The stunning victory of Hezbollah over the combined might of Israel and the US has inspired tens of millions across the Arab world. At last someone has stood up and fought back.

But while a few thousand determined guerrilla fighters could give Israel a bloody nose, there is no way that they on their own can end imperialist domination of the Middle East.

That will require the mobilisation of a much more powerful social force - the 100 million-strong Arab working class. The working class alone has the capacity to challenge the Arab ruling classes that are in league with the imperialist forces and ensure that the fabulous wealth of the region is used for the benefit of the mass of people.

This is not to downplay the significance of Hezbollah 's military victory - serious commentators, on the right and the left, see it as a turning point. It has the potential to inspire revolt in country after country.

So what is the state of the workers' movement, and what is it up against?

The situation varies enormously, from Iraq - formerly the most advanced Arab economy, now devastated by US imperialism - to the boom economies of the oil-rich Emirates, to the grinding poverty of Egypt and Syria. But one thing virtually all of them have in common is decades of neoliberalism - so-called economic reform -that has created societies more polarised than ever between rich and poor.

Economic "reform" has meant tax cuts for the rich, cuts to subsidies on basic necessities, privatisation and government "development" projects that siphon money to rich shareholders. Governments and big business have worked hand in hand to ensure that workers bear the brunt of economic restructuring.

This of course is the pattern, not just in the Middle East, but all around the world - which opens up possibilities of international working class solidarity.

To understand the nature of the class struggle in the Arab world, we have to dismiss any idea that the region is a rural backwater. Fifty-six per cent of the entire population lives in cities - 86 per cent in Saudi Arabia, 88 per cent in Lebanon, 73 per cent in Jordan.

Cairo has over 15 million people, Alexandria about 5 million, Damascus 5 million, Casablanca 3 million, Amman 2 million; and within these cities there are rapidly growing working classes. This growing working class has enormous power.

This is most obviously the case for the oil workers who have the capacity to paralyse one of the world's most vital industries. But they are not the only ones with the power to shut down the economy. So too have electricity workers, truck drivers, bank workers, dock workers, airline workers, communications workers.

Moreover being concentrated in the cities - the centres of political power - workers have the capacity to mobilise behind them the mass of the oppressed and dispossessed - in particular, the vast numbers of urban poor who eke out a precarious existence in economies where unemployment routinely exceeds 30 per cent.

Workers face enormous challenges in their attempts to organise. Most of the regimes are brutal dictatorships where torture, death squads and shooting down of protesters are a given. Independent unions or socialist parties are rarely allowed. Strikes are illegal.

Even in supposedly democratic Lebanon, the government can dissolve unions at will. In 1996 the then Prime Minister Rafiq Hariri declared a state of emergency after an explosion of worker unrest. The following year the government rigged the elections in the General Union of Lebanese Workers and arrested popular union leader Elias Abu Rizk when he refused to accept the rigged results.

In the Gulf States and Saudi Arabia, where 13 million of the 35 million people are foreign-born workers who have absolutely no rights, a common tactic is to deport anyone who stands up for their rights. But this has not stopped resistance.

In Bahrain, there has been strike after strike over unemployment and pay. Economic protests intersect with political protests in support of the Palestinians and against the war on Lebanon.

In Dubai, where there is an incredible construction boom, there has been a surge of strikes and riots by building workers over non-payment of wages. In May this year 8,000 workers halted work on the world's tallest skyscraper.

The government deported hundreds of them. But this did not intimidate the migrant workers. It made them more inventive. In June Chinese workers struck over non-payment of wages. When management threatened to deport them, they took the manager hostage!

The rapid and uneven development of the region in the context of brutal repression creates the potential for explosive struggles. Saudi Arabia is a classic case.

In 1970 just a quarter of the Saudi population lived in cities. Today it is 86 per cent. It is one of the richest states in the world, whose economy is fully integrated into international capitalism - but it is run by a brutal feudal-style monarchy.

There is an incredible contrast between the air-conditioned tower blocks and marbled palaces of central Jeddah and the nearby sweltering slums where destitution and disease are rife. Enormous wealth is squandered on luxury spending. Forty per cent of oil revenue goes straight into the pockets of the royal family.

Per capita income fell from $US18,000 in the early 1980s to $US6,000 in 2000. Unemployment has risen to 25-30 per cent. This growing social polarisation fuels discontent, with the growth of both Islamist and secular opposition.

Algeria has seen the most sustained opposition. In the 1980s Islamists were the main beneficiaries of discontent. In December 1991 a military coup prevented the Islamists winning free elections. This led to an insurgency which met with brutal repression, with 120,000 killed.

Since then the Islamists have been sidelined as popular revolt has spread against the military-backed regime. Neoliberal economic measures led to per capita income being halved during the 1990s. Unemployment has spiralled to 50 per cent.

In February 2003 there was a two-day general strike against privatisation and for higher wages. It was a complete success, shutting down 90 per cent of economic activity - from the symbols of global capital like Coca Cola and Pepsi to government services and the steel industry.

Economic unrest has intersected with a revolt by the oppressed Berber people (30 per cent of the population). In 2001 a rebellion led to two months of street battles.

A police shooting of a student ignited the deep hatred of the regime and the revolt soon spread from the Berber area. On 14 June 2001, one million marched in Algiers. Riot police attacked the march killing four and wounding 400. This sparked riots throughout the Berber areas.

In the lead-up to the May 2002 elections there was a five-day general strike in the Berber area in support of a successful boycott campaign.

There is an incredible willingness to fight, but no resolute leadership. The Islamists have little support in urban areas or among Berbers. The moderate Berber parties, like the Socialist Forces Front, have also been discredited because of their unwillingness to challenge the government. The crying need then, is to build a revolutionary socialist party that can galvanise the working class opposition into a challenge for power.

Egypt is a key country with its 80 million people, huge industrial cities and long history of workers' struggle. Its first strike was recorded in 1882.

Since 1974 Egypt has been a laboratory for neoliberal strategies. This has meant privatisation, rising prices, bread shortages, hundreds of factory closures and peasants driven off their land.

By the 1990s there were 60,000 political prisoners. Torture is routine. Death squads operate openly.

In 1991 Egypt signed a structural adjustment program drawn up by the IMF which abolished subsidies on basic foods. Mass rioting erupted that forced the government of Hosni Mubarak to retreat.

Since then the government - worried about things getting totally out of hand - has oscillated between pushing ahead with more austerity measures and limited democratic concessions. 2005 saw a reported 712 strikes and demonstrations involving one million workers.

There have been militant strikes by women textile workers. Workers at a factory that used asbestos occupied it for six months.

Workers rebelled against the government-controlled "unions", forming factory committees to organise strikes. They have begun to link up these workplace committees in a Co-ordinating Committee of workers from industrial centres all over Egypt. Socialist, communist and nationalist groups have been active in the committees.

Recently, the Egyptian Movement for Change, KIFAYA ("Enough"), was formed, bringing together liberals, nationalists, socialists, Islamists and many young activists new to politics. It made a real splash, organising a series of protests for democratic rights. It has opened up the possibility of a radical new left emerging.

In country after country there is no lack of a willingness to fight. I have hardly mentioned Lebanon where there have been numerous mass strikes over the last five years, including a huge general strike earlier this year.

What is vital to take things forward is the establishment of a revolutionary left that offers a sharp alternative to the Islamists and the failed politics of Arab nationalism and Stalinism; a revolutionary left that looks to the power of workers and that breaks with the class collaborationist approach of the old Stalinist Communist Parties who argued for workers to unite with so-called "progressive" Arab capitalists and nationalist politicians.

What's needed is a party that fights for genuine workers' democracy; a party that leads an uncompromising struggle against US imperialist domination, for Palestinian liberation and against the obscenely rich local rulers. That is, a socialist party that fights for a society where workers rule and the enormous wealth of the region is used for the benefit of all.