In 1944, writing from a position at the heart of the wartime state, Marxist economist Ed Sard made an astute and even uncanny prediction: “We are now being prepared to recognize as a legitimate economic activity peacetime expenditures for war of a sizable nature. Herein lies the real importance of the psychological preparations now under way for World War III.”

In these sentences, Sard anticipated not only the paranoid atmosphere of the Cold War decades but the emergence of the postwar military-industrial complex. For the first time in the nation’s history, permanent war-production industries became a significant feature of the peacetime economy.

Militarization, whether overt or more subtle in its operation, infused all aspects of American life. Just as Sard predicted, the state no longer needed a hot war to justify its investment in the war machine.

Marcel van der Linden’s tribute rightly lauds Sard’s prescience. Certainly, as van der Linden notes, these keen insights were aided by Sard’s direct access to the internal data of the War Production Board. His position as editor of the publication Statistics of War Production provided the raw material from which Sard was able to divine the shape of things to come.

Having said that, if some aspects of Sard’s predictions were uncannily on the nose, others fell short. His theory of the permanent war economy has faced many decades of theoretical critique and empirical challenge, and now is a good time for an overall assessment.

Here it is important to note that in the permanent war economy thesis, Sard and those following in his wake envisioned a new evolution of capitalism in the postwar United States. State spending on arms production, they believed, fundamentally transformed the dynamics of the capitalist system, rendering much of Karl Marx’s analysis obsolete. Military spending provided an outlet for surplus, thus indefinitely postponing the return of crises, which many on the Marxist left believed were endemic to the system.

From this perspective, the unprecedented stability of the postwar “golden age” — characterized by low unemployment and high profitability — was entirely premised on the parasitic growth of the military-industrial complex. Sard did note that other, nonmilitary forms of large-scale state spending such as public works projects and infrastructure investments could produce the same economic effects. But capitalists would always object to what they viewed as intrusions into the realm of private accumulation.

Precisely because Sard believed military expenditure was the special outlet for surplus keeping this entire system aloft, he expected such expenditure to continue at consistently high levels into the postwar years. Elaborating on his initial formulation in 1951, Sard seemed to have been vindicated. After the brief blip of postwar reconversion and declining arms budgets, by the late 1940s and the early ’50s, the US government was once again making enormous investments in the expansion of arms-production industries, and military expenditure as a percentage of GNP climbed to levels never seen in a peacetime economy.

Arms spending remained high through the 1950s and ’60s, alongside low rates of unemployment and rising profitability. However, Sard had vastly overestimated the significance of that spending. As Ernest Mandel would later show, updating Sard’s projections on military expenditure into the 1970s, ultimately, Sard was describing an economy at war, not the weight of permanent war spending in a peacetime economy.

Sard had extrapolated from the 1951 data on military spending as a percentage of GNP the new normal under peacetime conditions. This was a problem, because in 1951, the United States was very much at war. US military spending as a percentage of GNP/GDP would never again reach the Korean War–era peak of 13–14 percent — not even during the US wars in Vietnam, Afghanistan, and Iraq. Though Sard correctly predicted the permanence of war spending in the postwar United States, he vastly overestimated the weight of that spending.

While other theorists elaborated on Sard’s thesis over subsequent years and decades, Michael Kidron’s version — by this point, it was more commonly referred to as the “permanent arms economy” thesis — stands out as the most systematic of the bunch. Unlike Sard, Kidron attempted to explain the role of arms spending in the US economy in relation to the capitalist system’s fundamental laws of motion, rather than through an understanding of crises as being rooted in overproduction or underconsumption.

While the broad contours of the social and economic function of arms spending in Kidron’s formulation mirrored those described by Sard, for Kidron, the real significance of arms spending lay in its ability to offset a declining rate of profit. He believed that it did so largely by directing investment into the production of commodities that were either fast-wasting (because they blew up or quickly became obsolete) or merely sat idle. In either case, arms did not enter into expanded capitalist production or the reproduction of the workforce.

For Sard, the decision to direct state investment toward arms production rather than other, more socially useful forms of production was a political one, since only military investment could garner the support of the capitalist class. In Kidron’s permanent arms economy, the special qualities of military industries made them uniquely — or, at least, consummately — well suited to offset a falling rate of profit.

Unlike Sard, Kidron grappled with the most substantive problem for the permanent arms economy thesis — the return, with a vengeance, of economic crisis from the late 1960s, amid continued state investment in arms production industries. Kidron attributed this to the emergence of “state capitalism” in the postwar United States.

Others, like Ernest Mandel, argued that arms spending had never possessed the magical ability to forestall crises granted by the permanent arms economy thesis. It was, Mandel wrote, “certainly not a deus ex machina in any way capable of achieving a qualitative change in the mechanisms of the capitalist mode of production.”

Instead, Mandel suggested, military expenditure had contradictory macroeconomic effects. Yes, it did work to drive up the rate of profit, in part by increasing exploitation in the form of state taxation of wages. At the same time, the capital intensity of arms industries, like the high-tech aerospace industry, accelerated the very processes that led to a falling rate of profit and, ultimately, crisis conditions.

The high-tech nature of many US arms industries also led Mandel to suggest that overall, increasing state investment in arms production might actually speed up the rising organic composition of capital, and thus accelerate a falling rate of profit, across the whole economy. This was because military industries were never totally siloed off from nonmilitary industries, and rapid technological change in military industries would ultimately influence civilian industries too.

For a contemporary example of this phenomenon, one need only be reminded of the military origins of the internet as ARPANET. Critics of the military-industrial complex such as Seymour Melman and Mary Kaldor suggested that these spillover effects of military technology on the civilian economy generally retarded innovation and thus economic growth.

More recent empirical studies lend credence to the idea that the effects of arms spending are not as straightforward as the permanent arms economy thesis proposed. A 2016 study by Adem Elveren and Sara Hsu, looking at profit rates in twenty-four Organisation for Economic Co-operation and Development (OECD) countries between 1963 and 2008, found that military spending had a positive effect on profitability only up until the neoliberal era, when that relationship reversed. In a 2019 follow-up study, Elveren found no significant relationship between military expenditure and profitability between the 1980s and the early 2000s.

The key point is that state investment in arms production may contribute to higher rates of profit across the economy, but only under certain circumstances. It is by no means guaranteed. Marxist economist Michael Roberts, in his review of Elveren’s 2019 book on military expenditure, put it succinctly: “In the great scheme of things, milex [military expenditure] is not decisive for the health of the capitalist economy.”

In fact, Roberts argues, following on from Paul Mattick’s critiques of the permanent arms economy thesis during the 1960s, state investment in arms production imperils the capitalist accumulation process by “restricting the volume of use values that can be employed for reproductive purposes.” This becomes especially problematic when an economy is descending into recession conditions, when capitalists are already loath to invest in production and likely to speculate or hoard.

While large-scale state investment in arms production during the early decades of the Cold War played a role in spurring growth and prosperity, continued military investment in the latter decades of the twentieth century and beyond may have accelerated economic decline. Between 2006 and 2010, for example, US military spending was on the rise in both absolute and relative terms, just as the broader economy spiraled into recession conditions.

War and war production in the neoliberal period have became increasingly technologically intensive. As such, this failure to cohere to the midcentury pattern may illustrate precisely Mandel’s critique of the permanent arms economy thesis: the contradictory effects of military expenditure and the higher-than-average composition of capital in arms-producing industries.

Theorists of the permanent arms economy envisioned a clear and unidirectional role for arms spending in propping up a new transmutation of the capitalist system. It was the key change in the postwar productive landscape, underwriting the unprecedented prosperity of the golden age of US capitalism.

Crucially, these theorists saw the permanent arms economy as an obvious political problem: by staving off crises and keeping employment high, this form of state investment essentially bought off the US working class, freezing class relations in place, and rendering null any possibility of revolutionary overthrow. Meanwhile, hostilities mounted at the international level, a global interimperialist arms race bringing the entire world closer to nuclear holocaust with each passing year.

While debates around the permanent arms economy thesis unfolded in the relatively cloistered world of the socialist left, another theory describing a very similar dynamic had undisputably profound political consequences on the national political scene. Theorists of “military Keynesianism” also linked economic stability to large-scale state investment in arms production, which they enthusiastically endorsed.

Military Keynesianism informed the positions of Cold War politicians and capitalists and even those of organized labor. AFL-CIO leaders lent their support to the growth of military production industries, believing that the expansion of arms-producing industries would equate to the growth of good union jobs and broad economic prosperity.

Those commitments have produced enduring conflicts in the American labor movement, which in recent years have come to a head. In this regard, the United Auto Workers is a particularly striking example. While the union has led on opposition to Israel’s genocidal destruction of Gaza, it simultaneously represents a large proportion of workers in the military-industrial complex, manufacturing the very bombs, aircraft, and other war materiel that facilitates the onslaught.

With geopolitical tensions and arms budgets on the rise, it is unclear how labor unions will orient themselves toward the prospect of expanded defense production in the future. The coming years may see a repeat of Cold War military boosterism.

Politicians and arms contractors alike love to tout the job-creating, economy-boosting perks of new weapons programs. They never fail to mention “good jobs” in sales pitches or to append inflated employment figures to ads for futuristic weapons systems.

There is also an insidious and despairing logic contained within the permanent arms economy thesis. If investment in military production has a unique ability to stabilize the economy, then there will always be a compelling reason for the working class to support its expansion.

During the Vietnam War, International Ladies’ Garment Workers’ Union (ILGWU) education director and staunch George Meany ally Gus Tyler summed up the logic of “guns and butter” unionism: while it might seem “monstrous to advocate war as a way to continue the war on poverty, to make mass murder a measure for mass uplift,” the linkage of domestic prosperity to war and war production was simply the “bitter facts, the ironic logic.” The “bitter” fact Tyler asserts is the idea that, when it comes to war spending, labor’s interests remain hopelessly divided — between international working-class solidarity and domestic prosperity.

The mixed legacy of state investment in arms production over the twentieth and twenty-first centuries calls Tyler’s “ironic logic” into question. Nor is there any reason to believe that jobs at major military contractors are immune from the forces that have degraded work in other sectors.

In the neoliberal era, defense firms shed workers, increasing their reliance on outsourcing and offshoring. Though arms spending remained high throughout the 1970s and ’80s, those good, high-paying production jobs significantly declined as defense industries became increasingly technologically intensive. Recent labor disputes at Boeing underscore the point.

The Left has countless reasons to oppose ramped-up militarism and the expansion of domestic military production industries. This would still be the case whether or not military expenditure possessed the ability to usher in an era of renewed economic prosperity, but as it stands, “guns and butter” may no longer be on the table.

Both theoretical challenges to the permanent arms economy thesis and more recent empirical data suggest that far from being a magic bullet, military expenditure cannot stabilize the economy under all circumstances, and it may be especially unlikely to revive an already flagging US economy. Warmaking cannot ultimately be relied upon to produce “mass uplift” — yet another reason why it can and should be opposed, wholeheartedly and without reserve.

LAURA INGRAHAM (HOST): The Mexican flag is flown proudly to say, “This is our land, you stole it, and we’re taking it back.” Of course, they’re ignorant of their own history, they don’t know it. Now, equally as commonplace is the waving of other foreign flags on U.S. soil. Again, the message is America is just not special. Well, remember, we purchased California and half of Mexico in 1848 for $15 million after we won the Mexican-American war, so maybe some of these people waving the Mexican flag should consider getting off the protest circuit and opening a book once in a while. Now, in all these protests, we see that the idea of the melting pot in America that was what legal immigration was all about, that is long gone.

Now, foreigners who come in feel entitled and expect us to melt into their cultures. Embracing America, abiding by our laws, honoring our customs, that is out of the window. Instead of bringing America in to your own experience, they’re encouraged to resist America. So, you got online propaganda, bought and paid for by rich Democrat donors, feeds this radicalism and heck, many of our own schools teach them to resist the government here.

Whenever Donald Trump has contemplated confrontation with Iran, his decisions have been guided less by the consensus of the U.S. intelligence community than by his own calculation of risk and reward. At times he has pulled the trigger. At times he has backed down. All the while, the U.S. assessment of Iranian nuclear intentions has stayed remarkably consistent.

Now, Trump has gone all in. His decision this week to drop more than a dozen of the largest conventional bombs in the U.S. arsenal on key Iranian nuclear facilities was based, he has said, on his belief that Iran is close to being able to make the ultimate weapon.

That’s not exactly what his intelligence agencies have concluded. Their official, publicly stated assessment of Iran’s nuclear-weapons ambitions is that Supreme Leader Ayatollah Ali Khamenei suspended the country’s nuclear-weapons program in 2003, the year that the U.S. invaded Iraq and toppled Saddam Hussein in order to seize his supposed weapons of mass destruction. Those turned out to not exist. But Iran’s leaders reasonably feared that the U.S. might next turn its sights on their country and its very real weapons program.

Tulsi Gabbard, the director of national intelligence and (on paper at least) Trump’s senior intelligence adviser, reiterated the consensus view in congressional testimony this March. But she also noted that Iran had built up its largest-ever stockpile of enriched uranium, the core ingredient of a weapon, in a manner that was “unprecedented for a state without nuclear weapons.”

Her brief remark escaped much scrutiny but turns out to have been telling.

In recent briefings with Trump, CIA Director John Ratcliffe has laid out what the intelligence agencies know, particularly about Iran’s uranium stockpiles, and said Iran was clearly trying to build a nuclear weapon, according to officials familiar with his presentation who spoke on the condition of anonymity to discuss a sensitive matter. On its face, that appears to contradict the long-standing intelligence-community position. But Ratcliffe’s analysis is actually a more nuanced reading of the available information.

In a separate briefing for lawmakers last week, Ratcliffe used a football analogy to describe Iran’s ambitions: If a team had gone 99 yards down the field, its intention was obviously to score a touchdown, not stop at the one-yard line, he said.

International experts agree that Iran has enriched uranium to a point that is close to weapons grade, a fact that Vice President J. D. Vance has emphasized in his own public remarks. Senior administration officials take little comfort in Khamenei’s decades-old halt to the nuclear-weapons program. Trump believes that Iran is actively pursuing everything it would need to build a weapon, and in relatively short order, if the supreme leader gave the go-ahead. That’s the real threat, and the reason Trump gave the order to strike now, officials told me.

It also helps that Israel has assisted in paving the way. Trump’s thinking is in line with Prime Minister Benjamin Netanyahu’s; the prime minister has said that Iran may have been months or mere weeks away from building a weapon, and has generally taken the view that the country’s leaders are stockpiling uranium precisely for that purpose. In the week leading up to the U.S. strike-–which Israeli leaders appear not to have known about in advance-–the Israeli air force pummeled nuclear facilities, killed nuclear scientists and experts, and degraded Iranian air defenses.

The Israeli attacks, like the American ones, appear to have been largely driven by a sense of opportunity, after Israel previously weakened the regime and neutralized its longtime proxy forces in the region. There is no reason to think that the Trump administration, or Israel, suddenly had some new window into Khamenei’s brain. But the president took an intuitive view of the intelligence the U.S. has long possessed, and a fateful set of actions based on it.

It’s too pat to say that Trump has ignored his intelligence advisers, although he certainly created that impression. “Well then my intelligence community is wrong,” he said earlier in the week when a reporter noted that the agencies had found no evidence that Iran was trying to build a weapon. Trump had previously said that Gabbard was also wrong when she testified earlier this year.

Officials have told me that they’re not just concerned about Iran’s ability to build a warhead that could be placed atop a ballistic missile—a complex process that would require Iran to build a device that could survive reentry into Earth’s atmosphere and land precisely on its target. The regime could construct a simpler device and hand it over to a third party.

In an interview last month with a state-linked news outlet, Fereydoon Abbasi-Davani, a prominent Iranian nuclear scientist and the former head of the country’s Atomic Energy Organization, warned that Iran could use nuclear weapons against the U.S., Great Britain, and Israel without deploying them on missiles or an aircraft. “What if they are attacked from within?” he asked, an unsubtle suggestion that Iran could give a nuclear weapon to one of its proxies.

Israel was apparently listening and thought that Abbassi-Davani might possess the know-how to make such a device. He was killed earlier this month in an Israeli air strike.

Democratic lawmakers and Trump’s critics are sure to press for more information on when and how the president came to his decision. Senator Chris Murphy of Connecticut told my colleague Isaac Stanley-Becker that he was briefed last week on the intelligence. It “was clear to me that Iran did not pose an imminent threat, that they are not on the verge of being able to obtain a nuclear weapon that could pose a real threat to neighbors, and that negotiations were ongoing and certainly not at their endpoints,” Murphy said.

On Sunday morning, Defense Secretary Pete Hegseth briefed reporters about the U.S. operation and was asked whether new information had persuaded Trump to act. Hegseth declined to share many details about Trump’s decision making, but he allowed that “the president has made it very clear [that] he’s looked at all of this, all of the intelligence, all the information, and come to the conclusion that the Iranian nuclear program is a threat, and was willing to take this precision operation to neutralize that threat.”

Ultimately, Trump’s decision to bomb Iran had little to do with any sudden change in intelligence assessments. The choice to use military force was a judgment call, and now, it’s his to own.

Isaac Stanley-Becker and Missy Ryan contributed reporting.

For almost two months, Panama has seen a national strike against privatization, mega-mining, and US imperialism. It is the country’s third period of mass civil unrest since 2022. Capital and the government have retaliated through police repression, persecution, and mass firings. Yet this has been unable to stifle widespread criticism of elected officials and mainstream political figures, focused mainly on the defense of Panamanian sovereignty and the government’s disregard of due process.

Without a left-wing party to represent the movement’s demands, there is no clear end to the tug-of-war between the workers and an increasingly authoritarian state backed by big business and the United States. But after previous mass protests in 2022 and 2023, can these past demonstrations teach us something about where today’s movement is headed?

The mobilizations have involved the banana, construction, and teachers’ unions, who called for an indefinite strike on April 28, as well as students, feminists, indigenous populations, and other social movements. The demands carry over grievances from the previous demonstrations: the under-resourced social security fund, now facing imminent privatization after the approval of a new law, and President José Raúl Mulino’s stated intentions to reopen the Canadian-owned Donoso mine.

One of the world’s biggest copper extractors, the mine was declared unconstitutional in 2023. On top of this, there is widespread condemnation of the memorandum signed in April between the government and US secretary of defense Pete Hegseth, which allows for an increased US military presence in Panama around the Canal Zone. The Canal was built and managed by the United States during its almost century-long occupation of Panama, which ended in 1999 after a long struggle for sovereignty.

Mulino’s government, headed by the right-wing RM party (Realizando Metas, Spanish for Accomplishing Goals) has responded with violence, with the president opposing the demonstrations from the start. Over three hundred demonstrators are reported to face judicial charges and more than a thousand have been brought before justices of the peace. With Chiquita’s recent firing of over five thousand banana workers in the Bocas del Toro province, it’s clear that big business is also retaliating.

As a security minister during Ricardo Martinelli’s administration in 2010, Mulino himself played a key role in repressing Bocas del Toro’s striking banana workers, leaving a tally of eleven dead, two blinded, and sixty-seven partially blinded from rubber bullets, according to Human Rights Watch.

Now as president, his administration is stepping up the repression, especially against unions. It has called for the arrests of prominent union leaders, raiding union offices without warrant; shut down affiliated cooperatives; and attempted to cut essential funding for teachers’ unions. The construction workers’ union, SUNTRACS, also the biggest and most militant in the country, is bearing the brunt of the government efforts. Already in February, Mulino had referred to the union as a terrorist mafia. SUNTRACS secretary general Saúl Méndez, also under warrant, is currently awaiting political asylum in the Bolivian Embassy.

Among the charges are money laundering and fraud, with some of the claims dating to almost twenty years ago. While these charges remain to be proven in court, the government’s methods have raised alarm even by SUNTRACS’s political adversaries on the Right. Critics have contrasted this persecution with the government’s inaction on convicted former president Martinelli, then Minister Mulino’s former boss in 2010, who was granted political asylum by Colombia in May.

Response from political parties and public representatives has been lukewarm. On April 30, a coalition of activists, independent politicians, and representatives from across parties signed a declaration  condemning the memorandum and calling for Panamanians to defend their sovereignty in international forums. The declaration, meant to show a consensus in the political establishment, did not include the issues surrounding the mine and social security privatization. Among the signatories are a former president, former vice mayors, and former and acting congresspeople. Yet Panamanian politicians are overwhelmingly unpopular.

Panama’s party-political landscape has historically relied on corruption, patronage, inter-elite struggles, and varying degrees of loyalty to the United States and free market. This has been even more true under Mulino’s administration as lines between government and opposition in Panama are blurrier than usual. The social democratic PRD (Revolutionary Democratic Party), despite being the only force to vote en bloc against privatizing social security, often collaborates with the RM on legislation.

There isn’t a left-wing party to channel these demands into institutional politics. A prevalent anti-leftist sentiment — fueled by US influence during the Cold War and the Panamanian oligarchy’s grip in politics and media — has proved difficult to shake off among Panamanian voters. All left-wing electoral efforts, headed by SUNTRACS or figures affiliated with the union like Saúl Méndez, have fared poorly, with no elected lawmakers and an average of 1 percent in presidential elections.

Instead, popular discontent has been channeled through “anti-corruption” independents, centrists backed by economic elites, who campaigned against the political establishment to great success. While the anti-corruption label has proved successful among voters, its proponents often use it to launder any social demands and push instead for austerity. Almost half of the independent caucus has voted for privatizing social security.

In 2023, a mass mobilization successfully pressured the Supreme Court to rule on an immensely unpopular mining contract. It was a victory conquered on fertile ground: then president Laurentino Cortizo was highly unpopular, Panamanians were driven to the streets by a broadly shared environmentalism, whether as a source of national pride or a source of revenue in the green economy. Contract clauses that gave mining company First Quantum almost sovereign control over the mine territory brought up negative historical parallels to the US occupation. More importantly, it was a single-issue movement: declare unconstitutional a demonstrably unconstitutional mine.

That wasn’t the case with the 2022 protests. Kickstarted by a fuel price hike, the protest soon compiled a broader list of demands, including a solution to the social security deficit, lower prices for the basic food basket, and devoting 5 percent of the GDP to education. Coalesced as the United People’s Alliance for Life, workers, indigenous peoples, and social movements held a strike for over a month, until the government agreed to sit down for negotiations with the Catholic Church as mediator.

Ever since the early 1990s, such talks have been a frequent pressure valve in times of crisis in Panama. As well as the government, these extra-institutional dialogues have often included civil society, unions, and business guilds. But in a country as unequal as Panama, it’s not only employer representatives that channel the economic elite’s influence but also state and civil society actors from the NGO complex. In 2022, workers not only succeeded in establishing one-to-one negotiations with the state, but also won a rare public platform by broadcasting the talks on public television.

A first set of agreements were reached, but after demobilization and pressure by the business class the negotiations were discontinued. The changes stipulated in the agreements — including a reduction in basic food prices and an increased medicine supply in the public health system — were never followed through.

The outcome of the last protests has shown the state’s readiness to disregard law and the constitution in pursuit of its interests, and once again confirmed the Panamanian people’s well-placed mistrust of their institutions. Like the colonial maxim quoted recently by Panamanian human rights lawyer Carlos Bichet, acátese pero no sígase, “comply but do not implement.”

With four years before another presidential election, the Panamanian tradition of forcing negotiations remains the social movements’ best chance to exert power outside of the institutions. But the window of opportunity is shrinking. The banana workers’ union recently called off the strike after reaching an agreement with members of congress. The lawmakers have promised a debate on maintaining the banana workers’ pension benefits, which the new law eliminates, as well as mediating with Chiquita to reinstate the thousands of fired workers. Meanwhile, construction and teachers’ unions remain on strike. Whether they can be able to force negotiations without the banana workers’ active support remains to be seen. If 2022 can be of any lesson, it is that they should never let their guard down.

Columbia University graduate and Palestinian activist Mahmoud Khalil reunited with his wife and met his newborn son after being released from over 100 days in ICE detention. After flying from Louisiana to New Jersey, Khalil told reporters, “If they threaten me with detention, even if they would kill me, I would still speak up for Palestine.” Khalil was the first arrested, on March 8. He is a legal permanent resident of the United States, with a green card. His wife, Dr. Noor Abdalla, a U.S. citizen, was eight months pregnant at the time. Mahmoud played a prominent role in the Palestine solidarity protests at Columbia University last spring. Watch a special report from Democracy Now! from the Newark airport.

A courier firm that conquered Southeast Asia’s logistics industry and scaled globally riding the Chinese e-commerce wave is now grappling with new pressures.

Broken roads, chaotic traffic, nameless alleys, and fragmented island provinces make Southeast Asia a tough terrain for online deliveries – tough enough that even Amazon has struggled to expand there. Yet, a Chinese entrepreneur saw an opportunity in the region, launching J&T Express in Jakarta in 2015. 

Today, the company holds a 28.6% market share in Southeast Asia, generating $10 billion in revenue globally and turning its first profit in 2024. It has since expanded into 13 countries, from China to Latin America and the Middle East, striking deals with regional players like Noon and Salla. Noon is one of the Middle East’s largest e-commerce platforms, while Saudi-based Salla helps merchants run their own online stores with integrated sales and delivery tools. 

“Our growth has been reliant primarily on e-commerce platforms,” Simon Shao, J&T Express’ head of investment and financing, told Rest of World, citing Chinese heavyweights TikTok, Pinduoduo, Temu, and SheiniSheinFounded in China in 2008 and headquartered in Singapore, Shein is a fast fashion brand that grew rapidly through exposure on social media.READ MORE, as well as regional platform ShopeeiShopeeSingapore-based Shopee, a subsidiary of Sea Ltd., is a major e-commerce platform that operates across Southeast Asia.READ MORE.

As profitability sets in, the e-commerce platforms that helped logistics firms like J&T Express succeed are now increasingly competing with them, according to a recent report by Singapore’s DBS Bank and research firm Cube Asia.

In April, Shopee, whose in-house courier SPX has been growing rapidly, dropped J&T Express for most everyday orders in Indonesia. Shao said they saw it coming and the revenue loss from this change is “very limited” because Shopee has been one of J&T’s “smaller customers” in the country.

J&T Express works across three continents with multiple platforms, which gives it a cushion to withstand market shocks — such as Shopee taking a large chunk of logistics in-house, Shao said.

Between 2016 and 2021, Southeast Asia’s e-commerce market grew at an annual rate of 40%, according to McKinsey. That growth is projected to triple by 2030, with the region’s six largest economies — Indonesia, Malaysia, the Philippines, Vietnam, Thailand, and Singapore — expected to generate $380 billion in e-commerce sales. 

Jet Jie Li, former executive at Chinese smartphone giant Oppo, sensed the coming e-commerce boom in the region a decade ago. At the time, Li ran Oppo’s operations in Indonesia and knew that delivery options were limited in the country. He went on to build J&T Express, tapping into Oppo’s vast retail network and recruiting local partners.

Shao described these partners as the “regional sponsors” — a model in which stakeholders possess local expertise and often equity, managing regional operations and overseeing both independent network partners and directly operated outlets and service stations. “They’re closer to the market,” he said. “A lot of them are local people. They are very familiar with the local know-how … and make decisions much faster.”

That model, Shao said, was critical to J&T’s early success in Indonesia, where it scaled quickly and laid the groundwork for its global expansion. 

The model allows the company to be flexible, adapting to local conditions. As J&T Express expanded to other countries, it built new pickup and delivery outlets and ramped up investment in automated sorting machines to speed up deliveries. 

In Vietnam, where capital expenditure needs were moderate, the company invested in infrastructure while also working with local sponsors. It did the same in Mexico, to better “control operations and improve service quality.” 

The ability to build its own infrastructure sets J&T Express apart in the region. Budiyanto Darmastono, vice chairperson at the Association of Indonesian Express, Post and Logistics Services, told Rest of World that other local players usually don’t take this kind of risk because they lack access to large-scale funding or the financial backing to absorb losses if demand doesn’t materialize quickly. 

“Once the infrastructure is set, then they [logistics firms] need to find customers,” Budiyanto said. “If you set the same price as other competitors, customers won’t find any reason to switch to [J&T].”

J&T Express was accused of predatory pricing by rivals last month, prompting the Indonesian government to consider introducing price-floor regulations. The company pointed to economies of scale, adoption of advanced technology, and management experience as factors reducing the cost per parcel. 

In 2024, Shopee and its Alibaba-owned competitor, Lazada, faced formal antitrust scrutiny from the Indonesian government. Shopee was accused of restricting courier options to its in-house logistics arm, and Lazada of engaging in “discriminatory actions that potentially hinder competition and harm customers.” 

At a formal hearing before Indonesia’s competition regulator, Shopee admitted to the violation and said it would allow third-party couriers back on the platform. J&T Express was reinstated on Shopee but dropped again in 2025, leaving the delivery heavyweight limited to handling larger freight shipments.

“The delivery fee has reached a rock bottom now,” and logistics companies can’t go any lower due to minimal profit margins, Jeff Tan, who leads logistics research in the Asia-Pacific region for Frost & Sullivan, a global advisory firm, told Rest of World. 

According to Tan, Shopee is passing some logistics costs to sellers who want better placement or visibility on its app — like appearing higher in search results or on the homepage.

J&T Express is expanding its services to non-e-commerce platforms and securing direct delivery contracts with global retail brands. The company inked deals with beauty retailer Sephora, footwear brand Clarks, and fashion retailer Zalora in Singapore. In the Philippines, in addition to its existing collaboration with Uniqlo, it formed a strategic partnership with Globe Telecom, the country’s largest mobile communications company. 

The company is also investing in rural areas, using DeepSeek AI in its operations, and testing the use of unmanned vehicles in China. 

But the rollout of autonomous vehicles outside of China “will take time due to the infrastructure and cost,” Shao said.

“It only takes a handful of successful people to leave to decimate the city’s tax base,” billionaire hedge fund manager Bill Ackman said to the Free Press on Wednesday. And he’s right.

A small but obscenely wealthy faction of New Yorkers are threatening to leave the city if Zohran Mamdani, the democratic socialist candidate for mayor, wins the race. Billionaire John Catsimatidis says he’ll go and take his supermarkets with him. Other rich people, like Neil Blumenthal and unnamed sources in finance and professional sports management, warn that others will leave too.

And the threat is real. Liberals often maintain that capitalism can co-exist with high taxes because any hit to the tax base by capital flight will inevitably be compensated for by the increase in revenue and economic growth, but while that happens on occasion, it’s far from an inevitability. In 2016, for example, hedge fund billionaire David Tepper caused a serious financial crisis for New Jersey when he left the state — and took billions in tax revenue with him. Politicians argued that it was the state’s high tax rate that chased him away. And capital flight has long plagued South and Central American countries; just last year, the persistent threat become so egregious in Nicaragua that president Daniel Ortega advanced a spate of legislation that (among other things) authorized the use of police force against corporate officers withholding financial information necessary to keep capital in the country.

So it’s not surprising to see the rich resort to the same tactics to keep Mamdani out of office. Still, there is a potential solution to this kind of problem: a state-level exit tax.

Exit taxes — taxes imposed on rich people who leave a given jurisdiction — have a grim reputation in the United States; but this is largely just because they are such an effective policy tool against the rich. And they are also well within the bounds of liberal orthodoxy: in 2020, for example, Elizabeth Warren proposed an exit tax of 40 percent “on the net worth above $50 million of any U.S. citizen who renounces their citizenship.”

Exit taxes at the state level would be more difficult to pull off since they would likely encounter constitutional objections, but these, Stetson University law professor Andrew Appleby argues, can be navigated:

If a state has a solid theoretical foundation and incorporates proper design principles . . . an exit tax can effectively mitigate tax base migration while aligning with prevailing policy goals and avoiding constitutional infirmities.

State-level exit taxes in the United States would also be useful as a way to prevent the “race to the bottom” of states competing for residency and investment by the rich by lowering their tax rates. As Thomas Piketty observes, something like this will ultimately have to be put in place if we are to maintain any tax system at all.

Though he is running close behind Andrew Cuomo, current polling suggests that unless something significant changes Zohran Mamdani is unlikely to win this election. Now is not the time for caution. Mamdani should announce that if elected, he will immediately work with the governor to implement a 40 percent exit tax on anyone with a net worth of more than $5 million. This will be a strong sign to voters that he is serious about taking the fight to the rich, and it will also help mainstream a long-neglected idea whose time has come.

The New York State Legislature this week passed a bill banning anonymous complaints to the state child abuse hotline. If Gov. Kathy Hochul signs the legislation, New Yorkers will now have to provide their name and contact information if they want to make an allegation that someone might be neglecting a child.

This dramatic change in the law comes a year and a half after a ProPublica investigation showed how the hotline had been weaponized by jealous exes, spiteful landlords and others who endlessly called in baseless allegations. Even if a caller didn’t leave their name or any details, and even if the same allegation had repeatedly been investigated and found to be unsubstantiated, it automatically triggered an invasive search of the accused’s home and often a strip search of the children.

We detailed the case of one Brooklyn mother whose apartment was searched dozens of times — by police officers and child protective services caseworkers who never had a warrant and often showed up at her door after midnight — all because an angry former acquaintance kept anonymously calling the hotline about her. She was never found to have mistreated her children in any way.

According to federal statistics, 96% of anonymous calls to child abuse hotlines are deemed baseless after an investigation. Among all allegations of child abuse or neglect, including non-anonymous calls, 83% are ultimately deemed unfounded.

In New York, more than 4,000 children every year had experienced child protective services investigations as a result of anonymous calls — until now.

The legislation passing is “a win-win for everybody,” said Democratic state Sen. Jabari Brisport, the bill’s sponsor. Not only will it protect victims of domestic violence who may have an abusive current or former partner who has used the anonymous reporting system to harass them or to influence a custody dispute, it will also help caseworkers themselves, Brisport said. “They are stretched so thin already,” he said. “By reducing the number of these false complaints, we can let them do their jobs better.”

“But the fact that false reports make such an effective method of harassment is a symptom of deeper issues in how CPS operates,” Brisport added, referring to how the home searches and investigations that result from these calls often turn families’ lives upside-down. Black parents especially are affected, he said, and they can feel helplessly unable to comfort their children through a terrifying and opaque process that can lead to their separation from their mom and dad.

A committee of the U.S. Commission on Civil Rights last year published a report that cited ProPublica’s journalism on these issues and called on New York to abolish anonymous reporting. ProPublica’s articles were also circulated among lawmakers and legislative staff in Albany both last year and this spring.

California and Texas, too, have passed legislation to curtail anonymous reporting. Several other states are considering similar bills.

New York’s new law will maintain the confidentiality of callers to the child abuse hotline, just not their anonymity. That means that if someone thinks that a family member, neighbor or colleague is harming a child, and they call it in, they can still be assured that the state will not reveal their identity to the alleged abuser or publicly in any way. The caller will just have to provide their name and contact information so that caseworkers can follow up, in part to make sure that they don’t have an ulterior motive for making a malicious accusation and so that caseworkers can gather more details from the caller to conduct a more informed investigation.

If they refuse to identify themselves, hotline staff will decline to pass along the tip to child protective services. But an amendment was added to the bill stating that if a caller doesn’t want to leave their name, they can still speak to a supervisor, who will then explain to them that if they provide their name it will remain confidential; that intentionally making a false report is illegal; and that issues involving children in need can also be addressed through housing, food and other services. Contact information for such services will be provided.

The new law will not affect mandated reporters of child abuse, such as teachers and police officers, who already were not anonymous.

Chris Gottlieb, director of the NYU School of Law Family Defense Clinic, helped to shepherd the legislation to its passage. She said that when she used to bring up this issue in Albany — and talk about how child protective services agents searching families’ homes without a warrant can be deeply traumatizing for both parents and children — she was often met with blank stares. But then ProPublica’s reporting “helped to change the conversation,” she said, and more importantly, parents themselves, many of them Black and Latino and led by the community organizer Joyce McMillan, started holding regular rallies on the steps of the Legislature and testifying at hearings.

In fact, parents have filed a first-of-its-kind class-action lawsuit challenging warrantless child protective services searches of their homes as unconstitutional. New York City is contesting the suit, but the city’s Administration for Children’s Services has said that it is committed to addressing child safety concerns while also respecting families’ rights.

In past statements to ProPublica, ACS has said that it is required by state law to investigate fully and to seek to conduct a home assessment whenever it receives a report of child maltreatment from the state, no matter the original source of that report. But a spokesperson said that the agency supports anonymous reporting reform with the perspective that protections for children who are in danger should also be preserved.

One of the plaintiffs in the class-action suit, Shavona Warmington, praised New York state lawmakers for abolishing anonymous reporting once and for all.

The Queens mother of six alleges that someone called in complaints about her every several months for a decade, knowing that the mere fact of a call would cause caseworkers to pound on her door; threaten that they would call the police if she didn’t let them in; search her refrigerator, cabinets, closets and bed while her kids watched; and then strip search and interrogate them. She said that the content of the reports to the hotline always sounded familiar, clearly from the same person, but that this never mattered.

In the suit, she contended that the person who made the complaints was likely the man who abused her. He could call every day and they would still send somebody out.

Her children have been traumatized by the sound of a knock on the door, she said.

“I have no contact with him otherwise, just through ACS,” Warmington said, referring to her abuser.

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The decision reveals a troubling trend: Rights tied to sex and gender identity are increasingly at the mercy of judicial interpretation.

In 2022, the Court undid a constitutional right for the first time by declaring that the U.S. Constitution does not confer a right to abortion in the landmark decision Dobbs v. Jackson Women’s Health Organization. In a decision this week called United States v. Skrmetti, they’ve taken the next step, extending the logic of Dobbs and destabilizing much of the law on sex discrimination.

The majority in Skrmetti was careful to cite case law on sex discrimination and suggest that the law at issue, which banned gender-affirming care for transgender youth, simply raised different issues. But Skrmetti shows how fragile protections against sex discrimination have become without any explicit guarantee, like the Equal Rights Amendment. 

Skrmetti involves one of the many laws banning gender-affirming care for trans minors that passed in 2023. A group of plaintiffs challenged the constitutionality of the law under the Equal Protection Clause shortly after it passed, relying on the 2020 case, Bostock v. Clayton County, which involved employment discrimination under the landmark Title VII of the Civil Rights Act of 1964. Bostock reasoned that sex always factored into discrimination on the basis of sexual orientation or gender identity. The Skrmetti plaintiffs tried to make the same point.

A district court seemed persuaded and blocked the Tennessee law from being enforced as the case made its way through the courts, but the Sixth Circuit Court of Appeals reversed. 

‘Skrmetti’ shows how fragile protections against sex discrimination have become without any explicit guarantee, like the Equal Rights Amendment. 

When the Supreme Court agreed to hear the plaintiffs’ appeal, some progressive commentators worried that Skrmetti would spell the end for any protection against sex discrimination. The majority opinion written by Chief Justice John Roberts seemed invested in dispelling that impression. The Court cited canonical sex discrimination cases and repeated that legislation based on sex stereotypes was constitutionally problematic. 

But then Roberts drew on the logic of Dobbs to explain why Tennessee’s law didn’t raise concerns under the Equal Protection Clause.

For decades, feminist scholars had explained that abortion bans could be seen as unconstitutional sex discrimination. In rejecting this claim, the majority relied on a widely ridiculed 1974 case called Geduldig v. Aiello, which held that pregnancy discrimination didn’t qualify as sex discrimination. The fact that only women could get pregnant—in the Court’s analysis—didn’t make discriminating on that basis sex discrimination. By extension, criminalizing a procedure that the Court said only one sex could receive wasn’t a problem either—not unless there was strong evidence that an interest in regulating abortion was mere pretext for sex discrimination, a hurdle that seemed impossible to clear. 

The same logic informed the Court’s decision in Skrmetti. The majority acknowledged that the only people seeking treatment for gender dysphoria would be transgender, and that there was some connection between gender identity and sex under Bostock. But if only trans youth sought out gender-affirming care, that was no different from only women being pregnant or seeking abortion, in the reasoning of Dobbs and Geduldig. None of these things, in the Court’s analysis, posed a problem under the Equal Protection Clause. 

A revived campaign for the ERA is about much more than symbolism.

So while the Court paid lip service to maintaining critical cases prohibiting sex discrimination, Skrmetti showed how easily those cases can be rewritten or distinguished. Framing a case as one about biological difference, or a medical procedure like gender-affirming care or abortion, might be all it takes. 

The campaign for the ERA has waxed and waned since the 1978 ratification deadline set by Congress. Perhaps one of the most potent reasons advocates pursued other priorities was because the Supreme Court’s jurisprudence already seemed to prohibit sex discrimination, amounting to what Professor Reva Siegel has called a “de facto ERA.” If there were already solid, albeit imperfect, protections against sex discrimination, then the ERA might be symbolically important, but other objectives might have seemed more practically important. 

The Court’s ruling in Skrmetti didn’t dismantle constitutional sex discriminations protections in one fell swoop, but it did show that they aren’t ironclad. That’s why a revived campaign for the ERA is about much more than symbolism. The Court’s ruling shows we can’t take the sex discrimination protections we have for granted anymore.