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The Socialist Workers Party (USA) was formed on January 1, 1938. Most of the members were from the Workers Party of the United States which had entered the Socialist Party of America in 1936. The Socialist Workers Party (SWP) also took with them some of the Socialist Party's left wing, and most of the Socialist youth organization, the Young Peoples Socialist League.

Leon Trotsky published The Death Agony of Capitalism and the Tasks of the Fourth International in mid-1938, which is also known as the Transitional Program. In it, Trotsky predicted a revolutionary upsurge would occur at the end of World War II, which Trotsyists would have to prepare for. Using that document as a basis, the Fourth International (FI) was formed in Paris during September of 1938. The Fourth International was a grouping of Trotskyist parties worldwide, just as the Third International was a grouping of orthodox communist parties, and the Second International was a grouping of socialist parties. The American Socialist Workers Party formed one of the largest national parties in the Fourth International.

Within the SWP, a factional fight of issues, including the nature of the Soviet Union, flared up in 1939 and 1940. Events such as the Molotov-Ribbentrop Pact of August 1939, followed by the Soviet invasion of Poland in September, and the Winter War between the USSR and Finland which began in November, helped exacerbate this feud. One of the main questions was whether the USSR was worth defending. Those who thought it was not worth defending were a minority, but a significant minority. In April of 1940, some of them left and formed the Workers Party.

The Smith Act was passed by the US Congress in June 1940. During World War II, leaders of the SWP were imprisoned under the act. Two months after the act passed, Leon Trotsky was assassinated in Mexico by a Spanish communist.

The SWP followed the Proletarian Military Policy during World War II. The policy was to be against the war, but to not fight conscription. Instead, SWP members would be conscripted and would try to turn the war into a revolutionary one. Many SWP'ers went on the dangerous Murmansk run in which merchant marine ships brought supplies to the USSR.

Post-war

The SWP position during and after World War II was based on the idea that there would soon be a revolutionary upsurge. A minority faction within the SWP, which included Felix Morrow and Albert Goldman began arguing prior to their imprisonment that there might not be a revolutionary situation at the end of World War II, and that the SWP should be preparing for the continuance of the CPSU party line in the USSR, as well as the return of bourgeois republics in Europe. History shows that this faction was more correct in their outlook than the SWP majority faction. The minority faction has support in the Fourth International as well. At the end of World War II this factional fight flared up and the minority faction began having more contact with the Workers Party, which had split off from the SWP several years prior. Many of the people in this minority faction left the SWP in 1946 and joined the Workers Party.

On the other hand, a faction within the Workers Party, the Johnson-Forest Tendency, left the Workers Party and re-entered the SWP in 1947. The tendency had developed a theory that the USSR was state capitalist. They also had been very impressed with wildcat strikes during World War II (despite the AFL and CIO leaderships no-strike pledges). They did a lot of theoretical work, reading Hegel and works of Marx and Lenin that were little known in the US at the time. Their theories tilted more towards mass action and workers power than bureaucracy and authoritarian vanguard leadership. They left the SWP in 1951. Some of them went on to form the Marxist-Humanist News and Letters Committees.

The Fourth International split in 1953. One faction, led by the FI's secretariat Michel Pablo, urged that the FI parties enter the larger worker parties on the FI's right on a long term basis. The faction which included the majority of the SWP opposed this idea. The SWP left the FI and formed the International Committee of the Fourth International (ICFI) with France's Parti Communiste Internationaliste, the former UK Revolutionary Communist Party which had enter the Labour Party in a faction called "The Club", as well as smaller parties from around the world. The group that did not leave the FI with the ICFI continued to call themselves the Fourth International, while the ICFI referred to them as the International Secretariat of the Fourth International (ISFI).

The split in the International also was connected to a split in the SWP. A faction within the SWP whose thinking reflected more the Sectariat's line than the ICFI's, stated that the SWP's very negative attitude about the USSR and Eastern Europe, among other things, made it too sectarian. This perceived sectarianism included SWP lack of opposition to anti-communist union leaders in unions such as the United Auto Workers for fear of being allied with the CPUSA. In 1953 the SWP celebrated the 25th year of the Trotskyist faction expulsion from the CPUSA, the "anti-sectarian" faction refused to participate. This led to the expulsion of the faction in November of 1953. The faction went on to form the Socialist Union in 1954.

Another SWP faction had started to have ideas different than the dominant SWP ones. Particularly, they believed they should ally with workers states in what they saw as a global class war between workers and capitalists. This global class war faction started coming about in 1948 when they saw the Henry Wallace campaign for president as being something to support. This was followed by different perspectives between the factional and SWP majority position on the victory of Chinese communists in 1949, the Korean War, the 1956 uprising in Hungary and other issues. The faction left the SWP in 1958. In 1959, the split faction, which was mostly concentrated in the Buffalo SWP branch (but also took people from some other SWP branches like Youngstown, Ohio), formed the Workers World Party.

The Cuban revolution and COINTELPRO

On January 1, 1959 the Movimiento 26 de Julio took control of Cuba, an event that would have major impact on the SWP henceforth. The SWP had begin recruiting more youth in the late 1950's and early 1960's than they had previously. The leadership of a SWP youth group which had been formed in 1959, the Young Socialist Alliance, began to form the Revolutionary Tendency (RT) which had a more critical view of the Cuban government than the SWP leadership. The RT did not see the Cuban government as being a proletarian workers one. The SWP majority, on the other hand, saw the revolution in Cuba as a vindication of sorts for the ISFI position that a good revolution was possible without a vanguard Marxist-Leninist party leading it. They began considering reaching out to the ISFI.

The ICFI, which the SWP was a part of, reunited with the ISFI in 1963, creating the United Secretariat of the Fourth International. There had been opposition to this reunification within the ICFI, especially from the British section, known as "The Club" (a Trotskyist faction of the Labour Party which would later become the Socialist Labour League). Also opposing this merger was the SWP's Revolutionary Tendency. The Revolutionary Tendency was split into two factions - one that opposed the ICFI/ISFI reunification in conjunction with the British Socialist Labour League, an RT faction which would in the future become the American Committee of the Fourth International (ACFI) , and an RT faction that did not oppose the reunification as part of an international tendency, this faction in the future becoming the Spartacist League. At the 1963 SWP convention the RT was denounced, and after the convention a plenum was called and several RT leaders from the "Spartacist" faction were expelled. In 1964 the leaders of the "ACFI" RT faction were expelled.

Another tendency which had begun to form in 1957, mostly in the Seattle branch of the SWP, had differences with the SWP majority primarily over policies regarding African-Americans and the civil rights movement. The Seattle branch, which had more black members than many branches and which was more involved in the black struggle in the South, wanted the SWP to support integration instead of black nationalism. By the mid-1960's, this branch also had problems with the SWP majority on anti-war tactics, with the tendency feeling the SWP was more interested in building a single-issue anti-war mass movement than making efforts to "connect the war to the other evils of the system" within the anti-war movement. Unhappy with the SWP's 1965 convention, one of their members being kicked off the SWP's National Committee, and the SWP leadership's actions towards the branch, the tendency left the SWP in 1965. They would go on to form the Freedom Socialist Party.

In the early 1970's, some of the SWP old-timers began to become concerned with the class composition of the party, with so many college students joining. A group of them founded the Proletarian Orientation Tendency (POT). Ironically, the tendency was strongest in areas where the SWP was successful in recruiting student activists - Berkeley, Boston, Madison. This tendency was told to disband in 1971 and some of the members left the SWP. Some of those who left formed the Class Struggle League. The Class Struggle League was eventually joined by some Spartacist League entryists, who helped to break up the League. The SWP's Leninist Tendency, a group with an outlook similar to that of the POT, also left the party in 1971. The SWP would go on to adopt many of the positions of these expelled tendencies several years later.

In 1972, Jack Barnes replaced Farrell Dobbs as SWP national secretary. This succession reflected something happening in the rest of the party - Dobbs had come into the SWP from the labor movement, Barnes, like most of the newer SWP members, had joined the SWP as a student.

In 1973, a small tendency that had become close to the Spartacist League called the Revolutionary Internationalist Tendency was expelled. In 1974 a tendency with much of the same "workerist" outlook as the POT and Leninist Tendency, the Internationalist Tendency, came under fire. The Internationalist Tendency (IT) was aligning itself with the majority position of the USFI against positions which the SWP leadership did not share. The Internationalist Tendency was purged from the SWP in 1974.

In the late 1970's, the SWP leadership felt there was going to be an upsurge of labor militancy, and pushed their white collar members to quit their jobs and get blue collar industrial jobs.

Abandoning Trotskyism

In the early 1980's, Jack Barnes began orientating more towards the Cuban Communist Party perspective and away from Trotskyism. In a 1982 speech, Their Trotsky and Ours, Barnes formally rejected Trotskyism. Two groups opposed this new move. One was the Fourth Internationalist Tendency. The other was a group that would later form Socialist Action. Both groups were expelled from the SWP in a process lasting from 1983 to 1984. The Fourth Internationalist Tendency (FIT) remained oriented towards the SWP for a while, hoping the SWP leadership would realize it made a mistake in expelling them. The FIT published Bulletin in Defense of Marxism. Socialist Action went its own way. Socialist Action published the eponymous newspaper Socialist Action. Eventually FIT gave up on the SWP, and FIT dissolved - most of the members joined Solidarity.

In 1990, the SWP left the USFI. The SWP became affiliated with Communist Leagues in other countries, in an international in which the SWP is the largest and dominant party.

In 2000, the SWP (specifically its printing operation, Printing & Publishing Corp and Pathfinder Press) hired the law offices of Herrick, Feinstein LLP and threatened to sue the Marxists Internet Archive (MIA) for publishing various works of Trotsky on the MIA web site which Pathfinder Press claimed to hold the copyright to. The MIA said they did not believe that Pathfinder Press actually had the copyright to these works, but would pull the works from their website anyhow while MIA would have further consultations with its lawyers. This legal letter brought condemnation of the SWP from Trotskyists around the world.

The SWP recently sold its West Street building in New York City for 20 million dollars in 2003, and is now renting offices in midtown Manhattan. They are still publishing The Militant, running candidates for office and trying to organize garment workers in the garment district, and can sometimes be seen at anti-war rallies.