Only he is a Marxist who extends the recognition of the class struggle to the recognition of the dictatorship of the proletariat. This is the touchstone on which the real understanding and recognition of Marxism is to be tested.

V. I. Lenin 

Economic & Philosophic Science Review 

No 1154 October 01 2002

Subscriptions (£25 p a.) & circulation:  078679 96074  

www.epsr-marx-lenin.co.uk
[P&P Bulletin Publications PO B0X 50, London SW 17 9NL] [ Post Office Regd.]       25p 

Northwest seminar Sat Nov 23, Pse collect receipts.

Protest demonstrations are a natural start to challenging the USA's crisis-driven belligerence; but the source of war-fever in economic collapse is incurable without putting a revolutionary end to capitalism itself. Imperialist crisis and imperialist war remain the decisive framework of all modern history, and the record shows that only revolutionary DEFEATS for imperialism have ever offered civilisation a glimmer of a possible peaceful future for the planet. All the ingredients pointing towards the overthrow of imperialism as the only way out are multiplying rapidly, - loss of bourgeois nerve; insoluble trade-war conflict; intolerable mass suffering as economies collapse; communist revolutions reviving already; and the human groundwork already being laid for far more spectacular defeats for imperialism to come; -- all as indicated in the capitalist press's own reports. The incurable global 'over-production' crisis and associated imperialist warmongering can only be faced up to with a Marxist analysis and open preparations for consciously revolutionary parties.

The huge anti-war rally usefully told Bush and Blair that the blitzkrieg of Iraq would be criminal fascist aggression and obscene reactionary nonsense.

But stopping one war via massive public opinion mobilisation (even if such an unlikely outcome really is achieved) does still not come remotely near to halting the SYSTEM of imperialist armsrace warmongering in general.

And monopoly-capitalist crisis does not stop at just looking for one war (and then put its weaponry away if public opinion says "no" to it).

The people who believe that "no to war" will put an end to imperialist death and destruction have not thought through the implications of insoluble capitalist economic crisis at this juncture, and are also ignoring history.

A world economic 'over-production' catastrophe, ten times worse than the inter-imperialist conflict for global supremacy which required the destruction in World War I to "resolve", will have infinitely more disastrous consequences on today's planet, - especially bearing in mind that the WWI throat-cutting for colonial 'market' supremacy did not in fact end in 1918 or restore economic equilibrium.

That impossibility for the rival imperialist powers to PEACEFULLY sit out an 'over-production' crisis and trade-war mayhem was merely temporarily adjourned in 1918 (because of fears of Bolshevik Revolution spreading from Russia to ALL of the major participants in that monstrous capitalist system bloodbath.)

Market chaos, and aggressive colonial warmongering in a desperate race to dominate global raw-material sources, had put inevitably-renewed World War back on the agenda within 15 years of the Versailles Treaty concluding the supposed "war to end all war".

Inter-imperialist war because of 'overproduction' crisis remained the essence of World War II (regardless of the West's sub-plot to try to get the USSR destroyed in the course of the arms-race insanity); - and this time, its global devastation was so colossal (several hundred times that which had been achieved by WWI) that the huge international reconstruction required after the war (1945) was sufficient to keep ALL the major imperialist powers happily expanding economically for the following half century.

That has all now come to a grinding halt, and the bourgeois capitalist system is simply INCAPABLE of seeing any way out of the renewed 'over-production' crisis other than via renewed trade-war mayhem, arms-race belligerence, and warmongering aggression (for TOTAL global-market domination, regardless of the humiliating deep slump about to engulf the planet which will make the 1930s Depression seem like a little local difficulty by comparison).

And THAT is what was being spelled out by US imperialism last week when warning all countries to never try to catch up with the American arms-race lead or face pre-emptive strikes for daring to. The USA already has the whip hand in the arms race and has no intention of relinquishing it, least of all in the coming period when vicious trade war conflicts are going to put all the major imperialist powers at odds with each other, with increasing frequency, and when utterly bankrupt smaller countries could be going ballistic at their plight; - or revolutionary; or both, (- the "threat to America from failing states" in Bush's double-talk, which can only be solved by "the path of action" regardless of whether the USA's former 'allies' stand with America or against it).

A clearer declaration of non-stop warmongering intentions than that could not be imagined. And this 'Pax Americana' is not incurably belligerent because it is America; or because it is the morally and intellectually challenged Bush Texan oil mafia; or because people have not protested; "no to war" loudly enough; but because the global imperialist economy will now be steadily ruined for everybody (by insoluble 'over-production' crisis) unless the most enormous destruction-mayhem breaks out. This will enable the monopoly capitalist bourgeoisie, (who OWN the world) to eventually resume their secure and delicious profits-amassing pre-eminence, - with the American ruling class the most supremely mighty, luxuried, and ego-massaged top dogs in all history.

With easily the most to lose, and being the best-equipped to survive it, Washington WANTS turmoil. That way, the USA can continue to flourish (it cynically thinks and hopes) when the world 'free-market' economic system (for which America has most responsibility, being the overwhelmingly dominating power) has crashed in humiliating chaos precisely. BECAUSE OF its grotesquely unequal and uneven MONOPOLY development).

Instead of any guilt or apologies for the catastrophic mess to the world's economy that capitalist 'freedom' has brought, the dominant bourgeois ideology of the US imperialist state will whip up national chauvinist defiance to fever pitch in order to blame any and everybody else on Earth for the disaster, except themselves. The 'no to war' global lobby will be treated with utmost contempt.

Although one specific warmongering adventure might be stopped by public pressure, imperialism's unalterable mode of existence (of never-ending armsrace warmongering-posturing) can obviously only be got rid of by getting rid of the capitalist system itself and its inevitable monopoly-imperialist bourgeoisie, always rising to the top of things. Monopolisation tendencies, and the vicious corruption and domineering that goes with them, are incurable under capitalism.

Through its domination of propaganda ideology, the monopoly bourgeois system has an infallible method of ultimately thwarting however much public opinion has been mobilised against warmongering adventures: Simply stage a phoney 'provocation'.

The European end of World War II was got under way by mighty German imperialism pretending that puny sick Poland was mounting intolerable provocation aggression against Germany's border radio station at Gleiwitz in 1939.

The capitalist press itself (the nervous part) is currently recollecting how the USA manufactured a 'cause' for invading Vietnam in order to keep up the West's warmongering hysteria against communism:

The words "Gulf of Tonkin" have echoed round Washington again this week as old-timers remember how war panic can produce bad law. In August 1964, just two Senators - Wayne Morse of Oregon and Ernest Gruening of  Alaska - held out against a tidal wave of  indignation.

President Lyndon Johnson got Congress to authorise "all necessary measures" after two North Vietnamese patrol boats reportedly launched unprovoked attacks on US ships. This became the legal basis for the subsequent war.

It is widely accepted now that the first ship attacked, the USS Maddox, was spying, and that the second attack did not happen. 	

Mr Gruening said: "This resolution is a further authorisation for escalation unlimited. I am opposed to sacrificing a single American boy in this venture."

Mr Morse said: "I believe this resolution to be a historic mistake' .

Nine years later, the War Powers Resolution was passed: now a president can take military action immediately;  but he must go to Congress within 60 to 90 days for permission to continue the engagement.

On that ludicrous artificial 'excuse', the flag-waving US imperialist state not only fought out one of the most brutal wars in history, and a self-damaging war at that, - but used its propaganda monopoly to continue its murderous genocidal defoliation onslaught (to effectively destroy Vietnam for decades to come) IN SPITE OF that unjust war by then having become the cause célèbre of antiwar protesters the whole world over, and the cause for serious disaffection among thousands of young draft-dodging Americans and a danger to the USA's own domestic stability.

And only DEFEAT in Vietnam eventually forced the USA to quit under the twin pressures of Viet Cong guerrilla-war superiority and near-insurrection at home against the body bags forever returning in increasing numbers. 

In other words, the imperialist system has to be REVOLUTIONARILY DEFEATED in some way or other before it will abandon its warmongering.

And then not for long (in America's case after that defeat). Even as its Indo-China warmongering was being reined in, a fascist military dictatorship was being imposed on Chile in 1973, imitating a score of similar reactionary coups imposed on Latin America by the USA for more than a century. 

Washington-financed and CIA-organised murderous onslaughts followed at regular intervals to reimpose repressive reaction on Grenada, Panama, Nicaragua, etc, where anti-imperialist revolts h ad taken place; to constantly keep up the subversive pressure on Cuba's planned anti-imperialist economy; and to try to stage a coup in Venezuela, and get militarily involved in Colombia to prevent a leftist revolution there; etc, etc, etc.

But even that gruesome, relentless, warmongering scenario is rendered utterly redundant and innocuous by frightened imperialism's demented new belligerence, easily detectable in many ways, such as the despair which bourgeois realism is itself confessing to; the alarming trade war getting out of control; the economic disasters some countries are already suffering which cannot but have serious revolutionary implications for all of capitalism; the actual revolutionary risings already taking place and beyond the control of imperialism's current warmongering scope; and the potential revolutionary advances which clearly cannot be denied forever.

From all of these issues, no complex analysis is required to see that a host of gigantic problems loom over US imperialism which utterly dwarf the supposed 'difficulty' Washington has in tolerating Iraq.

So low is imperialist confidence now in its own abilities to master all the challenges facing it that howls of despair can be heard from the most conservative 'Times' correspondents, usually rocks of cocky assurance about how the might and glory of the West would prevail against all its maladies and assailants; but no longer:

We seem to be facing the end of the world as we know it - or at least as we knew it in the comfortable 1990s. Optimism about the prospects for the world economy, about the war in Afghanistan and even about the possibility of progress on such global issues as poverty alleviation and climate change - has often been a hallmark of this column, but surely it is time to give up?

The Middle East is about to explode into war, possibly threatening a global holocaust, at least if Tony Blair's famous dossier is to be believed. India and Pakistan are again on the brink of a nuclear confrontation. The battle against terrorism has been forgotten since America has turned its attention to Iraq. And even if we look at the advanced capitalist countries, conditions seem to be going from bad to worse.

America is led by a bitterly divided and incoherent Government whose policies - on Iraq, Israel, and even on the economy - seem to rotate by 180 degrees every other day. Germany has voted for political paralysis, at a time when enlargement will produce the most wrenching changes since the Second World War in Europe and decisive leadership is desperately required. The rest of the EU is rapidly following in the same direction, with governments forced to abandon the eurozone's stability pact - supposedly the keystone of European economic policy - less than a year after the single currency's launch. And looming over all these local dramas is the grim global backdrop: the world economy is threatened by a generalised depression of a kind not seen since the 1930s. 

In these grim conditions there is a time honoured recourse, at least for the rich: escapism. Why not follow Boccaccio's Decameron, turn away from the plagues of the outside world and retreat to a refuge of beauty, luxury and self-indulgence? Although I am not very rich, I had the opportunity to do exactly this, when I spent two days at a retreat for the rich and powerful organised by NetJets, a company which provides private aircraft for the world's movers and shakers.

Everything about this gathering made me think of Boccaccio. The setting was Waddesdon Manor, the magnificent baroque palace outside London built by the Rothschild family in the 1880s. The food was cooked by Raymond Blanc and the wine came direct from Chateau Lafitte Rothschild. The hosts were Lord Rothschild, whose name is synonymous with old money, and Warren Buffet, the owner of NetJets, the second richest man in the world (after Bill Gates) and the most successful stockmarket investor in history. But it was the conference agenda that really made me think of Boccaccio's sybarites, eating sweetmeats on their hilltop outside Florence, as plague ravaged the world outside.

Never before had I seen such rich and powerful people enjoying themselves so thoroughly as they confessed their despondency, helplessness and fear. If you are rich and successful, there is something very reassuring about the complacent pessimism which says that sacrifices are needed (from others), that the world is going to hell and there is nothing that anyone can do to stop it - least of all you.

Three interconnected traumas accounted for the sense of pleasurable despair, as we sipped the world's most expensive claret: the Middle East, the collapse of shares and the prospect of a global economic depression.

As I listened to the grim discussions on all these issues, I was filled first with a sense of foreboding, but then with immense relief. When the richest, luckiest, most powerful people in the world are so uniformly gloomy, there are only two possibilities about the future: either the world really is on the brink of some all-consuming apocalypse (in which case we may as well enjoy it while we can, Decameron style); or conditions are very near rock-bottom and can only get better in the months ahead. 

The apocalyptic tone was set by a hair-raising discussion of the Middle East. After hearing presentations from two well-placed Washington officials, it became clear not only that war was now inevitable and in a matter of weeks, not months. Far more alarming was that the war would not stop with the removal of President Saddam Hussein, still less with a UN-sponsored campaign to eliminate Iraq's weapons of mass destruction. Within hours of September 11, President Bush apparently made two irrevocable decisions: America was at war; and the war "was not just against the authors of September 11, but against all those who air or support acts of this kind". The war against terror would therefore "get bigger and bigger all the time".

After dealing with Iraq, the pressure for "regime change" would shift to Iran, then Saudi Arabia, Syria and Pakistan. Most Middle Eastern countries, we were told, were not really "nations". They were personal fiefdoms: Iraq should really be called "Saddam-land", Syria, "Assad-land" - and the name Saudi Arabia speaks for itself. Thus military action to remove Saddam will really be a war for Iraq, not against it. The White House seemed confident that Iraqis would see things this way and would welcome US soldiers, if not American bombs.

As if an ever-expanding war were not bad enough, the economic outlook presented to the gathered plutocrats was even grimmer, since it was not overlaid with the blustering confidence of the Washington war party. In contrast to the geopolitical experts, who all seemed intoxicated by the omnipotence of the US military machine, the economic experts including James Wolfensohn, President of the World Bank, Paul Volcker, the former Chairman of the Federal Reserve Board and, of course, Mr Buffet himself - all emphasised the impotence of monetary and fiscal policy after the collapse of one of the great speculative bubbles of all time.

To make matters worse; the assembled company generally agreed that America and Britain would soon be threatened by new bubbles in the property markets. Meanwhile growth in Europe and Japan could not be revived through conventional macroeconomic policy, for example reductions in interest rates or other forms of monetary expansion. Such measures would not have much chance of working in Japan, Germany and France without painful labour market, tax and regulatory reforms which neither the governments, nor the voters, of these countries were willing to consider seriously, much less to accept.

As for the stockmarkets, Mr Buffet's views were quite clear. "I could make a case that the stockmarket has now fallen to fair value, but I don't really believe it. Considering the corruption in US accounting and the normal risk premium investors would expect, I don't think the market is yet fairly valued." For good measure he added that after a period of absurdly high prices, values could easily fall to unusual lows "Betting against the American economy hasn't worked for 200 years, but betting against the American stockmarket frequently has."

So there you have it. The world's most successful investor, the world's greatest central banker, the military experts and all the other luminaries seemed to agree - things would get a lot worse before they got any better.

We still wander in a daze. Democracies rarely stay up all night seeking reasons to go to war. Normally they do the opposite. They talk, negotiate, compromise, take refuge in the United Nations. They do not like fighting, unless driven by an overwhelming logic of events.

Yesterday's government dossier on Iraq reads like a desperate quest for such a logic. Ministers cannot be quaking with fear at the prospect of an imminent, assault from President Saddam Hussein. A year ago they claimed that their bombing was "containing" him, stopping him from harming even his own people, let alone his neighbours or British interests. 

Of course he seeks nasty weapons. Paranoid dictators always do. But nothing in the dossier constitutes evidence of an early threat, let alone a casus belli between Britain and Iraq. What is going on?

I am no pacifist sap. I was convinced when past British Governments told me of threats to the British state. One threat was from Soviet Russia, and came complete with target maps, lists of vulnerable cities and an armoury of all-too-effective weapons of mass destruction. Yet where were Tony Blair and Clare Short and others in the Labour Party? They wanted unilateral nuclear disarmament and claimed that the "threat" was dreamt up by warmongering Americans.. They were wrong.

Unlike many in the Labour Party, I believed that the Falklands war had to be fought against a palpable assault on British sovereignty. I thought the Gulf War just in that the invasion of Kuwait could only be resisted by main force. I felt the same about domestic terrorism. Mr Blair, supported by Ms Short and others, believed in releasing IRA terrorists from prison on the strength of vague promises of disarmament. This seemed naive and reckless appeasement, and so it has proved. People need no lessons from Mr Blair or Jack Straw in being "tough on terrorism, tough on the causes of terrorism".

But yesterday's dossier is not serious. Mr Blair told us yet again yesterday what a nasty person Saddam is. We know that. The task of leadership is not to write tabloid front pages but to judge how far a threat to the nation's interest is real and, if so, how the nation should respond proportionately. Neither Mr Blair nor George Bush has yet explained what has suddenly led them to abandon containment of Iraq and to demand Saddam's head on a plate.

Indeed the first surprise for those who thought the West's policy on Iraq has been crass and counter-productive is to find that Mr Blair agrees. Despite what we were told at the time, the 1998 bombing of Baghdad was ineffective. It did not remove weapons of mass destruction. Sanctions did not stop Saddam rebuilding his arsenals. They did eliminate the entire Iraqi business and professional class as possible opposition to Saddam and make him so rich he could buy any weapons he wanted. Every bomb that landed cemented him in power. Containment was such a failure, says Mr Blair now, that Britain must go to war to rectify it.

The dossier's attempt to present Saddam as an incipient nuclear power is worse than half-hearted. He has no factory to treat enriched uranium even if he found it "somewhere in Africa". Had he such a factory, it could be bombed. His biological weapons are hard to deliver, least of all with his ageing Scuds. They were not used even in the Gulf War. Saddam has had these weapons for 20 years. So have many highly unstable Central Asian states. Nor does the dossier explain why these weapons could not be eliminated "surgically", as their predecessors were by the Israelis in 1981 and allegedly by American missiles ever since.

Saddam displays no expansionist intent. Containment has at least held him within his borders for a decade. He is not known to be arming a terrorist group. There are no urgent pleas for Western help from his neighbours. He has made no ultimatum against them or against the West that would justify a pre-emptive attack. The possession of evil weapons is itself no legal basis for aggressive war. The whole scenario is bizarre.

Saddam is certainly a league leader among dictators. We are not dealing with a jumped-up Taleban or a mad ayatollah. The Iraqi leader's 20-year rule has been tenacious, merciless and brutal even by Middle East standards, long before the West gave him the excuse of economic sanctions as an engine of repression. Yet he was considered an ally of the West and was supplied with Western arms. A strong ruler in Baghdad was seen as useful by Western pragmatists. To the hard men of Washington and London, high-flown phrases about democracy, humanity, disarmament and civilised values were for wimps. They liked the cut of Saddam's jib when it suited them.

Now he is beyond mere damnation. He is the object of a Third Crusade in the holy war on terror. After Kosovo and Afghanistan, the suspicion is hard to avoid that the West's warrior statesmen are seeking new citadels to conquer. Whether or not Saddam is a menace to world peace, menace he must become. Hence yesterday's lurid report.

The headline accompanying the latter piece ("This is not a dossier but an act of desperation") as the main feature in the 'Times' sums up how imperialism's warmongering option is currently playing badly throughout world public opinion, including bourgeois elements with greater claims to 'rationality'.

But the petty bourgeois fake-'left' (Socialist Alliance, SWP, SLP, 'left' Labour MPs, new TUC 'militant' leaders, etc) will as usual rush to capitalism's defence by stressing "the fight for democracy" and NEVER mentioning the fact that REVOLUTION is the only direction in which the imperialist system can now degenerate, beyond all reach of 'reform' to its reality of ever vaster monopoly structures and the scientific inevitability (Marx) of insoluble and unavoidable periodic lover-productions crises, leading only to slump and war as all of modern history solely testifies.

But the fake-'left' is a very specific (and thankfully limited) sectarian CLASS mentality (the petty bourgeois trade unionist philosophy see Marx and Lenin) which the vast mass of  'no to war' demonstrators have no necessary proneness to.

What workers need to be convinced of is how impossible of any solution OTHER THAN revolution is this global imperialist-system crisis. It is simply not going to be solved any other way, no matter how hard anyone tries, or how sincerely people get together with a will to peacefully reform the situation. It simply cannot happen because of the very mechanics of the monopoly bourgeois 'free-market'.

First, a total markets collapse and all-out trade war will seize the world in its grip at any moment now (as the EPSR has consistently explained was coming since long long ago, always using capitalism's own admissions and data to prove the point).

Exactly 'when' is not the problem, and is a ridiculous question to ask, merely hiding the questioner's cynical scepticism.

What will have to be done when the capitalist boom-bubble collapses, is the only sane question.

And the fake-'left' has consistently REFUSED to address it, and still refuses now.

And if now it is just occasionally reluctantly acknowledged that " ....ultimately, revolution, probably, is the only way, like..." (mumble, mumble), then what does refusing to tell the working class about it amount to if revolution was always "inevitable"????

It amounts to downright counterrevolutionary opportunist DISINFORMATION to simply keep urging workers year in and year out to just "insist on this reform, and that reform", etc, etc, etc, when all the time in reality, the capitalist system is heading for the ultimate warmongering CRASH at the termination of the ultimate privatising boom (which meanwhile had been effortlessly negating or undermining all notions of socialistic 'reforms' which the working-class had been restricted to plodding away at by its fake-'left' leadership).

And instead of the working class reaching the end of the utterly degenerate and misleading consumerist boom with a widespread, totally-Marxist-trained and recognised revolutionary cadre party which all could then turn to when the revolutionary time at last came into its own, the working class in reality is now left with NOTHING to rely on, not the faintest sign of a Bolshevik Party in sight, - just a rabble of sectarian fake-'lefts' led by pathetic demagogues and haunted by the still unanalysed idiocies of Stalinist Revisionism or Trotskyist anti-communism, who all still resolutely refuse to polemicise or debate with the EPSR's consistent Marxist-Leninist analysis (of the steadily maturing imperialist revolutionary crisis, and what sort of party needs to be built to prepare for it).

But things can be transformed very rapidly. New mass parties will soon be being agitated-for which will have the openly consciously expressed task of becoming the party of workers REVOLUTION, nothing less. 

Around such agitation a correct understanding of the world such as the EPSR has always struggled towards and fought to have debated, regardless of what faults or mistakes are objectively revealed in the workers movement, - will be priceless, and will quickly catch on, as was demonstrated inside the SLP before the sad philistine demagogue Scargill took fright, backed by the truly infamous and wretched opportunism of Lalkar.

Basic Marxist economic understanding of inevitable revolutionary crisis (such as the EPSR has endlessly put out in massive detail) will be the forward-development that the average 'no to war' demonstrator will eventually respond to.

The evidence from the bourgeoisie's own press continues unabated. All-out vicious trade-war, plunging the world into insoluble conflict, creeps relentlessly closer day by day:

Brazil launched a broadside against Europe's and America's lavish payments to their farmers  yesterday, filing a double complaint at the World Trade Organisation over cotton subsidies in the US and sugar subsidies in the EU.

Brazil blames America's $3.9bn (£2.5bn) cotton subsidies for ruining its own far more efficient industry. The US is the world's most expensive producer of cotton, with costs per lb twice the world average. Brazil says the EU's sugar regime is also damaging to its farmers.

Aid agencies yesterday accused the US of dumping its surplus cotton on world markets and contributing to a catastrophic price fall. World prices have fallen by half since the mid-1990s and, adjusted for inflation, they are at their lowest level since the great depression.

In a report released to coincide with the filing of the Brazilian case, Oxfam said the subsidy regime, which costs three times more than America's aid budget for all of Africa's 500m people, was contributing to mass poverty in cotton producing nations such as Mali and Chad.

"The US is the world's strongest proponent of free trade, but when poor cotton farmers in Mali try to trade on the world market, they must compete against massively subsidised American cotton," said Kevin Watkins, the report's author. "This makes a mockery of the idea of a level playing field. The rules are rigged against the poor."  

The challenge by one of the leading members of the Cairns groups of agricultural free traders strikes at the heart of the complicated system of quotas and payments that protect western farmers.
	
The WTO is likely to take at least a year to decide if the cotton and sugar regimes break its rules.

The International Monetary Fund is to draw up urgent proposals for a bankruptcy system that will provide crisis-hit countries such as Argentina with the protection currently offered to companies.

Fearful of a continued run of financial crises, the IMF has been given six months to come up with a blueprint that will provide countries with a mechanism for coping with debt defaults.

The proposals were put forward amid admissions by IMF members that the recovery in the global economy had not taken hold as rapidly or as strongly as hoped a few months ago and as concerns grow that Brazil may be the next country to be faced by a run on its financial markets.

The plans have met an angry response from Wall Street and City banks which lend vast sums to Latin America and other parts of the developing world. Citigroup and JP Morgan Chase, two of the biggest lenders, have already written off millions of dollars in bad debts from the Argentina crisis this year. The economic woes in Latin America have been a strong factor in the slide of world stock markets.

Policy makers in some developing countries also opposed the proposals. They expressed fears that the potential of bankruptcy might scare off lenders and only precipitate further financial ills. Brazil's central bank chief said he was "sceptical" about the concept. 

Horst Köhler, managing director of the IMF, described the option as a last resort and said it was not intended to undermine the world's lenders.

The IMFC's decision to press ahead with the proposals for a "sovereign debt restructuring mechanism" comes in the face of entrenched resistance from private banks and leaves G7 governments on a collision course with Wall Street. 

Investment banks and investor trade bodies oppose the plan, saying that by providing an "easy get-out" it will encourage countries to behave irresponsibly and then default. They claim the result would be less willingness by investors to lend and a rise in the cost of borrowing. "The [IMF's approach) is the wrong path to follow," Robert Gray, vicechairman of HSBC, said. However, resistance looks likely to founder in the face of the G7's determination.

Gordon Brown said the past year, which has seen banks closed and rioting on the streets of Latin America, had made the case for developing a more consistent approach to dealing with financial meltdowns. The proposals would allow sovereign nations in effect to file for bankruptcy in an international court and restructure their debt loads.

"We agreed on the need to strengthen the mechanisms for crisis prevention and crisis resolution," Mr Brown said. The world economy faces a "testing time'.

US treasury secretary Paul O'Neill, whose support had wavered, endorsed the idea of sovereign debt restructuring.

	Argentina plunged into crisis in January when it defaulted on its debts and has since floundered, unable to agree terms for aid. There are concerns that Brazil will default on $250bn (£160bn) of debt due to a collapse in confidence ahead of presidential elections next month, prompting a record $30bn bailout by the IMF. 

Disarray and confusion among Japanese officials over plans to use government funds to bail out the country's indebted banking system did little to boost optimism, however. The latest problems for Japan came as the UK-based Centre for Economic and Business Research (CEBR) said it forecast a 35 per cent chance of a Japanese style deflationary recession in other G7 economies.

At the same time, the revolutionary social breakdown and intolerable poverty, plus demeaning humiliation, go on worsening in, say, Argentina, - outlining the fate that the whole world will shortly be suffering as unshakable global SLUMP paralyses and impoverishes the entire international market economy.

It is the raw material of the REVOLUTIONARY understanding of their predicament that the whole world's working class must inevitably come to, sooner or later. All can make it sooner by calling for the building of an openly revolutionary party for the working class NOW:

It must be the longest economic shipwreck in history. For the past nine months, since Argentina erupted into blazing street riots, changed president five times in two weeks, declared the world's biggest debt default and devalued its currency by more than 70 per cent, this South American Titanic has been going down.

With credit lines from the rest of the world cut off and ravaged banks still rationing cash supplies, the country that a decade ago was a booming, freemarket success story has hurtled into a world-class economic disaster with no obvious rescue in sight.

Its interim president, Eduardo Duhalde, admits his job consists of 'plugging the holes' in the sinking ship where 'absolutely nothing works'.

After four years of unrelenting recession, unemployment has spiralled to over 21 per cent and soaring prices caused by devaluation have plunged over half the country's 36m inhabitants under the poverty line of i3 a day. Thousands of middle-class savers are still struggling to accept that their dollar savings have shrunk into pesos.

A gaping divide is opening up between the wealthy few and the struggling masses in a country which until now saw itself as a bubble of European sophistication and middle-class comfort in an otherwise poor and violent continent.

'Argentina has never had such painful times. It has never been so anguished,' says Marcos Aguinis, former culture secretary and author of The Atrocious Enchantment of Being Argentine.

Much of Argentina's despair comes from the fact that the country ought to be fine. It is as big as India, has a moderate climate, endless fertile land, oil and minerals, and only 36m inhabitants to feed. It has no ethnic or border conflicts and no major natural hazards. Increasingly few believe Duhalde's mantra: 'Argentina is condemned to success.'

As March presidential elections loom, candidates are offering 'revolution' and 'change', but their vicious bickering is only furthering public disenchantment. As both rich and poor feel the crunch of the country's worst economic crisis, politicians, seen as corrupt and inept, have been 'devalued' as much as the peso. The clamour goes on 'for them all to go' and no candidate can muster more than 15 per cent in pre-election polls.

Hopes of a bail-out from the International Monetary Fund (IMF) are fading even as Brazil receives a $30bn emergency loan. Thousands are bailing out, fleeing to Europe clutching passports inherited from their immigrant forefathers. Others have sunk into poverty, and armies of poor in Buenos Aires have resorted to rummaging through rubbish to eekout a living. Thieves are stripping tombstones of their metal plaques, light bulbs from street lamps and copper from telephone cables,

After mastering his trade in Bogota, Fabian was ready when crime fever hit Buenos Aires, one of the safest cities in the world a decade ago. Reported crime and murder rates have soared and business has taken off for Fabian as bankers, businessmen and diplomats seek protection from kidnapping gangs and armed thieves.

'The rich are already living in fortress-like houses behind fences wired up with alarms; says Fabian, in his bunker-like high security salesroom on a busy Buenos Aires street.

'They have guards to protect them at work. The journey is their most vulnerable moment'. 

In Fabian's showroom, potential clients can examine a display of car windows pumped with bullets of different calibres. On the wall, photos show baseball bat brandishing youths surrounding a gleaming BMW. 

Brista Security's prices remain in dollars because of the cost of importing materials made to international standards. The company's turnover has gone from around $200,000 a month last year to more than $1m. And because of	January's devaluation, each dollar is worth three times as much in Argentina as last year.

Many of Fabian's clients are Argentines with dollar savings safely stowed in European or American banks. Others work in export businesses, which are quietly making profits as they sell their products at dollar prices, but spend a fraction of their previous outgoings now that local salaries and running costs have dropped.

'Globalisation brings maximum poverty and maximum wealth,' he says. 'That great divide generates violence. 

'I knew Argentina was going to join the ranks of Latin America's violent countries. I have been preparing for this moment And it is going to last a long time.'

Alicia gazes out of the cafe window nostalgically.

'What have they done to this country?'she asks.  At 79 and struggling with bone and breast cancer, Alicia is counting her days and her shrinking savings. Having run a dry-cleaners all her fife, her pension is 364 pesos (£65). Since the peso was devalued, the price of everything imported, including drugs, has soared and Alicia's monthly cancer treatment costs nearly twice her pension.

After several months unable to touch her savings when bank deposits were frozen in December, Alicia's $40,000 was converted into 56,000 pesos, which today would only be worth $15,500. In the shake-up after a decade in which pesos could be swapped for dollars, Alicia lost $24,000. The alternative was to wait until 2005 until the original sum would be released. So Alicia has settled for her 'pesified' savings and withdrawing the maximum ration of 1,200 pesos (£216) from two bank accounts each month to cover her drugs and living costs.

'When the money runs out that's it,  I die before my time. But maybe I've already lived enough' she says. 'They are killing pensioners. It's a kind of genocide. l don't know if it's the banks' fault or the govemment's.'

Lloyds Bank has assured Alicia it would like to return her savings in full, but is bound by national legislation which froze savings in December after $1.4bn were withdrawn from the collapsing financial system in a single day of panic. The country's Supreme Court has since declared the bank restrictions unconstitutional, triggering an avalanche of lawsuits by savers.

A well-known Argentine sports commentator, 65-year old Horacio Garcia Blanco, died in May of kidney failure after failing to win a suit to release money for a kidney transplant in Spain. After more than nine months, frustrated and tireless savers still chant outside banks and trash their battered doors with saucepans to demand their savings be returned intact.

Alicia is Polish and was held for four years in a concentration camp in Poland until the end of the Second World War in 1945. In 1948, she emigrated to Argentina. 

'I came to the end of the earth to get away from war. But now I find myself in the middle of a different kind of war'.

For some, like 28-year-old Evito Morales, queuing has become a way to earn a living in the crisis. Along with hundreds of shantytown dwellers, Evito queues most days outside the battered and barricaded banks in the financial centre of Buenos Aires, buying up the maximum daily ration of $1,000 per person on behalf of illegal moneychangers, who move tens of thousands of dollars each day under the noses of the banks and the police.

'It's ugly as a job, but I don't have a choice; says Evito, shiftily watching police among the churning crowds outside the banks. 'You hold the money in your hands for a few hours and then it goes. You need it. You touch it and you can't have it.' 

Evito treks in each day from a poor suburb, where the streets are strewn with dismantled parts of stolen cars, never sure if there will be work. He earns about 10 pesos a day (£1.80), three of which he spends on his bus fare. As Evito queues, his boss, Silvio (who refuses to give his surname or be photographed), straightens his tie and sips a coffee in his plush new office. He juggles three mobile phones to instruct minions in the streets to buy and sell dollars, bonds, cheques and even frozen bank accounts, skimming a profit from every deal.

Late last year, when architect Maria Viegas finished building a $300,000 home in the leafy Belgrano district of Buenos Aires, she realised nobody was going to buy it.  She had invested all her small construction company's assets in the house and one other which still stand empty now that the property market has fallen through the floor. 

Like so many of the country's once thriving middle-class, Maria is taking a harsh lesson in scraping by after a decade-long 'fiesta' under former president Carlos Menem. With the peso pegged to the dollar, the country was flooded with cheap imported gadgets and Argentines jet-setted around the world to the annoyance of their poorer Latin American neighbours.

'I built up my business over 17 years,' says Maria. 'In 1995, I built ten houses at once and had three staff. Suddenly I have nothing left. The houses I built are not worth what I paid for the land they stand on. And however low the price, nobody is looking to buy.'

As thousands lose jobs each month and salaries are slashed and prices rise, many cash-strapped middle-class families are selling off their wedding rings and furniture. Psychoanalysts, a common breed in this city of anxious, melancholic, former European immigrants, say patients no longer wish to talk. 'All they want is a quick-fix' says analyst Enrique Tenembaum. 'It's  ironic, they are the victims of globalisation gone wrong. But they are turning to globalised drug companies for an instant cure.'

Jobless and desperate to support her children, Maria set up a table in the local park and started squeezing fresh juice for joggers and passers-by.

'I never thought I'd end up like this. My kids were harried at first, but now they've got used to it; she says, pulling the handle on yet another half orange and propping her sunglasses on top of her head. 

'It's non-stop; she laughs. 'I try to use my left arm in the week and keep my right arm for the weekends when it gets really busy.' Maria, a single mother, makes 1,000 pesos (£180) a month,  just enough to feed her four teenage children. She has had to pull them out of private school and in recent months she has cut off their cable television and mobile phone, unable to pay the bills. 'We are down to basics,' she says. 'I don't remember the last time I bought a book'.

With the country's finances in turmoil, grain in a barn has become a better and safer form of currency for farmers than pesos in a bank. 'We think in kilos not in pesos; says Fortunato. 'When you need to buy something, you drain off however many tonnes of grain it's worth from the silo. You buy a van for 70 tonnes of soya'.

Quick-thinking thieves have adapted to the cash-free economy in the area, finding it is more lucrative to siphon grain out of silos at night and steal cattle from fields than rob banks or houses.

'That is the danger of doing well when the state is penniless,' he says. 'In other countries, farmers receive subsidies. Here, the state sucks what it can out of you. You become afraid to say you are doing well, because someone is going to rob you or ask you to lend them money.'

Critics accuse successful farmers of pushing food prices up when millions are sinking into poverty. As television screens have shocked once-proud Argentines with images of emaciated children, prices for fresh staples, such as milk, flour and meat, have doubled and over half the population cannot afford basic supplies.

But in recent months, gripped by fear after a wave of kidnappings and armed crime, many of the more comfortably off have taken to hiding their wealth, 'dressing down' sending their children to their private schools in scruffy clothes instead of uniforms and using a clapped out old car rather than the conspicuous BMW.

In barrios such as San Isidro, plush villas are prickling with fences, alarms and armed guards, as the explosion of poverty has forced barefoot children and youths from the shantytown nearby to try door-to-door begging, and, in some cases, armed robbery and kidnapping.

Earlier this year, Maria's sister, who lives nearby, was bundled into her car by two teenagers with guns as she unloaded shopping outside her home. A few hours later, after her captors tried to force her to withdraw cash from a cashpoint, she was dumped in a shantytown, stripped of everything including her shoes. 'I don't dare walk down the road any more. It's as if we are becoming more people and they are more animals; she adds. 'But you can't just build fences. You have to start doing something to help.'

Matias lives in shantytown number 31, in the shadow of the Sheraton Hotel, in the heart of Buenos Aires. At 16, he is a veteran 'cartonero' (rubbish recycler), having made ends meet for the past three years by rescuing recyclable paper scraps from rubbish in the smart Palermo neighbourhood across a railway line in the centre of town.

Earlier this year, Matias had to drop out of school to trawl the streets full-time after his first son, also called Matias, was born and the young couple ran out of money.

'The thing is that it has got harder now, because of all the people. You have to be really fast. Everywhere I go, there are already three or four people going through the rubbish before I even get there:

Since the crisis began, portenos (the inhabitants of the port city of Buenos Aires), proud of their country's once-thriving middle class, have watched in horror as a growing army of 'new poor' have begun scouring the streets day and night, stripping the city's rubbish of anything that is edible or recyclable. Recycling firms have estimated that 300,000 families are now living off the rubbish across the country.

Barter clubs, which previously helped those running out of pesos to make ends meet by swapping clothes for food or books for washing powder, have degenerated as high-quality, recyclable goods have become increasingly scarce and forgers have flooded the system with fake 'credits' - the alternative currency used in the barter clubs to establish the value of each item.

As the army of rubbish scavengers grows, Matias sets out earlier each day and returns home later each evening, piling up a cart full of paper which he sells to a recycling firm, making at best a meagre seven pesos a day (£1.25). A bag of nappies costs eight pesos, which means Matias can hardly keep up with his young child's needs.

'Sometimes I'm lucky and I find a pair of shoes or trousers in the rubbish. But even the rich have stopped throwing those things out now,' he says.

As the recession snowballed and unemployment crept relentlessly up over the past four years, protesting unemployed men, women and children, known as the piqueteros  (picketers), have become a regular thorn in several governments' sides, blocking roads and bridges with burning tyres as they clamour for jobs, food and subsidies.

Since December's riots, the piqueteros have been at the front line of clashes with police, and while middle-class outrage at the loss of billions of dollars of savings has gradually lost steam, the piqueteros movement, representing the country's 18m poor, rumbles on as food prices have soared and hunger has spread. Thousands have marched from grimy provincial shantytowns into the palm-lined centre of Buenos Aires facing ranks of edgy riot police in the Plaza de Mayo, while their leaders win meetings and concessions from a cash-strapped government desperate to keep a lid on social unrest.

In Salta, one of the country's most northern provinces, near the border with Bolivia, the piqueteros have special cause to be angry. Most lost their work in the early 1990s when local oil and gas companies fell into the hands of foreign companies. 

'This region is rich in oil and gas. We have our wealth under the ground. But we live in poverty' said Julia, a 46-year-old single mother. In this arid region, remote villages, many of which do not have gas or water, watch gas being pumped through the Andes to neighbouring Chile. 'You end up concluding you've been robbed,' she adds.

In June, she was arrested alongside several other protesters. 'I'm not afraid of the police, but I don't take my children any more, just in case. All I want is a job. At least you can let off steam by protesting'.

Julia lives on 150 peso (£27) a month, over half of which is spent on her electricity and gas bills. 'I can hardly buy anything with what's left. Bread and milk are three times as expensive now,' she says. 

'People are getting poorer every day. I run a soup kitchen and some children arrive now without any clothes.'

The government subsidy, distributed to at least lm of the country's poorest families, buys less and less as inflation makes even basic supplies unaffordable.

On top of all this, no less than the Daily Telegraph is currently revealing to the world that a six year civil war in Nepal is about to end in the victory of a communist revolution, exactly as the EPSR has explained will be inevitable throughout the Third World in due course.

The Maoist movement now wields de facto control over most of Nepal. By following the Mao Tse-tung model of guerrilla warfare - becoming "fish swimming in the ocean of the people" - the insurgents have won dominance of the Himalayas and of the foothills. King Gyanendra's rule is now limited to Kathmandu, Nepal's few towns and the southern lowlands of the Terai.

The Maoists succeeded in closing down Kathmandu with a general strike on Monday, showing that they can challenge the king in his capital. A British military source has no doubt that the rebels are heading for victory. "They will continue to gain ground. Unless something dramatic happens, it's only a matter of time before they win," he said.

The Maoist movement has grown from the genuine grievances of an impoverished, low caste, peasant majority suffering under the rule of a corrupt, high caste, urban elite.

Nepal embraced democracy in 1990, but the lack of any real social improvement has sowed deep disillusion. The Maoist insurgency began six years after the advent of democracy and has claimed 5,000 lives. But the rebels have carefully avoided harming foreigners, perhaps explaining why their remarkable success has gone largely unnoticed outside Nepal.

One British military source said the Nepalese army had "certainly lost the battle for hearts and minds", while the police were "useless and discredited." If they are ever to defeat the Maoists, the security forces need help. But British sources say their human rights record makes it impossible for London to offer direct military aid.

In the Himalayan foothills, the army's brutality also serves as a "recruiting sergeant" for the Maoists. In Sirubari, 40 miles from Kathmandu, villagers described how 300 soldiers descended at 5 am on May 29.

A man in military uniform, with his face hidden in a red cloth, accompanied the patrol. He was said to be a Maoist prisoner and he picked out five men, claiming that they were rebels, despite their family's denials.

Mr Gautam's son was taken from beside a dirt track. His nephew, Ganesh Prasad Gautam, 32, was also arrested. Tika Prasad - Dulal, 70, was dragged from his home with his elderly brothers Bhakta Lal, 65, and Ghalak Prasad, 55. The sixth man, Mr Lama, was brought from a neighbouring village. The men were marched to a hillside half a mile away. Villagers heard bursts of automatic gunfire. When they dared to leave their houses the following morning, they found the bodies.

Mukti Nath Gautam, 65, knelt beside the patch of bare ground, where tangled undergrowth served as a tombstone, and prayed for his son. Four months ago he found his son's blindfolded corpse lashed to a tree trunk and riddled with bullet wounds.  Mr Gautam cut down the body of Tej Prasad, 29, and buried him.  

He remembered the moment when soldiers of the Royal Nepalese Army arrived at his village, Sirubari, and took away his son, a father of four. "I told the soldiers, please kill me instead. What can I do if you kill him? Why you kill my son? Please take me instead."

The graves of five other men were scattered along the wooded hillside. One was so shallow that the monsoon rain had washed away much of the earth, partially exposing the remains of Cheing Lama, 35.

All six were victims of an operation mounted in the Himalayan foothills against Nepal's increasingly confident Maoist guerrillas. The hatred of the army sparked by this and other incidents helps to explain why the rebels have substantial popular support. 

Further along the valley, where the hills curve gently towards Kathmandu, a roofless, shattered  police-station was evidence of the latest Maoist operation. The rebels had blown the building to pieces in a night raid. Step by step, the attacks are reaching closer to the capital.

The intensity of the Maoist campaign has cruelly exposed the government's inability to contain the threat. A fortnight ago, the rebels attacked two military bases and killed 100 soldiers and policemen in the space of eight hours. They broke a brief ceasefire last November by mounting 60 raids across the country in a single night.

In the reported incidents of a single day this week, the Maoists destroyed a telephone exchange, raked a courthouse with gunfire, burnt down a village development committee office and bombed an electricity substation. They decapitated one local official, leaving his torso near his house, and assaulted a teacher, ordering him to produce £600 or face death.

By wrecking every state institution within reach, the Maoists are following the instructions of their Chinese mentor. They hope to render Nepal ungovernable.

• Unlike almost every other successful guerrilla movement, Nepal's Maoists have no state sponsor. They are implacably hostile to the Chinese government, regarding its current leaders as "renegade revisionists" for abandoning Maoism.

• The rebels get their weapons and cash from a Maoist network centred in northern India. Indians donate money and weapons are smuggled across the frontier.

• The insurgents also resort to extortion on a huge scale. Many Nepalese businessmen pay protection money and peasants face endless threats and demands for cash.

How good their Marxist understanding of the world is, and how free they are from sectarian Maoist voluntarism remains to be seen.

But a communist revolution it remains in the classic mould.

And the dangers it faces from getting bogged down in sectarian sterility, which the fake-'left' in the West will quickly jeer at, is far more to the blame of the fake-'left' (for failing to revive a scientifically Marxist-Leninist workers international movement for critical debate and polemics, as well as solidarity, - replacing the hopeless Stalinist Revisionist and Trotskyist anti-communist movements), than to the blame of the local Maoists' own inevitable theoretical limitations, if any there be.

Almost as clinching an argument for a solely revolutionary understanding of future world developments is to ask the question of what will warmongering Washington do about Nepal if it goes communist?

This has got to be far more alarming to the West than just barmy old Saddam, shouting out his defiance of American imperialism and waving about an old shotgun and all his other makeshift weaponry.

So why no invasion of Nepal to stub out this new 'axis of evil' in this critical south-central Asian landmass?

Could it be that a trained communist guerrilla army, which is winning state power because of mass popular support, is a far more daunting military target than the barmy Taleban, 'ruling' an untamably divisively tribal Afghanistan??

If so, then the fake-'left' fear of organising for revolution in the face of the 'daunting' US imperialist counter-revolutionary 'New World Order' which has allegedly been "imposing 'peace' defeats on all the world's hot-spots, one after the other" (Socialist Alliance and SLP) ends up looking more stupid and out-of-touch than ever.

Finally, let any 'no to war' reformist illusions from faintheartedness reconsider the astonishing Palestinian story, to which the EPSR will be returning again, and again, and again.

The Palestinian national-liberation struggle started in such catastrophic confusion and defeat in 1948, - and so treacherously undone by 'peaceful coexistence' Stalinist Revisionism, - that it remained internationally almost invisible until the 1970s, and thereafter only suspected of the most. traitorous bourgeois nationalism of its own, or else of related Narodnik-style adventurism.

The more subjective fanaticism of the more recent Islamic anarcho-terrorism looked just as unpromising initially for creating a serious national-liberation revolution, but not any more.

In spite of the almost unbelievably inhuman repressive terror by Zionism and the most calculatedly vicious campaign of savage national humiliation that any people has ever had to suffer since the Jews themselves were made trash of by the imperialist system's World War II needs, - the Palestinian nation and its guerrilla war fightback has never stopped steadily growing and strengthening over the recent years.

The religious fundamentalism still remains a puzzling problem, but that it has helped utterly galvanise and transform the entire Palestinian national-liberation struggle is undeniable.

Even the pro-Zionist bourgeois press is beginning to acknowledge this remarkable long-term achievement of the Palestinian people.

Americas warmongering imperialist plans (to impose global counter-revolution) fear this remarkable Palestinian fighting transformation against all the odds, as much as anything else around the Middle East: 

This morning exactly 20 years ago a terrible massacre was unfolding in the Palestinian refugee camps of Sabra and Shatila in Beirut. Some of us lost friends there, some relatives, but all Palestinians come together annually to commemorate those who died, as well as the thousands killed at the Tal al-Za'atar camp in 1976 and the many massacres that made us refugees in 1948 such as Deir Yassin, Abu Shusha, Tantura, Eilaboun, and Husnaynia.

How many Palestinians became refugees, and where are they now? The story of the Palestinian refugees is not simply unknown, it is concealed.

Palestinians make up around one-third of the world's refugee population, and they are also one of the oldest of refugee groups. There are now more than 5 million refugees. They form the majority of the Palestinian people (just over two-thirds) and include refugees from the 1948 war as well as the six-day war of 1967, which created another half million.

So there are several different generations and types of refugees, some scattered in the 59 UN-registered camps throughout the West Bank and Gaza, Jordan, Syria and Lebanon. However, most of the families who registered with the UN after 1948 (now 3.8 million) don't even live in the camps, and many refugees never registered at all. Others live in the rest of the Arab world, from Baghdad to Cairo; some, more recently, in Europe and in America; many are Israeli . citizens, living in unrecognised villages close to their original homes inside Israel.

The creation of the refugee crisis can largely be attributed to the dramatic events which live on in the Palestinian memory as the Nakbah (Catastrophe): the fragmentation and devastation of Palestinian society which attended the creation of Israel in 1948. The Palestinian villages in the Galilee and elsewhere were demolished by the authorities of the new state once the original inhabitants were driven out or fled during the fighting.

The members of this largely peasant society found themselves confined to refugee camps, where many remain. They were the main target for the expulsion policy of the emerging Israeli state: a policy consistently denied in Israeli history books, in spite of all evidence to the contrary (in particular, the archivally based work of the "new" Israeli historians, such as Professors Benny Morris and Ilan Pappé). 

The denial arises partly from the controversial nature of such ethnic cleansing. But it was also conditioned by fears of what a recognition of accountability for the expulsion would involve. Thus generations of Israelis have grown up not knowing that the Jewish majority in their state was based on the expulsion of another people. The Zionist myth was of pioneering forbears claiming "A Land Without People for a People Without Land":

The international community at the time believed the UN had a special responsibility to Palestinian refugees, given that their predicament was a direct result of the UN decision to partition Palestine. But the UN resolution that dealt with the urgent refugee crisis; general assembly resolution 194 of 1949, has yet to be implemented: Israel refuses to do so. Every Palestinian refugee today knows this resolution, calling for the return to their homes of those who wish to do so, as well as compensation. They also remember the British colonial role in their tragedy, as one British parliamentary commission of inquiry which travelled to the region's refugee camps recently discovered.

The UN was more successful in establishing an institution to tackle the humanitarian crisis of the refugees. In 1950 the UN Relief and Works Agency (UNRWA) began the operations which it still carries out to this day. But its mandate is limited: it cannot provide anything other than minimal relief; it cannot provide representation for the refugees; and it cannot offer the vital legal protection that the UN's high commissioner for refugees offers to all other refugee populations. 

No one thought the crisis would last for so long, that the refugees would not be allowed to return. The political organisation of the camps in the mid-60s  -  Fatah, the Popular Front for the Liberation of Palestine and others  - emerged as a result of the despair at these failings. Although Palestinians every year heard the international community and Arab states insisting on the refugees' right of return, nothing was done. Renowned internationally only for the 70s airplane hijackings, the Palestinian movement worked in the camps organising unions, creating hospitals and employment, and coordinating with other national liberation movements, such as Swapo and the ANC. 

By 1970, the Palestinian political groups had merged into the Palestine Liberation Organisation, forming a government in exile and establishing diplomatic relations across the world. Its national council is made up of representatives from the parties, unions and different exile constituencies, as well as those inside the occupied territories. Much of the regional conflict of the 70s and 80s was the result not just of Israel's attempt to crush this political infrastructure, but of the Arab states' attempts to control the Palestinians' political independence.

In different periods, the weight of the Palestinian national movement has rested more in the occupied territories or with the exile movement. But whatever the shifting balance, the Palestinians' strength always resides inside the refugee camps themselves, be they in Gaza and the West Bank, South Lebanon or Amman. It is also where, should anyone desire to discover it, one finds the will of the Palestinian people.

Rival Palestinian militant groups, after six months of behind-the-scenes negotiations, have come close to a breakthrough that could alter the course of the Israeli-Palestinian conflict. Thirteen factions, including Fatah, Hamas and Islamic Jihad, have been meeting regularly in Gaza City to try to end their historic squabbles and put together a united front.

The ongoing discussions are comparable to the internal debates within the IRA in the 1980s and 1990s that led to shifts in strategy.

A switch, in Palestinian military, and political strategy could bring a halt to attacks, including suicide bombings, in Israel. Targets would be confined to Israeli soldiers and armed Jewish settlers in the West Bank and Gaza.

Samir al-Masharwi, second in command of Fatah in Gaza, said: "The intention is not to stop the Palestinian fight but to limit the scope of the struggle, and widen popular support, and stop the targetting of [Israeli] civilians."

But such an agreement could be scuppered by continuing violence. Four Palestinians - Rwaida al-Hajeen, two of her children, Ashraf, 23, and Nihad,17, and a nephew, Mohammed, 20 - were killed when a shell from an Israeli tank fell on their home near Gaza yesterday. Hamas, the most reluctant of the organisations to enter into an agreement, vowed revenge.

Less than three weeks ago, the rival factions, including Hamas, appeared to have achieved a historic compromise. A two page draft agreement was reached after a meeting on August 10: it was finalised on August 12. Preparations to make it public, later abandoned, were initiated.

A copy of the draft agreement, called A Proposal for a United Programme, has been handed to the Guardian by Palestinian sources, along with other key documents from the talks. The papers provide an insight into the internal arguments, illustrate how close the factions have come to achieving a consensus, and reveal the extent to which Hamas, the most extreme of the groups, has shown a willingness to make concessions.

The draft agreement sets out three strategic aims:

• An end to Israeli military occupation and the illegal settlements from the land occupied on June 5 1967, including Jerusalem:'

• "Establish an independent Palestinian state that will have full sovereignty, with its capital in Jerusalem, on the land occupied in 1967."

• "Preserving and protecting the right of Palestinian refugees to return to their homes they were forced to leave, according, to UN resolution 194 in 1948."

It calls on the factions to unite under one leader, and an accompanying letter makes it clear this would be Yasser Arafat. The draft also calls for a complete reform of Palestinian society to build a democracy, with a multiparty system.

Mainstream

The first aim is the most significant in that it seems to resolve the main debate among the Palestinian groups: between those, such as Fatah, which accept that the best that Palestinians can realistically achieve is a state in the West Bank and Gaza, the territory lost to Israel in the 1967 war, and those, such as Hamas and Islamic Jihad, whose objective is a Palestine that includes not only the West Bank and Gaza but Israel too, lost in the 1948 war.

Within 24 hours of the draft being agreed by all parties on August 12, Hamas produced a surprise by presenting an alternative draft. It called for "the removal of the Zionist military and illegal settlers from the Palestinian lands". It added that the Palestinian refugees should receive their land and compensation, and not, as in the draft, land or compensation.

Some at Fatah do not see the Hamas draft as a rejection. They noted that there was no reference to 1948 and that Hamas opted for an ambiguous reference to "Palestinian lands".

Abdel Aziz Rantissi, a Hamas leader in Gaza, is reluctant to take responsibility for the talks failing. "There are lots of points on which we have consensus," he said. "That is why there is a probability of us reaching common ground.' He did not express objections to Mr Arafat becoming the leader of the united front.

Sheikh Abdullah al-Shami, the Islamic Jihad leader and founder, was optimistic about a deal but stressed there was not yet consensus. "We have not accepted that [a return to the territory of] '67 is the maximum we can achieve;' he said. He was also concerned that if operations were to be confined to the West Bank and Gaza, they might not be successful, given that the Israelis were well entrenched in Gaza.

The Fatah representative, Abu Ali Shaheen, a minister in the Palestinian Authority, has quit the talks in frustration at Hamas's behaviour. He said the discussions were "history" and blamed Hamas's external leadership in Damascus, which channels funds from Saudi Arabia and other Arab countries to Hamas, for exercising a veto.

His suspicion is that the Arab countries, seeing the significance of the draft, blocked it in order to present it later in a bigger international arena.

Fatah does not accept that ell is lost and has replaced Mr Shaheen at the talks.

Mr Masharwi said: "The dialogue is continuing. I refuse to be pessimistic. I think there might be a compromise in the end."

If a successful revolutionary example against such impossibly super-human difficulties (as are imposed by Zionist tyranny every minute of every day) can be ultimately achieved, then the whole world will know that the game is theoretically virtually up for all Western imperialist global domination (of which the Zionist tyranny is a prized example).

Part of the demented American blitzkrieg posturing against Iraq is a reflection of Washington's far deeper anxieties should the Palestinian revolution, of all things, set the world a triumphant revolutionary example despite all the filth and murderous repression that the Jewish colonisation is non-stop savagely throwing at it. 

The precise detail of the Palestinian unification talks is not the point here, - that will be for examination in due course.

It is the growing maturity and confidence behind national liberation revolution (that has led to the talks themselves) which is the key thing.

The anti-Marxist sectarian philistinism of the fake-'left' stays opportunistically stuck on such idiocies as "condemning" Sept 11 or Hamas suicide bomb terrorism, or 'shirking such issues by recycling Stalinist Revisionist monolithic mindlessness of "we support Arafat" (Lalkar) in deliberate disregard of how new revolutionary inputs might change the PLO pattern.

Saturday was a healthy mobilisation against war, but building Leninism will be a million times more important in the long run.	 EPSR