By Roger Silverman, April 2025
The world is reeling with shock and disbelief. Its dominant power has abruptly abandoned eight decades of economic orthodoxy, diplomatic consensus, strategic alliances and liberal pretensions. At home this means the shutdown of entire government agencies, mass redundancies, defiance of judicial rulings, incarceration, deportations, concentration camps; internationally, a global trade war, the violation of military treaties, forcible annexations, the breach of climate agreements, a diplomatic somersault towards an alliance with Moscow, preparations for world war with China… These are not mere tactical adjustments; this is a coup.
What is the explanation? Just as earthquakes and volcanic eruptions result from tectonic shifts in the Earth’s crust, so too the buildup to this political earthquake arose from the inexorable stresses building up under the surface over nearly two decades, ever since the financial crash of 2008. Among the symptoms are economic instability, growing inequality, environmental disaster, political upheavals and growing social unrest. Now once again we are on the brink of recession.
The 2008 crisis precipitated a wave of turbulence worldwide: an upsurge of protests, uprisings, governmental crises, coups, civil wars, the collapse of reformist parties, the sudden eruptions of new left movements, soon followed by their equally sudden collapse, the coming to power of far-right governments east and west…
The age of globalization is over. The liberal dreams of eliminating national borders have been shattered. The EU, NATO and the UN are all crumbling. Conditions in the ex-colonial world have precipitated an endless wave of migration to the West, aggravating the crisis still further.
Economic decline
The old capitalist economies are in irrevocable decline. In Western Europe, annual growth hardly reaches 1%. Europe’s strongest economy Germany actually contracted in 2023 and 2024.
Apart from brief blips, the US economy too is slowing down relentlessly. Between 1945 and 1973 it grew by an annual average of 4%; since then it has hardly reached 2%. Over the past 15 years, the average growth rate of the US economy has slumped by nearly half compared to the previous 25 years. Since the 1980s, the US economy has seen a process of deindustrialization comparable to that of Britain. It is now based almost entirely on parasitical speculation in finance, real estate, the stock market, etc.
American companies are currently burdened with the heaviest debt in history. Their total outstanding debt amounts to five times their annual income. Over the past two years, corporate bankruptcies have soared by 87%.
The USA has the grossest income inequality and the lowest life expectancy of all the G7 countries. Since 2008, the incomes of all but the richest have risen by just 0.9% per year.
On the eve of the 2008 crash, Obama had won the presidency on the slogan: “Yes we can”. Eight years later, what was the outcome? “No he didn’t”. This explains both the chronically low turnout in successive elections and in particular the rejection of Biden and the Democrats. Trump’s popular vote in the 2024 presidential election was actually only marginally higher than in 2020, when he lost; his clear victory this time was the result of the Democrats’ loss of seven million votes since then – a vote which reflected a perfectly justified mood of demoralisation and despair.
Concentration of wealth
While the hourly wage in real terms of most blue-collar workers is no higher today than it was in 1979, despite a rapid rise in their productivity, life at the top is very different. The world now has more dollar billionaires than ever: 2,781 in all, 141 more than in 2023 and 26 more than the previous record set in 2021. Of the top ten, eight are in the USA, one in France and one in India. They’re richer than ever, owning $14.2 trillion altogether – up by $2 trillion since 2023 – and their wealth is soaring at unprecedented speed. The richest twenty accumulated a combined $700 billion extra in the one year from 2023 to 2024! “Communist” China boasts the second number of billionaires with 473, and India third with 200.
Looking at it another way: the wealth of the 400 richest people grew in the last year by almost $1 trillion to a record $5.4 trillion. Of these, the top 1% own a total of $43.45 trillion and the top dozen enjoy fortunes amounting to over $100 billion.
There has been a colossal rise in inequality. While the wealth of the world’s richest 1% at one end of the scale has trebled since 1989, at the other, that of its poorest 50% had not grown at all in the same three and a half decades. In the USA, in 2011 400 people had owned more wealth than the bottom half of all Americans; by 2019 this had shrunk to just three!
The state
It is this gross concentration of wealth that explains the nature of US politics today.
In the Communist Manifesto, this is how Marx and Engels summed up the functions of the capitalist state: “The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie.”
In the heyday of capitalism, business entrepreneurs entrusted the running of their state to a specialised caste of experts. Political leaders in their day were connoisseurs with a range of diplomatic skills, strategic expertise, an insight into the lessons of history. The classic bourgeois state served as an executive committee of the entire capitalist class, acting to manage their affairs, protect their common interests, administer their needs, formulate policies, regulate competition, resolve disputes between them, collect taxes, provide essential services, maintain order, subdue working-class revolt, etc.
The state found it increasingly necessary to invest in projects that benefited the ruling class collectively: for instance, the provision of such public welfare as was required to maintain the stability of the system. On a global scale, the dominant imperialist states invested in loans to poorer countries, defence guarantees to allies, overseas aid, NGOs and international alliances, United Nations projects, etc. These expenses were necessary overheads, prudent insurance policies for maintaining imperialist power over the long term. But as the crisis deepens, the ruling class are constantly whittling them down as extravagant luxuries.
Trotsky commented that at its height the British ruling class was able to plan for decades and even centuries ahead. By contrast, Trump has the strategic foresight of a flea; he switches policy several times a day. That’s because Trump and Musk brazenly represent the abandonment by the ruling class of any long-term strategy in favour of a desperate quest for instant cash gains. Personal corruption has increasingly supplanted the profession of public service.
The art of the deal
Trump is contemptuously dispensing with the old political arts; he is running the state as “the art of the deal”, to quote the title of his ghost-written book. He is a middleman who creates no value but simply buys and sells. He treats the presidency as a sequel to his former TV “reality show”. His foreign policy largely entails the acquisition of property. He remains fundamentally a property speculator with his eye on lucrative plunder: Greenland, Canada, the Panama Canal, the minerals of Ukraine, the “riviera of the Middle East” in Gaza. Musk too is essentially just another investor. He may or may not know much about cybernetics or car technology or space rockets; he certainly has a nose for profit.
Today, politics is supplanted by business. Trump and Musk see every issue as a straight business deal; they have reduced politics to a simple balance sheet of profit and loss. They are exempting the state from all but a bare minimum of regulatory and administrative responsibilities, reducing it to its essential function as an instrument of class repression. That’s the function of Musk’s extra-constitutional Department of Government Efficiency, a brutal Orwellian dystopia: to dismantle virtually the entire state apparatus and strip it of little more than its power of repression. 2.4 million state employees are under threat of instant redundancy, with the outright closure of government departments such as health, education, USAID, Voice of America, etc. Next on their hit list will be the US Social Security system, which costs $1.3 trillion a year.
The overriding goal of the plutocrats is to maximise their wealth, even at the expense of their own long-term stability, and at the cost of the rest of the population, who suffer cuts in both their personal incomes and in the social wage (public expenditure). To do this, they poison political discourse with racist demagogy. Trump’s policy of deporting up to twelve million immigrants is actually detrimental to the economy; the USA is after all a country built by immigrants. The flow of Immigration keeps wage costs low and is one factor in the USA’s relative economic success. However, his brazen display of calculated bigotry is a highly effective instrument of “divide and rule”. Similarly, his provocative slogan “Drill, baby, drill!” – his refusal to acknowledge the reality of impending environmental disaster – reflects a get-rich-quick greed for instant profitability, and a contempt for any considerations of responsible planning.
Tariff war
The purpose of tariffs is to protect domestic capitalists against competition they cannot otherwise withstand. When the USA imposed tariffs in the 1920s, and then drastically raised them in 1930 under the notorious Smoot-Hawley Tariff Act, it provoked retaliatory measures from trading partners, leading to a trade war and contributing to the Great Depression. More recently, similar protective policies were practised by Japan, Korea, and Taiwan to develop their nascent industries; and when India gained independence in 1947 it imposed severe protectionist tariffs until it was forced by the IMF to abandon them in 1991. But from the end of the second world war up to now, from a position of strength the USA and its allies had shifted to a policy of free trade, to force less developed countries to open their markets to an influx of imports.
The unprecedented growth of the Chinese economy has increasingly eroded the USA’s predominance. In his first term, Trump levied duties on some specific imports from China, but since his return to office a full-scale trade war has been launched, in which indiscriminate tariffs have been imposed on virtually all foreign trade and punitive reciprocal tariffs of 125% and even 145% on US-China trade. Trump’s imposition of tariffs will stoke inflation, choke off international trade, and shrink the economy. It has already invoked retaliatory measures, threatening a wholesale trade war, sustained capital flight from the USA, a balance of payments crisis and the collapse of the dollar – a scenario which can only precipitate a deep recession.
The Economist commented: “With his aggressive and erratic protectionism, Mr. Trump is playing with fire… In economics as in foreign relations, it is becoming clear that policy is being set on the president’s whim. That will cause lasting damage at home and abroad…The world economy is at a dangerous moment… The real world will pay the price.”
World relations
Only rarely has a dying empire gracefully ceded supremacy once its time has come. The USA is preparing for a future war with China. Faced with the military threat posed by China’s current ally Russia, with its huge nuclear stockpile, the now displaced traditional faction of the US ruling class had been seeking, at colossal cost and with diminishing returns, to exhaust Russia’s resources with economic sanctions and a proxy war. The new administration is supplanting this policy with an alternative strategy: to appease and neutralise Russia rather than confront and provoke it.
Trump’s brutal rupture with the eighty-year old NATO alliance and his rapprochement with Russia are therefore by no means perverse. They represent a perfectly rational recognition of the new world balance of forces. His Vice-President Vance calls for a “focus on East Asia, which is where our most significant competitor is for the next 20 or 30 years”. Even more clearly, his new Secretary of State Rubio says: “We’re in a situation now where the Russians have become increasingly dependent on the Chinese… If Russia becomes a permanent junior partner to China in the long term, now you’re talking about two nuclear powers aligned against the United States… It’s not a good outcome for America or for Europe or the world.”
This explains Trump’s determination to end a war which it was already losing in any case, by conceding to Russia the neutrality of Ukraine and ceding to its jurisdiction the territory both of Crimea and Donbas, with their Russian ethnic populations. But in foreign policy too, what counts now is not so much diplomacy or strategy but money. In return Trump plans to commandeer the rich mineral, agricultural and energy resources of Western Ukraine. In effect the outcome will be a ruthless partition of Ukraine, with Russia reoccupying the East and the USA swallowing up the assets of the West.
Fascism and the plutocracy
From day one of his presidency, Trump has assumed virtual dictatorial authority: governing by decree, exercising arbitrary powers, defying judicial rulings, disregarding constitutional guarantees, overriding congressional restraints. His administration is determined to crush all resistance. As an added safeguard against domestic legal restraints, he is actively outsourcing repression, by building new concentration camps not just in Texas but in Guantanamo and El Salvador – and not only for the incarceration of “illegal immigrants”, but (if he can) for “undesirable” US citizens too.
To pose a legitimate question: is the new regime in the USA fascist? Trump was elected to office, this time with a clear majority. But after all, both Mussolini and Hitler also came to power initially by ostensibly constitutional means: Mussolini at the invitation of a King, Hitler of a President. Only once in office did they proceed to assume dictatorial rule.
However, there is a difference. Both came to power only after years of bitter struggle: strikes, uprisings, revolutions which were violently confronted on the streets by gangs of organised thugs. The prolonged deadlock in the class struggle having sapped the ability of the ruling class to wield power by traditional means, it made a strategic decision to incorporate these private street gangs into the state machine and relinquish direct control to lawless and unaccountable dictators.
The victory of fascism means the physical destruction of the organisations of the working class. It means outright slaughter: the physical extermination of the organised working class at the hands of strikebreaking street gangs. The Italian ruling class handed power to Mussolini only once a wave of strikes and factory occupations had been forcibly suppressed by his private army of Fascisti. In Germany, it was only after a decade and a half of revolution, insurrection and street battles with his street army the Nazi SA that Hitler gained state power, crushing a generation of militant workers. Similarly, the Spanish dictatorship triumphed only after three years of civil war, ending with the army and the paramilitary Falange going from village to village systematically wiping out the opposition. The Indonesian regime likewise mobilised a mass army of crazed thugs which summarily executed one million communist activists throughout the archipelago.
Mussolini, Hitler, Franco, Pinochet, Suharto and their like all had at their command very real private armies, and between them murdered literally millions of working-class activists. They terrorised, jailed, tortured and physically exterminated a generation of working-class militants, and as a consequence their regimes lingered on for many years.
An empire in decline
Trump and Musk represent a declining empire thrashing around to maintain its supremacy by whatever means available: dismantling constitutional balances, curbing free speech, driving down wages, imposing tariffs, threatening annexations, shutting down institutions, laying off workers, ordering mass deportations…
Their administration is undoubtedly brutal, vulgar and dangerous; but it’s a mistake, at least so far, to call it fascist. It does not represent the voluntary surrender by the ruling class of direct political power, in conditions of crisis and deadlock in the class struggle, to an agency of hired mercenaries, once traditional means of control have failed. In a sense, Trumpism is the exact opposite. Far from submission to an unaccountable dictatorship, it represents the direct personal seizure of the functions of the state by a handful of capitalist oligarchs who have amassed into their hands such a vast accumulation of wealth and power that they feel able to dismiss the services of a professional elite to administer their affairs.
Certainly, they have fascist ambitions; they are aspiring fascists. Musk’s sieg heil salute was no accident. And yes, they do have at their disposal fascist gangs, so far relatively small (the Proud Boys, the Oath Takers, the mob which stormed the Capitol in 2021). These will undoubtedly be deployed if and when the time comes; but at this stage they are held in reserve. Only once Trump has succeeded in decisively crushing the widespread working-class resistance that is coming can something like a classic fascist regime materialise.
To call the Trump regime fascist implies the destruction of the organisations of the working class. That may well turn out to be the ultimate outcome: but the decisive battles are still to come.
Capitalism and fascism
At times of acute and intractable crisis, the ruling class resorts to fascist terror; but once in power it begins to regret having relinquished direct control. In his classic book Fascism and Big Business, written as early as the mid-1930s, Daniel Guerin described the paradoxical relationship between capitalism and fascism: the strains and inevitable tensions that arise between them:
“The fact is undeniable that the industrialists who subsidized and put fascism in power are not entirely satisfied with their own creation. In the first place the regime is terribly expensive. The maintenance of the excessive bureaucracy of the state, the party and the numerous semi-governmental bodies costs unheard-of sums and adds to the financial difficulties of the government.”
Above all, Guerin commented that “the economic policy of fascism, however favorable to themselves it may be, is not entirely satisfactory to the big capitalists. Although they eagerly pocket the fabulous profits from armament orders, they are terrified at the possible consequences of this policy. They are haunted by the thought of a financial catastrophe… Therefore the industrialists are not wholly content, and in the minds of some of them the idea begins to germinate of throwing overboard once and for all the fascist plebeians and their leader himself, and of completing the already far-advanced transformation of the fascist totalitarian regime into a purely military dictatorship. But they hesitate… Most of all, the industrialists are apprehensive lest a radical change in the regime, such as they desire, should cost much bloodshed. They dread a civil war… Hence they hesitate.”
To repeat: in this case, far from ceding sovereignty to an unaccountable ideological clique over which it has no immediate control, the Trump regime represents the direct administration of affairs by a capitalist class which has become so concentrated that it has dispensed with an entire culture of statecraft. The ruling corporations have amassed into their hands such a grotesque accumulation of wealth and power that they no longer require a professional elite to administer their affairs. Far from surrendering direct power to a fascist dictatorship, they have even dispensed with the finesse, diplomacy and strategic planning of a classic bourgeois state.
Plutocracy
So how do we define this new phenomenon? It’s time to retrieve the word plutocracy: literally “rule by the rich”. Of course, the rich have always ruled; but up to now they have entrusted the administration of their rule to a special caste of mandarins: politicians and bureaucrats. Society today has become so grotesquely polarised, wealth so monstrously concentrated, capitalism so grossly monopolised that the plutocracy feels able to dispense with any requirement to assign its collective interests to a specialised political agency: it now rules directly in its own name. Naked personal power is concentrated directly in the hands of the billionaires: the venture capitalist Elon Musk (predicted soon to become the world’s first trillionaire); the shopping tycoon Bezos; the social media mogul Zuckerberg; all under the banner of the property speculator Trump. The ruling corporations have amassed into their hands such a grotesque accumulation of wealth and power that they no longer require a professional elite to administer their affairs.
The new era of Trump and Musk was already foreshadowed in Jack London’s prophetic novel The Iron Heel, in which he quotes from a private letter written by Abraham Lincoln (long thought to be misattributed, but now confirmed)…
“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country…. Corporations have been enthroned, an era of corruption in high places will follow, and the money-power of the country will endeavor to prolong its reign by working upon the prejudices of the people until the wealth is aggregated in a few hands and the Republic is destroyed.”
This prediction anticipates a society in which the entire political edifice is crumbling, to be dispensed with by the sheer rule of money. The novel’s revolutionary hero sums up the role of politicians: “You pompously call yourselves Republicans and Democrats. There is no Republican Party. There is no Democratic Party…. You are lick-spittlers and panderers, the creatures of the plutocracy.”
The oligarch tells the revolutionary hero: “We will grind you revolutionists down under our heel, and we shall walk upon your faces. The world is ours, we are its lords, and ours it shall remain.” Exactly these same words could be spoken today by Trump and Musk.
The last word
But a state ruled directly by the plutocratic oligarchy and lacking the strategic skills of a professional political caste can only end up all the sooner in an almighty crash. And that can only bring confrontation.
That is why we need to remember too the hero’s riposte: “There is a greater strength than wealth, and it is greater because it cannot be taken away. Our strength, the strength of the proletariat, is in our muscles, in our hands to cast ballots, in our fingers to pull triggers.“
What is the future for the American working class? The imposition of tariffs will raise prices and precipitate a global recession; the purge of state payrolls will further swell the ranks of the unemployed; the expulsion of migrant workers and the forced relocation of US companies from abroad will squeeze workers’ wages and conditions closer to third-world levels. Whatever faint illusions in the American dream still linger on will quickly evaporate.
Never in history has there been such universal unrest. Even the revolutions that followed the first world war were confined to Europe and parts of Asia, whereas today they are shaking every continent. Above all, the youth are mobilising worldwide in Me Too, Black Lives Matter, Palestine solidarity and climate protests. A succession of overthrown dictators have been forced to flee their palace rooftops in helicopters.
While in its former strongholds the working class has lost its industrial base and its traditional reformist parties are in terminal decline, a new working class is emerging. It constitutes today a majority of the world population, based now on every continent, with women in the forefront of militant struggle. It comprises massive pent-up power, East and West. Once it rises to its feet, it has the capacity to open up a new chapter of history.
We are moving towards a definitive stage in the class war. The voice of the working class is yet to be heard. It is inconceivable that they will remain silent. Victory is by no means guaranteed… but the last word is yet to be spoken.
Roger Silverman
April 2025