The choices facing the US ruling class are unpalatable. Iraq and the Middle East are too important to American imperialism for Washington simply to pull out. But each of the alternatives to Bush’s now abandoned slogan of ‘staying the course’ – withdrawing a reduced US force to a handful of bases in and around Iraq, partitioning the country, cutting a deal with Iran and Syria – involves major difficulties. Washington’s problems are reinforced by the setbacks it has suffered in other fronts of the ‘long war’. Israel’s 33-day war against Lebanon demonstrated the limits of hi-tech firepower confronted with a determined and well-equipped guerrilla army with a popular base, immensely boosted the prestige of Hezbollah, and destroyed Sharon’s strategy of repartitioning Israel-Palestine through selective withdrawals. Meanwhile the offensive mounted by NATO in southern Afghanistan has been blunted by the resistance of a rejuvenated and confident Taliban.

Experience of past imperial collapses – India, Algeria, Aden, Vietnam – indicates that a sudden and chaotic withdrawal of US and British forces from Iraq cannot be ruled out. But whether or not the endgame comes quickly in Iraq, the danger that the US will try to recoup its position through a dramatic assertion of its military power remains very real. In particular, we need to remain alert to the possibility that a Bush administration with nothing to lose politically after its probable defeat in the mid-term Congressional elections on 7 November may try one last throw of the dice by attacking the main regional beneficiary from the US failure in Iraq, the Islamic Republican regime in Iran. Building the global anti-war movement will therefore continue to be central to the work of revolutionary socialists.

2. Though the US is currently losing the war on terrorism, the broader capitalist economic offensive goes on apace. Even here there have been setbacks for the other side, often reflecting Washington’s weakened global position – notably the collapse of the Doha round of trade negotiations at the World Trade Organization. But the investment of capitalist classes worldwide in the neo-liberal package of policies is enormous, and is constantly reinforced by the relentless pressures of global competition. (The New York Times recently reported that Sudan, whose economy is booming despite the war on Darfur and condemnation by the West, has been praised by the World Bank for implementing an IMF programme of privatization, spending cuts, etc! ) Workers, peasants, and poor people around the world are therefore continually confronted with ‘reforms’ whose aim is to reduce their living standards, cut back on welfare provision, and make it easier for local and foreign capitalists to exploit them.

Since the mid-1990s the neo-liberal offensive has provoked waves of resistance that provide the conditions for a renewal of the left. The region where this resistance has developed to the highest level is, of course, Latin America, where the governments of Hugo Chávez in Venezuela and Evo Morales in Bolivia have become lightning conductors for the confrontation between the new movements on the one hand and neo-liberalism and imperialism on the other. The significance of Venezuela and Bolivia lies in the interplay between movements from below and governments that identify with these movements. Chávez in particular has sought to project himself as a global figure championing ‘21st century socialism’ and challenging US hegemony.

Here then are cases where resistance to neo-liberalism has gone beyond simply stopping obnoxious ‘reforms’ and has begun to seek alternatives. Thus the Morales government’s attempt to restore state control over Bolivia’s hydrocarbon reserves puts the issue of social ownership as an alternative to privatization back onto the agenda. But the obstacles confronting these experiments are very real.

The efforts of the US and the Latin American ruling classes to contain the ‘Chávez effect’ have been successful in the presidential elections in Peru and Mexico (in the latter case at the price of massive electoral fraud that has split the country in two). The Bolivian oligarchy openly threatens Morales with secession and civil war. In both Venezuela and Bolivia left-wing presidents sit atop state machines programmed to defend the status quo. These problems can only begin to be addressed through a new breakthrough in which the mass movements begin to develop organs of popular power that can supplant the old state apparatuses.

3. The European ruling classes find themselves caught in a particularly difficult bind. The eurozone is locked into chronic slow growth compared to the other major regions of advanced capitalism – the US and East Asia. The flood of cheap manufactured goods from China is particularly threatening to the weaker capitalisms of southern Europe that have concentrated in industrial sectors such as textiles, clothing, and footwear highly vulnerable to Chinese competition. As a result, European capitalism has a strong interest in neo-liberal ‘reforms’ that would make it easier to push through drastic economic restructuring that would enhance competitiveness at the expense of the working people.

The problem is that European governments are confronted with massive popular opposition to these policies. This is most visible in France, where the neo-liberal agenda has suffered three major defeats in recent history – the 1995 public sector strikes, the rejection of the European Constitution in the referendum of May 2005, and the mass student-worker revolt last spring that forced the abandonment the CPE draft law attacking the rights of young workers. The weakening of the workers’ movement means that successful mass resistance is relatively rare. What is universal is a huge gap between elites deeply committed to neo-liberalism and the mass of the population sullenly opposed to ‘reform’.

The result is often stalemated politics. Both the major parties lost votes in the last German federal elections in September 2005. As a result they were forced together into a Grand Coalition of the conservative Christian union parties and the Social Democratic Party under Angela Merkel. There is increasing frustration in big business at the failure of the Merkel government to press ahead with ‘reforms’. In both France and Italy establishment politics is evenly divided between centre-right and centre-left groupings equally committed to the neo-liberal agenda and equally wary about driving it through and provoking explosions from below. ‘Both sides have a bias for state intervention,’ a Bank of America economist complained before the Italian general election of April 2006. ‘The electorate prefers more social protection and social spending [rather] than lower taxes and deep supply-side reforms.’

The current crisis in Hungary illustrates the even deeper problems faced by the ruling classes of Central and Eastern Europe. Here the transition to market capitalism has mainly benefited the elites at the top who, whether they come from the old Stalinist nomenklatura or the dissident movements, are strongly committed to neo-liberal policies. Now, in order to meet the tough convergence criteria required to join the euro, the Central and Eastern European governments must cut the massive budget deficits they built up when they used tax cuts and higher spending to ease the transition, as Hungarian Prime Minister Ferenc Gyurcsany admitted in his famous secret speech confessing to having lied to the electorate. Fearful of the popular backlash to the austerity measures demanded by the European Commission, politicians engage in demagogic displacement activity – attacking the central bank, like the right-wing populist government in Poland, or seeking to appropriate the heritage of the 1956 Revolution, like the right-wing opposition in Hungary.

This economic and political stagnation doesn’t mean that attacks do not take place. German big business has over the past few years bypassed the stalemated political process and negotiated local deals with the trade union bureaucracy that have allowed them to cut wages, jobs, and conditions and expand the number of low-paid, temporary, often part-time ‘atypical’ workers, helping to make Germany the biggest exporter in the world.

And there are efforts to restructure the political field on more favourable terms to capital. The front-runners in the French presidential elections, Ségolène Royal and Nicolas Sarkozy, both model themselves on Blair and are running on a mix of neo-liberalism and authoritarian populism. Italian big business is hoping (though with steadily diminishing confidence) that the Prodi government can contain the unions and the left and restructure an economy sinking under the weight of international competition.

4. Nevertheless, the current situation in Europe is favourable to the development of parties of the radical left that can begin to occupy the space abandoned by social-democratic parties as they moved rightwards and embraced neo-liberalism (what in France is sometimes called social liberalism). The need for such parties is reinforced by the evolution of the movements for another globalization that emerged with the Seattle and Genoa protests and were the driving force in the mass protests against the Iraq War, which have been strongest in Europe.

The initial phase of development of the altermondialiste movement suffered from what Daniel Bensaïd has called the ‘social illusion’, characterized by a belief in the ‘self-sufficiency of the social movements’ and the ‘repression of the political question’. This was reflected in the notorious ban on political parties in the Charter of Principles of the World Social Forum and in the hostility to the radical left shown by the right wing of the movement, notably ATTAC in France and its allies.

Bensaïd describes this as ‘the "Utopian" moment of the social movements’. Seeking to separate movements and parties was never tenable: movements challenging the whole gamut of neo-liberal policies plus imperialist war were necessarily intervening on the political field. This logic demanded political representation for these movements. The point at which this became indisputable was the French referendum of May 2005 when an alliance of trade unionists, activist coalitions such as ATTAC, left-wing think-tanks, and political parties – ranging from the left (and not so left) of the Socialist Party through the Communist Party (PCF) to the Ligue Communiste Révolutionnaire (LCR) – succeeded in defeating the Constitution.

Failure to acknowledge this reality has helped to bring a substantial section of the altermondialiste movement into crisis. ATTAC France has been broken wide open by a factional struggle roughly speaking between left and right that has culminated in a ballot-rigging scandal. The European Social Forum process is close to collapse – after the ESF in Athens, which was smaller and even more divided than its predecessors, the dominant Franco-Italian right wing is struggling to ‘relaunch’ the process and cannot even find a country willing to host the next Forum.

In Latin America, the other main pole of the movement, the breakthroughs in Venezuela and Bolivia have provided a radicalizing impetus reflected at the ‘polycentric’ WSF in Caracas last January. But in Brazil, home of the WSF, the .movement is split over its attitude to the Lula government, which has stuck fast to the neo-liberal economic policies of its predecessor. The next WSF in Nairobi in January will focus the movement in Africa, the continent most devastated by neo-liberalism, but there is a real danger that it will be dominated by NGOs seeking to collaborate with rather than to confront the advanced capitalist states and the transnational corporations.

5. A range of new formations of the radical left have emerged in the past few years to take up the challenge of providing political expression to resistance to neo-liberalism. Some – Respect in England and Wales, the WASG-Linkspartei in Germany, the Left Bloc in Portugal – have in the past year continued to make real advances, as has the Party of Socialism and Liberty (P-SOL) in Brazil. But there are contrasting cases that are much more negative. The Scottish Socialist Party (SSP) – widely held up as a model for the radical left – is in the process of committing suicide. In Italy the Partito della Rifondazione Comunista (PRC) has moved decisively to the right. And in France the LCR is throwing away a major opportunity to widen and strengthen the radical left.

The Italian case is the worst but in some ways easiest to understand. The centrist leadership of the PRC under Fausto Bertinotti has consistently tacked right and left to dominate a deeply factionalized party. In the late 1990s Bertinotti moved leftwards, bringing down the last Prodi government and strongly identifying with the rising anti-capitalist movement. At Genoa and at the first ESF in Florence Bertinotti effortlessly embraced the language of revolution and used the woolly and ambiguous vocabulary of autonomism both to project a radical image and to preserve for himself maximum room for manoeuvre. But, as the movement in Italy declined after the highpoint of 2001-3, the Bertinotti leadership tacked rightwards and the PRC joined the Prodi centre-left government.

The damage that this has caused the radical left in Italy cannot be underestimated. In his capacity as President of the Chamber of Deputies Bertinotti recently attended the congress of the ex-fascist Alleanza Nazionale and embraced its leader, Gianfranco Fini. What this can have felt for anyone who took part in the Genoa protests and remembers Fini’s role in directing the murderous police assault can only be imagined.

More concretely, the PRC (including a Fourth International senator) voted for the Italian military mission to Afghanistan. The impact on the Italian anti-war movement, initially the strongest in Europe, has been devastating. In spring 2004 a million people demonstrated in Rome against the war in Iraq – an anti-war demo there a few weeks ago was a mere thousand. This tragic experience underlines the impossibility of separating movement and party, as most of the activists involved in the Italian Social Forums, along with many of the autonomist disobbedienti, have been dragged along in the wake of the PRC as it moved right.

6. The Italian case is one of a centrist party manoeuvring first left and then right. More generally in Europe the problem has been one of how and whether the revolutionary left should relate to new political formations that, if they are to succeed, must embrace substantial numbers of refugees from social democracy. In some cases, the behaviour of the far left has been sectarian to the point of caricature. In Germany, for example, the local affiliate of the Committee for a Workers’ International (CWI) has used the participation of one wing of the new left, the ex-Stalinist PDS, in social-liberal state governments to try to kill off the new party at birth. Our comrades in Linksruck have, while condemning the PDS’s serving in these coalition governments, successfully fought alongside ex-social democrats in the WASG to give the new left the space it needs to develop and grow.

The dominant faction in the SSP never succeeded in breaking with the sectarianism it too had learned in the CWI. Shunning the anti-war movement and the G8 protests, it used the pretext of a News of the World-manufactured sex scandal to remove the party’s most popular figure, Tommy Sheridan, and has worked obsessively to destroy him, apparently unaware that they are sawing off the branch on which they too – and indeed the entire radical left in Scotland – are sitting.

The case of France is more complex. The victory of the left No in the referendum, followed by the defeat of the CPE, created a powerful impetus to translate the social resistance to neo-liberalism into a political realignment of the radical left that could bring together the Communist Party and the LCR, alongside substantial sections of the altermondialiste movement and of non-aligned activists and intellectuals, in opposition to the dominant parties on the centre-left and centre-right. Tragically, the majority in the LCR has used the real danger that such a regroupment might be drawn behind the Socialist Party in a new version of the plural left that governed France disastrously between 1997 and 2001 as a justification for refusing seriously to explore the possibility of a more principled realignment.

The effect has been to allow the PCF, itself deeply divided over whether to run its own candidate in the forthcoming presidential elections, to make the running as the champion of unity in the extensive network of May 29 collectives that have sought to continue the movement against the Constitution. At best, the LCR is throwing away a major opportunity to reshape the French left. At worst, the organization might actually split, if a serious unitary candidate emerges with the backing of the PCF and the 29 May collectives and the minority within the Ligue that advocates left realignment were to break away to join them. Any such split would be a tragedy: the LCR is one of the anchor-stones of the revolutionary left internationally, and no genuine renewal of the French left can take place without it.

7. Behind all these cases is the same false polarity – either Bertinotti’s opportunism or revolutionary purism, either the movement or the party, either a broad party or a narrow revolutionary organization. The entire strategy the SWP has pursued since Seattle has involved a refusal of these fake choices. Challenging social liberalism means building broad political formations that do not prejudge the issue of reform and revolution. Only on this basis will it be possible to build parties of the radical left that can win large numbers of workers previously loyal to the mainstream reformist parties. This means, moreover, that these new formations cannot succumb to the temptation to turn their backs on social democracy. On the contrary, they have to maintain an orientation on the social liberal parties in order to attract more of their supporters. Hence Respect, in initiating the Fighting Unions Conference on 11 November, has made a special effort to draw in and work with Labour Party supporters.

But at the same time revolutionary socialists, in building these new formations, should not liquidate their own distinct politics and organizations. In following the path of reformists into bourgeois coalition governments since the time of Millerand in the 1890s, Bertinotti has at least demonstrated that the issue of reform and revolution is a live one. Revolutionary Marxists have not just to maintain their traditions and organizations, but should be seeking to win new adherents and influence. But the only place to do this is in the wider united fronts – for example, the Stop the War Coalition, but also Respect and new left formations like it in other countries. It is on this basis, for example, that the SWP in Scotland is working Sheridan and his supporters to build Solidarity as a genuinely non-sectarian radical left movement rather than an SSP Mark 2.

The false choice between opportunism and sectarianism that runs through current debates on the revolutionary left internationally serves to remove the creative tension between a Marxist core seeking to drive the movements forward and the broader and looser formations through which activists from many different traditions can learn to work together to build political alternatives to neo-liberalism. But it is only through that tension, that dialectic of party and movement, that any real breakthrough to mass revolutionary parties can come.

Central Committee, 1 November 2006