Vietnamese people, their land, and their own troops. I had friends at work that dies from Agent Orange cancers. Some 57.000 US workers died in that predatory war, along with 3 million Vietnamese by most accounts; children in Vietnam are still being born with deformities due to this assault.
After Vietnam, journalists became embedded with the invading armies, like in Iraq and Afghanistan. Only a few courageous independent journalists braved the dangers of reporting from the ground.
The Israeli's have not allowed any independent journalists in to Gaza or where the IDF is committing its gen*cide and ethnic cleansing of the land it occupies. Palestinian Journalists have been murdered at an alarming rate, greater than any other combat zone. Supporters of Palestinian rights and those that oppose the gen*cide and stand up for Palestinians have also been "murdered" by the IDF, the American Rachel Corrie was one of them.
The tide is turning against the murderous Israeli regime. In the US, support for The Palestinian side is greater than for Israel which is a monumental shift.
Workers of the world owe the Palestinian people a debt of gratitude in standing against imperialist war and violence. We are all victims in the long run.
I would add to this important commentary from Mohamad Safa that Israel alone is not the problem either. Israel is a settler colony, western capitalism and particularly US imperialism’s only reliable ally in this important part of the world. And Israel would not have been able to commit the most horrific barbarity it has culminating in the present genocide without US backing.
A siege mentality is not only a natural outcome of settler colonies much like the British settling of Protestants in Northern Ireland; it is promoted as the dislocation and ethnic cleansing of the indigenous population is fiercely resisted. This is why the Irish have a long history of supporting colonial resistence. Occupation not only de-humanizes the victims, it dehumanizes the occupier. There are generations of Israeli children that will need to be de-zionised if you like. I think it is important to recognize that capitalism cannot resolve this crisis of its own making. Only a united, international working class movement can accomplish that. Richard Mellor FFWP Admin
I was born in southern Lebanon and have lived there my entire life—for more than 35 years—I was born in wars, lived through wars, and worked in their midst of these wars in relief and diplomacy.
Arresting Netanyahu is not the be-all, end-all. The problem is Israel. I have lived through 8 different Israeli Prime Ministers and different extremist government; while Netanyahu's right wing extremist government is the most horrendous, but they are all cut from the same cloth.
Promoting the blame on Netanyahu for the genocide and ecocide in Lebanon is misleading. The reality is, Netanyahu is not the disease, he is a symptom of it.
The same things were said when Shimon Peres committed massacres in Lebanon in 1996—most horrific the Qana Massacre, when Israel bombed a United Nations center sheltering around 800 displaced Lebanese civilians.
The same was said when Ehud Barak, Ehud Olmert, and Ariel Sharon committed war crimes and crimes against humanity in Lebanon. Now, the same is being said about Netanyahu.
If Netanyahu were arrested and removed today, would Israel suddenly stop being so problematic and a threat to world peace? No!
The problem is not Netanyahu alone; it is Israel as a whole. It is not the fault of one war criminal leader or a specific warmongering political party. It is the system. Israel kills children as a hobby. This violent Israeli culture and mentality is not new. The Israel we see today is a by-product of nearly 80 years of dehumanization and normalized violence against people in the Middle East.
Israel has killed nearly 100,000 people—including 25,000 children—in 1,000 days in Middle East. That means Israel killed about 100 people every day for 1,000 days with complete impunity. They believe that Israelis must inflict violence on others in order to survive and thrive themselves.
Israel does not want peace, Israel wants Palestine, a piece of Lebanon, and a piece of Syria—until now...
Peace through strength is not peace. Peace through mutual respect is. Peace without justice is an illusion. And diplomacy can be made only with countries that respect international law.
It's extraordinary that Israel can go on a mass murder and steal land from three neighboring countries simultaneously while you will look us dead in the eye and say Israel wants peace.
We know who the enemy of peace is. it has a name, it is Israel.
John Clark makes the point here that consciousness is not a static thing; it is complicated. It is fluid and we have to recognize, as Marx says, that consciousness is a product of being. He gives a concrete example of this in the essay below.
John writes:
As I’ve argued before, the power of the ruling ideas in this society is considerable but it is challenged by oppositional forms of thinking that flow from the conditions of working-class life. These two factors are always in competition and this can produce strange results.FFWP Admin
John Clark.
Toronto
After a lot of discussions I’ve had and social media posts I’ve read, I want to offer some thoughts on how problematic it is to base your conclusions on immediate consciousness. I’m going to argue that the situation is usually far more complex and often holds more possibilities than that which you can gather by simply noting the opinions working-class people express at a given moment. I’ll begin with a concrete example that made a strong impression on me.
Way back in the 1970s, I was working for the Ford Motor Company in its Basildon Tractor Plant in Essex to the east of London. In this factory, there was a huge problem with racism among the majority white workers and a member of the fascist National Front was even elected as a shop steward. Down the road from us, at the very much bigger factory in Dagenham, things were even worse, with rampant anti-Black racism hugely prevalent. The infamous ‘rivers of blood’ speech that the infamous Conservative Enoch Powell had made a few years earlier to whip up racism was still reverberating in British society.
One day, a young Black worker in Dagenham, after weeks of being harassed by a racist foreman, threatened his tormentor with a hammer and lost his job as a result. The whole factory exploded in anger, with workers stopping work but remaining on the property, and management had to reinstate the worker.
A left-wing shop Dagenham shop steward I spoke to shortly afterwards was predictably thrilled by this development but had to admit that he would never have imagined that such unity in action could instantaneously replace divisive hatred.
Of course, the racism was still there but even white workers with horrible ideas hated the employer and recognized their class interests and the need for solidarity in this situation. Yet, if you had based yourself on the immediate thinking of many of the white workers the day before this struggle broke out, you could never have predicted it or even imagined it possible.
As I’ve argued before, the power of the ruling ideas in this society is considerable but it is challenged by oppositional forms of thinking that flow from the conditions of working-class life. These two factors are always in competition and this can produce strange results. A worker who insists that the boss worked hard for his wealth and should be respected may still be on the lookout for ways to restrict the quantity of surplus value that has to be provided. Someone who expresses great respect for authority may hate the cops with a passion.
This is not to say, of course, that the views people express are irrelevant and they need to be properly understood. It’s just that the contradictions and social tensions in this exploitative society have the potential to spark resistance and this can happen when it is least expected.
The other vital consideration, when it comes to overcoming the ruling ideas that keep working-class people passive and divided, is that the class struggle is engaged in collectively and we are dealing with social consciousness and not just individual thinking.
In my Dagenham example, at the point at which the rebellion broke out, there would have been white workers who actively opposed racism, a minority who deliberately worked to spread it and a majority who had been influenced by racism but only to a certain degree. In the period leading up to active resistance, there would have been discussions and debates in which the racist core lost their dominant position. A leap in consciousness occurred and collective working-class action, based on the real interests of all the workers in the factory, suddenly exploded and scared the living daylights out of management.
So, when you hear depressingly backward talk in your local coffee shop or read a report of an opinion survey on immigration that can lead to pessimism, while you need to take stock of that present reality, you also shouldn’t lose sight of the contradictions and possibilities that can produce very different forms of thinking with great speed.
When you read news reports or watch footage of sweeping struggles of astounding boldness, you should realize that many of those on the front lines held the most conservative and compliant views just weeks or even days before they were caught up in one of the leaps in collective awareness that marks such social explosions.
Benjamin Netanyahu has remained in office for years by empowering the far right of his coalitions, including religious fundamentalist parties. The outlook of Netanyahu – arrogant, military supremacist, with no strategies but endless wars and his own political survival – is a perfect fit for the religious zealots and bigots in and around his cabinet. These are people who see the necessity of asserting Jewish religious traditions at the expense of those of other faiths.
These same politicians, who warn the west against the encroachment of ‘Islamic fundamentalism’, are themselves the authors par excellence of religious intolerance and oppression. They are the ‘Taliban’ of the Jewish faith: blind and ignorant, misogynistic men.
Zionism was originally a largely a secular, non-religious political nationalist movement, although there was an obvious historical association with Jerusalem. But nowadays, the stories from the Torah are being cynically used to boost that nationalism; its embrace of ultra-religious ideology and the rise of the religious neo-fascists is a relatively new development.
Goaded by the apocalyptic myths of the Hebrew bible – and they are mostly myths – these newly unleashed fanatics would be happy to see the Middle East plunged into a religious war, one which they are confident they would win.
The religious right are on the point of provoking a powerful reaction from Arab states in the area, by repeated incursions into the compound of the Al-Aqsa Mosque in Jerusalem. The area has great significance in Islamic tradition, but also has great significance in Judaic tradition.
Western wall revered today
The compound is on the site of what was the huge so-called ‘Second’ Temple, active around two thousand years ago, but utterly destroyed by the Romans after an unsuccessful revolt, in 70CE. What remains of the Temple – its lower foundation walls – are revered by Jews today as the Western Wall, and the area above it, where the Temple used to stand, is known to Jews as Temple Mount.
However, fourteen centuries ago, during the period of the rise of the first Arab empire, and at the time of the establishment of Islam, the area was put to a new use. Here, the Dome of the Rock was built at the end of the seventh century, by the Caliph Abd Al-Malik. It was Islam’s very first monumental place of worship, built to rival the great cathedrals of Byzantine Christianity.
This was at a time when early Islam had not clearly and decisively differentiated itself from Judaism or Christianity – it is a faith that shares many influences with both religions – and the Dome of the Rock was of a design meant to express the majesty and grandeur of the Caliphate.
Being first-ever major site of worship, the Dome of the Rock was not built in what became the style of later mosques, but it is still revered by Muslims as the third most holy site, after mosques built later in Mecca and Medina. Tradition has it that Mohammed ascended to heaven from the Dome of the Rock.
Al-Aqsa is a huge mosque and is filled regularly…when allowed
In more modern times, a large mosque was built nearby – the Al-Aqsa Mosque and this used to be the place where thousands of Palestinians would gather for Friday prayers. “Used to”…because the Israeli authorities are increasingly asserting their rights to decide how many and which Palestinians are allowed into the compound on Fridays and the entry to the mosque has become a flashpoint of conflict between the IDF and local Palestinian worshippers.
The Jordanian government has an axe to grind on this issue because it is ‘legally’ the custodian of the Al-Aqsa compound, from an Israeli-Jordanian treaty of 1994, not that the Israeli government takes much notice of that fact.
In modern times, Jews have been forbidden from entering the Al-Aqsa compound at all, much less worshipping there, but in recent years there have been repeated encroachments by ultra-religious Jewish groups, goaded by politicians from the far right. Last month more than 2,000 Israelis, many of them settlers – the same groups organising murderous pogroms against Arab villages – stormed the Al-Aqsa compound, alongside Israel’s national security minister, Itamar Ben Gvir. Here, they prayed and performed religious rituals.
There are those on the far religious right in Israel who would be happy to take over the Al-Aqsa compound altogether, in the hope of somehow restoring the area to its “former glory”. The essential thing for them is to ‘liberate’ the area – like the whole of ‘Greater’ Israel – from the yoke of the Muslims. It is the stuff of messianic politics, but it pervades an entire spectrum of Israeli right-wing politics, including many in the army and the state machine.
Ben Gvir – the same ‘security’ minister who gave out ten thousand assault rifles to Jewish settlers – made no bones about who had the whip hand in Jerusalem. “Everywhere”, he toldHaaretz, “people understand that Israel is in charge. There is still more to do, and with God’s help, we will move forward”. The plan to forces changes to the protocols around the Al-Aqsa compound, we should add, are fully endorsed by Netanyahu and his cabinet.
Unsurprisingly, there is growing anger among Muslims, over what is seen as the repeated desecration of a holy Islamic site. There is also a fear that in the weeks approaching the general election in Israel – due in October – that the Israeli religious right would use the issue to provoke religious conflict in the hope of shoring up their position in the polls.
Jordanian government has reasons to worry
Last week, the Jordanian government convened a meeting of foreign ministers of Muslim countries to express their alarm at the developments in Jerusalem. “We warn that tampering with the status quo”, the Jordanian foreign minister, told the Guardian, ”could trigger a religious conflict that will reverberate beyond Palestine and Jordan into the whole Muslim world.”
Jordan has special reason to worry, because half of its population of twelve million are Palestinian, and what happens on the West Bank of the River Jordan will sooner or later have a major impact on what happens on the East Bank.
Ben Gvir, ‘security’ minister, the person who armed settlers and who is, in effect, the main proponent of terrorism in the West Bank
Jordan is a monarchy, but hardly a constitutional one – political activity is severely limited and opposition is actively suppressed by the authorities. There is a parliament, but its powers and activities are strictly curtailed. Nonetheless, opposition is growing, as a result of the genocidal destruction of Gaza and the Israeli depredations on the West Bank. To add insult to injury, Israel has reneged on a previous agreement to share the waters of the Jordan River with the result that there are shortages affecting Jordanian agriculture.
The “normalisation” of relations between the Jordanian monarchy and Israel, established now for decades, has come under considerable strain and the Jordanian monarchy is finding that repeated suppression cannot block opposition forever. The encroachment of Jewish worshippers onto a Muslim holy site in Jerusalem is only increasing support for new, radical Islamic parties in Jordan, the largest of which now has around quarter of the MPs in parliament.
Aggression and hubris pervades the whole Israeli state
Dima Tahboub, a member of parliament and spokesperson for Jordan’s Islamist Umma (‘Community’) party told the Guardian. “Anti-normalisation sentiment here has grown even larger than before due to the Zionist state’s plans of annexation of the West Bank, the denial of Jordan’s share in the water agreement and also the daily challenges to the custodianship at al-Aqsa mosque…Every day there is penetration by settlers into al-Aqsa mosque and at the same time, [Palestinian]Jerusalemites are prevented from entering the mosque.”
Whether or not the religious arsonists around Ben Gvir are successful in provoking a religious fire remains to be seen, but it is yet another indication of the aggression and hubris that pervades the whole Israeli state and establishment at the present time.
We might also add that the political establishment of the west – including most of the leadership of the Labour Party – are complicit in this process. They wring their hands over the pogroms conducted by armed Jewish settlers against Palestinian villages and they sigh over the ferocity and scale of the killings of tens of thousands of Palestinians in Gaza. But they continue to arm Israel and trade with Israel as if it were a ‘normal’ country, living by ‘normal’ rules, and not a vicious theocracy bent on wiping out all traces of other faiths and traditions in ‘its own’ territory.
Feature picture shows the Dome of the Rock in the Al-Aqsa compound, from Wikimedia Commons, here. Inset picture of Ben Gvir, from Wikimedia Commons, here]
See more on the history of the Dome of the Rock and early Islam, inThe Origins of Judaism, Christianity and Islam,here.
Back last February, I posted about the state of the Japanese economy when Sanai Takaichi, Japan’s first female prime minister called a snap general election, which she won in a landslide. Takaichi, who models her views on Britain’s Margaret Thatcher of the 1980s and now on Trumpism, claimed she would be different from all past prime ministers. She would cut taxes, in particular, the consumption tax which drives up prices in the shops, but at the same time increase government spending on social security and ‘defence’, even if it meant higher budget deficits. Takaichi was ‘going for growth’ in a not dissimilar way as the ill-fated, short-lived British Conservative prime minister, Liz Truss. Truss’s plans for big rises in the UK budget deficit led to a sharp rise in UK government bond yields and a run on the pound. She lasted just over a month before ‘the powers that be’ (the bond markets) got her ousted.
Last February, I forecast that something similar would happen in Japan, if at a slow burn. And now it has come to pass. Japanese government bond yields have rocketed to highs
While the Japanese yen has collapsed to near historic lows.
The problem for Japan is that economic expansion has increasingly depended on permanent government deficits, with government spending on construction and other projects; and yet Japan’s economy has continued to stagnate. With Japan’s corporate sector unwilling or unable to invest, Takaichi has been attempting to end Japan’s stagnation by yet more spending on projects to boost technology, while telling the Bank of Japan to not raise interest rates, as servicing existing government debt is already using up a quarter of all government spending! This Truss-Trump type policy has got the Bank of Japan and the financial institutions really worried, as well as foreign investors.
As I said last February, the Japanese economy has now morphed into stagflation, with rising prices, flat GDP and consumer spending and falling real wages. Consumer prices have risen 12% since 2021. At the same time, real GDP is barely higher than it was in 2018. Real wages are down 7% from their 2018 level.
Takaichi’s policies won’t end up crashing the Japanese government bond market as Liz Truss managed in the UK. That’s because most Japanese government debt is held by Japanese (88%), unlike in the UK. The risk of capital flight only lies in that portion held by private investors, the net debt. And the latter is smaller than it’s been in decades, mainly because the BoJ has bought so much of the debt since 2013.
Instead, it is the currency that is diving. With a 50% depreciation of the yen since 2021 to its lowest rate for 40 years. Far from delivering a kick-start to economic growth and exports, the fall in the yen has just accelerated inflation. The inflation rate is heading to 3% a year, unheard before of in Japan.
In the last week, the fall in the yen eventually prompted the Bank of Japan to intervene and start buying yen with its dollar reserves. But the new development was that US Treasury also came to the aid of the BoJ and Takaichi by starting to buy yen. This has helped to stop the depreciation of the currency, at least for now.
The US entered the fray for two reasons. First, the US Treasury Secretary Scott Bessent was concerned that the fast rise in Japanese government bond yields (2.86% in July, its highest level in some 30 years) would also lead a further rise in US government bond yields, already at highs. The cost of servicing US government debt would rise and other interest rates in the US, like mortgage rates would move up. US government borrowing costs are now at around 4.6 per cent, and 30-year bond rates are north of 5 per cent for the first time since the great financial crisis.
Rising interest rates are not popular with American households, where inflation is also on the rise, the jobs market is stalling and real incomes are stagnating at best.
The other reason for the US intervention was that a weak yen would lead to an accelerated flow out of yen by financial investors and into buying US dollars. This would strengthen the dollar and so make US exports even more difficult to compete in world markets. But what was odd about the US intervention was the US treasury used euros to buy yen, not dollars. This suggests that the US government is now reluctant to print more dollars because foreign investors have to some extent lost their enthusiasm for dollar assets, at least for US government bonds. It’s a sign of a weakening of US dollar’s ‘exorbitant privilege’ in world financial markets.
What can we learn from these currency events? First and foremost, that all roads are now leading to ‘stagflation’, where inflation rises, but economies do not expand. This is the story for Japan, Europe and even the US. Second, that pro-business governments cannot stimulate growth through currency depreciation or through trying to keep interest rates low if capitalist companies won’t invest. Japan’s corporations may have increased profits at the expense of wages, but they are not investing that extra capital in new technology and productivity-enhancing equipment.
The current yen crisis could only be resolved by a sharp rise in Japanese interest rates to encourage investors to hold Japanese financial assets. But this would ensure an outright recession in the Japanese economy. Takaichi is caught in a trap between inflation and slump.
