Silent Return of Say’s Law in Economic Discourse

Prabhat Patnaik | 26 May 2025

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This backdoor entry of Say’s Law is reflected in the absurd rationale of the neo-liberal economic order that’s pushing an ‘export-led growth’ strategy on smaller countries.

Jean-Baptiste Say, a French economist who wrote in the late 18th century, had formulated a law to the effect that ‘supply creates its own demand’, which meant that there could never be an inadequate demand for the aggregate of goods produced in any economy.

Say’s argument was as follows. Whatever is produced generates an equal amount of income among those associated with its production. This income is either consumed or ‘saved’ (i.e., not consumed). Whatever is consumed generates an equal amount of demand for the produced consumption goods, and whatever is ‘saved’ is either directly used for purchasing capital goods, or offered as a loan to those who wish to purchase capital goods, namely, undertake investment, by borrowing. Whatever is ‘saved’ and whatever is invested are ultimately equalised through adjustments in the interest rate, so that through such adjustments whatever is produced gets ultimately demanded in the aggregate, and the capitalist economy has no reasons for not being at a state of maximum production, that is, at full employment. There may be demand-supply mismatches in particular markets, but never in the aggregate.

The problem with Say’s Law is that all demand out of incomes earned in the current period is seen to be for goods produced in the current period, whether for consumption or for adding to one’s wealth (i.e., investment). But if persons wish to add to their wealth in the form of money (and that would be the case if they hold their wealth partly also in the form of money), which is not a good produced in the current period (for instance if they wish to hold paper money out of their current incomes), then there is no reason why the supply of produced goods in the current period should create a demand equal to itself.

In the C-M-C circuit, if persons do not wish to convert M into C, then there will be an overproduction of C, i.e., of produced goods. And any reduction in the money-price of produced goods in such a situation of insufficient demand, would only strengthen the demand for money as a form of wealth and hence not eliminate the over-production tendency.

Mainstream bourgeois economics which assumed Say’s Law, held that persons never wished to hold money as a form of wealth, that money was only a medium of circulation but never a form of wealth-holding. This, however, was an absurd assumption. It was not only empirically untrue, but also logically untenable, which is why Say’s Law was an absurd assumption to make for a capitalist economy.

Karl Marx had been quite scathing about Say’s Law and about J B Say as an economist (whom he had called the “trite” Monsieur Say) and had expounded the possibility of an over-production crises under capitalism.

Why, it may be wondered, are we talking about such arcane debates in economics, which were settled not only by Marx but resettled in the 1930s by the Keynesian Revolution in bourgeois economics at the time of the Great Depression, when to argue that a capitalist economy can never experience a deficiency of aggregate demand for produced goods was ludicrous in the extreme.

Keynes wanted to save Western capitalism from a Bolshevik-style revolution, and to do so, he recognised, one had to first admit its failures and repair the system to overcome them so that a revolution could be forestalled.

The reason we are talking about Say’s Law is because it has made a silent return to economic discourse, a return whose very silence makes it as influential as it is insidious. In fact, the rationale for the entire neo-liberal economic order is based on assuming the validity of Say’s Law.

The intellectual groundwork for neoliberalism, and for jettisoning the dirigiste strategy that had been prevalent until then (in India the dirigiste strategy is often referred to as the Nehru-Mahalanobis strategy), was laid down in the early 1970s. The argument was advanced that four east Asian ‘tigers’ -- South Korea, Taiwan, Hong Kong and Singapore -- had shown remarkably high economic growth rates, much higher than countries like India pursuing dirigiste strategies; and that if other countries too abandoned dirigisme, or what the World Bank called their ‘inward-looking’ development strategy, and pursued ‘export-led growth’ instead, then they too could emerge as successful as these ‘Asian tigers’.

This was an absurd argument. If the level of world aggregate demand is expanding at a certain rate, then the output of all countries taken together cannot possibly expand at a higher rate. If the output of some countries is expanding at a higher rate than world aggregate demand, it is because the output of others is expanding at a lower rate.

If the output growth of the hitherto slow-growers accelerates then that can only be at the expense of those who were hitherto growing rapidly.

Hence, to dangle the hope that all countries could grow as rapidly as the ‘Asian tigers’ if only they pursued an ‘export-led growth’ strategy was absurd. It amounted to ignoring the constraint of aggregate demand, namely, to assuming Say’s Law. Behind the call to abandon the Nehruvian strategy, therefore, was an invoking of the absurd Say’s Law.

This invoking, however, was camouflaged, which is why it succeeded. The camouflage took the form of a ‘small country assumption’. A small country, precisely because it is small, can push out larger exports at the expense of larger countries without causing them damage on a scale that they would notice. For small countries, therefore, the assumption that they can export more if they wish, namely, that they face no noticeable demand constraint, makes some sense, and is often made.

But the neoliberal strategy of ‘export-led growth’ was sold to all countries by pretending that each of them could act as if it was a ‘small country’. This was utterly absurd, a flagrant case of the converse fallacy of aggregation, and a back-door entry for Say’s Law.

Of course, the success of the four Asian ‘countries’ was followed by more spectacular growth successes in China and South-East Asia; true, they were not necessarily examples of neoliberal strategy, nor of ‘export-led growth’ pure and simple. And to the extent that they had export successes, this was to a large extent because Western metropolitan capital chose to locate plants on their soil for producing for the Western metropolitan market.

The counterpart of their success, in other words, was the slower growth of metropolitan capitalist economies, though not of metropolitan capitals, not to mention the fact that other Third World countries were left out in the race. It was a race nonetheless among countries.

By falsely assuming Say’s Law, the ‘export-led growth’ strategy actually pitted countries, especially countries of the Third World, against one another. For example, India could export more garments only at the expense of Bangladesh, and so on. This, in turn, meant that the more a country could squeeze its working population by giving them lower wages, extracting from them longer hours of work, and withholding legitimate payments from them through fraud, the more successful it would be in its export drive. Inequalising growth, or even poverty-generating growth, was thus built into the very logic of ‘export-led growth’.

Inequalising growth, however, ultimately meant a slowing down of the rate of growth of demand in the world economy and hence the onset of a crisis for the export-led growth strategy. Even before the pandemic, the decadal growth rate of GDP (gross domestic product) for the world economy as a whole had been the lowest among all the decades since the Second World War; and this growth rate has slowed down even further after the pandemic.

This strategy, apart from being ethically repugnant, since it apotheosizes cut-throat competition among the oppressed people, has brought the world economy to a cul-de-sac. The only way that an economy of the Third World can get out of this dead end is by activating the State to undertake larger expenditures to enlarge the home market. 

Enlarging the home market requires increasing the rate of agricultural growth (which puts more income in the hands of the peasants and agricultural labourers), raising the level of minimum wages (which puts more income in the hands of the workers), and increasing welfare state measures (which improves the real living standards of the entire working population); and it requires financing such spending through wealth and inheritance taxation.

All this, however, would require imposing capital controls, especially on financial outflows, which in turn would necessitate trade controls. It would require, in short, abandoning the strategy of ‘export-led growth’ and hence overcoming the stranglehold of Say’s Law that has already done so much damage.

The writer is Professor Emeritus, Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. The views are personal.

 

US Court Slams $168m Fine on Spyware Giant NSO

A Legal Researcher | 27 May 2025

A landmark blow to the Global Surveillance Trade; reckoning for Pegasus and implications for India.

On May 6, 2025, a U.S. court in California ordered NSO Group, an Israeli spyware company, to pay $168 million in damages. The judgment was the result of a lawsuit filed by Meta Platforms, the owner of WhatsApp. This was not merely the conclusion of a protracted corporate lawsuit; it marked a landmark moment in the global fight against the clandestine and often abusive world of digital surveillance. The verdict, a resounding victory for Meta Platforms, owner of WhatsApp, has sent shockwaves through an industry that has long thrived in the shadows, peddling powerful tools of espionage to governments worldwide.

At the heart of this legal battle is NSO Group, the developer of Pegasus, a spyware tool of notorious capability. Pegasus has been repeatedly linked to state-sponsored surveillance campaigns targeting journalists, human rights activists, political dissidents, and even heads of state across the globe, transforming smartphones into pocket-sized spies. The U.S. court’s decision to hold NSO Group liable for its actions and impose substantial damages signifies a potential turning point. The sheer size of the penalty, combined with its status as the first U.S. jury verdict against a commercial spyware company, signals a shift in the landscape of accountability. NSO Group’s defence has often leaned on the argument that it sells only to sovereign governments, thereby attempting to deflect responsibility for how its tools are used. However, this verdict pierces that veil, holding the technology provider directly accountable for facilitating illegal acts. This suggests that the creators of such potent surveillance tools may no longer be able to easily evade responsibility for the abuse their products enable.

This article will dissect the Meta vs. NSO Group judgment, explore its implications for the shadowy spyware industry, and critically examine what this U.S. legal precedent means for India. The U.S. ruling, therefore, is not just a foreign legal development but a significant event with potential repercussions for India’s ongoing struggle for digital rights and accountability.

The verdict rings out: Meta’s gruelling six-year battle and NSO’s defeat

The culmination of a nearly six-year legal confrontation saw a U.S. federal jury in the Northern District of California order NSO Group to pay Meta Platforms approximately $167.7 million. This sum comprised $444,719 in compensatory damages, covering Meta’s costs in responding to the attack, and a colossal $167,254,000 in punitive damages, designed to punish NSO Group for its conduct and deter future wrongdoing.

This damages trial followed a crucial summary judgment by U.S. District Judge Phyllis J. Hamilton on December 20, 2024. In that earlier ruling, Judge Hamilton found NSO Group liable for violating the U.S. Computer Fraud and Abuse Act (CFAA), the California Comprehensive Computer Data Access and Fraud Act (CDAFA), and for breaching WhatsApp’s terms of service. The case centred on NSO Group’s 2019 cyberattack, which exploited a vulnerability in WhatsApp’s audio calling feature. This flaw allowed NSO to covertly install its Pegasus spyware on the mobile devices of more than 1,400 WhatsApp users across the globe, including journalists, human rights activists, political dissidents, and diplomats.

Throughout the litigation, NSO Group employed a multi-pronged defence strategy, which was systematically dismantled by the U.S. courts. A cornerstone of NSO’s defence was the claim of foreign sovereign immunity, arguing that because it sells its spyware exclusively to government agencies, it should be shielded from lawsuits as an agent of those foreign states. This argument was consistently rejected by U.S. courts, culminating in the U.S. Supreme Court declining to hear NSO’s appeal on the matter. This series of rejections was pivotal, establishing that NSO Group, despite its governmental clientele, could indeed be sued in U.S. courts, particularly as evidence emerged that NSO utilized U.S.-based servers for its operations. NSO had long contended that U.S. courts lacked jurisdiction over its foreign operations targeting foreign victims, a claim significantly undermined by these rulings.

Furthermore, the NSO Group attempted to distance itself from the actual deployment of Pegasus, asserting that its government clients operate the spyware independently. However, court documents and trial testimony painted a different picture. Evidence, including sworn depositions from NSO employees, revealed the company’s direct involvement in the spyware’s installation and data extraction processes. Some employees even admitted to using WhatsApp to install spyware and continuing these activities even after Meta had filed the lawsuit. This direct operational role contradicted NSO’s narrative of being a passive technology provider.

The company also faced criticism and sanctions for its conduct during the discovery phase of the lawsuit, including its failure to produce the Pegasus source code as ordered by the court. In arguing against damages, NSO contended that Meta had suffered no actual financial loss, suggesting that employee salaries for remediation efforts would have been paid regardless of the attack and that WhatsApp’s servers were not physically damaged. The jury, however, sided with Meta, awarding the full amount of compensatory damages requested.

The crumbling of the “sovereign agent” facade is perhaps one of the most significant outcomes of this litigation. Spyware companies have historically hidden behind the argument that they merely sell tools to governments, thereby deflecting responsibility for any misuse. This verdict, by establishing NSO’s direct actions in deploying spyware and by piercing the sovereign immunity claim, creates a powerful precedent. It suggests that the creators of these potent surveillance tools can be held accountable in jurisdictions like the United States, especially if their actions involve U.S. infrastructure or violate U.S. laws. This development considerably increases the legal exposure for such companies on a global scale.

The composition of the damages award is also telling. The overwhelming proportion of punitive damages ($167.25 million) compared to compensatory damages ($444,719) indicates that the jury found NSO Group acted with “malice, oppression or fraud,” as noted in the court’s findings. Compensatory damages are intended to cover actual losses incurred by the plaintiff. Punitive damages, on the other hand, are designed to punish the defendant for egregious conduct and to deter similar behaviour in the future. The jury’s decision to award such substantial punitive damages sends an unequivocal message that NSO’s conduct was not merely illegal but profoundly reprehensible. This financial blow is aimed squarely at NSO Group and, by extension, the broader spyware industry, signalling that such activities will incur severe financial penalties that go far beyond merely covering the victim’s direct costs. This could make the business model of such companies, some of which, like NSO, are already reported to be under financial strain, far riskier and less tenable.

Pegasus unveiled: The “ghost” in the machine and its modus operandi

Pegasus is not just any spyware; it is a highly sophisticated tool engineered to infiltrate both iOS and Android devices, the dominant mobile operating systems globally. Its notoriety stems significantly from its “zero-click” exploit capabilities. This means Pegasus can be surreptitiously installed on a target’s device without requiring any action from the user – no need to click a malicious link, open an infected attachment, or even answer a call. The spyware can be delivered silently, for instance, through a missed WhatsApp call or a specially crafted message that doesn’t even need to be opened by the recipient.

Once installed, Pegasus effectively hands over complete control of the compromised device to the attacker. It can access a vast trove of personal and sensitive information, including encrypted messages (either by intercepting them before encryption on the sending device or by reading them after decryption on the receiving device), emails, photos, videos, call logs, contact lists, GPS location data, and stored passwords. Furthermore, Pegasus can remotely and covertly activate the device’s microphone and camera, turning the phone into a live surveillance device, all without the owner’s knowledge or consent. During the U.S. trial, NSO Group executives themselves conceded that Pegasus is capable of vacuuming up “every kind of user data on the phone”.

NSO Group has consistently maintained a specific narrative about its business model. The company claims that its flagship product, Pegasus, is sold exclusively to vetted government security and law enforcement agencies. The stated purpose, according to NSO, is to aid these agencies in legitimate activities such as conducting rescue operations and combating serious criminals, including terrorists, money launderers, and drug traffickers.

However, this official line stands in stark contrast to the findings of numerous independent investigations conducted by organizations like the University of Toronto’s Citizen Lab, Amnesty International, and various international media consortia, including the Pegasus Project. These investigations have meticulously documented the widespread use of Pegasus against unintended targets: journalists attempting to hold power accountable, human rights activists defending fundamental freedoms, lawyers representing sensitive clients, political opponents challenging incumbent regimes, and even heads of state. The trial also revealed that NSO Group invests heavily in its offensive capabilities, with executives admitting to spending tens of millions of dollars annually to develop sophisticated malware installation methods. The price tag for such capabilities is correspondingly high; for instance, NSO reportedly charged European government customers up to $7 million for the ability to hack just 15 devices, with additional costs for targeting devices internationally.

The glaring disparity between NSO Group’s stated purpose for Pegasus and the documented reality of its deployment against civil society effectively exposes the fallacy of the “dual-use” argument often employed for such powerful technologies. NSO’s defence consistently hinges on the supposed legitimacy of its clients and the intended use of Pegasus against “serious crime and terrorism.” However, the evidence presented during the trial, coupled with a vast body of independent research, points to a persistent pattern of abuse. This discrepancy suggests one or a combination of possibilities: NSO’s vetting processes for its government clients are woefully inadequate, its contractual controls designed to prevent misuse are ineffective or unenforced, or the company is wilfully blind to, if not complicit in, the misuse of its spyware by these clients. The argument that such tools have both legitimate and illegitimate uses – the “dual-use” defence – often crumbles when the technology in question is as inherently invasive as Pegasus and the oversight mechanisms are minimal or absent.

Moreover, the very existence, development, and marketing of a tool like Pegasus, capable of achieving total and covert compromise of a personal device, indicates a dangerous global trend towards the normalization of extreme surveillance capabilities. The fact that NSO Group could successfully develop and sell such a product to numerous governments worldwide suggests a significant global appetite for these intrusive powers. The technical sophistication of Pegasus, particularly its zero-click infection vectors, means that traditional cybersecurity defences employed by average users are often rendered useless. This creates an environment where the reasonable expectation of digital privacy is severely eroded, potentially casting a chilling effect on free speech, association, and dissent, even for individuals who are not directly targeted but fear they could be.

Turning point for spyware accountability?

The verdict against NSO Group is a landmark precedent in the fight against the unregulated proliferation of commercial spyware. It is the first U.S. jury verdict against a commercial spyware company and, significantly, the first U.S. verdict against NSO Group itself. The financial award also represents the largest reported verdict in a civil case brought under either the Computer Fraud and Abuse Act (CFAA) or the California Comprehensive Computer Data Access and Fraud Act (CDAFA).

The judgment is anticipated to have a significant impact on the broader spyware industry. Meta, in its statement following the verdict, emphasised that the ruling acts as a “critical deterrent to this malicious industry”. The success of Meta’s lawsuit may embolden other victims of spyware, whether individuals or corporations, to seek legal recourse against spyware vendors. Furthermore, the ruling could make it considerably harder for spyware companies to hide behind “plausible deniability” regarding the use of their products. This, coupled with the substantial financial penalty, is likely to lead to increased legal and financial risks for the industry, potentially affecting investment, operational strategies, and the overall viability of businesses built on selling such intrusive technologies.

This legal victory also serves to empower technology platforms in their efforts to protect their users and systems. It validates the legal strategy employed by tech companies like Meta, which utilized anti-hacking statutes such as the CFAA to hold spyware developers accountable for exploiting their platforms. Demonstrating a commitment beyond mere financial compensation, Meta has announced its intention to donate the damages recovered from NSO Group to digital rights organizations that are actively working to combat surveillance abuses and protect vulnerable users. This action is part of a growing trend where major technology companies, including Apple, which has also filed its own lawsuit against NSO Group, are taking a more proactive and aggressive stance in combating the commercial surveillance industry through both legal challenges and technical countermeasures.

The outcome of the Meta vs. NSO case signals a potential shift in the power dynamics that have characterized the surveillance technology landscape. For years, spyware firms like NSO Group operated largely in the shadows, their actions difficult to definitively prove and their legal standing often ambiguous due to claims of sovereign immunity and client confidentiality. Technology platforms, whose services were exploited as vectors for spyware delivery, were often in a reactive posture. This verdict, however, building upon the crucial judicial rejection of NSO’s sovereign immunity claims, empowers these platforms. They can now more confidently leverage their considerable legal and technical resources to proactively protect their ecosystems, thereby making it more costly and legally perilous for spyware vendors to target mainstream communication platforms.

The case also inadvertently highlights the role of the U.S. legal system as a, perhaps reluctant, enforcer of global digital rights. This is also a consequence of the geographical concentration of major technology company headquarters and critical internet infrastructure, including servers, within the United States. When global communication platforms, many of which are U.S.-based, find their terms of service violated or their U.S.-located servers accessed without authorization for the purpose of deploying spyware, it provides a jurisdictional hook for legal action within the American judicial system. While the outcome in the Meta vs. NSO case is viewed positively by digital rights advocates, it does raise broader questions about the sustainability and global desirability of relying predominantly on one nation’s courts to address what inherently international issues of spyware abuse are. This underscores the pressing need for enhanced international cooperation and the development of stronger, harmonized national laws elsewhere to combat this menace effectively.

Finally, the substantial financial penalty imposed on NSO Group, particularly the massive punitive damages award, underscores the potential of economic deterrence as a key weapon against the spyware industry. NSO Group has been reported to be facing significant financial difficulties, including being placed on a U.S. government blacklist that restricts its access to American technology and markets. A judgment of nearly $168 million could indeed be a fatal blow to an already struggling entity. This suggests that economic pressure, exerted through sanctions, large civil penalties, and divestment campaigns, might be one of the most effective tools to curb the proliferation of commercial spyware, especially since ethical appeals or reliance on the discretion of client governments have, to date, proven largely insufficient.

The Indian Connection: Pegasus shadows loom large over democracy

The NSO Group’s activities, as detailed in the U.S. court proceedings and prior investigations, have a significant and alarming Indian connection. Court documents related to the Meta lawsuit revealed that India was the second-most targeted country in the 2019 WhatsApp hacking campaign, with over 100 Indian users identified as victims. The list of those targeted in India reportedly included journalists, human rights activists, lawyers, and politicians, mirroring the global pattern of Pegasus deployment against civil society figures rather than solely against criminals and terrorists as NSO Group claims.

These findings were amplified by the Pegasus Project revelations in 2021. This collaborative investigative effort by international media organizations, based on a leaked list of potential surveillance targets, indicated that around 300 phone numbers in India were of interest to NSO’s clients. The Indian list controversially  included serving ministers, prominent opposition leaders such as Rahul Gandhi, political strategists like Prashant Kishor, numerous journalists including Siddharth Varadarajan of The Wire, activists such as Umar Khalid, a former Election Commissioner, Ashok Lavasa, who had flagged poll code violations by the Prime Minister, and even sitting Supreme Court judges.

Amnesty International’s Security Lab has conducted forensic investigations that further substantiate these concerns. Their findings confirmed repeated targeting of Indian journalists. Siddharth Varadarajan, for instance, was found to have been targeted with Pegasus in 2018 and then again in October 2023. Another journalist, Anand Mangnale, South Asia Editor at The Organised Crime and Corruption Reporting Project (OCCRP), was targeted in August 2023 with a sophisticated zero-click exploit delivered via iMessage while he was reportedly working on a story about alleged stock manipulation by a large Indian conglomerate.

In response to the widespread outcry following the Pegasus Project revelations, the Supreme Court of India intervened in October 2021. Recognising the gravity of the allegations, the Court constituted an independent technical committee, headed by retired Supreme Court Justice R.V. Raveendran, to investigate the claims of Pegasus surveillance.  This committee submitted its report in a sealed cover to the Supreme Court in August 2022. Out of the 29 phones analysed by the Technical Committee, just five showed signs of malware — and even in those cases, there was no clear evidence linking it to Pegasus, as per the three-part report presented to the Court by the Justice R.V. Raveendran committee. Crucially, the CJI NV Ramana (as he was then) also made a significant observation: the Indian government “did not cooperate” with the technical committee’s investigation.

The full contents of the technical committee’s report remain sealed and have not been made public.

The Indian government’s official stance on the Pegasus allegations has been one of consistent denial of any unauthorised interception by its agencies. Statements from the Ministry of Electronics and Information Technology (MeitY), including those made by Union Minister Ashwini Vaishnaw, have dismissed the reports as attempts to “malign Indian democracy and its well-established institutions”. The government has asserted that existing legal frameworks, such as the Indian Telegraph Act and the Information Technology Act, provide sufficient checks and balances against illegal surveillance. However, MeitY, through CERT-In (Indian Computer Emergency Response Team), was reportedly informed by WhatsApp about the Pegasus breach affecting Indian users as early as September 2019, raising questions about the timeliness and transparency of the government’s subsequent public responses.

More often than not, the government has invoked “national security” as a reason to avoid confirming or denying the procurement or use of Pegasus spyware. During Supreme Court hearings, the Solicitor General of India argued that “terrorists cannot claim privacy rights.” This sentiment was, to some extent, echoed by one of the judges who remarked, “What is wrong if the country is using spyware?… Using against whom is the question?”. These statements have fuelled concerns among civil liberties advocates that the national security argument is being used to shield potentially unlawful surveillance activities from scrutiny.

The Indian government’s persistent invocation of “national security” to sidestep transparency regarding Pegasus use, particularly its documented non-cooperation with the Supreme Court-appointed technical committee, presents a stark contrast to the detailed evidence and rigorous judicial scrutiny observed in the U.S. legal proceedings against NSO Group. While national security is undeniably a legitimate concern for any state, its deployment as a blanket justification to prevent any meaningful disclosure about the use of highly invasive spyware against a wide range of citizens—including journalists, opposition figures, and potentially even members of the judiciary—raises profound questions about democratic accountability and the potential for abuse of power. The U.S. verdict, which meticulously details the illegal hacking mechanisms employed by NSO, makes the Indian government’s opaque and defensive stance increasingly difficult to sustain, as the spyware tool itself has now been judicially recognized in a foreign court as problematic and its vendor held liable for its misuse.

The repeated and continued targeting of journalists in India, as confirmed by forensic analysis even after the initial Pegasus revelations and the Supreme Court’s intervention, suggests a brazen and deeply concerning attempt to suppress dissent and investigative journalism. When journalists investigating sensitive matters, such as allegations of financial misconduct by powerful entities, find themselves under state-sponsored surveillance, it sends a potent chilling message to the entire media community. This transcends individual privacy violations; it constitutes an assault on the freedom of the press, a cornerstone of any functioning democracy. The persistence of such targeting implies that the perpetrators feel a disturbing sense of impunity within the domestic Indian context.

The situation also presents a tale of two judiciaries and, by extension, two executive approaches. The proactive stance of the U.S. judiciary in holding NSO Group accountable, significantly aided by a well-resourced corporate plaintiff like Meta, contrasts sharply with the Indian Supreme Court’s current position. The Indian Court appears to be treading a cautious path, attempting to balance national security claims against individual queries about surveillance, a task made more challenging by the executive branch’s non-cooperation. While the U.S. case benefited from Meta’s considerable resources and clear legal standing as an aggrieved party whose platform was abused, in India, the petitioners are often individuals, under-resourced rights groups, or journalists. The Indian Supreme Court’s cautious handling of the sealed technical committee report and the government’s steadfast refusal to cooperate highlight systemic challenges in achieving accountability domestically. The fact that MeitY was reportedly informed of the WhatsApp breach affecting Indian users as far back as September 2019, yet the government’s public narrative and actions did not appear to reflect this urgency or information, further underscores this accountability deficit. The U.S. verdict might provide Indian petitioners with stronger international legal and moral backing, but overcoming domestic institutional hurdles remains a formidable challenge.

VI. Echoes in Delhi: How the US verdict resonates in India’s Pegasus saga

The U.S. District Court’s comprehensive findings against NSO Group and the subsequent multi-million dollar damages award are poised to have significant reverberations in India, where the Pegasus spyware controversy continues to simmer. The U.S. court’s meticulous detailing of NSO’s illegal activities and the intrusive nature of Pegasus spyware provide substantial evidentiary and moral support for petitioners currently before the Indian Supreme Court. Indeed, during hearings in April 2025, Senior Advocate Kapil Sibal, representing one of the petitioners, explicitly cited the U.S. judgment, highlighting the court’s observation that India was among the countries where WhatsApp users were targeted by Pegasus. The detailed revelations from the U.S. trial concerning NSO Group’s operational methods and its direct involvement in deploying the spyware can be leveraged to counter claims that the spyware’s use is solely determined by client governments without NSO’s active participation or knowledge.

This international legal precedent is likely to fuel fresh and more vociferous demands for transparency and accountability from the Indian government. Opposition parties, such as the Congress party which has already called for Supreme Court-monitored probes based on U.S. court revelations , along with civil society organizations; and various digital rights advocates, are expected to intensify their calls for the Indian government to: first, unequivocally state whether it procured and deployed Pegasus spyware; second, consent to a truly independent and transparent investigation into the allegations; and third, make the Supreme Court-appointed technical committee’s full report public, allowing for informed public debate and scrutiny.

The U.S. judgment also presents a formidable challenge to the broad “national security” argument frequently invoked by the Indian government to justify opacity surrounding the use of Pegasus. By laying bare the illicit hacking mechanisms of Pegasus and its deployment against ordinary citizens such as journalists and activists, the U.S. court’s findings weaken the credibility of using an all-encompassing national security pretext to shield such surveillance from any form of oversight in India. If the tool’s mode of operation is deemed illegal by a U.S. court when used against similar profiles of individuals, its alleged use in India under a vague and unsubstantiated national security rationale becomes increasingly questionable and harder to defend both domestically and internationally.

Ultimately, the U.S. verdict indirectly places India’s own democratic institutions—particularly its judiciary and parliamentary oversight mechanisms—under a critical test. If a foreign court, driven by a corporate plaintiff, can achieve a significant degree of accountability against the NSO Group, the question inevitably arises: why are Indian institutions apparently struggling to achieve similar accountability regarding the use of Pegasus within India’s borders? This focuses uncomfortable attention on the independence, efficacy, and resilience of these institutions when confronted with executive power and sweeping claims of national security. The Indian Supreme Court’s next steps in the Pegasus matter, with hearings scheduled for July 30, 2025, will be very closely watched in this context.

Conclusion

The broader struggle against illicit surveillance and the misuse of powerful espionage technologies is far from over. It requires sustained, multifaceted efforts from technology companies committed to protecting their users, from a vigilant and courageous civil society, from international bodies striving to establish global norms, and, most crucially, from national governments willing to uphold the rule of law and safeguard fundamental human rights in the increasingly complex digital age. The path to effectively reining in the global spyware menace is undoubtedly long and arduous, but the Meta-NSO verdict offers a crucial milestone, a tangible victory for a future where digital technologies empower rather than oppress.

The writer is part of the legal research team of Sabrang India.

Courtesy: Sabrang India

Europe: Tanks Don’t Fill Lunchboxes

Peter Mertens | 29 May 2025

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Berlin rearms, Washington directs—but who pays the price? Money for pensions, healthcare, and public services is now funneled into tanks, missiles, and frigates.

“The rearmament of Europe is not meant to replace NATO but to strengthen and diversify it. It will allow the US to focus on the Pacific and East Asia while Europe concentrates on defending NATO’s eastern flank,” says Belgian defense minister, Theo Francken, who is also vice-chair of NATO’s Parliamentary Assembly. Francken’s words reflect what is currently being thought in NATO circles.

According to Washington, the US is currently “overstretched” in the Indo-Pacific, a region encompassing the western Pacific and Indian Ocean. Here, the US is working to militarily encircle China. It already has bases in Japan, South Korea, and the Philippines, patrols the South China Sea, has partnerships like AUKUS (with Australia) and QUAD (with India), and an unwavering focus on Taiwan. But these military initiatives demand colossal resources: money, personnel, and logistics.

As China continues to grow, Washington gets entangled in multiple crises: Ukraine, the Middle East, and the Indo-Pacific. At the same time, domestic tensions in the US are rising. The military-industrial complex struggles to keep pace: ammunition stockpiles dwindle, shipbuilding lags, and maintaining readiness across all fronts becomes increasingly difficult. The once-unassailable American empire now grapples with the limits of its reach.

Thus, Washington declares: Countering Russia’s militarization is Europe’s job; we’ll focus on China. Europe may occasionally send a frigate to Southeast Asia, but that’s not its core task.

The consequence? Europe must dismantle its social security systems, privatize public services, and slash pensions to meet NATO’s insane new demands. All so the US can focus on its main adversary: China.

The failure of Europe’s strategy

As I argued in my book Mutiny (2023), the war in Ukraine has always had a “Janus face” – a duality. On one side, there’s Russia’s violation of Ukraine’s territorial integrity, a breach of international law. On the other, it’s a proxy war between the US and Russia, fought on the backs of Ukrainians, where tens of thousands of young people are sacrificed as cannon fodder for a geopolitical conflict.

Washington now openly admits this: It was a proxy war fueled and directed by the US But Trump now claims it was the wrong proxy war. He argues Russia isn’t the true adversary; instead, all efforts should prepare for the coming war against China.

With a predatory “peace deal,” Trump wants Europe to bear the costs of the war while the US secures control over Ukraine’s mineral and resource extraction. Trump aims to treat Ukraine like a colony, much as the US has treated many Global South nations. This reveals the war’s true nature: it’s not about values, but about geostrategic interests, as well as control of resources and fertile land.

Europe’s failure to pursue serious diplomatic initiatives for a ceasefire over the past three years is now backfiring. According to European Commission President Ursula von der Leyen, Putin must “lose this war.” Former Estonian Prime Minister (now EU Foreign Minister) Kaja Kallas declared peace “not a goal,” insisting the “solution must be military.” From the start, the EU refused to consider any resolution beyond escalating war. In Europe’s narrative, the words “peace” and “negotiations” became taboo.

At no point did European leaders demonstrate statesmanship through diplomacy or mediation. Instead, initiatives like Turkey’s were undermined by London and Paris. “We had three years to pursue peace, and not a single European leader took action!” says international relations professor Tom Sauer and try to prove him wrong. “Our strategy was to send weapons, money, and say, ‘Figure it out.’ We prolonged this war, to Ukraine’s detriment as Russia has been winning for the past two years.”[1]

Today, this strategy has visibly failed. Now, Trump unilaterally negotiates directly with Russia. Yet instead of learning from this disaster, parts of Europe’s establishment cling to the failed strategy, determined to prolong the war at any cost.

Contradictions abound. The same people who yesterday claimed victory over Moscow was imminent now warn that Moscow could “reach Brussels’ Grand Place tomorrow” unless Europe rapidly rearms. Both claims cannot be true. It’s clear their goal is to sell massive rearmament plans.

When German militarism gazes East

When German militarism gazes eastward, Europe picks up the pieces. This summarizes the two World Wars of the 20th century. In WWI (1914–1918), German youth were mobilized against “Russian despotism.” In WWII (1939–1945), sons of German workers were sent to the front to suppress the “Bolshevik threat.” The slogans changed, but the goal of eastward expansion remained.

Many who grew up in the 20th century learned that the combination of Germany, chauvinism, and militarism is a bad idea. The Ruhr Valley’s arms manufacturers fueled two of history’s most devastating wars. Post-WWII, Europe agreed: never again German militarism.

Suddenly, the world feels like a bad B-movie. Here it is again: Germany must rapidly reassert itself. Germany must embrace its “historic role.” Germany must militarize. We must “do whatever it takes” to counter the “Russian threat.” These words echo again in the Bundestag. It’s a déjà vu.

On March 18, 2025, the German parliament approved constitutional amendments enabling the largest rearmament program since WWII. It’s not that Germany doesn’t have an army today. To the contrary, Germany already ranks fourth globally in defense spending, up from the seventh place. Now, it’s turbocharging its “war readiness” to get kriegstüchtig.

German rearmament is now debt-financed – a radical shift. Until recently, Berlin blocked any proposal increasing debt. It still does for for social or green initiatives. Not so for public spending on the military.

Meanwhile and on top of German additional spending, the European Commission launched a massive militarization package, partly funded by debt and loans, partly by pillaging cohesion, climate, and development funds.

Originally named “ReArm,” the European Commission’s rearmament plan is now rebranded “Readiness 2030.” We must be ready in five years! To achieve this, Europe will spend €800 billion. All so the US can complete its military encirclement of China. Is the EU’s rearmament plan anything but a bow to Trump?

The military arm of an imperial Europe

While Europe’s official rhetoric speaks of peace and security, its policies tell another story. European Commission’s President Ursula Von der Leyen leaves no doubt: The EU must not only develop the means to defend its global interests but also to be ready to deploy them. In other words, Europe wants to be a geopolitical player in the power struggle with China and the US.

Yet no EU state is really willing to surrender its national army. Instead, a new layer is added: joint “battle groups” and military structures. Democratic oversight is lacking. National militaries have some accountability, but EU-level control is vague. The European Parliament lacks equivalent power or transparency, risking troop deployments without public awareness.

In February 2024, the EU decided to send warships to the Middle East – not to pressure Israel to stop its bombing and illegal annexation, as urged by the International Court of Justice,. No frigate has left its harbor for that. They did, however, to protect “free passage” in the Red Sea and Gulf of Aden, crucial trade routes. With other words, military ships protect European interests, not people.

Germany continues arming Israel; France arms Cameroon and Indonesia. European companies sell weapons to India, Pakistan, and Nigeria despite wars and oppression. In the Sahel, EU military missions over two decades have brought instability, not stability. The EU cares not for human rights but resources, trade routes, and spheres of influence.

The claim that Europe must rearm against Russia is full of holes. Europe already has four times as many warships, three times as many tanks and artillery, and twice as many fighter jets as Russia. Russia doesn’t want war with NATO – and even if it did, rebuilding its army after the war in Ukraine would take years. Brussels knows this full well.

EU rearmament isn’t just about freeing the US to focus on the Indo-Pacific; it’s about building a European military layer for interventions beyond defense. Some dream of a strong military arm for a new imperial Europe.

Where is Europe heading?

Sky-rocketing energy prices, technologically lagging behind China and the US, and a lack of industrial vision have plunged Germany – Europe’s economic engine – into recession. The US imposes 25% tariffs on European steel, aluminum, and cars, with Trump threatening more. This could cripple Germany’s car industry.

While Germany’s elite long remained loyal to Washington, Frankfurt’s financial circles increasingly advocate European sovereignty – independent from the US

This push for autonomy echoes in the EU’s new Defense White Paper. Europe must stand on its own. Today, 78% of defense purchases come from outside the EU, mostly the US The White Paper aims to reverse this: By 2035, 60% of equipment must be European-made.

This goal seems unrealistic. Europe’s arms industry is fragmented, with German, French, Italian, and British firms competing for billions. While Germany funnels money to Rheinmetall, Franco-Italian and Anglo-French alliances jostle for advantage.

There’s no unified command. The Kiel Institute for the World Economy (KfW) calls for 300,000 more European soldiers – but they’d serve 29 national armies. Recruitment and training remain hurdles.

True independence from the US is distant. Pro-US Trans-Atlanticists have long dominated the EU. Post-Brexit, the Baltics and Poland – built on anti-communism, Russophobia, and neoliberalism – have taken up London’s role. The appointment of Lithuania’s ex-PM Andrius Kubilius as an EU key figure makes this clear: “Expect no competition between me and NATO.”

The Baltics demand Europe abandon “strategic autonomy” and accept subordination to NATO. But why should all EU states align their foreign policies with Baltic and Polish priorities when facing other challenges? Le Monde Diplomatique asks: “The Iberian Peninsula fears climate change more than Russian invasion; France relies on nuclear deterrence; Germany benefits from East-West balance; Greece worries about Istanbul, not Moscow; Italy eyes the Mediterranean; Denmark is preoccupied with Trump.”[2]

Yet in March 2025, EU leaders reaffirmed loyalty to NATO. Ahead of June’s critical NATO summit in The Hague, Europe’s leaders meekly comply with Trump and NATO Secretary-General Mark Rutte. “Strategic autonomy” remains distant – and if achieved, it would only serve European imperialism.

Under capitalism, “security” is trapped in a web of resource control, trade routes, geostrategy, and global redivision. We need a new definition: security as access to water, food, healthcare, protection from pandemics and climate chaos. Achieving this requires a different Europe – one of peace, solidarity, democracy, and socialism.

Social security is the new cannon fodder

“The UN’s 0.7% aid target is ignored. Climate goals are missed. These are greater threats than Russia. You can talk to Russia, but not to the climate,” argues Professor Tom Sauer.[3]

He has a point. Social and ecological targets are trampled for decades, but military spending is treated as sacred. When Trump and Rutte demand 2% of GDP for NATO, no one questions it – except Sauer: “Why 2%? That’s a political fetish, not law.”[4]

Belgium doubled military spending from €3.9 billion (2017) to €7.4 billion (2024). To hit the 2% fetish, the 2025 Easter Agreement raises it to €12.8 billion annually – €5 billion more yearly, stolen from pensions and social security.

Before even achieving this, whispers of a new NATO demand emerge: 5% of GDP for defense, 3.5% for “hard defense.” For Belgium, that’s €22.3 billion yearly – €15 billion more than 2024. Lunacy. That’s our pensions. Our public services. Our healthcare.

When Defense Minister Theo Francken praised the US model this year, some thought it a bad joke. “We laughed at US poverty, addiction, lack of safety nets, $1,000 dentist bills,” Francken told De Tijd. “We didn’t want to live there because they spent on ‘hard security.’ It’s nicer to fund pensions, unemployment, a ‘Cuban model’ where €13 buys a large bag of medications at the pharmacy. But who was right?”[5]

Who’s right, the NATO Parliamentary Assembly’s vice-chairperson asks. Those pouring billions into a warmongering military-industrial complex while millions lack basic protections? Those wasting money on imperialist wars while six million Americans battle opioid addiction? Those charging $1,000 for dental care? Francken’s message is clear: The shift to a war economy will kill social security.

French journalist Rémi Godeau agrees: “Let’s be clear, the war economy means longer work hours and rationing the welfare state’s ‘excess.’”[6] Social security, housing, elderly care – all “excess.” Francken calls social security “too fat”, but he won’t spare a word for arms industry dividends, corruption, and billionaire hoarding.

What von der Leyen calls the “era of rearmament” means an era of social dismantling for Europe’s working class. More money for tanks means less for pensions; more for drones, less for childcare.

“The German government ordered, among others, 105 Leopard II tanks from Rheinmetall. One tank costs €27.8 million. A new primary school in my district costs €25 million. What’s good for Rheinmetall is bad for our children,” says Gesine Lötzsch of Die Linke. She’s right. These are political choices with consequences that will haunt us for decades. There’s no reason to accept them – it’s never too late to say no.

Breaking the Deadly Arms Race

In the narrative of Trump, Rutte, and Francken, we supposedly have too few weapons. That is grotesque. Military spending on Earth has been moving in only one direction for the past ten years: upward! Last year, 2.718 trillion dollars were spent globally on armaments, an increase of nearly ten percent compared to the previous year, according to calculations by the Stockholm International Peace Research Institute (SIPRI). That is the strongest increase since 1988. Military spending by European countries will rise to 693 billion dollars in 2024. This is an increase of 17 percent compared to 2023 and 83 percent compared to 2015. How can there be too few weapons?”

The world is slowly suffocating under a hallucinatory arms race. It always follows the same logic: if one country upgrades, others will follow. Anyone who pursues the logic of deterrence to its inevitable conclusion will end up advocating for the nuclear armament of Germany and Europe.

At worst, this spiral will culminate in a major war with many losers and few winners. History teaches us that this dangerous vortex can only be broken through mutual disarmament treaties. This requires sober diplomacy, but also a robust international anti-war movement applying pressure from below.

Arms production won’t save the economy

“What many forget when hearing these astronomical defense figures is that this tax money largely flows back into our economy.” So claims our Defense Minister, Theo Francken. The title of his X post leaves no room for doubt: “Defense is business!”

The advantage of Minister Francken is his ability to articulate NATO and arms industry talking points so clearly. The theory that increased militarization will boost the economy is an evergreen of the military-industrial complex. They proudly call it ‘military Keynesianism’: have governments massively subsidize the arms industry. Now that Europe’s auto sector is floundering and Germany faces its third consecutive year of recession, they want us to believe switching from cars to tanks is the solution.

This is nonsense, of course, because families don’t buy tanks. You don’t drive a tank to grandma’s house. Yet these tanks must be sold. To sustain this industry, they must be used – otherwise, the sector collapses. In other words, militarizing the economy creates permanent pressure for war. A war not meant to be won, but to be endless, because peace threatens profit margins.

The only way to sustain this, is through perpetual war. This is Washington’s model: 850 global military bases, endless interventions, and coups. The Korean War (1950), the Bay of Pigs invasion (1961), Vietnam, Grenada and Panama (1980s), the Gulf War (1991), Afghanistan and Iraq (21st century), the proxy war against Russia in Ukraine – the list goes on. Permanent war is the lifeblood of military Keynesianism.

Moreover, the new arms race is to be funded partly by debt. “Just like in the US,” say the warmongers. They omit that US debt is historically high, and inequality has never been worse. This is the cost of near-permanent war.

Tanks don’t fill lunchboxes. Higher military spending won’t raise living standards. Arms production offers no economic benefits. Building tanks, bombs, or missile systems contributes nothing to the broader economy. The myth of job creation is equally false: €1 invested in hospitals creates 2.5 times more jobs than €1 in weapons. In terms of employment efficiency, defense ranks 70th out of 100 sectors.

Even arms industry jobs aren’t secure – they depend on perpetual war. Francken’s claims are false. The billions funneled to arms manufacturers don’t ‘flow back’ to society. They flow to one group: the arms makers themselves. Profits for Rheinmetall, Dassault, BAE Systems, Leonardo, Thales, and Saab have reached astronomical levels.

“Returns have soared up to over 1,000% in three years. The sector averages 400–500%. It’s enormous, unprecedented,” says KBC Bank’s chief economist. Yes, Francken is right about one thing: defense is big business.

Peace builds care, war builds ruin

To further fuel the overheated push toward militarization, Belgian Prime Minister Bart De Wever eagerly revives a late Roman slogan – once meant to halt the decline of the Western Roman Empire through stricter military discipline and higher defense spending: “Si vis pacem, para bellum” (“If you want peace, prepare for war”). This was never a slogan of peace. It has always been a rallying cry for militarization and war. But militarization does not strengthen society. Mere decades after Rome embraced it, the empire collapsed irreversibly.

History teaches us: Wars and arms races are not stopped from above. Those in power halt militarization and war only when pressured from below. It is the people who pay the price – with their livelihoods, their futures, their children – who can make the difference. If the labor and peace movements join hands and unite, much becomes possible.

The left must not conform to the new military consensus. Instead, it must boldly challenge the West’s hypocrisy, its warlike conflicts of interest, and the destructive arms race.

“Wenn wir zum Krieg rüsten, werden wir Krieg haben” (“If we prepare for war, we will have war”), wrote German poet Bertolt Brecht in the lead-up to World War II. The bitter reality of the 20th century proves his point. The lesson is simple: Those who want peace must prepare for peace, not war.

When it comes to war, billions suddenly seem to materialize effortlessly. When it comes to people, they don’t. This is a world turned upside down. We don’t need NATO – we need peace. The arms race does not lead to security, but to greater inequality, more violence, and endless war.

Peace will not be achieved by surrendering to the dogma of militarization and today’s military fetishes. It requires building new power structures. Peace is not inevitable – it is the result of struggle. A struggle that embeds demands for social progress into a different logic, one daring to think beyond the constraints of capitalism. This system, where powerful monopolies impose profit-driven domination through conquest, war, and an economy of destruction, offers no future for humanity or the planet. “It’s barbarism or socialism,” declared Rosa Luxemburg. We choose the side of labor, peace, and socialism.

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[1] Humo, March 25, 2025

[2] Pierre Rimbert, Faire la guerre pour faire l’Europe. Le Monde Diplomatique, Dossier avril 2025, Le piège du grand réarmement.

[3] Humo, March 25, 2025

[4] Tom Sauer in Humo, March 25, 2025

[5] Defense Minister Theo Francken (N-VA): ‘Belgische boots on the ground in Oekraïne? Dat is de logica zelve’. De Tijd, Februari 15 , 2025.

[6] Rémi Godeau, L’Opinion, February 27, 2025

Courtesy: Peoples Dispatch

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