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Red Flag:  No, East Germany wasn’t socialist—and neither is “democratic socialism”

In his weekly column, Nathaniel Flakin critiques controversial statement by Die Linke’s Heidi Reichinnek


10/09/2025

A mural depicting a socialist utopia: two smiling people with symbols of science and advancement swirling around them.

Heidi Reichinnek of Die Linke is more popular among people under 45 than chancellor Friedrich Merz. Admittedly, that’s a low bar to clear—but the 37-year-old politician with the Rosa Luxemburg tattoo, co-chair of the Left Party’s parliamentary group, rocks Tiktok with passionate speeches against the Far Right.

What kind of system does she want? In an interview with Stern magazine, she was asked about the German Democratic Republic, better known as East Germany, and answered:  “What we had in the GDR wasn’t socialism. At least not the kind my party envisions.”

Every single right-wing influencer in Germany responded:  socialism can only mean a repressive dictatorship. Following a famous method, let’s define what socialism is not, in order to figure out what it is. 

Definitely not socialism

Reichinnek says she is for “democratic socialism.” She calls that a “utopia” (literally:  a non-place), but a “first step” would be “to bring public services back into public ownership,” including “housing, transportation, health care, and education,” alongside a “redistribution of wealth.” She does not mention what any further steps would be, but she explicitly rejects “nationalizing everything.”

What Reichinnek is describing is more or less what West German capitalism looked like in the 1970s, before the neoliberal offensive. Prior to the age of privatizations, public services were mostly run by the state. Reichinnek simultaneously defends the Basic Law, which guarantees private property. So even in the golden age of the “social market economy,” the means of production were still monopolized by a handful of Nazi billionaires. 

Just like “democratic socialists” Bernie Sanders and Alexandria Ocasio-Cortez on the other side of the Atlantic, Die Linke envisions “socialism” as capitalism with more protections for workers. The problem is that such a regulated capitalism is inherently precarious—it’s only possible when capitalism is growing and the ruling class is forced to make concessions.

As we’ve seen for the last 50 years, competition between nation-states forces them to claw these concessions back. The only way to win lasting improvements for working people is to break out of this system by expropriating the bourgeoisie. Society’s wealth should be under democratic control—not the exclusive property of a few oligarchs who inherited billions from war criminals. Anything less is not democratic and not socialist. As Rosa Luxemburg put it:

“What was considered equality and democracy until now:  parliaments, national assemblies, equal ballots, was a pack of lies! Full power in the hands of the working masses, as a weapon for smashing capitalism to pieces — this is the only true equality, this is the only true democracy!”

Also not socialism

The GDR, in contrast, did nationalize just about everything. So was it socialist? Also not. Because socialism—which Marx described as a “first” or “lower” phase of communism—is not simply about state ownership. Socialism refers to a society in which the working class holds political power; as workers increasingly administer their own lives and society as a whole, class divisions and the state wither away.

The GDR existed for just over 40 years, and in that time, the state did anything but wither; the Ministry for State Security grew incessantly, and surveilled, harassed, and imprisoned workers and young people they considered to be “enemy-negative forces.” This wasn’t just an insult to human dignity—it was also an enormous waste of resources.

With a planned economy, and without the need to constantly generate profits, the GDR made accomplishments that sound fantastical today. They completely eliminated homelessness and allowed 90 percent of women to join the work force:  the highest rate recorded by any country ever. They came up with innovations like near-unbreakable glasses and hyperefficient prefab concrete housing. Yet a privileged bureaucracy, obsessed with control, produced constant inefficiencies and alienated workers from what was supposed to be “their” system.

In a recent video, the YouTuber Fabian Lehr rebuts Reichinnek and argues that the GDR was socialism, because despite any and all shortcomings, East Germany’s economic base was socialist. The history of German capitalism shows that the very same bourgeoisie can rule via an imperial monarchy, a bourgeois democracy, a fascist dictatorship, or a different bourgeois democracy. But this is because capitalism needs a state with a certain autonomy.

Under a planned economy, no division exists between the political and economic spheres. “The economy” does not act like a mythical force hovering above society—it is subject to conscious planning. So decisions about who will produce what for whom are directly political. That’s why it is no secondary question if the working class is directly exercising power or not.

Lehr points to the GDR’s accomplishments, but offers no explanation for why millions of people wanted to leave this supposedly socialist society—or more generally, why productivity growth remained far lower than in the West. As Leon Trotsky argued in the 1930s, socialism must increase human productivity, or it has no historical justification. And one irony seems to escape him:  due to his long association with Trotskyism, comrade Lehr could have easily faced a long prison sentence in the GDR, as did many communists with similarly “problematic” backgrounds. This does not speak for a particularly civilized society. 

Real socialism

Socialism is fundamentally different from both Die Linke’s magically reformed capitalism, but also different from the GDR’s bureaucratically planned economy. A society can only be described as socialist if it meets Marx’s criteria of evolving towards the abolition of classes and the state. It’s a dialectical category defined not by an abstract checklist, but development and contradictions.

A planned economy needs broad, constant democracy to function. There is no other way to accurately judge what producers can do and what consumers need. By suppressing all criticism, Stalinist states like the GDR denied themselves the possibility of good planning.

There is a lot more in Reichinnek’s interview to criticize. As a “small step,” she thinks Die Linke should form coalition governments alongside the SPD and the Greens, “to achieve what is achievable at a given point in time.” In Berlin, we have seen what this looks like:  “left-wing” ministers privatizing public housing, deporting thousands of immigrants, and cutting wages for public sector workers. Small steps indeed! Recently, we saw leading members of Die Linke voting to give €500 billion to the German army.

Rosa Luxemburg, whose face is tattooed on Reichinnek’s arm, rejected the idea that reforms to capitalism were the “first steps” toward socialism:

“[P]eople who pronounce themselves in favour of the method of legislative reform in place and in contradistinction to the conquest of political power and social revolution, do not really choose a more tranquil, calmer and slower road to the same goal, but a different goal.”

And while Reichinnek emphasizes her goal of joining government coalitions, Rosa Luxemburg took the opposite view:

“[T]he role of [a socialist party] in bourgeois society is essentially that of an opposition party. It can only enter on scene as a government party on the ruins of bourgeois society.”

Red Flag is a weekly opinion column on Berlin politics that Nathaniel has been writing since 2020. After moving through different homes, it now appears at The Left Berlin.

11 September 1973: Putsch in Chile — the other 9/11

This week in working class history


In September 1970, Salvador Allende was elected president of Chile, on the back of a wave of strikes and land occupations. His victory inspired wider social movements: workers took over factories, peasants seized the land, and indigenous Mapuches demanded recognition. This grassroots mobilisation led to the establishment of Cordones Industriales – workers’ councils that coordinated militant action across different factories and workplaces. Allende was pushed into nationalising some industries, including the mines and some banks

In response, US President Nixon ordered a trade embargo. The CIA-backed truck drivers’ union organised strikes that disrupted the delivery of vital goods – though since most drivers owned their own trucks, this was more a bosses’ strike than a genuine workers’ action. In June 1973, a tank regiment surrounded the presidential palace. Allende’s response was to compromise and to attempt to negotiate with the bosses and the military. He agreed not to interfere with Chile’s army or police. In August, he invited General Augusto Pinochet into his cabinet.

In September, the Chilean military, led by Pinochet, staged a coup. Political parties were shut down, and Pinochet’s opponents were rounded up and tortured. 30,000 were killed, including Allende, and more than 3,000 “disappeared”. 12,000 Leftists were rounded up and sent to the national football stadium. One of them was the singer Victor Jara. Before they killed Jara, soldiers pulled his nails out, chopped his hands off, then told him to play his guitar: “Let’s hear you sing Venceremos now.”

Organised and financed by the CIA – which had cabled its Santiago station that “It is firm and continuing policy that Allende be overthrown by a coup” – Pinochet’s regime, working with the “Chicago Boys”, became a testing ground for the monetarist policies later adopted by Ronald Reagan and Margaret Thatcher. This involved privatisation, unemployment, and massive attacks on workers’ rights. Pinochet’s US-backed economic programme was the forerunner to today’s austerity politics.

What are the lessons of Chile? On the one hand, Allende’s fate justifies St-Just’s statement: “Those who make revolutions by halves dig their own graves”. The rich and powerful will not hand over power without a fight. But Chile also showed the power of our side. When the truck owners went on strike, local committees were set up to distribute food and other essential goods. Workers organised production for need not profit. Before it was crushed, the Chilean uprising showed what a better society could look like.

Together for Gaza: Stop the genocide

Why you should join the Zusammen für Gaza demonstration on September 27th


The discourse on Gaza among the political and media elites of this country is finally beginning to shift. Increasing numbers of politicians and journalists are actually starting to use the word “genocide” and calling for an end to all arms shipments to Israel as well as sanctions of some kind. But it seems clear that we need pressure from below to ensure that this shift moves much more quickly and decisively to ensure real action. One of the best ways to do just that is by organizing mass demonstrations. 

Berlin is home to the largest Palestinian community in any city outside the Arab world. At least an estimated 30,000 Palestinians live here, 200,000 in Germany as a whole. Yet it has been incredibly difficult to organize large demonstrations in this city, for several reasons.

The primary reason for this is the outrageous behavior of the police at virtually every single demonstration. Even before 2023, the Berlin police had been notorious for the exceptional brutality against Palestinian protests in particular, with full support of nearly the entire political and media establishment.

Attending a demonstration means risking arbitrary police violence and detainment or arrest, leading to criminal charges. Many Palestinians with an unsure status are understandably not able to risk this, because of the consequences that might have for themselves and their families. There have been several cases of deportations and jobs lost.

The level of violence actually seems to be increasing with each new demonstration: the case of Kitty O’Brien now gone viral is just one of many. This is all compounded by the arbitrary restrictions placed on these demonstrations, which are often stopped by the police up to the point of banning them entirely. But the major reason for the fact that the demonstrations in Berlin and Germany in general have been so tiny has been the failure to mobilize the wider community.

The largest demonstration to date was the United 4 Gaza demonstration in June organized by Abed Hassan and Amin Rjoob with the backing of the heart of the Palestinian movement in Berlin. An estimated 70,000 attended. Even the attendance at successful demonstrations like United 4 Gaza remains ridiculously low in comparison to the demonstrations in New York, London, Madrid, Sydney, or elsewhere around the world. Recently in The Hague, 100,000 people were on the streets demanding an end to the genocide: the equivalent here would be 500,000 people.

It is important to remember that Berlin has seen protests of that size before: Against the Iraq War in 2003, over 500,000 people marched on the streets of Berlin alone, the largest demonstration in the history of the Federal Republic. Considering the polls that suggest a large majority of Germans diverge starkly in their opinions from the genocidal line of the government, it is imperative to find a way to mobilize at least a significant number of them to achieve something comparable to the demonstrations of 2003. 

A major contributing factor that has prevented a mass mobilization similar to that found in other countries was the egregious failure of all human rights groups and the Linke to get behind the demonstrations in the first place. In fact, the German branches of organizations like Fridays for Future and Amnesty International famously distanced themselves from the international organizations for condemning the genocide in Gaza.

This has been changing over the past year: much too late, and not with sufficient soul-searching that should accompany their change of stance. Other NGOs like medico international have, on the other hand, from the very start been supportive of the cause of stopping the genocide and advocating Palestinian liberation, although initially not on the streets. 

Finally—and far too late—several NGOs, including Amnesty International and medico international, and several private individuals organized a rally in February 2025 (For a Just Peace in Palestine and Israel) in front of the Bundeskanzleramt. This was still couched in extremely “moderate” language under the slogan “Ceasefire now.” It was an incredibly frustrating event, organized with minimum Palestinian participation and conflicted with another major demonstration at the same time. The turnout was anything but what it should have been: perhaps rightfully so, since the wording was so drenched in relativizing both-sidesism.

But the situation now is very different. Some of the same individuals, NGOs (including Amnesty and medico), and most importantly the party the Linke have announced a demonstration “Zusammen für Gaza—Stoppt den Genozid” (Together for Gaza—Stop the Genocide). They have been joined by several Palestinian activists and politicians. The demonstration starts at Alexanderplatz on Saturday, September 27th, and leads to the Bundestag, where it will be followed by a rally/concert in the evening.

This time, the tenor is decidedly different. That the word genocide is mentioned at all is already an amazing step forward in the context of this country. The wording of the call to demonstrate has clearly been chosen very carefully to create the broadest possible coalition to exert the most pressure to end the German support for genocide in Gaza, certainly the most pressing issue for activists here at the moment. This is necessary when organizing a large demonstration.

But this time, some things are new. Ramsis Kilani, who is listed first among the list of “initial supporters” published on the protest’s website, eloquently points out in an Instagram reel, that there are many things to criticize here, but the demands also go farther than anything that we’ve seen from this spectrum up to now.

Of course, the core of the movement has demands that go much farther, down to the root of the problem, Zionist settler colonialism. But we should bring this criticism to the demonstration itself. It is precisely what we have been pushing on the streets and in social media that has led these organizations to change their position.

We need to continue that process: and we can do that most effectively by using this opportunity to show our dissent at the demonstration itself, and make the best possible use of the resources they have made available to turn this event into the largest demonstration for Palestine that Germany has ever seen. We are not only calling for a stop to the genocide and German support for it, but also to promote Palestinian liberation. 

So while it is absolutely crucial to continue pushing NGOs, and most importantly the Linke, in the right direction, a boycott of this demonstration—or, worse, a counter demonstration—would only be destructive to the cause we are all fighting for.

Yes, it is incredibly frustrating. The Linke general secretary Janis Ehling recently gave a useless interview, ostensibly in support of the demonstration while undermining it at the same time. Attacks from within the party (like Bodo Ramelow’s insidious interview where he claims that saying that IDF kills kids is equivalent to the myth that “Jews eat children.” More than anything, this interview exposes Ramelow’s own antisemitism). The list goes on.

The failures of some people supporting the demo has made it very difficult to write this article at all. But if we are to have any hope that the movement to stop this genocide will grow and become more effective in this country, it is vital to seize this opportunity and make the demonstration ours. Please go to the website https://www.zusammen-fuer-gaza.de and sign up as a supporter, and of course please attend if you can. 

Microsoft’s dark cloud

Microsoft provides mass surveillance capabilities to Israel and helping to target Palestinians


09/09/2025

When we talk about the damage done by the tech industry, the same names keep popping up: Elon Musk, Facebook, Amazon, OpenAI, etc. But there’s one ancient evil that we tend to give a pass to. Microsoft is often seen as old-fashioned, even harmless – your grandpa’s megacorp so to speak. 

Yet Microsoft remains one of the most powerful and destructive companies in the world—and it is directly complicit in the ongoing genocide in Palestine.

Microsoft helps the IDF to target Palestinians

In early August, a joint investigation by The Guardian, +972 Magazine, and Local Call, revealed that Microsoft has developed a customized version of its Azure cloud platform specifically for Israel’s military surveillance agency, Unit 8200. 

Unit 8200 hosts vast amounts of data using Azure for its surveillance apparatus. This cloud-based system stores intercepted Palestinian phone calls. Leaked documents reviewed by The Guardian show that, as of July 2025, the equivalent of 200 million hours of audio were stored on Microsoft servers in the Netherlands. More data is stored on servers in Ireland and Israel.

According to Israeli intelligence sources, this Azure-hosted data was used to help plan lethal airstrikes in Gaza and guide arrests and other operations in the West Bank.

In response to these accusations, Microsoft has played innocent, despite launching two external inquiries into the allegations. After the first inquiry, Microsoft announced in May that it had found no evidence the Israeli military had violated its terms of service. A second inquiry was launched in August after senior Microsoft executives raised concerns about their Israel-based employees. In other words: what if some Israeli employees have been more loyal to their government than to their employer?

Despite this internal finger pointing, it seems clear that Microsoft must have known what its system would be used for. According to an intelligence source interviewed by The Guardian:  

“Technically, they’re not supposed to be told exactly what it is, but you don’t have to be a genius to figure it out,” the source noted. “You tell [Microsoft] we don’t have any more space on the servers, that it’s audio files. It’s pretty clear what it is.”

In a June report,  the UN Special Rapporteur on Palestine stated that Microsoft’s servers “ensure data sovereignty and provide a shield from accountability, under favourable contracts with minimal restrictions or oversight.” 

Speaking at a conference titled “IT for IDF”, an Israeli colonel described cloud technology as “a weapon.” Netanyahu himself has said that the relationship between Israel and Microsoft is “a marriage made in heaven, but recognized here on earth.” 

No Azure for Apartheid

No Azure for Apartheid is a Microsoft-worker campaign group opposing the company’s complicity in the genocide. The group has criticised the latest inquiry as “as yet another tactic to delay the immediate cessation of ties with the Israeli military”. 

Members of the group have organized several protests in recent weeks. They briefly occupied Microsoft east campus in Redmond on the 19th of August. A few days later, the group used kayaks to protest outside the waterfront homes of Microsoft CEO Satya Nadella and President Brad Smith. 

On the 26th, five Microsoft workers were arrested at another sit-in at the company’s headquarters. Two workers – Riki Fameli and Anna Hattle – were then fired. Previously, Microsoft has fired two members of No Azure for Apartheid – Abdo Mohamed and Hossam Nasr – for organizing another vigil. 

Reports confirm the company has asked the FBI for help tracking workers and activists. Internal emails reviewed by Bloomberg show that Microsoft went as far as flagging employees and former employees involved with No Azure for Apartheid by name.  

In an article on Medium, No Azure for Apartheid has listed the many ways in which Microsoft technology is either directly or indirectly used to power the genocide in Gaza. This includes, amongst other things, Microsoft’s ties to members of the so-called “Gaza Humanitarian Foundation” (GHF). UN experts have said that the GHF “is an utterly disturbing example of how humanitarian relief can be exploited for covert military and geopolitical agendas in serious breach of international law”. 

Microsoft is gutting the game industry 

Microsoft is not only complicit in genocide, it is harmful on many more levels. The company has laid off thousands of workers in several rounds: 6,000 in May, 9,000 announced in July, 10,000 back in 2023… the list goes on. While this is in no way comparable with the murder of Palestinians, it is hard to understate how many people lost their jobs and how damaging these layoffs have been. 

The layoffs have arguably not received much coverage in the mainstream press. Perhaps this is because a large portion of those affected work in the gaming industry and there is still a widespread assumption that making games is not a “real” job. Yet gaming is the largest cultural industry in the world.  Such mass layoffs—combined with the closure of many studios—are already wreaking havoc.

Why is this happening ? The short version is: 1. Microsoft purchases a host of game studios to create a sort of Netflix for games, 2. Netflix for games is an unprofitable idea, 3. Microsoft decides to pivot to AI (because which tech company doesn’t?), 4. people get sacked. 

The mass layoffs and complicity in genocide are linked, and the fightback by some Microsoft-owned game studios is making that evident. In August, Arkane Lyon published a letter calling out Microsoft’s complicity in the genocide, after initially delaying due to the layoffs. 

“Our concern was that the open letter would be muted by the layoffs news,” Arkane told Game File. “Since then, it has been very difficult to find the correct timing, knowing that the situation in Gaza was deteriorating rapidly.”

The letter demands, amongst other things “Termination of all ongoing or future contract with Israeli Occupation Forces” and Microsoft “Disclosing all ties to the Israeli military”.

Other game developers have canceled ports of their game for the Xbox.

What can you do?

So, Microsoft is bad. According to BDS, it is “perhaps the most complicit tech company in Israel’s illegal apartheid regime and ongoing genocide”.

But what can we do to fight it? 

Calling for a full Microsoft boycott would be hypocritical on my part. After all, I’m writing this article on a Windows machine. For many people, switching to another operating system is either too costly or too difficult to be a realistic option. But Microsoft is more than just its operating system—the company offers a wide range of products, including games.

Among other things here’s what you can do:

  • Stop buying Xbox products and cancel your Game Pass Subscription.
  • Stop buying Microsoft hardware such as Surface laptops, keyboards, or controllers.
  • Avoid using Microsoft software (Bing, Edge, Windows, Office)  as much as possible. If the Windows operating system is difficult to avoid for many people, products like Bing, Edge, or Office can easily be replaced by other, free alternatives. 
  • Sign this petition.

The Norwegian investment impasse

Oil, genocide, and the contradictions of capitalist coordination


08/09/2025

As Norwegians head to vote in their national elections on 8 September, a topic that has occupied much space in recent news cycles has been the discovery that the country’s sovereign wealth fund has been investing increasing sums of money into Bet Shemesh Engines Ltd., an Israeli manufacturer of jet engine parts—used, to nobody’s surprise, in the genocide in Gaza. This fund (“the oil fund”, or Oljefondet in Norwegian) is made up of the taxes levied on the profits made by the Norwegian oil industry. It also happens to be the largest sovereign wealth fund in the world, worth close to €1.7 trillion today. Oljefondet’s investments into Bet Shemesh have taken place despite the fact that it has its own ethics council, to prevent precisely these sorts of investments from taking place. The ethics council is more than just for show: it has indeed pulled investment out of specific companies in the past, and even out of entire industries such as tobacco or coal. Despite this, the fund’s investments in Israel have increased by a factor of six over the past 20 years, clearly diverging with Norwegian public sentiment towards Israel. Moreover, the fact that this even saw the coverage that it did is likely due to the publicity generated by an open letter written by Francesca Albanese. The phrase mitt oljefond, mitt valg (“my oil fund, my choice”) has rapidly become a symbol of protest as Norwegians have taken to the streets to demand disinvestment from firms complicit in genocide. 

These protests have been somewhat successful, and some degree of disinvestment has genuinely materialised. Retrospective analyses of this entire debacle have highlighted the toothlessness of the ethical council, pointing out that there is indeed no firm legal obligation to follow their advice, making the question of disinvestment a political rather than purely technocratic process. While true, this critique is limited in that it eschews any sort of structural analysis of the politics of investment, instead looking at each of these decisions as individual instances. It therefore fails to explain why this political process should have failed to disinvest from genocide, even given the general Norwegian aversion to business with Israel and why it continues to rule out complete disinvestment in Israel. More importantly, it also gives us no capacity to understand how we might prevent this sort of thing from happening in the future. 

How should we characterise this “politics of investment” today? Investment itself—a tool that is patently necessary to keep capital’s motor running—has a diverse range of functions. It can help kickstart new production processes by engaging new workers or buying new machinery; it can help build, maintain and upgrade infrastructural stock; it can help by creating institutions like universities and trade schools, in order to upskill workers; it can even help with developing new processes of production through what we call “innovation”. None of this is intrinsically a bad thing and there is no reason to assume that the notion of investment will disappear when capitalism withers away. 

On the other hand, given that we do live under capitalism, there are certain expectations underlying investment. The main one of these is that private actors who advance sums of money are rewarded by eventual returns on this sum. These returns can make their way to investors as dividend payouts, or, when investment simply represents partial ownership of the firm, the (notional) returns are an increase in the share price of the firm. And in theory, these returns come from faith in the firm’s ability to successfully produce and sell commodities at a profit. From the perspective of the investor, this means that all the tricks in the capitalist book are fair play: wage suppression and union busting, skimping on product quality, ignoring environmental regulation, lobbying politicians and so on.  

This means that in a market economy, investors are driven solely by the profit motive as far as decision-making is concerned. Any other factors (such as emissions) have to be described in financial terms, and “priced in” by some capable authority. This has its upsides: the profitable production and sale of commodities implies that these are commodities that people want to purchase. For instance, investors push money into BYD, since BYD produces affordable electric cars and people want to buy electric cars. It also has profound negatives: the most pressing of which is that an economic model predicated on infinite commodity production and consumption is unfeasible on a rapidly heating planet. And in the end, it is important to note that our access to iPhones is entirely incidental to the goals of capitalists or their financiers, which remains profit-seeking. This is why, together with iPhones, we also get things like planned obsolescence, where electronic devices are produced to lose function over time. 

The profit motive also obviously holds true for Oljefondet as a financier. In order to keep up with the rate of inflation, the laws of the market compel Oljefondet’s managers to invest “wisely”, to grow these investments as effectively as possible for the sake of the Norwegian people. This has (thus far) seemed to work out quite well, and Norway’s generally left-of-centre political culture has been able to act as a moderating force on these investments, making sure the most egregious investments are taken off the table. Why, then, is this moderating force now failing in face of a moral crisis as colossal as outright genocide? 

In the years since the crisis of 2008, it has grown increasingly evident that global capitalism is in deep crisis. Investment avenues for commodity production have grown increasingly narrow, due to a near-global collapse in the rate of profit. To simplify a bit, the system has been chugging along in the past decades in large part due to the rapid, world-historical growth in the Chinese economy, enabled by innovative industrial policy, foreign direct investment, and readily available pools of labour. Some of the benefits of this have trickled upwards to Western firms, through their ability to coordinate complex chains of subcontractors, drawing profits through the increasingly innovative range of property rights regimes that this era has sparked. This has been particularly true for Big Tech firms, such as Apple (€33.17b of Oljefondet): designed in Cupertino, made in Shenzhen. 

This marks a stark contrast to the more domestic side of Western capitalism, where economic coordination has grown increasingly anarchic under the maxims of the market. Countless hype-driven bubbles like generative artificial intelligence (Nvidia: €43b) and outright scams like cryptocurrency (Coinbase: €902m) mark avenues for get-rich-quick, pump-and-dump schemes. Existing social arrangements are torn apart as labour is pushed further into precarity by platforms capable of absorbing decades of losses, like Uber (€2b) and Doordash (€1b). And when all else fails, the rapidly widening realm of assetisation has helped create a wide store of perfectly viable avenues to strip-mine and turn tidy profits: from housing (Vonovia: €3.66b) to healthcare (UnitedHealth: €3.28b) to electricity (National Grid plc: €1.09b).  

In keeping the world economy chugging along pretty happily, this combination of fixes has also kept investors like Oljefondet chugging along with it. Small wonder, then, that most of Oljefondet’s investments—three-fifths, to be precise—lie in the United States. 

Times change. The rapid growth in Chinese competitiveness, not just in industrial production but also in the profit-absorbing parts of the supply chain, like product design and innovation, have made sustaining this drain increasingly difficult. China has rapidly grown to become a national microcosm of capitalism itself, dominating commodity production in countless fledgling industries, from electric vehicles to battery technology to solar power. It is unclear how the United States intends to undo this, tariffs or otherwise, since the fundamental problem is that the Western world has spent the past decades incrementally ceding responsibility for economic coordination to financial capital. Consequently, today, there is a colossal dearth of institutions capable of the meaningful, democratic planning that the production of social wealth and well-being requires. Contrast, for instance, how Chinese investment has led to massive expansions in green energy infrastructures, while billions of dollars of Western capital have instead been pumping into massive expansions in data centres, to prop up the artificial intelligence hype bubble. 

Unfortunately, this investment does not stop at Silicon Valley’s infinite hare-brained schemes. In much of the West, a massive expansion of military capacities has become the call of the hour. In Europe, this “rearmament” is ostensibly due to fears of further Russian expansion beyond Ukraine; as in the United States, however, these investments are also motivated by the desire to defend national borders, bolster colonial outposts like Israel, police domestic dissent and, depending on whom you ask, prepare for an eventual war with China. Ambitious plans for expansions in green energy have fallen by the wayside, as whatever remains of Western industrial capacity is diverted bit by bit towards “defence”. This is the backdrop against which NATO countries have uniformly increased their defense spending to 5% of GDP, with even Germany abandoning its long-standing commitment to the Schuldenbremse in its renewed enthusiasm for remilitarisation.  

The new titans of the military economy include fledgling arms manufacturers, like RTX (€2b) and Rheinmetall (€1.5b), surveillance/prediction firms like Palantir (€3.09b) and, of course, Big Tech firms. Prominent among these are Alphabet (€22.25b), Amazon (€23.19b) and Microsoft (€42.39b), each of which has very explicit tie-ups with the IDF, to whom they provide cloud services for logging phone calls made by Palestinian civilians in the West Bank, or for running the artificial “intelligence” systems that arbitrarily add Palestinian civilians to IDF kill-lists. These collaborations are no accident: for countries committing to (re)militarisation, very few countries are more valuable than Israel is. As has been pointed out ad nauseum, the immense utility of the IDF’s military and surveillance technology comes from their thorough subjugation of Palestinians as test subjects for the IDF’s advanced weaponry. 

All of this marks a rather difficult situation for Oljefondet, who must strike the right balance between seeking profits, respecting geopolitical constraints, and being seen as trustworthy. This means curtailing investments on green energy, where profit margins are low; it means obeying American investment imperatives and, ultimately, it also means deterministically pumping money into firms that are too big to fail. And while directly investing in genocide is indeed a step too far for most Norwegians, these constraints ensure that that is effectively what is happening anyway. 

Capitalism is a dirty business. Wage theft—the dirt that lies at its very core—can be broadly obscured, so long as (some) workers can identify their own short-term interests with those of the system. Now that this social arrangement is rapidly disappearing, we are witnessing a return to the naked, unmasked brutality of pre-war capitalism: a phase that began with the East India Company’s reign of terror in South Asia and ended with firms like IBM and Volkswagen aiding Nazi Germany in administering the concentration camps where more than six million Jews, and millions of Roma, Sinti, queer and disabled people were murdered, in the cold light of scientific industrial capitalism. 

The outrage has worked and the protests have succeeded at getting the fund to withdraw from a handful of businesses involved in genocide. This includes Bet Shemesh, but also Caterpillar (previously €1.85b): the firm whose bulldozers have practically turned into a symbol for the Israeli destruction of Palestinian homes. This is an unqualified positive and a political change we should all be thankful for. 

To prevent this from happening again, however, Norwegians need to honestly reckon with the reality of what market-driven investment means today, against the backdrop of an increasingly violent, militarised and exterminationist West. Adopting a politics of steadfastly continuing down the profit-maximisation path and tackling only the most egregious ethical pitfalls when they do arise is going to prove to be a Faustian bargain, that will inevitably push people to internalise a certain level of cynicism and disregard for human life. All of this is fertile ground for the far-right, who thrive off the amorality of their opposition.  

In the end, the only way out is through. While many Norwegians have deeply internalised the idea that they are a small country incapable of effecting any change anywhere, this is far from true when we look at Oljefondent: it is a hefty sum of money, capable of bringing about vast economic and social transformations if harnessed correctly. The hard reality, however, is that this requires at least something of a break with one of capital’s core precepts—accumulate, accumulate! That is Moses and the prophets!—and a transition to a mode of societal coordination that prioritises sustainability, well-being and individual freedom, over the generation of endless profits for the bourgeoisie.