Capitalism

29
Jan

By Alain Badiou
24 January 2023
via Verso Blog

This article was originally published by L’Obs on 2 September 2022.

The current conjuncture demands rigorous analysis if we are to understand the political moment and develop a strategy to respond to it. Alain Badiou undertakes this task, offering thirteen theses on global politics today and suggesting an organizing strategy for the Left given those conditions.

Thesis 1. The global conjuncture is one of the territorial and ideological hegemony of liberal capitalism.Commentary. The obviousness and banality of this thesis dispense me from commenting.

Thesis 2. This hegemony is by no means in crisis, still less in a coma, but in a particularly intense and innovative sequence of its deployment.

Commentary. On the subject of the capitalist globalisation that is totally hegemonic today, there are two opposing positions that are equally false. The first is the conservative position: capitalism, especially combined with parliamentary ‘democracy’, is humanity’s definitive form of economic and social organisation. It is in fact the end of history, as the essayist Fukuyama once popularised. The second is the leftist position according to which capitalism has entered its final crisis, or is even already dead.

The first position is simply a repetition of the ideological process begun in the late 1970s by the renegade intellectuals from the ‘red years’ (1965-1975), which consisted in simply eliminating the communist hypothesis from the field of possibilities. This made it possible to simplify the dominant propaganda: there was no longer any need to praise the (dubious) merits of capitalism, but only to maintain that facts (the USSR, Lenin, Stalin, Mao, China, the Khmer Rouge, the Western communist parties, etc.) had shown that nothing else was possible except criminal ‘totalitarianism’.

Faced with this verdict of impossibility, the only response is to re-establish the communist hypothesis, assessed beyond the fragmentary experiments of the last century, in its possibility, its strength and its liberating capacity. This is what is happening and inevitably will happen, and what I am trying to do in this very text.

The scenarios of bloodless capitalism or dead capitalism base themselves on the financial crisis of 2008, on the inflationary monetary disorders brought about by the Covid-19 pandemic, and on the countless episodes of corruption revealed daily. They conclude either that the moment is revolutionary, that all it takes is a strong push for the ‘system’ to collapse (classic leftism), or that all it takes is to step aside, to withdraw for example to the countryside and lead a sober life respectful of nature, to realise that we can then organise completely new ‘forms of life’, the destructive capitalist machine turning in a vacuum into its final nothingness (ecological Buddhism).

All of this has no connection whatsoever with reality.

Firstly, the crisis of 2008 was a classic crisis of overproduction (too many houses were built in the US and sold on credit to insolvent people), and, in due course, its propagation created the conditions for a new capitalist impetus, boosted by a strong sequence of concentration of capital, with the weak being washed away, the strong strengthened, and in passing – a very important gain – the ‘social legislation’ stemming from the end of the Second World War largely liquidated. Once this painful tidying up is done, ‘recovery’ is now in sight. Secondly, the extension of the capitalist grip to vast new territories, the intensive and extensive diversification of the world market, is far from complete. Almost all of Africa, a good part of Latin America, Eastern Europe, India are all ‘in transition’, either zones of plunder or countries ‘taking off’, where large-scale market implantation can and must follow the example of Japan or China.

The fact is that capitalism is corrupt in its essence. How can a collective logic whose only norms are ‘profit above all else’ and universal competition of all against all avoid widespread corruption? The recognised ‘cases’ of corruption are only side operations, either local purges for propagandist purposes or settling of scores between rival cliques.

Modern capitalism, that of the world market, which with its few centuries of existence is historically a recent social formation, has only just begun to conquer the planet, after a colonial sequence (from the sixteenth to the twentieth century) in which conquered territories were enslaved to the limited and protectionist market of a single country. Today, plundering is globalised, as is the proletariat, which now comes from every country in the world.

Thesis 3. However, three active contradictions are at work in this hegemony.

i) The extremely developed oligarchic dimension of the possession of capital leaves ever less room for the integration of new owners into this oligarchy. Hence the possibility of authoritarian sclerosis.

ii) The integration of financial and commercial circuits into a single world market is opposed by the maintenance, at the level of mass policing, of national forms that inevitably enter into rivalry. Hence the possibility of a planetary war resulting in one state that is clearly hegemonic, including over the world market.

iii) It is doubtful today whether capital, in its present line of development, can valorise the labour-power of the entire world population. Hence the risk that a mass of totally deprived and therefore politically dangerous people will form on a global scale.

Commentary.

i) We are now at a point where 264 people own the equivalent of what three billion others own – and the concentration continues. Here, in France, 10 per cent of the population own well over 50 per cent of the total wealth. These are concentrations of ownership with no stable precedent on a global scale. And they are far from complete. They have a monstrous side, which obviously does not guarantee them eternal duration, but is inherent to capitalist deployment, and even its main motor.

ii) The hegemony of the United States is increasingly being undermined. China and India between them have 40 per cent of the world’s workforce. This indicates a devastating deindustrialisation in the West. In fact, American workers now account for only 7 per cent of the global labour force, and Europe even less. The result of these contrasts is that the world order, still dominated for military and financial reasons by the USA, is seeing the emergence of rivals who want their share of sovereignty over the world market. Confrontations have already begun in the Middle East, Africa and the China seas. They will continue. War is the horizon of this situation, as the last century has shown, with two world wars and incessant colonial killings, and as the war in Ukraine confirms today.

iii) Already today there are probably between two and three billion people who are neither owners, landless peasants, petty-bourgeois employees or workers. They wander the world in search of a place to live, constituting a nomadic proletariat which, if politicised, would b

Thesis 4. In the last ten years, there have been numerous, and sometimes vigorous, movements of revolt against this or that aspect of the hegemony of liberal capitalism. But they have also been resolved without posing any major problem to the dominant capitalism.Commentary. These movements have been of four kinds.

i) Brief and localised riots. There have been large, spontaneous riots in the suburbs of major cities, for example London and Paris, usually following police killings of young people. These riots either lacked widespread support in a frightened public and were mercilessly suppressed, or were followed by vast ‘humanitarian’ mobilisations, focused on police violence, largely depoliticised in the sense that no mention was made of the precise nature of these exactions and the profit that bourgeois domination ultimately draws from them.

ii) Sustained uprisings, but without an organisational creation. Other movements, notably in the Arab world, have been socially much broader and lasted for many weeks. They took the canonical form of square occupations. They were generally quelled by the temptation of elections. The most typical case was that of Egypt: a very large-scale movement, with the negative unifying slogan ‘Mubarak out’ enjoying apparent success (Mubarak left power, was even arrested), the inability of the police for a long time to take over the square, the explicit unity of Coptic Christians and Muslims, and the apparent neutrality of the army. But, in the elections, naturally, it was the party with a presence in the popular masses – though not very present in the movement – that won, namely the Muslim Brotherhood. The most active part of the movement opposed this new government, thus opening the way to an intervention of the army, which put a general, El-Sisi, in power. He mercilessly repressed all opposition, first the Muslim Brotherhood, then the young revolutionaries, and in fact re-established the old regime in a rather worse form than before. The circular nature of this episode is particularly striking.

iii) Movements leading to the creation of a new political force. In some cases, the movement was able to create the conditions for the emergence of a new political force, different from the regular ones of parliamentarianism. This was the case with Syriza in Greece, where revolts were particularly numerous and harsh, and with Podemos in Spain. These forces have dissolved into the parliamentary consensus. In Greece, the Tsipras government surrendered without significant resistance to the injunctions of the European Commission and returned the country to the path of endless austerity. In Spain, Podemos has also become bogged down in the game of parliamentary combinations, whether governmental or oppositional. No trace of real politics has emerged from these organisational creations.

iv) Movements of fairly long duration, but with no notable positive effects. In some cases, apart from a few classic tactical episodes (such as the ‘takeover’ of classic demonstrations by groups equipped to confront the police for a few minutes), the absence of political innovation meant that on a global scale it was the figure of conservative reaction that was renewed. This was the case, for example, in the USA, where the dominant counter-effect of ‘Occupy Wall Street’ was the coming to power of Trump, and also in France, where the outcome of ‘Nuit debout’ was Macron. A little later, indeed, Macron was the sole target of the typically petty-bourgeois Gilets Jaunes movement. Like all such movements, whose leaders are all frankly hostile to the eradication of bourgeois property, and in fact want stronger state support for it, the result only affected state formalities, and its sole target was President Macron. And the magnificent result, worthy of the farces and traps that the parliamentary system reserves for its clients, was in the end the re-election of Macron.

Thesis 5. The cause of this impotence in the movements of this last decade is the absence of politics – even hostility to politics – in various forms, recognisable by a number of symptoms. Beneath these negative sentiments there is in fact a constant submission to electoral ritual, under the spurious name of ‘democracy’.

Commentary. Let us note, in particular, as signs of an extremely weak political subjectivity:

i) Exclusively negative unifying slogans: ‘against’ this or that, ‘Mubarak out’, ‘down with the 1% oligarchy’, ‘reject the labour law’, ‘no one likes the police’ etc.

ii) The absence of a prolonged temporality: both in terms of knowledge of the past, which is practically absent from the movements (apart from a few caricatures), and of which no inventive assessment is proposed other than a projection into the future, limited to abstract considerations on liberation or emancipation.

iii) A vocabulary largely borrowed from the adversary. This is above all the case with a particularly equivocal category such as ‘democracy’, or the use of the category of ‘life’, ‘our lives’, which is only an ineffective investment of existential categories in collective action.

iv) A blind cult of ‘novelty’ and a disregard for established truths. This point is a direct result of the commercial cult of the ‘novelty’ of products and a constant conviction that something is being ‘started’ which, in reality, has already happened many times. At the same time, it prevents us from learning the lessons of the past, from understanding the mechanism of structural repetition, and leads us to fall into the trap of false ‘modernities’.

v) An absurd time scale. This time scale, modelled on Marx’s money—commodities—money’ circuit, assumes that problems such as private property and the pathological concentration of wealth, which have been pending for millennia, can be dealt with or even resolved by a few weeks of ‘movement’. The refusal to consider that a good part of capitalist modernity is simply woven from a modern version of the triplet ‘family, private property, state’ established a few thousand years ago, as early as the Neolithic ‘revolution’. And that therefore communist logic, as far as the central problems that constitute it are concerned, is situated on a scale of centuries.

vi) A weak relationship to the state. What is at issue here is a constant underestimation of the resources of the state compared to those available to this or that ‘movement’, in terms of both armed force and the capacity for corruption. In particular, the effectiveness of ‘democratic’ corruption, whose symbol is electoral parliamentarianism, is underestimated, as is the extent of the ideological dominance of this corruption over the overwhelming majority of the population.

vii) A combination of disparate means without any assessment of their distant or near past. No conclusions are drawn that can be widely popularised from the methods that have been used since at least the ‘red years’ (1965-1975), or even for two centuries, such as factory occupations, trade-union strikes, legal demonstrations, the formation of groups to enable local confrontation with the police, the storming of buildings, the sequestration of bosses in factories, and so on. Nor from their static symmetries: for example, in squares occupied by crowds, long and repetitive hyper-democratic assemblies, where everyone is called on to speak for three minutes, whatever their ideas and linguistic resources, and where the ultimate stake envisaged is simply the repetition of this exercise.

Thesis 6. We must remember the most important experiences of the near past, and reflect on their failures.

Commentary. From the red years to today.

The commentary on Thesis 5 may well seem quite polemical, even pessimistic and depressing, especially for young people who can legitimately enthuse, for a time, about all those forms of action which I ask to be critically re-examined. These criticisms are understandable if we remember that, personally, in May ’68 and its aftermath, I experienced and participated enthusiastically in things of exactly the same order, and was able to follow them long enough to measure their weaknesses. I have the feeling that recent movements are exhausting themselves by repeating, under the mark of the new, well-known episodes of what can be called the ‘right’ of the May ’68 movement, whether this right comes from the classical left or from the anarchist ultra-left, which in its own way was already talking about ‘forms of life’, and whose militants we called ‘anarcho-desirers’.

There were in fact four distinct movements in 1968.

i) a revolt of student youth;

ii) a revolt of young workers in the large factories;

iii) a general strike by the trade unions attempting to control the two previous revolts;

iv) the emergence, often under the name of ‘Maoism’ – with several rival organisations – of an attempt at a new politics, the principle of which was to draw a unifying axis between the first two revolts by endowing them with an ideological and fighting force that seemed able to guarantee them a real political future. In fact, this lasted for at least a decade. The fact that it did not stabilise on a historical scale (which I readily acknowledge) should not mean that we repeat what happened then without even knowing that we are repeating it.

Let’s just remember that the June 1968 elections produced a majority so reactionary that it could be compared with the ‘blue horizon’ chamber at the end of the First World War. The end result of the May/June 2017 elections, with the crushing victory of Macron, an attested servant of globalised big capital, should make us reflect on what is repetitive in all this. All the more so as the same Macron was re-elected in 2022.

Thesis 7. The internal politics of a movement must have five characteristics, relating to slogans, strategy, vocabulary, the existence of a principle, and a clarified tactical vision.

Commentary.

i) The main slogans must be affirmative, offering a positive determination, and not be satisfied with complaint and denunciation. This is even so at the cost of internal division as soon as one goes beyond negative unity.

ii) The slogans must be strategically justified. This means: informed by knowledge of the previous stages of the problem the movement is addressing.

iii) The vocabulary used must be controlled and consistent. For example: ‘communism’ is today incompatible with ‘democracy’; ‘equality’ is incompatible with ‘liberty’; any positive use of an identitarian term, such as ‘French’, or ‘international community’, or ‘Islamist’ or ‘Europe’, must be proscribed, as well as terms of a psychological nature, such as ‘desire’, ‘life’, ‘person’, and any term linked to established state provisions, such as ‘citizen’, ‘elector’, and so on.

iv) A principle, what I call an ‘Idea’, must be constantly confronted with the situation, insofar as it locally carries a non-capitalist systemic possibility. Here we must quote Marx, as he defined the tasks of militants and their mode of presence in movements: ‘Communists everywhere support every revolutionary movement against the existing social and political order of things. In all these movements they bring to the front, as the leading question in each, the property question, no matter what its degree of development at the time.’

v) Tactically, it is always necessary to bring the movement as close as possible to a body capable of coming together to effectively discuss its own perspective and that from which it illuminates and judges the situation.

Political activists, as Marx says, are part of the general movement, they do not separate themselves from it. They distinguish themselves solely by their ability to inscribe the movement in an overall point of view, to foresee from this what the next stage must be, making no any concession on these two points, even under the guise of unity, to the conservative conceptions which can perfectly well subjectively dominate even a major movement. The experience of revolutions shows that crucial political moments are in the form closest to a public meeting, where the decision to be taken is clarified by speakers who may also contradict one another.

Thesis 8. Politics gives the spirit of movements a specific duration, which should match the temporality of states, and not just be a negative episode in their domination. Its general definition is that it organises, among the various components of the people and on the largest possible scale, a discussion around slogans which must be those of permanent propaganda as well as of future movements. Politics provides the general framework for these discussions: it is the assertion that there are today two ways for the general organisation of humanity, the capitalist way and the communist way. The first is only the contemporary form of what has existed since the Neolithic revolution, a few thousand years ago. The second proposes a second global, systemic revolution in the future of humanity. It proposes to emerge from the Neolithic age.

Commentary. In this sense, politics consists in situating locally, through broad discussion, the slogan that crystallises the existence of these two roads in the current situation. Being local, this slogan can only come from the experience of the masses concerned. It is there that politics learns what can make the effective struggle for the communist road exist locally, whatever the means. From this point of view, the wellspring of politics is not right away antagonistic confrontation, but the continuous investigation, in situ, of the ideas, slogans and initiatives capable of bringing to life locally the existence of two roads, one of which is the conservation of what exists, the other its complete transformation according to egalitarian principles which the new slogan has to crystallise. The name of this activity is ‘mass work’. The essence of politics, outside of movement, is mass work.

Thesis 9. Politics is done with people from everywhere. It cannot submit to the various forms of social segregation organised by capitalism.

Commentary. This means, especially for intellectual youth, who have always played a crucial role in the birth of new politics, the need for a continuous journey towards other social strata, especially the most deprived, where the impact of capitalism is most devastating. In present conditions priority must be given, in our countries as well as on a world scale, to the vast nomadic proletariat, who, like the peasants of Auvergne or Brittany in the past, arrive in great waves, facing the worst risks, to try to survive as workers here, since they can no longer do so as landless peasants there. The method, in this case as in all others, is patient investigation on the spot: in markets, housing estates, hostels and factories, the organisation of meetings, even very small ones at the beginning, the fixing and dissemination of slogans, broadening the base of work, confrontation with the various local conservative forces, etc. This is exciting work, once you realise that the key is active stubbornness. An important step is to organise schools to spread knowledge of the global history of struggle between the two roads, its successes and its current impasses.

What was done by the organisations that arose for this purpose after May ’68 can and must be done again. We must reconstitute the political axis I mentioned, which is still today an axis between the youth movement, some intellectuals, and the nomadic proletariat. This is already being done here and there. It is the only properly political task of the moment.

What has changed in France is the deindustrialisation of the suburbs of the big cities. This provides the far right with its working-class support. It must be fought on the spot, by explaining why and how two generations of workers have been sacrificed in a few years, and by simultaneously investigating, as far as possible, the opposite process, namely the extremely violent industrialisation of Asia. Work with manual workers is always immediately international, even here. In this respect, it would be extremely interesting to produce and distribute a newspaper of the workers of the world.

Thesis 10. There is no real political organisation today. The task is therefore to see to the means of reconstituting it.

Commentary. An organisation is responsible for conducting surveys, synthesising mass work and the local slogans that have emerged from it, so as to place them in a global perspective, enriching the movements and monitoring their consequences over the long term. An organisation is judged not on its form and procedures, as one judges a state, but on its capacity to do what it is charged with. We can use a formula from Mao: such an organisation is one which can be said to ‘give back to the masses in a precise form what it has received from them in a still confused form’.

Thesis 11. The classical party form is defunct today because it defined itself, not by its capacity to do what Thesis 9 says, namely mass work, but by its claim to ‘represent’ the working class, or the proletariat.

Comment. We must break with the logic of representation in all its forms. The political organisation must have an instrumental definition, not a representative one. Besides, ‘representation’ means ‘identity of what is represented’. But identities must be excluded from the political field.

Thesis 12. As we have just seen, what defines politics is not the relationship to the state. In this sense, politics takes place ‘at a distance’ from the state. Strategically, however, it is necessary to break the state, because it is the universal guardian of the capitalist road, notably because it polices the right to private property of the means of production and exchange. As the Chinese revolutionaries said during the Cultural Revolution, we must ‘break with bourgeois right’. Therefore, political action towards the state is a mixture of distance and negativity. The aim is actually for the state to be increasingly surrounded by hostile opinion and political sites that have become alien to it.

Commentary. The historical record of this case is very complex. For example, the Russian Revolution of 1917 certainly combined several things, i.e. a broad hostility to the tsarist regime, including in the countryside because of the war, an intense and long-standing ideological preparation, especially in the intellectual strata, workers’ revolts leading to real mass organisations, called soviets, and soldiers’ uprisings, with the existence, thanks to the Bolsheviks, of a solid, diversified organisation, capable of holding meetings with orators who were first-rate in their conviction and their didactic talent. All of this took place with victorious insurrections and a terrible civil war that was finally won by the revolutionary camp, despite massive foreign intervention. The Chinese revolution followed a completely different course: a long march through the countryside, the formation of people’s assemblies, a real Red Army, the lasting occupation of a remote area in the north of the country, where agrarian and productive reform could be experimented with, at the same time as the army was being consolidated, the whole process lasting some thirty years. Moreover, instead of the Stalinist terror of the 1930s, there was a mass student and worker uprising in China against the aristocracy of the Communist Party. This unprecedented movement, called the Proletarian Cultural Revolution, is for us the latest example of a policy of direct confrontation with the figures of state power. None of this can be transposed to our situation. But one lesson runs through the whole adventure: the state, whatever its form, can in no way represent or define the politics of emancipation.

The complete dialectic of any true revolutionary politics has four terms:

i) The strategic idea of the struggle between two roads, communist and capitalist. This is what Mao called the ‘ideological preparation of opinion’, without which, he said, revolutionary politics is impossible.

ii) The local investment of this idea or principle by the political organisation, in the form of mass work. The decentralised circulation of everything that emerges from this work in terms of slogans and victorious practical experiences.

iii) Popular movements in the form of historical events, within which the political organisation works for both their negative unity and the refinement of their affirmative determination.

iv) The state whose power must be broken, either by confrontation or encirclement, if it is the power of the agents of capitalism. And, if it comes from the communist road, it must be destroyed, if necessary, by the revolutionary means that the Chinese Cultural Revolution attempted in a fatal disorder.

To invent in situ the contemporary disposition of these four terms is the problem of our conjuncture, simultaneously practical and theoretical.

 

Thesis 13. The situation of contemporary capitalism involves a kind of stalemate between the globalisation of the market and the still largely national character of the police and military control of populations. In other words, there is a gap between the economic disposition of things, which is global, and its necessary state protection, which remains national. The second aspect is the resurrection of imperialist rivalries in other forms. Despite this change of form, the risk of war is increasing. In fact, war is already present in large parts of the world. Future politics will also have the task, if it can, of preventing the outbreak of an all-out war, which this time could put the existence of humanity at stake. It can also be said that the historical choice is: either humanity breaks with the contemporary Neolithic age that is capitalism and initiates its communist phase on a global scale; or it remains in its Neolithic phase, and will be greatly exposed to perishing in a nuclear war.

Commentary. Today the great powers seek, on the one hand, to collaborate in the stability of world affairs, notably by combating protectionism, but on the other hand fight one another for hegemony. The result is the end of directly colonial practices, such as those of France or England in the nineteenth century, i.e. the military and administrative occupation of entire countries. The new practice is what I propose to call zoning: in entire zones (Iraq, Syria, Libya, Afghanistan, Nigeria, Mali, Central Africa, Congo, and so on) states are undermined, annihilated, and the zone becomes a zone of plunder, open to armed gangs as well as all the capitalist predators of the planet. Alternatively, the state is made up of businessmen linked by a thousand ties to the big companies of the world market. Rivalries intertwine in vast territories, with constantly shifting power relations. Under these conditions, an uncontrolled military incident would be enough to bring us to the brink of war. The blocs are already drawn: the United States and its ‘Western-Japanese’ clique on one side, China and Russia on the other, nuclear weapons everywhere. We can only recall Lenin’s dictum: ‘Either revolution will prevent war, or war will provoke revolution.’

We could thus define the maximum ambition of future political work: to realise for the first time in history the first hypothesis, so that revolution will prevent war, rather than the second, i.e. that war will provoke revolution. It was this second hypothesis that materialised in Russia in the context of the First World War, and in China in the context of the Second. But at what a price! And with what long-term consequences!

We must hope, and we must act. Anyone, anywhere, can start to make real politics, in the sense presented in this text. And talk, in turn, to those around them about what they have done. This is how it all begins.

Translated by David Fernbach

Category : Capitalism | China | Marxism | Philosophy | Socialism | Theory | Blog
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Review of Civil War by Other Means: America’s Long and Unfinished Fight for Democracy by Jeremi Suri (PublicAffairs, 2022)

By Matthew E. Stanley
Jacobin

A new book argues that the American right emerged out of a backlash to multiracial democracy following the Civil War. This is only partly true: reactionaries did not just fear democracy, they feared the economic redistribution former slaves associated with it.

In August, a poll conducted by YouGov revealed that 40 percent of Americans believe it likely that a civil war will take place within the next decade. That same poll showed that an even larger number, 62 percent, think that levels of political violence will increase within the next few years. Undeniably, there seems to be a sense among Americans that our democratic system is not robust enough to deal with the conflicts it generates. Moments of episodic crises, such as the January 6 insurrection, would then seem to be symptomatic of the broader structural problems with American democracy. But what is their cause?

In Civil War by Other Means: America’s Long and Unfinished Fight for Democracy, historian Jeremi Suri argues that the failure of Reconstruction, the ambitious post–Civil War project to create a new social order in the US South, explains not only the existence of a conspiratorial right but the January 6 insurrection too. Suri maintains that the world’s first experiment in genuine multiracial democracy inspired a long, violent resistance, not only against the progressive state governments of the 1860s and 1870s but against the very idea of a multiracial body politic. The effects of that backlash have reverberated for a century and a half, Suri argues, culminating with the ransacking of the US Capitol.

Suri’s study is thoughtful and deftly written. Its premise — that the January 6 attack, like Donald Trump himself, was far less a sudden, singular rupture than the predictable culmination of long-standing political currents — is indisputable. But by limiting its understanding of democracy to struggles for the franchise, Civil War by Other Means obscures what was at stake for former slaves and working-class whites during the Reconstruction era. Both groups were not simply concerned with the right to vote but in securing economic freedom for themselves after the dispossession of the planter class.

Ignoring these facts leads Suri to wrongly identify culture and constitutional encumbrances, rather than concentrated wealth under capitalism, as the primary obstacles to political self-determination.

A Splendid Failure
Suri begins by excavating the roots of white Southern anti-government resistance after slavery. In one chapter, he explores the power of martyrdom, including how the memory of John Wilkes Booth bolstered defenses of local white power, as anti-black collective violence surged throughout the former Confederacy. In another, he recounts how roughly fifty thousand white Southerners, mostly Confederate officers and Southern gentry, went into self-exile after Appomattox in the hopes of recreating their slave empire in Latin America.

These exiles, whom Ulysses S. Grant considered “a part of the Rebellion itself,” developed identities of resistance to multiracial democracy on both sides of the Rio Grande: against liberal reformers in Mexico and Radical Republicans in the United States. Suri views all of them — Lincoln’s assassins, Klansmen, and Confederate expatriates — as ideological ancestors of the January 6 insurrectionists.

Meanwhile, ex-slaves worked to realize their own understandings of democracy in the postwar South. The governments they created along with their allies, white Southern Unionists and black and white Northern “carpetbaggers,” were some of the most progressive in US history. In addition to universal male suffrage, the most reform-minded of those governments championed public education and infrastructure, women’s property rights, child labor laws, and new systems of credit that allowed poor people to buy land.

The result was, according to Suri, a “Second American Revolution” that made good on the promises of the Declaration of Independence. In some cases, Southern Republicanism was even more radical than Suri acknowledges. In New Orleans, for instance, the Republic Club sent a message of solidarity to the Paris Commune and applied for membership in the First International.

The book’s primary focus, however, is not grassroots radicalism but high politics. And it is here, in examining the nuances and limitations of the Republican Party, that Suri’s analysis is strongest. Considering how the party legislated and implemented policy to protect (or not) multiracial democracy in the South, he views Northern Republicans as necessary but cautious allies who were pushed from below.

Suri’s narrative is insightful but familiar: Andrew Johnson’s intransigence expanded and emboldened the Radicals in Congress; the Civil Rights Act of 1867, the Fourteenth Amendment, and the Reconstruction Acts opened democratic possibility in the South. Believing the Fifteenth Amendment to be “the most important event” in the nation’s history, President Grant proved an ardent defender of civil rights laws, and his use of military occupation largely worked against rising white violence. However, time, expense, political fatigue, and economic panic fed growing indifference in the North. With no popular base to support them, the gains of Reconstruction teetered on collapse.

The Rutherford Hayes and James Garfield presidencies had their opportunities to protect multiracial democracy, Suri argues, but were plagued by tepid leadership, constitutional crisis, corruption, and assassination. By the summer of 1877, Northern Republicans had acquiesced to “local self-government” (white rule) in the South while deploying federal forces against striking industrial workers in the North, facilitating their turn from “a party of money rather than a party of morals,” as Frederick Douglass put it. Associating “big government” with black rights, white reactionaries fomented a violent overthrow of what W. E. B. Du Bois termed the “abolition democracy,” ushering in home rule and eight decades of Jim Crow. The death of Reconstruction was the dawn of a new tradition of racialized anti-government activism.

Suri’s version of Reconstruction celebrates the inclusive, democratic possibilities of US politics while offering a broader critique of the US election system. Its riveting narrative offers a powerful warning against Whiggish conceptions of the past. Suri convincingly argues, for instance, that the presidential election of 1872 was the fairest and freest election in the nation’s history until the 1960s. This is a story of revolutionary conditions and remarkable multiracial advances leading to backlash, violence, and the deterioration of political and social rights. Rather than a march of progress, this analysis of American democracy is that of an ongoing project — one that is long, arduous, uneven, and woefully incomplete.

A Flawed Democracy
Suri maintains that the problems of Reconstruction and of Republican efforts to protect multiracial democracy are the problems of our time, too. Since its inception in the early nineteenth century, mass democracy in the United States has always been contested, its expansion predicated on hard-fought struggles for rights. There was never a golden age of American democracy. Indeed, the scope of disenfranchisement is even wider than Suri lets on. Enormous blocs of should-be voters have been — and in many cases continue to be — restricted by gender, race, servitude, the absence of property, age, ethnicity, literacy, criminal record, ability, or national origin. In many ways, the American ballot box has merely registered political outcomes that were largely determined before voting even began.

We still carry the US election system that Suri characterizes as arbitrary and contentious, and it has contributed to the nation’s current status as a “flawed democracy,” according to the Democracy Index. As Suri notes, the Constitution’s minoritarian elements — including the document’s strong protection of property rights, emphasis on capital mobility, and relative difficulty to amend — were designed by slaveholders and an ownership class that was deeply suspicious of, if not actively hostile to, popular democracy. Even for white male property owners, the system was mediated through a convoluted network of electors and representatives. Other features of US politics that structurally assist the forces of white democracy, according to Suri, include rampant gerrymandering, various forms of voter suppression, the nondemocratic nature of the US Senate and the Supreme Court, and the disenfranchisement of US citizens in the non-state territories of Washington, Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Mariana Islands (whose residents are principally, and not coincidentally, non-white people).

It was not simply multiracial democracy per se that white reactionaries of the Reconstruction era found so offensive; it was the threat that mass democracy posed to material as well as racial status.
Suri reserves his greatest ire, however, for the Electoral College, which he identifies as an archaic, elitist, antidemocratic, and deeply unpopular relic of the eighteenth century. To be sure, Reconstruction-era Republicans benefited from that outmoded system, as Hayes won the Electoral College but not the popular vote in 1876. At the same time, white Southern fears of government unleashed during Reconstruction have helped sustain this undemocratic system ever since. Further, the Electoral College would for decades afford disproportionate power to the segregationist South, since black people counted as full persons for purposes of electoral representation after the Fifteenth Amendment but were disenfranchised by Jim Crow laws.

These weaknesses in our constitutional system and the absence of a direct popular vote continue to enable right-wing authoritarianism, Suri contends. Today’s Republicans are generally hostile to voting rights because they view them, understandably, as more likely to check than augment their power. Some party leaders, including senator Mike Lee of Utah, have gone so far as to openly celebrate the Constitution’s lack of democracy. In his book’s final chapter, Suri makes several recommendations about how to stave off this antidemocratic momentum and ostensibly “save our democracy.” He proposes a constitutional amendment guaranteeing all citizens the right to vote, the abolition of the Electoral College, the legal prohibition of partisan gerrymandering, and a new and more democratic presidential line of succession.

This focus on formal politics, intriguing though it is, nevertheless offers an incomplete portrait of the Reconstruction era. And Suri’s emphasis on technocratic fixes also skirts vital questions about securing, maintaining, and leveraging power. (How will these laws come to pass without a mass movement?) In other words, Civil War by Other Means falls short not in its diagnosis of problems but in its identification of causes and solutions. In Suri’s telling, Radical Reconstruction was hindered by anti-black violence, shifting public opinion, and the constraints of the political system. It was not hindered by class conditions. Similar to the mono-causal “whitelash” theory that gained traction after the 2016 election, Suri views racial resentment, rather than white supremacy bound to political economy, as the principal explanatory factor for Reconstruction’s failure — and for the precarious state of US democracy.

In truth, it was not simply multiracial democracy per se that white reactionaries of the Reconstruction era found so offensive; it was the threat that mass democracy posed to material as well as racial status. Anti-black collective violence was not identical to class violence, but the two were inseparable. Suri too often overlooks this fact. Indeed, the Ku Klux Klan was not just a violent hate group; it was also effectively, as Chad Pearson argues in the book Capital’s Terrorists, a business owners’ organization. The white counterrevolution was not merely a racial project; it was also, as Du Bois argued, a conflict among classes, with former slaveholders using race hatred to “achieve economic security and restore fatal losses of capital and investment.”

Insurrectionist Workers?
Suri’s misapplication of class begins in the book’s introduction, which profiles insurrectionist Kevin Seefried as emblematic of those who stormed the US Capitol. A white worker and Sons of Confederate Veterans member from Sussex County, Delaware, Seefried supports Suri’s long Civil War thesis. After all, Seefried is an avowed anti-government white nationalist who forced a Confederate flag into the congressional chambers. But while Suri explains that the grievances of insurrectionists like Seefried may have stemmed in part from being “left behind” by the nation’s move toward a “multiracial meritocracy,” he marshals no evidence that Seefried was representative of the pro-Trump mob.

In reality, Seefried was a typical rioter only in that he is a white male who holds far-right political views (the January 6 insurrectionists were roughly 86 percent men and 93 percent non-Hispanic white). Few (about 14 percent) were members of militias or other hate or extremist groups. Far more (around 20 percent) were former military, offering further evidence that “the bombs explode at home.” Nor did the insurrectionists simply hail from rural America. They also came from the nation’s largest metro areas: New York City, Los Angeles, Chicago, San Francisco, Dallas, and Houston. Rather than urbanity or rurality, the common-origin denominator among the rioters involved demographic trends. Most came from counties that are trending rapidly toward racial pluralism and majority-minority status, and where the share of the white population is declining at rates well above the national average. This, no doubt, speaks to the valence within their ranks of a “Great Replacement” theory, one promulgated by conservative media personalities.

Most critically, the January 6 insurrectionists were not downtrodden workers, unemployed and uneducated, as Suri’s portrait of Seefried suggests. The vast majority were, like Trump’s base, professional-class, with disproportionate numbers of deeply conservative provincial elites from midsize cities, small towns, and retirement enclaves. Some were the bourgeoise that Patrick Wyman terms the “American gentry” — business and property owners who sit atop local hierarchies, and who “see themselves as local leaders in business and politics, the unappreciated backbone of a once-great nation.” Fearful of wavering influence in their own (typically racially and socioeconomically segregated) communities, they equated Trump’s “Make America Great Again” with protection of both their financial assets and racial identities.

In fact, the University of Chicago’s Project on Security and Threats obtained employment data for 501 of the 716 people arrested or charged for their role in January 6. The vast majority were either business owners, self-employed, or white-collar professionals, including doctors, lawyers, bankers, architects, and accountants. Only 22 percent of the sample held what the compilers described as “blue collar” jobs, as either wage-earning or salaried workers. Only 7 percent were unemployed. Even relative to other right-wing extremist groups as compiled by the FBI, the January 6 insurrectionists were strikingly well-off. After all, partaking in a prearranged government takeover in one of the nation’s most expensive cities requires time off work, as well as travel, airfare, and hotel expense. Many of the rioters dined in gourmet restaurants the night of January 5. Others stayed at the posh Willard Hotel, where rooms will cost you over $300 per night. Some even flew to the “Stop the Steal” rally on private jets.

Among both white and black Radicals, phrases including ‘better classes,’ ‘most respectable,’ and ‘best men’ were code for the class difference between free men of color and recently freed slaves.
The depiction of Kevin Seefried as a typical insurrectionist reinforces Suri’s idea of the roots of racial repression as primarily cultural, based on “habit and tradition,” rather than material, in the service of profit and class hegemony. However, belief in the Big lie, and the willingness to act violently on its behalf, is dangerous not because it holds sway among relatively powerless citizens like Seefried. It is dangerous because it is mainstream among relatively affluent members of a particular social class, the vast majority of whom, yes, are white, and who wield white nationalism in the service of class politics, as well as class power in the service of white nationalism. This is not to downplay the obvious role that white identity played in both Trump’s election and January 6, only to highlight that it is not fringe bands of neo-Confederates but acute inequality, engendered by the basic machinations of capitalism, that poses the greatest threat to American democracy.

Democracy on the Land
For a book about the long struggle for democracy, Suri’s study contains surprisingly little about contests over the meaning of democracy. His emphasis is on electoral democracy, or the processes by which enfranchised people vote for political representatives in periodically held elections. Yet more than any period of US history, Reconstruction demonstrates how this definition of democracy is necessary but insufficient. Although Suri characterizes Reconstruction as “a struggle over conflicting conceptions of democracy,” his core question is “democracy for whom?” and not “democracy of what kind?” Put another way, Suri’s notion of democracy pivots entirely on race — white man’s democracy vs. multiracial democracy — while obscuring intraracial distinctions and calls for economic democracy.

Former slaves did indeed see voting rights and ballot inclusion as fundamental rights. However, Suri’s claim that blacks recognized “representation in politics” as “the basic foundation of democracy” requires further context, and the book’s fixation on voting rights gives the impression that land ownership was of secondary importance to former slaves. It was not.

Although Suri’s flattening of critical class differences prevents him from exploring such issues, countless ex-slaves prioritized rights in land as equal to or above voting. This was especially true of newly emancipated people in rural areas, most of them landless and illiterate, whose demands tended to be more material than their free counterparts in the urban South. One freedman prefigured Martin Luther King Jr’s pithy critique of civil rights devoid of economic justice: “What’s the use of being free if you don’t own enough land to be buried in?”

The story of “Forty acres and a mule” as a dream deferred, though largely absent from Suri’s account, is essential to any materialist interpretation of Reconstruction — or of US history for that matter. Eager to kickstart the South’s cash crop economy, Southern planters and Northern capitalists each had a vested interest in opposing both communitarianism (democratically owned property) and independent proprietorship (small-scale privately owned property) for former slaves. Some of the latter feared that land redistribution in the South would lead industrial workers in the North to challenge other forms of property. Countless Northern industrialists, philanthropists, and politicians supported black political rights out of either sincere egalitarian impulses or an opportunity to grow their political party in the South. But many also feared alliances between former slaves and poor and middling white agrarians in the North and West. Even free blacks, white reformers, and Freedmen’s Bureau agents, most of them well-meaning, sincerely believed that the dependency of wage labor was the surest way to self-sufficiency for former slaves.

While Reconstruction represented an exceptional — and in many ways revolutionary — reallocation of power toward working people, property confiscation constituted what historian Michael Fitzgerald calls a “wartime vogue,” far less a result of ideology than of military necessity. By 1866, the idea of land redistribution for ex-slaves was a nonstarter. Allies of the former slaves, including the Freedmen’s Aid Association, the American Missionary Association, and the Freedmen’s Bureau, called for education, thrift, and land purchase through savings as substitutes for land reform. As time wore on, Southern state governments and most congressional Republicans exhibited what historian Claude Oubre terms only a “meager effort” to provide economic security for blacks. The democratic visions of these institutions were limited somewhat by the economic concepts of the time and the political constraints of the moment. But they were also limited by their class positions.

Of course, there were also black intraracial class tensions, particularly in urban centers. While the postwar South held a broad range of black voters, leaders, and convention delegates, contested definitions of democracy, including which of its elements should be emphasized, tended to break along class lines. Among both white and black Radicals, phrases including “better classes,” “most respectable,” and “best men” were code for the class difference between free men of color and recently freed slaves — and also served as indicators of democratic prerogatives. In his study of Reconstruction-era Mobile, Alabama, historian Michael Fitzgerald argues that “class divisions within the black community were so urgent that factional conflict could not be contained.”

As early as the state black conventions of 1865, Eric Foner observes a striking divide between more prominent leaders who pushed “political equality and self-help formulas,” and rural freedmen who possessed above all a “thirst for land.” Demanding “land or blood,” ex-slaves in the countryside decisively favored assembly delegates who called for plantations to be broken up. Yet convention leaders rarely highlighted such views. “By and large,” Foner contends, “economic concerns figured only marginally in the proceedings, and the addresses and resolutions offered no economic program, apart from stressing the ‘mutual interest’ of capital and labor, and urging self-improvement as the route to personal advancement.” Describing this gulf between ex-slaves and free blacks (the self-described men of “intelligence and wealth”), historian Ted Tunnell argues that the type of civic rights prioritized by free blacks, notably equal access to public spaces such as theaters, saloons, and steamboats, were “remote from the needs and aspirations of the overwhelming majority of ex-slaves who lived hard lives on toil and ceaseless anxiety.”

In his 1935 Marxist masterwork, Black Reconstruction in America, Du Bois characterizes Radical Reconstruction as a “dictatorship of labor” and acknowledges that the failure of land reform had far more to do with white than black opposition. Yet he also maintains that black leadership during Reconstruction skewed petite bourgeois, its members steeped in an individualistic, capitalist ideology (which was by no means unique to the black middle class).

In other words, former slaves who desperately needed land were too often represented by conservative white Unionists and free blacks whose class statuses and interests disinclined them from supporting large-scale material redistribution, which raises the question: Were Reconstruction governments truly a “dictatorship of labor,” or were they liberal and multiracial bourgeois alliances sustained by the votes of black and a minority of poor whites?

The book’s key shortcoming lies in its failure to address the full spectrum of Reconstruction-era democracy and to foreground the materialist nature of its social and political conflict.
In either case, former slaves constituted a distinct and especially radical social class. They envisioned self-ownership as a right, viewing it not as apart from, but essential to and often ahead of, voting. Most understood that political democracy would be limited — and even be turned back altogether — without control over the land that their labor had made productive. And they perceived this issue as both a matter of justice and, in many cases, precedent. As Du Bois points out, “The German and English and French serf, the Italian and Russian serf, were, on emancipation, given definite rights in the land. Only the American negro slave was emancipated without such rights and in the end this spelled for him the continuation of slavery.” Writing on Louisiana’s 1867 Radical convention, Tunnell explained that although civil rights were a monumental achievement, they did not directly address “fundamental economic problems.” “More than anything else,” he insists, “ex-slaves needed land.”

Democracy, in other words, was a contested concept in the Reconstruction South, not only between black and white but within the Radical movement. While Radicals shared common commitments to civil rights and state building, they were not a class coalition. And when the interests of Northern capital, the Northern voting public, and former slaves no longer intersected, as was the case by 1874, the coalition broke down. Despite populist economic programs and the workerist orientation of some party leaders, the absence of a working-class movement rendered social democracy unachievable, and the lack of social democracy in the South — the failure of land reform specifically — made the counterrevolution of property almost inevitable.

Beyond Political Democracy
As a history of Reconstruction, Civil War by Other Means is a brisk, engaging, and often penetrating read. Suri imposes a degree of continuity sure to give some historians pause — drawing a rather straight line between the Union Leagues and Black Lives Matter, between the Klan and QAnon, Ben “Pitchfork” Tillman and Donald Trump, white hoods and red hats. Yet the book’s premise, that “the Civil War never fully ended” and that its pronounced divisions related to race and anti-statism have been festering in US politics since Reconstruction, is unquestionable. Although his frequent use of Trump-era media language — “disinformation,” “white privilege,” “treason,” and “insurrection” — seems like an appeal to the incrementalist MSNBC crowd, Suri makes bold constitutional proposals and shows an uncommon commitment to representative government, multiracial political democracy, and majority rule, which he views as the solutions to the stubborn problem of white nationalism. In that regard, Civil War by Other Means is superior to other post-2016 studies of race in America that paint whiteness more as a timeless feature to be condemned morally and “worked through” by self-help-oriented individuals than a manifestation of social conditions to be overcome through mass politics.

But the book’s key shortcoming lies in its failure to address the full spectrum of Reconstruction-era democracy and to foreground the materialist nature of its social and political conflict. Suri hopes Americans will safeguard their democracy by digging up the roots to “remove the rot,” but his vision, which would no doubt remake US politics for the better, never transcends technocratic proceduralism. Skipping over the vital question of movement building, Suri is most concerned with what to do with power once achieved rather than how to achieve it. Accordingly, he views white nationalism as a cultural and political problem to be curbed through constitutional change rather than a question rooted in material relations to be solved through social transformation. In other words, Suri’s “democracy” is neither social democracy nor economic democracy. It is certainly not democratic socialism, with its emphasis on democratic participation beyond the political arena and a more equal distribution of resources through worker control.

Ultimately, Suri fails to answer a basic question: Is it even possible to possess and express equal political rights — to, in effect, “do” political democracy — in a profoundly materially unequal society devoid of economic rights? That question, too, is a legacy of Reconstruction, and part of our long and unfinished fight.

Matthew E. Stanley teaches in the department of history and political science at Albany State University.

 

Category : Capitalism | Marxism | Racism | Slavery | US History | Blog
2
Dec


 

By JERRY HARRIS

Race and Class

Abstract: The Russian invasion of the Ukraine is a powerful assertion of geopolitical power and conflict. But Russia’s nationalist and expansionary drive takes place within the context of transnational economic ties. Such ties help define the nature of the war, and both the Russian and western response. The contradictory pressures of nationalist desires conflicting with transnational integration is an underappreciated complexity of the war that this article will explore.

 Keywords: energy resources, finance capital, nationalism, oligarchy, Russian invasion, sanctions, transnational capitalist class, Ukraine.

 Introduction

The invasion of Ukraine is seen by most as a geopolitical conflict between the West and Russia. Nationalist ideologies and power competition do play a significant role, but such competition takes place within the context of transnational relations that also define the nature of the struggle. Unlike the invasion of Czechoslovakia, which took place during limited economic and cultural ties between the West and Soviet Union, the current war is deeply affected by mutual economic relationships between transnational capitalists and links between transnational corporations. Exploring how the contradictions between national and transnational elements structure the character of the war is the purpose of this article.

Global capitalism has gone through tremendous change over the past forty years, building a system of transnational integration characterised by global financial flows and production. This has profoundly changed a world built around nation-centric power. The emergence of the transnational capitalist class (TCC) reshaped domestic economies and social relations by restructuring state institutions and rules to serve the new forms of global accumulation. Major trade arrangements were ratified, banks bailed out, corporate taxes cut, transnational corporations promoted and social contracts undermined. And yet the old forms of power, habits, identities and privileges still fight to maintain their existence. This mixture of national structures overturned by transnational forces creates a powerful vortex of tensions.

In Russia, this process took place first under Yeltsin and then Putin, turning the country into a neoliberal state. As the new ruling class sought a capitalist identity outside the Soviet experience, it linked to its imperial past. As a result, Russian national concepts of power rooted in Tsarist imperialist expansion reasserted their influence, even as the oligarchy made use of transnational accumulation. Neither did Great Power concepts fully fade in the West, as NATO’s eastward expansion shows. As globalisation entered a sustained period of economic, environmental and social turmoil, transnational hegemony was opened to greater challenge, particularly from authoritarian state capitalism, which finds inspiration in fascism and empire. As the globalist project of a fully integrated economic world floundered under the weight of its own excess, nationalist ideology and power projections re-emerged.

Mike Davis hits home when he describes the Putin government as one that hates Lenin and the Bolshevik position on self-determination, a government drenched in Great Russian chauvinism and supported by the reactionary religious hierarchy of the Eastern Orthodox Church. A government that invites the backing of pan-Slavic neo-fascists, that idealises the Tsarist empire, with Putin himself an iconic hero of far-right nationalists throughout Europe and the US.[1]

And yet it is a government that has structured its economy to serve and benefit from transnational capitalism. That contradiction, between nationalist ideology and its transnational model of accumulation, is the Russian trap. And it works both ways, for Russia and for its global partners.

Global capitalism and Russia

In Russia, the creation of a TCC took place primarily through the privatisation of state assets, in combination with private/state ownership arrangements in energy and finance. The state did not represent a national capitalist class, nor was its primary concern building a modern industrial base. Rather, the state played a central role in integrating the key sectors of the Russian economy into global capitalism. Russian oligarchs also rushed to integrate into elite cultural and financial networks. They sent billions into offshore havens, spent hundreds of millions on London and New York real estate, lived on their yachts, and sent their children to elite western schools.

But the full political integration of the Russian state was stymied by the western architecture of power. NATO’s expansion eastward clashed with Russia’s intent to re-establish its own sphere of influence. This was an uneven process, unfolding over a period of three decades. The G7 became the G8 as Russia was given a seat at the elite table. But tensions never fully resolved. Political, social and environmental problems continued to sharpen, giving rise to security concerns and a renewal of nationalist rhetoric to regain state legitimacy. In turn, rivalries became more aggressive, and the balance between globalism and nationalism began to shift.

To explore the above process, we begin with Russia’s internal transformation and the creation of its transnational capitalist class.

Scholar Oleg Komolov describes the Russian economy primarily as a supplier of resources, with the TCC deeply integrated into global capitalism. He points out how the ruling class that emerged from the privatisation of state assets occupies primarily the role of an intermediate seller of Russian commodities on world markets and is not interested in improving the efficiency of the economy, developing competitive manufacturing industries and technological progress. [Moreover] the export economy was developed with large-scale participation of foreign capital in all sectors of the economy, the artificial devaluation of the ruble and net capital outflow to countries of the center.[2]

Between 1997 and 2017, the outflow of capital exceeded inflows, with offshore havens the destination for 70 per cent of capital exports. The two most prominent outflow years were during the global crash of 2008 and the Russian seizure of Crimea in 2014, with a combined total of $285 billion.[3] Outside the flight to offshore havens, Russian energy TNCs had made foreign direct investments of $335.7 billion by 2017.[4]

The Russian state and private oligarchy worked together in the outflow of capital, which reduces the amount of held dollars and keeps the value of the rouble low. In turn, this helps the export of fossil fuels and minerals. According to the World Bank, the rouble is one of the world’s most undervalued currencies.[5] Oil and gas make up 65 per cent of Russian exports, but minerals and wheat also play an important role. The state has supported this process by increasing its overseas holdings in US Treasury bonds from $8 billion to $164 billion between 2007 and 2013.[6]

Keeping the value of the rouble low meant undercutting investments in the modernisation of manufacturing. The results being high import prices for machinery and agricultural inputs, as well as high consumer prices for foreign goods. In 2017, machinery and equipment made up 47 per cent of imports, and chemical products 18 per cent.[7] Thus, a low-valued rouble drove up the cost of tractors, combines, transport and machine tools, fertilisers and chemicals – a typical pattern among transnational petro-states. Privileging globalist accumulation over the national market marked the Russian ruling class with a transnational character and strategy.

Another aspect of Russia’s integration was creating an attractive market for foreign speculative capital. During the 2005–08 financial frenzy, capital flowed into Russia, benefiting from liberalisation of currency regulations. During these years, transnational capitalists sank $325 billion into Russian corporations, with large amounts going to state-owned entities like Sberbank and the energy giant Gazprom. Among the biggest investors were financial giants JPMorgan, BlackRock and Pimco.[8] Loans were also made, reaching $400 billion from some of the biggest global banks including Citigroup, HSBC, BNP Paribas and Deutsche Bank. The benefits for finance capital were double: debt from loans and earnings from investments meant profits for transnational investors the world over. The outflow of profits over a twenty-year period reached $1.2 trillion, and taking on foreign liabilities certainly didn’t support the rouble.

Energy, transnational capital and sanctions

Key to the Russian economy, and indeed the world economy, are energy resources. Russia’s fossil fuel industry has been largely exempt from the sanctions in 2022, as it was in 2014. In both cases, transfer payments for energy continued to flow through the SWIFT computers, and in 2022 these were worth about $350 million per day. Between 24 February and 24 March 2022, Russia sold $19 billion in fossil fuels. The links between western oil majors and Russian TNCs deeply influences the limits and impacts of sanctions, and so deserves attention.

First, we can review the degree of joint ventures between Russian and transnational energy majors. Rosneft emerged as Russia’s largest oil producer when Putin dismantled Yukos, and sold its $90 billion in assets for just $2 billion. Western banks rushed to loan Rosneft $22 billion as it became Russia’s dominant energy company. Financial backing came from ABN Amro, Barclays, BNP Paribas, Citigroup, Goldman Sachs, JPMorgan and Morgan Stanley. Rosneft then raised $10.7 billion in an IPO on the London Stock Exchange with BP taking a 20 per cent stake. Other strategic investors included Petronas (Malaysia) and CNPC (China). Russian oligarchs joined in, with Roman Abramovich, Vladimir Lisin and Oleg Deripaska each investing $1 billion. As Hans-Joerg Rudloff, chairman of Barclays and Rosneft board member, noted, Russia was ‘on the track of international economic integration’.[9] In 2006 Rosneft turned east, joining with China’s Sinopec in a $13.7 billion buyout of TNK-BP’s Udmurtneft Oil. In a key deal after the 2014 imposition of sanctions, Rosneft signed a thirty-year contract with the state-owned China National Petroleum Corporation worth about $400 billion. Furthermore, Exxon had a $3.2 billion Arctic offshore drilling deal with Rosneft in which the Russian TNC obtained minority stakes in the Gulf of Mexico and oil fields in Texas. Rex Tillerson, chief executive of Exxon Mobile and future Secretary of State, received the Order of Friendship award from Putin in gratitude for Exxon’s commitment.[10]

Gazprom also has a significant level of transnational integration. In developing Shtokman, one of the world’s largest gas fields, Gazprom partnered with Total from France and StatoilHydro of Norway. Total has a close relationship with the Russians. The French oil major has investments in two other Russian oil fields, and a 16 per cent stake in Novatek, the country’s largest gas producer after Gazprom. The largest foreign investment project in Russia, the Sakhalin-2 oil field, involved the British and Japanese. Although Gazprom retains majority ownership, Shell held 27.5 per cent, Mitsui 15 per cent, and Mitsubishi 10 per cent.[11]

Overall, more than 400 foreign financial institutions have provided $130 billion to Russian energy companies, $52 billion in investments and $84 billion in credit. A total of 154 US financial companies hold almost half of these investments at $23.6 billion. JPMorgan is the largest with investments and loans of $10 billion. Other major investors include Qatar’s sovereign wealth fund with $15.3 billion invested in Rosneft. The UK was the third largest investor, where 32 financial institutions contributed $2.5 billion. Other important investors come from Italy, Netherlands, Norway, Switzerland, Japan and China.[12]

To understand how sanctions disrupted these transnational relations, we need to investigate sanctions from 2014 and 2022. In 2014, companies weren’t banned from conducting business with Russian state-owned energy giants, although banks were sanctioned from making loans. The policy allowed protection for transnational institutional investors. But the US did move to sanction Rosneft’s president, Igor Sechin. This prompted Jack Ma, founder of China’s Alibaba, and John J. Mack of Morgan Stanley, to resign from the Rosneft board; while Donald Humphreys, former chief financial officer of Exxon Mobil, and BP chief executive Bob Dudley continued to serve. As western sanctions tightened, they did cause some difficult problems, forcing Eni, Exxon and Statoil to withdraw from a $20 billion Rosneft Arctic exploration project. But to replace the loss of advance drilling technology, Rosneft took a 30 per cent stake in North Atlantic Drilling, a subsidiary of Seadrill, the world’s largest offshore driller controlled by Norway’s richest man, John Fredriksen. Rosneft also faced problems when sanctions cut access to foreign capital markets. To counteract the sanctions, it arranged a series of prepayment deals with some of the largest western oil traders including Glencore, Trafigura and BP. Furthermore, Rosneft bought Morgan Stanley’s global oil trading business, obtaining an international network of oil tank storage contracts, supply agreements and freight shipping contracts, as well as a 49 per cent stake in Heidmar, a manager of oil tankers. So, while the 2014 sanctions caused a number of real problems, Rosneft’s transnational relationships provided important avenues to avoid major disruptions.[13]

Overall, the 2014 sanctions did hurt Russia. FDI inflows fell from $69 billion in 2013 to $21 billion in 2014. But the Obama administration also faced stiff resistance not only across Europe, but in the US as well. Hostility to the sanctions came from the two most influential US business groups, the National Association of Manufacturers and the US Chamber of Commerce. Both lobbied and took out critical ads in national newspapers, insisting that sanctions should not hurt financial institutions that held significant Russian debt. Among the corporations who lobbied against the sanctions were Exxon Mobil, BP, American Petroleum Institute, Amway, Caterpillar, Chevron and GM.[14]

In implementing sanctions, the US believed Russia would view its global business ties as too valuable to lose, and so economic pressure would force a retreat from eastern Ukraine. But from the other side of the mirror, Putin believed global business’s ties to Russia were too valuable and would undercut western sanctions. In important ways both were right, and the same dynamic is at play in 2022. In the recent crisis the US Chamber of Commerce has again lobbied Congress arguing sanctions should be ‘as targeted as possible in order to limit potential harm to the competitiveness of U.S. companies’.[15]

The magnitude of the 2022 invasion has caused the current sanctions to be deeper and broader. What Russian Marxist Boris Kagarlitsky pointed out in 2014 is even more true today:

The situation confronting our elites … is more or less straightforward, they cannot enter actively into confrontation with the West without dealing crushing blows to their own interests, to their own capital holdings and to their own networks, methods of rule and way of life.[16]

But this is a two-way street – the West can’t sanction Russia without hurting itself, so the question becomes who hurts the most. For example, the world’s largest asset manager BlackRock took a loss of $17 billion on their Russian exposure.[17]

Because Russia is the main supplier of oil and gas to Europe, its energy industry is a major focus of new sanctions. ExxonMobil is beginning steps to exit the Sakhalin-1 project and cease operations it carries out on behalf of a consortium of Japanese, Indian and Russian companies. Shell also announced plans to leave Sakhalin and ‘withdraw all involvement in Russian hydrocarbons’.[18] BP has moved to offload its 20 per cent stake in Rosneft and may take a hit estimated at $25 billion. BP’s move comes after thirty years of joint venture. Additionally, the Singapore-based trading company Trafigura is threatening to opt out of its 10 per cent shareholding of Vostok Oil, a vast gas project led by Rosneft. And Norway’s Equinor will also begin to exit its joint ventures. But TotalEnergies, the large French transnational, while committing to no new investments, is holding on to its nearly 20 per cent of Novatek.

Yet none of these companies may end up leaving. Exxon, BP and Shell need to find someone to buy out their interests. That will not be easy in the present circumstances, and they may have to appeal to their Russian counterparts to take their shares. Furthermore, oil tankers continue to transport millions of barrels of oil from Russian ports, estimated to be worth $700 million per day. These include tankers from Greece, and those chartered by US oil giant Chevron.[19] And SWIFT payment transfers for energy continue at the above-mentioned $350 million per day. Consequently, for all the difficulties of the sanctions, global energy integration affords Russia significant amounts of capital, which helps to finance the war.

India’s case is yet another example of the complexity of transnational production. Obtaining about a 33 per cent discount from Russia, India’s oil imports have surged by 700 per cent.[20] Some of these imports go to Reliance Industries, which has the world’s largest refinery complex, and also to an affiliate of Rosneft, Nayara Energy. Using Russian crude, Indian refineries produce diesel and jet fuel, which is sold to Europe, whose imports from India have jumped. As Shell’s chief executive explained, oil substantially treated or changed loses it national origin. ‘We do not have systems in the world to trace back whether that particular molecule originated from a geological formation in Russia, [therefore] diesel going out of an Indian refinery that was fed with Russian crude is considered to be Indian diesel.’[21]

One particularly ironic aspect of transnational relations is that Russian gas flows through pipelines running through Ukraine to Italy, Austria and eastern Europe. Russia pays transport fees to the government, thus supplying funds to Ukraine even as the war raged. And, of course, gas reaching the EU means more money for Russia. It wasn’t until May 2022 that Ukraine stopped the Sokhranovka pipeline that operates from the Russian-controlled Luhansk region. The value of the gas is about $1 billion each month. But Sudzha, Russia’s main pipeline, is, at the time of writing, still in Ukrainian-held territory, allowed to operate, and expected to take on some of the lost capacity.

Another example of the complexity of transnational production is how the invasion impacted Rusal, the world’s second-largest aluminium producer, owned by Oleg Deripaska and listed on the Hong Kong market. Rusal has a joint venture with Australian mining giant Rio Tinto. But because of sanctions, their joint refinery, Queensland Alumina, will not ship products to Russia. The result is that Rusal had to halt production at its Nikolaev refinery located in Ukraine, which accounts for 23 per cent of its annual production. Nikolaev is one of the most modern refineries in the world and employs about 1,500 people. To make up the shortfall Rusal may divert production from its Aughinish refinery in Ireland to feed its Russian smelters.[22] In turn, that will reduce supplies in Europe where materials are already short. The end result is higher unemployment in Ukraine, higher prices in Europe, and a lower stock price for Rusal.

Data compiled by the Yale School of Management reported 253 TNCs are making a clean break with Russia, essentially leaving no operations behind. Some of these include Uber, Shell, Salesforce, Reebok, McKinsey, Nasdaq, eBay, Delta, Deloitte, BP, BlackRock, American Airlines and Alcoa. Another 248 companies have suspended their operations without permanently exiting or divesting. Among these are Adidas, American Express, Burger King, Chanel, Coca-Cola, Dell, Disney, GM, Hewlett Packard, Honeywell, Hyundai, IBM, McDonalds, Mastercard, Nike, Oracle, Starbucks, UPS, Visa and Xerox. Some seventy-five companies have suspended a significant portion of their business. These include Caterpillar, John Deere, Dow, GE, Goldman Sachs, JPMorgan, Kellogg’s, Pepsico and Whirlpool. Pausing new investments are ninety-six companies. This is different from JPMorgan and Goldman Sachs who, while suspending some operations, continue to snatch up depressed Russian securities at very low prices. Among those pausing new investments are Cargill, Colgate-Palmolive, Credit Suisse, Danone, Johnson & Johnson, Siemens and Unilever. The total so far is 672 companies taking various forms of action. Yale reported 162 companies staying the course, including Acer, Alibaba, International Paper, Koch, and Lenovo.[23]

Some funds not appearing in the Yale report include the important financial centres in Singapore, which has halted any new economic activity with four major Russian banks. And Singapore’s large sovereign wealth funds, which have about $6 billion invested in Russia, have also suspended activity.[24] Two of China’s largest state-owned banks are limiting loans for purchases of Russian commodities.[25] The New Development Bank, established by Russia, China, Brazil and South Africa, put new transactions on hold. And the Asian Infrastructure Investment Bank, whose major shareholder is China, stopped its projects in Russia and Belarus. As of the middle of March 2022, there were more than 3,600 sanctions on Russian individuals and companies.

Table 1: Estimated and potential losses of companies leaving Russia[26]

Companies Leaving Russia

Estimated and Potential Loss (US$ million)

BlackRock $17,000
Bank of America $700
BNY Mellon $200
Citigroup $1,900
Ericsson $95
Goldman Sachs $300
JPMorgan $1,000
Nokia $109
Shell $5,000
Société Générale $3,300
Volvo $423

 

The rush to boycott Russia reminds one of the corporate rush to endorse Black Lives Matter; essentially a marketing strategy to stay in front of popular politics. And while the costs are disruptive, transnational corporations are large enough to swallow such losses. For example, as the price for oil rose, Shell increased its early quarterly profits by 300 per cent to $9.1 billion – already enough to cover its projected $5 billion loss. Most of these sanctions will only harm the Russian people without having any real effect on the ruling class or the invasion. Russian citizens are already experiencing a dramatic decline in purchasing power and may soon face growing unemployment and a lack of consumer goods. The larger developing crisis is in world food supplies as Russia and Ukraine export a significant amount of the world’s wheat, corn, barley and sunflower oil. Shortages and price increases will hit the poor in the Global South the hardest.

Financial institutions and the TCC

Because of the integration of the global financial system, Russian capital was exposed to severe sanctions in 2022 that constituted a geo-economic break. There has been a general belief in the sanctity of foreign reserves. The US often talks about a ‘rules-based world order’. This includes open capital markets and accounts, deeply integrated financial markets, and benchmark assets in US dollars. Putin counted on all of this to keep the Russian economy functioning during the invasion. But seven of the largest Russian banks have been removed from the SWIFT interbank system. This severely limits the ability to pay for imports or receive payment for exports, as SWIFT is used to link funds for transnational deals. Russia’s central bank also kept about half its $630 billion dollars and euro reserves in foreign institutions residing in London, New York, Paris and Tokyo, and from $86 to $140 billion in Chinese bonds. Except for the Chinese holdings, these funds are now frozen, causing the rouble to lose about 40 per cent of its value, although with capital controls the rouble regained most of its value. Moreover, the collapse of Russian corporate stocks triggered the multi-week closure of the Russian stock market. And both Moody and Fitch downgraded Russian sovereign debt to ‘junk’. Russia is moving towards its first foreign currency debt default in one hundred years, but, as of May 2022, was still making payments using money from energy exports.

The severity of the economic sanctions is a radical step. Even during the second world war, relations between the Bank of England and the Reichsbank continued into the 1940s. And the Bank of International Settlements continued to allow the German central bank access to its clearing and settlement facilities throughout the war.

As Dominik Leusder points out:

More than any armed conflict, the current international monetary system has laid bare the folly of this romantic liberal portrait of globalisation. The sanctions against Russia are the clearest manifestation yet of a distinct undercurrent of financial globalisation … the West’s ability to coerce states has only increased as a function of their integration [so] as Russia became a central node [of] the global economy, it became more vulnerable.[27]

 

And yet western investors and companies are also in danger, as sanctions over the transfer of funds may mean Russia defaults on billions in loans. Facing such problems, US authorities gave the okay to JPMorgan to process interest payments due on dollar bonds from the Russian government. Citigroup is another payment agent for about fifty corporate bonds tied to Russian TNCs like Gazprom and MMC Norilsk Nickel. [28] Furthermore, the important financial institution Gazprombank is spared from sanctions and continues to be a conduit for commodity transactions. For example, working with Citibank it helped Brazil purchase Russian fertiliser, which is not sanctioned. Thus, the flow of capital continues, at least in part, despite sanctions.

Again, Leusder provides insightful analysis:

As globalization underwrote Putin’s militarism and his increasingly hostile posture toward Russia’s neighbors, it simultaneously rendered the country’s economy fatally reliant: on the net demand from other countries such as Germany and China; on imports of crucial goods such as machinery, transportation equipment, pharmaceutical and electronics, mostly from Europe; on access to the global dollar system to finance and conduct trade … This is one way to construe the deceptively simple insight of Henry Farrell and Abraham L. Newman’s theory of weaponized interdependence: the logic of financial globalization that generated Russia’s trade surplus and gave Putin room to maneuver also provided the economic and financial weaponry that was turned against him.[29]

Thus, a nationalist strategy to reconstitute the Russian empire, using the profits and ties that come with globalisation, is undercut by the contradiction of those same ties and relationships.

Weaponised interdependence is a good description of the financial markets in metals. Alongside Russian fossil fuels are its exports of metals, including copper, alumina and nickel, which is used in making stainless steel and batteries for electric cars. Here are the complications of transnational capitalism. Tsingshan Holding Group in China is the world’s largest nickel producer, China’s second largest steel producer, and is involved in electric vehicle batteries. Tsingshan made an enormous $3 billion bet shorting the price of nickel, counting on its own increased production in creating an abundance of supplies. This bet was made on the London Metal Exchange (LME), which is a unit of Hong Kong Exchanges and Clearing Limited. With the Russian invasion, although nickel was not sanctioned, fear took hold of the market and prices jumped 250 per cent. The short bet based on lowering cost was a disaster. Trade chaos took hold, leaving Tsingshan with two choices. Either deliver tons of nickel or pay for margin calls, which means coming up with the cash or securities to cover potential losses. But Tsingshan only held 30,000 tons of its 150,000-ton bet. The remainder was held by JPMorgan, BNP Paribas, Standard Chartered and United Overseas Bank. On the cusp of a global financial disaster, LME suspended trading and retroactively cancelled $3.9 billion of trades, blaming banks for preventing efforts to create greater transparency that could have revealed the interconnected problem.[30] Consequently, the Russian invasion set off a financial crisis that punished transnational capitalists that have no part in the war.

Facing sanctions, oligarchs can’t be happy with the war, and a number have stated their opposition. Nevertheless, the global financial system has been built to safely hide their money, as well as the wealth of others in the TCC. It’s estimated that oligarchs have hidden about half their wealth offshore, amounting to some $200 billion. Somewhere between 10,000 to 20,000 Russians hold more than $10 million each in offshore assets and havens.[31] Still, that is significantly less than their American counterparts who have an estimated $1.2 trillion in offshore tax havens. Much of the Russian money is in US, UK and EU assets. Transparency International has estimated about $2 billion just in UK property.[32]

But much of this wealth is difficult to discover because the TCC has structured international laws to hide wealth in complex trusts and shell corporations.[33] Global accounting firms PwC, KPMG, Deloitte and EY helped oligarchs move money to offshore shell companies for years before currently withdrawing services. Rosneft, VTB, Alfa Bank, Gazprom and Sberbank have been represented by leading US law firms, including White & Case, DLA Piper, Dechert, Latham & Watkins and Baker Botts. And Baker McKenzie, one of the world’s largest law firms, continues to represent some of Russia’s largest companies, including Gazprom and VTB.[34] Concord Management specialised in serving ultra-wealthy Russians, helping them invest in hedge funds, private equity and real estate. Since 1999, Concord has channelled billions to BlackRock, Carlyle Group and others. Wall Street banks such as Credit Suisse, Goldman Sachs and Morgan Stanley often acted as intermediators, linking Concord to hedge funds.[35] Such well-worn networks tie the Russian TCC to global capitalists and financial institutions in a mutually beneficial relationship, and creates a shared culture that exalts the privileges of wealth and common ideas about how the world economic system works.

Capitalists the world over make use of sophisticated accountants, bankers and lawyers to hide their assets. An agent will set up an offshore shell company in a country with little transparency. This company then creates more shells in other low-transparency jurisdictions – about forty-two exist across the world, including the US states of Delaware and South Dakota. This allows the ‘ultimate beneficial owner’, often unknown, to have multiple bank accounts and the ability to move money and invest without any scrutiny. Government investigators in both the US and the UK regularly ignore suspicious banking activity. In 2018, the EU passed regulations demanding access to information on the ownership of European companies nested in shell companies. Yet in 2022 no such registry exists. Congress passed a transparency law in 2021 with a $63 million budget, but never provided the money to the Treasury Department. Consequently, the effort to sanction oligarchs is undercut by the global financial system built to the demands of the TCC, of which Russian capitalists are members. While some pressure is being directed on the oligarchs, the system of hidden cross-border capital flows is too valuable to end, allowing the Russian TCC to escape greater harm.

A good example of how shell corporations function is the effort to sanction Arcady Rotenberg. Rotenberg is worth about $3 billion with an estimated $91 million invested in the US and a $35 million mansion outside London, bought through an entity in the British Virgin Islands. He has at least 200 companies located across dozens of countries. Even after coming under sanctions in 2014, Rotenberg became the owner of two additional companies located in Luxembourg, well known as a haven for billionaires. Although senate investigators found countless bank filings on suspicious Rotenberg activities, none of them have been investigated by the Treasury Department.

As Cihan Tuğal reminds us, Putin and his cronies

are a solid part of world capitalism, and their apparently insane actions are intended to produce a better place at the table. They want to be recognized as legitimate imperialists in the new, post-Wilson and post-Lenin world of the 21st century … [Putin] is not only serving his ego, but a capitalist class fostered by post-1991 reforms, which were selective appropriations of free market ideas. The gang of cronies is not Putin’s creation alone. It is an outcome of transnational dynamics. This class is hungry for markets, and it cannot help but look for ways to burst out of Russia.[36]

German/Russian economic relations

Moving from a picture of transnational markets, industries and finance, we can explore the specific relationship between Germany and Russia. Germany as the largest European economy is also the most integrated with Russia. For Russia, it’s their most important economic partner alongside China. In 2021, German exports to Russia were worth more than $28.4 billion, and it invested a further €25 billion in operations.[37] Germany still depends on Russia for about 55 per cent of its natural gas, 35 per cent of its oil, and half its coal.

Before 2014, there were 7,000 German companies inside Russia representing some of the largest TNCs in the world, such as Adidas, BASF, Siemens, Volkswagen, Opel and Daimler. On the financial side, all major German commercial banks were active in Russia. In terms of oil and gas, Germany’s biggest energy group Eon was the largest foreign shareholder in Gazprom, which, alongside BASF, was building the $6.6 billion Baltic Sea pipeline. The Germans held 20 per cent of the Nord Stream joint venture, with former chancellor Gerhard Schröder as chairman and Matthias Warnig of Dresdner Bank its chief executive. Even after the seizure of Crimea, Siemens CEO Joe Kaeser confirmed its commitment to Russia to sell trains, energy infrastructure, medical technology and manufacturing automation technology. Cross-border deals also continued, with RWE selling its oil and gas subsidiary to Russia’s LetterOne for over $7.5 billion. But, with the 2014 sanctions, German trade with Russia dropped by 35 per cent, and German firms investing in Russia dropped to just under 4,000 by 2020.[38]

Now the invasion of Ukraine has shaken the German/Russian relationship in a very significant manner, particularly in the auto and energy industries. Wintershall Dea, an oil and gas TNC, will stop payments to Russia and write off its €1 billion investment in Nord Stream 2. Additionally, it will not receive revenues from its Russian operations, which accounted for about 20 per cent of its 2021 profits. The company issued a statement on the turmoil caused by the invasion lamenting,

What is happening now is shaking the very foundations of our cooperation. We have been working in Russia for over 30 years … We have built many personal relationships – including in our joint ventures with Gazprom. But the Russian war of aggression against Ukraine marks a turning point.[39]

Nord Stream 2 has been a contentious issue between the US and Germany for years. The pipeline running through the Baltic goes directly to Germany. The US has pressured Germany to end the project, but Angela Merkel refused to do so. The project, worth $11 billion, is registered as a Swiss firm whose parent company is Gazprom. Gazprom owns the pipeline and paid half the costs, the rest shared by Shell, Austria’s OMV, France’s Engie, and Germany’s Uniper and Wintershall DEA.[40] The invasion has prompted Germany to halt the project. The suspension of Nord Stream 2 may not be permanent, but even a temporary suspension is a huge shift.

Russia exports fifty-six billion cubic metres of liquefied natural gas to Germany yearly. Inside Germany, Gazprom owns and operates thousands of miles of pipeline, key storage facilities, and the largest underground storage tank for natural gas in western Europe. Russia also supplies German refineries with a third of their oil, a number with long-term contracts that Russia is not willing to cancel. Particularly ironic are the weapons sent by the German government to Ukraine that use steel produced in German factories powered by coal coming from Russia. As Putin has stated:

Let German citizens open their purses, have a look inside and ask themselves whether they are ready to pay three to five times more for electricity, for gas and for heating … You can’t isolate a country like Russia in the long run, neither politically nor economically. German industry needs the raw materials that Russia has. It’s not just oil and gas, it’s also rare earths. And these are raw materials that cannot simply be substituted.[41]

Turmoil has also hit the auto industry. Volkswagen, Mercedes-Benz and BMW halted production in Russia, and also suspended all vehicle exports. But the invasion has had an even bigger impact because of the coordination of production between Ukraine and European auto companies. With its low labour costs and educated workforce, Ukraine became a manufacturing centre of systems which connect electronic components, like tail lights and car entertainment systems. The work, done by hand, requires a large number of skilled workers. The fighting brought production to a sudden halt, and within days the lack of parts shut down European factories. BMW shut several plants in Germany, Austria and Britain, while VW was brought to a standstill at multiple locations, including its main site in Wolfsburg. Electric vehicle production at Zwickau stopped, including its SUV exports to the US, and Porsche idled manufacturing the Cayenne sport utility vehicle in Leipzig. As Jack Ewing noted:

No car can operate without wiring systems, which are often tailor-made to specific vehicles. So-called wiring harnesses are among the first components to be installed in a new vehicle, and their absence brings assembly lines to a standstill.[42]

Furthermore, Ukraine is also a major source of neon, a gas used for high-performance lasers required for production of scarce semiconductors, adding more woes to the industry.

None of these economic disruptions are welcomed by the TCC. But the German government has taken a major step away from its previous positions. At first opposed to banning Russia from SWIFT, and refusing to send arms to Ukraine, it has now reversed on both those issues. And the sizeable increase in its military budget surprised everyone. Although transnational links are deep, for now geopolitical tensions are riding roughshod over economic concerns. But such concerns have not gone away. The New York Times observes that ‘multiple cracks’ have already occurred over ‘lost trade, higher energy prices, slimmer profits and lower economic growth’, as well as lower employment.[43] As Martin Brudermüller, the chief executive of the chemical giant BASF stated, ‘Cheap Russian energy has been the basis of our industry’s competitiveness’.[44] And again, ‘Do we want to blindly destroy our entire national economy? What we have built up over decades?’[45] What is true for BASF is true for the German economy, whose success is built upon cheap gas from Russia and exports to China.

Conclusion

There are a number of questions not explored in this article. NATO’s eastward expansion, Great Russian chauvinism, fascist forces in both Russia and Ukraine, the meaning of independence and self-determination, US hypocrisy on foreign interventions, China’s role, and growing debates within the Left over the war. All these topics already have a growing and substantial body of literature. Also, events continue to rapidly develop and so the article has some time limitations. But the deeper issues on the intersections between national geopolitics and transnational economics, and how the resulting contradictions affect the war, will continue. What is clearly evident is that global capitalism has plunged the world into yet another crisis. A crisis that ignores a pandemic that threatens the health of every human on the planet, and an environmental crisis that threatens every species. The failure is staggering in its ignorance.

What the new global configuration will look like is difficult to tell. Much depends on how the conflict ends. A long-term occupation will freeze Russia’s transnational links, a rapid conclusion may mean the easing of sanctions. The invasion is a further deconstruction of the global capitalist system built over the past forty years of neoliberal hegemony. But there are still many trillions of dollars in cross-border accumulation, and global assembly lines continue to churn out commodities in a coordinated system of production and trade. The current problems in logistics and supplies are not because of too little demand, but because of too much, with the infrastructure of ports, shipping and transportation actually too limited. Such problems might call for an expansion of globalisation, which is at the heart of China’s Belt and Road strategy. But economic, political and social disruptions cause states to look to their own national security. As a result, the contradictions between national and transnational forces continue to be the nexus for world events, changing the balance of forces into new configurations of struggle.

This complex relationship between nationalism and globalism needs to be understood through historical materialism, which defines the world as a continual process of movement. Marx saw everything in motion – production, distribution, environmental metabolic relationships, the class struggle, and all human interactions. Change was driven by the balance between opposing forces, and the results were defined by the power between the aspects. How much of the old that remained, and how much of the new that was asserted, continually set the conditions for the movement to continue. This process of motion and change results in contradictions unfolding in many different forms. There is no historic queue in which socialism waits its turn to appear at the front of the line.

In the current capitalist world, neither nation-centric nor transnational relationships exist in isolation from the other. They exist in the same institutions and continually define and determine each other within a changing balance of forces. This unity of opposites in tension and conflict is what produces the historic transformation towards a new synthesis. No outcome is predetermined, but produced by the dynamic itself. Consequently, what aspects of nation-centric relationships survive or re-emerge depend on the agency of political struggle. Under pressure of globalist economic and environmental crisis, nationalist antagonisms have rematerialised, but within the context of transnational relationships. Globalisation didn’t create the ‘end of history’ because the past continues to exist in the present.[46]

We can see this contradiction in the balance between national and transnational forces in the Russian invasion. A balance in which nationalism and inter-state conflict has grown stronger as the forty-year hegemony of neoliberal globalisation has faced a series of economic, environmental and social crises. As the balance of power shifts, aspects of the old system reassert themselves, but deeply affected and redefined by the changes globalisation engendered. Old ideas and conflicts may re-emerge, yet they are never the same, but contextualised through the new forces that have asserted themselves. So, in analysing the Russia/Ukraine/NATO conflict, we must be careful not to place it in the world of the 1960s, but a world deeply restructured by transnational capitalism.

References

 Jerry Harris is national secretary of the Global Studies Association of North America. He is the author of over 100 journal and newspaper articles, and his latest book is Global Capitalism and the Crisis of Democracy (Atlanta, GA: Clarity Press, 2016).



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[2] O. Komolov, ‘Capital outflow and the place of Russia in core-periphery relationships’, World Review of Political Economy 10, no. 3 (2019).

[3] Komolov, ‘Capital outflow’.

[4] UNCTAD (United Nations Conference on Trade and Development), 2017 Foreign Direct Investment: Inward and Outward Flows and Stock, 1970–2016 (NY: UNCTAD, 2017).

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[11] C. Chyong and V. Tcherneva, ‘Europe’s vulnerability on Russian gas’, European Council on Foreign Relations, 17 March 2015, http://www.ecfr.eu/article/commentary_europes_vulnerability_on_russian_gas.

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[13] J. Harris, Global Capitalism and the Crisis of Democracy (Atlanta, Clarity Press, 2016).

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[30] I. Ouyang, ‘LME nickel mayhem’.

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[33] M. Apuzzo and J. Bradley, ‘Oligarchs got richer despite sanctions. Will this time be different?’, The New York Times, 16 March 2022, https://www.nytimes.com/2022/03/16/world/europe/russia-oligarchs-sanctions-putin.html.

[34] M. Goldstein, K. P. Vogel, J. Drucker, M. Farrell and M. McIntire, ‘How western firms quietly enabled Russian oligarchs’, The New York Times, 9 March 2022, https://www.nytimes.com/2022/03/09/business/russian-oligarchs-money-concord.html.

[35] M. Goldstein and D. Enrich, ‘How one oligarch used shell companies and Wall Street ties to invest in the U.S.’ The New York Times, 21 March 2022, https://www.nytimes.com/2022/03/21/business/russia-roman-abramovich-concord.html.

[36] C. Tuğal, ‘Putin’s invasion: imperialism after the epoch of Lenin and Wilson’, LeftEast, 6 March 2020, https://lefteast.org/putins-invasion-imperialism-after-the-epoch-of-lenin-and-wilson/.

[37] M. Eddy, ‘For German firms, ties to Russia are personal, not just financial’, The New York Times, 6 March 2022, https://www.nytimes.com/2022/03/06/business/germany-russia-companies.html.

[38] M. Eddy, ‘For German firms’.

[39] M. Eddy, ‘For German firms’.

[40] J. Mason, ‘U.S. slaps sanctions on company building Russia’s Nord Stream 2 pipeline’, Reuters, 23 February 2002, https://www.reuters.com/business/energy/us-plans-sanctions-company-building-russias-nord-stream-2-pipeline-cnn-2022-02-23/.

[41] K. Bennhold, ‘The former Chancellor who became Putin’s man in Germany’, The New York Times, 23 April 2022, https://www.nytimes.com/2022/04/23/world/europe/schroder-germany-russia-gas-ukraine-war-energy.html.

[42] J. Ewing, ‘Car industry woes show how global conflicts will reshape trade’, The New York Times, 7 March 2022, https://www.nytimes.com/2022/03/07/business/cars-russia-china-trade.html.

[43] K. Bennhold and S. Erlanger, ‘Ukraine war pushes Germans to change. They are wavering’, The New York Times, 12 April 2022, https://www.nytimes.com/2022/04/12/world/europe/germany-russia-ukraine-war.html.

[44] K. Bennhold and S. Erlanger, ‘Ukraine war pushes’.

[45] M. Eddy, ‘Why Germany can’t just pull the plug on Russian energy’, The New York Times, 5 April 2022, https://www.nytimes.com/2022/04/05/business/germany-russia-oil-gas-coal.html.

[46] J. Harris, Global Capitalism.

Category : Capitalism | Globalization | Hegemony | Russia | Theory | Blog
12
Sep

By Ian Angus

Climate & Capitalism

Sep 07, 2022

In Part Eight of Capital, titled “So-called Primitive Accumulation,” Marx describes the brutal processes that separated working people from the means of subsistence, and concentrated wealth in the hands of landlords and capitalists. It’s one of the most dramatic and readable parts of the book.

It is also a continuing source of confusion and debate. Literally dozens of articles have tried to explain what “primitive accumulation” really meant. Did it occur only in the distant past, or does it continue today? Was “primitive” a mistranslation? Should the name be changed? What exactly was “Marx’s theory of primitive accumulation”?

In this article, written for my coming book on The War Against the Commons, I argue that Marx thought “primitive accumulation” was a misleading and erroneous concept. Understanding what he actually wrote shines light on two essential Marxist concepts: exploitation and expropriation.

This is a draft, not my final word. I look forward to your comments, corrections and suggestions.

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On June 20 and 27, 1865, Karl Marx gave a two-part lecture to members of the International Workingmen’s Association (the First International) in London. In clear and direct English, he drew on insights that would appear in the nearly-finished first volume of Capital, to explain the labor theory of value, surplus value, class struggle, and the importance of trade unions as “centres of resistance against the encroachments of capital.”1 Since an English translation of Capital wasn’t published until after his death, those talks were the only opportunity that English-speaking workers had to learn those ideas directly from their author.

While explaining how workers sell their ability to work, Marx asked rhetorically how it came about that there are two types of people in the market–capitalists who own the means of production, and workers who must sell their labor-power in order to survive.

How does this strange phenomenon arise, that we find on the market a set of buyers, possessed of land, machinery, raw material, and the means of subsistence, all of them, save land in its crude state, the products of labour, and on the other hand, a set of sellers who have nothing to sell except their labouring power, their working arms and brains? That the one set buys continually in order to make a profit and enrich themselves, while the other set continually sells in order to earn their livelihood?

A full answer was outside the scope of his lecture, he said, but “the inquiry into this question would be an inquiry into what the economists call ‘Previous, or Original Accumulation,’ but which ought to be called Original Expropriation.”

“We should find that this so-called Original Accumulation means nothing but a series of historical processes, resulting in a Decomposition of the Original Union existing between the Labouring Man and his Instruments of Labour.… The Separation between the Man of Labour and the Instruments of Labour once established, such a state of things will maintain itself and reproduce itself upon a constantly increasing scale, until a new and fundamental revolution in the mode of production should again overturn it, and restore the original union in a new historical form.”

Marx was always very careful in his use of words. He didn’t replace accumulation with expropriation lightly. The switch is particularly important because this was the only time he discussed the issue in English–it wasn’t filtered through a translation.

In Capital, the subject occupies eight chapters in the part titled Die sogenannte ursprüngliche Akkumulation–later rendered in English translations as “So-called Primitive Accumulation.” Once again, Marx’s careful use of words is important–he added “so-called” to make a point, that the historical processes were not primitive and not accumulation. Much of the confusion about Marx’s meaning reflects failure to understand his ironic intent, here and elsewhere.

In the first paragraph he tells us that ‘ursprüngliche’ Akkumulation is his translation of Adam Smith’s words previous accumulation. He put the word ursprüngliche (previous) in scare quotes, signaling that the word is inappropriate. For some reason the quote marks are omitted in the English translations, so his irony is lost.

In the 1800s, primitive was a synonym for original–for example, the Primitive Methodist Church claimed to follow the original teachings of Methodism. As a result, the French edition of Capital, which Marx edited in the 1870s, translated ursprüngliche as primitive; that carried over to the 1887 English translation, and we have been stuck with primitive accumulation ever since, even though the word’s meaning has changed.

Marx explains why he used so-called and scare quotes by comparing the idea of previous accumulation to the Christian doctrine that we all suffer because Adam and Eve sinned in a distant mythical past. Proponents of previous accumulation tell an equivalent nursery tale:

Long, long ago there were two sorts of people; one, the diligent, intelligent and above all frugal elite; the other, lazy rascals, spending their substance, and more, in riotous living. … Thus it came to pass that the former sort accumulated wealth, and the latter sort finally had nothing to sell except their own skins. And from this original sin dates the poverty of the great majority who, despite all their labour, have up to now nothing to sell but themselves, and the wealth of the few that increases constantly, although they have long ceased to work.

“Such insipid childishness is every day preached to us in defense of property,” but when we consider actual history, “it is a notorious fact that conquest, enslavement, robbery, murder, in short, force, play the greatest part.” The chapters of So-called Primitive Accumulation describe the brutal processes by which “great masses of men [were] suddenly and forcibly torn from their means of subsistence, and hurled onto the labor-market as free, unprotected and rightless proletarians.”

These newly freed men became sellers of themselves only after they had been robbed of all their own means of production, and all the guarantees of existence afforded by the old feudal arrangements. And this history, the history of their expropriation, is written in the annals of mankind in letters of blood and fire.

Marx’s account focuses on expropriation in England, because the dispossession of working people was most complete there, but he also refers to the mass murder of indigenous people in the Americas, the plundering of India, and the trade in African slaves–“these idyllic proceedings are the chief moments of primitive accumulation.” That sentence, and others like it, illustrate Marx’s consistently sarcastic take on primitive accumulation. He is not describing primitive accumulation, he is condemning those who use the concept to conceal the brutal reality of expropriation.

Failure to understand that Marx was polemicizing against the concept of “primitive accumulation” has led to another misconception–that Marx thought it occurred only in the distant past, when capitalism was being born. That was what Adam Smith and other pro-capitalist writers meant by previous accumulation, and as we’ve seen, Marx compared that view to the Garden of Eden myth. Marx’s chapters on so-called primitive accumulation emphasized the violent expropriations that laid the basis for early capitalism because he was responding to the claim that capitalism evolved peacefully. But his account also includes the Opium Wars of the 1840s and 1850s, the Highland Clearances in capitalist Scotland, the colonial-created famine that killed a million people in Orissa in India in 1866, and plans for enclosing and privatizing land in Australia. All of these took place during Marx’s lifetime and while he was writing Capital. None of them were part of capitalism’s prehistory.

The expropriations that occurred in capitalism’s first centuries were devastating, but far from complete. In Marx’s view, capital could not rest there–its ultimate goal was “to expropriate all individuals from the means of production.”2 Elsewhere he wrote of big capitalists “dispossessing the smaller capitalists and expropriating the final residue of direct producers who still have something left to expropriate.”3 In other words, expropriation continues well after capitalism matures.

We often use the word accumulation loosely, for gathering up or hoarding, but for Marx it had a specific meaning, the increase of capital by the addition of surplus value,4 a continuous process that results from the exploitation of wage-labor. The examples he describes in “So-called Primitive Accumulation” all refer to robbery, dispossession, and expropriation–discrete appropriations without equivalent exchange. Expropriation, not accumulation.

In the history of capitalism, we see a constant, dialectical interplay between the two forms of class robbery that Peter Linebaugh has dubbed X2–expropriation and exploitation.

Expropriation is prior to exploitation, yet the two are interdependent. Expropriation not only prepares the ground, so to speak, it intensifies exploitation.5

Expropriation is open robbery. It includes forced enclosure, dispossession, slavery and other forms of theft, without equivalent exchange. Exploitation is concealed robbery. Workers appear to receive full payment for their labor in the form of wages, but in fact the employer receives more value than he pays for.

What Adam Smith and others described as a gradual build up of wealth by men who were more industrious and frugal than others was actually violent, forcible expropriation that created the original context for exploitation and has continued to expand it ever since. As John Bellamy Foster and Brett Clark write in The Robbery of Nature:

Like any complex, dynamic system, capitalism has both an inner force that propels it and objective conditions outside itself that set its boundaries, the relations to which are forever changing. The inner dynamic of the system is governed by the process of exploitation of labor power, under the guise of equal exchange, while its primary relation to its external environment is one of expropriation.6

In short, Marx did not have a “theory of primitive accumulation.” He devoted eight chapters of Capital to demonstrating that the political economists who promoted such a theory were wrong, that it was a “nursery tale” invented to whitewash capital’s real history.

Marx’s preference for “original expropriation” wasn’t just playing with words. That expression captured his view that “the expropriation from the land of the direct producers–private ownership for some, involving non-ownership of the land for others–is the basis of the capitalist mode of production.”7

The continuing separation of humanity from our direct relationship with the earth was not and is not a peaceful process: it is written in letters of blood and fire.

That’s why he preceded the words “primitive accumulation” by “so-called.”

Notes:
1 Quotations from Marx’s 1865 lectures, “Value, Price and Profit,” are from Marx Engels Collected Works, vol. 20, 103-149. Quotations from “So-Called Primitive Accumulation” are from Marx, Capital vol. 1 (Penguin, 1976) 873-940.
2 Marx, Capital vol. 3, (Penguin, 1981) 571.
3 Ibid, 349.
4 See chapters 24 and 25 of Capital vol. 1.
5 Linebaugh, Stop Thief! (PM Press, 2014), 73.
6 Foster and Clark, The Robbery of Nature (Monthly Review Press, 2020), 36.
7 Marx, Capital vol. 3 (Penguin, 1981) 948. Emphasis added.

About Ian Angus
Ian Angus is a socialist and ecosocialist activist in Canada. He is editor of the ecosocialist journal Climate & Capitalism. He is co-author, with Simon Butler, of Too Many People? Population, Immigration and the Environmental Crisis (Haymarket, 2011), editor of the anthology The Global Fight for Climate Justice (Fernwood, 2010); and author of Facing the Anthropocene: Fossil Capitalism and the Crisis of the Earth System (Monthly Review Press, 2016). His latest book is A Redder Shade of Green: Intersections of Science and Socialism (Monthly Review Press, 2017).

Category : Capitalism | Globalization | Marxism | Slavery | Terror and Violence | Working Class | Blog
16
Jul

By Steve Dubb and Emily Kawano

Nonprofit Quarterly
July 13, 2022 – What does ownership mean, and how can it be structured to design a more democratic economy? It is common to think of ownership as being about possession: it’s yours, or it’s mine—or perhaps, if we are thinking as a group, it’s ours. But it is much more than that. Ownership is a bundle of rights—social, individual, and collective—which means its boundaries and intersections vary from place to place.1

Today, a growing number of people are questioning how those ownership rights are defined and distributed. These days, in the world of work in the United States, there is talk of a Great Resignation;2 but this can also be thought of in other ways—as a great awakening, a great rebellion, a great recalibration.3 Beyond the workplace, communities are designing entirely new ecosystems of institutions—reclaiming ownership of their identities, cultures, land, and businesses.

Discussion of systems change has also rarely been more present. Yet, when people say “systems change,” more often than not they don’t mean systemic change—not really. Perhaps, to be generous, they mean systemic change writ small, focused on taking a multifaceted (sometimes called “collective impact”) approach to addressing a single problem—such as building a better workforce training and development system4— rather than shifting power and changing rights of ownership in society as a whole.

As Cyndi Suarez, NPQ’s president and editor in chief, observed a few years ago, “[S]ystem thinking has become deracinated, devoid of its true power implications.”5 Nowhere is this point more apt than when it comes to thinking of the overall economy. Simply put, when it comes to the economy, all too often systems change is treated as a bridge too far, best not entertained at all. Alternatively, systems change is only framed within the confines of our current dominant system: we are invited to “reimagine capitalism” rather than to dare imagine beyond it.6

With this article, we want to take that challenge on. We do this not out of curiosity or academic fancy but for some highly practical and pragmatic reasons. Our collective well-being—and perhaps even our collective survival—depends on it.

The Nature of the Challenge

It is common to treat the present global economy as a fact of nature, but it is not. Greed, we are also told, is part of the human condition. Maybe it is, but so too is cooperation. As Ariel Knafo, a psychology professor at Hebrew University in Jerusalem, explained in Scientific American years ago, “Human nature supports both prosocial and selfish traits,” and the “degree to which we act cooperatively or selfishly is unique to each individual and hinges on a variety of genetic and environmental influences.”7 Our current economic system privileges greed and diminishes cooperation; an economic system that prioritized solidarity would do the opposite. We can design our economy to build on the more cooperative, rather than the more self-serving, parts of our human selves—if we choose.

Can a redesign be done? Well, it has been done before. In fact, our present capitalist system, so often treated as permanent, is, historically speaking, quite new. The origins of the capitalist economy can be traced back to at least the beginning of the imperialist process unleashed by the European so-called “discovery” of the Americas. As economist Jeffrey Sachs explains in “Twentieth-century political economy: a brief history of global capitalism,” modern capitalism only “emerged as a [dominant] social system in western Europe in the first half of the nineteenth century.”8

In short, capitalism became the world’s reigning economic system only two centuries ago, and in many parts of the world its ascendancy is more recent than that. Economic systems have changed before. They can—and almost certainly will—change again.

Capitalism, as an economic system, has unleashed human productive capacity, but it has done so in ways that are highly exploitative and extractive. Capitalism, in short, has done and is doing great harm. It is impossible to discuss capitalism without recognizing its roots in Indigenous genocide and the enslavement of millions of Africans and their forcible relocation—dragged in chains to the “New World.” As Joseph Inikori, a University of Rochester historian, details, “the employment of enslaved Africans in large-scale commodity production in the Americas was central to the rise of the nineteenth-century Atlantic economy.”9

These days, even the benefits of capitalism on its own terms (such as gross domestic product) are showing diminishing returns—one sign of which is a decline in productivity increases.10 Meanwhile, when it comes to economic justice, the costs are disturbingly obvious. In January 2022, Oxfam offered a report that noted, “The 10 richest men in the world own more than the bottom 3.1 billion people.”11 And U.S. data on the racial wealth and wage gaps give few indications—to be polite—of substantive progress. In 2020, David Leonhardt in the New York Times observed that “the wages of Black men trail those of white men by as much as when Harry Truman was president.”12 Meanwhile, the Black-white wealth gap, according to Federal Reserve data, was greater in 2016 than in 1968 (2019 data showed modest improvement).13

Environmental costs are also rapidly rising. The climate crisis, the result of mounting carbon emissions, has already increased global temperatures by an estimated 1.11 degrees Celsius above preindustrial levels.14 But carbon emissions are by no means the only environmental challenge. As journalist Ashoka Mukpo writes in Mongabay, “The past 50 years have seen a catastrophic decline in the planet’s ecosystems and natural environments. Every day at least 32,300 hectares (80,000 acres) of forest vanish, and the size of wildlife populations has dropped by an average of 60%.”15

A Path Forward: Steps Toward a Solidarity Economy

How can any economy address the vast injustices ours generates today? The word economy is a combination of two Greek words—oikos, meaning household, and nomos, meaning management.16 The global economy, then, requires that we collectively manage our planetary home, including how we generate wealth and allocate resources. This is, of course, an immensely complicated endeavor in a world inhabited by more than 7.9 billion people.17
continue

Category : Capitalism | Cooperatives | Organizing | Socialism | Solidarity Economy | Blog
15
Jun


By Xuan Tan
People’s Daily
June 07, 2021

General Secretary Xi Jinping profoundly pointed out at the Party History Study and Education Mobilization Conference that the belief in communism and the belief in socialism with Chinese characteristics is the political soul of the Communists and the spiritual pillar for the Communists to withstand any test. He emphasized the centuries of the party. The course of struggle and great achievements are the most solid foundation for us to strengthen our confidence in road, theory, system, and culture. The words of the general secretary are loud, firm and heroic, deeply revealing the inner relationship between socialism and communism, and a century of struggle and struggle, and demonstrates the perseverance and perseverance of the Chinese Communists to advance along the only correct path of socialism with Chinese characteristics.

Over the course of a hundred years, many people and things are still vivid, and many shouts and singing are still in my ears. After going through the wind, frost, snow and rain, and creating miracles on earth, we have the obligation to comfort the martyrs with victory: Socialism has not failed China! We have the responsibility to let history tell the future: socialism will not fail China!

One

The accidents of history often carry certainty. In the 1840s, ancient China was opened by the powerful ships and guns of the great powers, and China’s destiny has since entered an unprecedentedly miserable situation. In almost the same era, in Europe where capitalism was in the ascendant, Marx and Engels began their great explorations of scientific socialism and the cause of human liberation and progress.

After the Opium War, China was poor, weak, and at the mercy of others. “Forty million people shed tears, where is China in the End of the World”. This poem by Tan Sitong is full of blood and tears and hesitation. The Taiping Heavenly Kingdom, the Reform Movement of 1898, the Boxer Movement, the Revolution of 1911… the Chinese struggled in the dark to find a way to save the nation and survive; reformism, liberalism, social Darwinism, anarchism, pragmatism… all kinds of Western theories and doctrines have been Introduce as a prescription to strengthen the country and enrich the people. I have tried every plan, but they have repeatedly come to nothing. Every road was explored, but he was battered. “Countless heads and blood, poorly bought fake republics.” Great powers were rampant, warlords fought, and the people were in dire straits. The First World War pierced the seemingly beautiful illusion of capitalist civilization. Countless people with lofty ideals use their lives and souls to ask questions again and again: Where is the way out for China? Where is the hope of the nation?

The blast of the October Revolution brought Marxism-Leninism to China. This is a great historical agreement, this is a solemn historical promise! The shackles of feudal society for thousands of years are too tight, and the old cannot be replaced without a thorough social transformation. The oppression imposed by imperialism on the Chinese is too heavy, and it cannot be resisted without the mighty power of mobilizing tens of thousands of toiling people.

Li Dazhao praised: “The alarm bell of humanity is ringing! The dawn of freedom is here! Try to see the future of the world, it must be the world of red flag!” Chen Duxiu declared: “The political revolution in France in the eighteenth century, and the social revolution in Russia in the twentieth century. People are all swearing at them; but later historians will regard them as the key to the change and evolution of human society.” The young Mao Zedong exclaimed: “The time has come! The tide of the world is getting more urgent! Dongting The gate of the lake moved and opened! The mighty new thoughts have surged on both sides of the Xiangjiang River!”

In 1920, when it was warm and cold, the 29-year-old Chen Wangdao spent two months in the firewood room in his hometown of Yiwu, Zhejiang, and forgot to eat and sleep for two months. For the first time, he translated the “Communist Manifesto” completely, and the first 1,000 copies were sold out immediately. By 1926, it was reprinted and republished 17 times. The advanced and unyielding Chinese have chosen Marxism as the way to save the country and the people after repeated comparisons and repetitions, as their unswerving ambition.

In July 1921, the Communist Party of China, a political party with Marxism as its guiding ideology and communism as its goal, was born, with faith, entrustment and dreams in mind, resolutely in the rising sun of Shanghai Shikumen and the blue waves of Nanhu Lake in Jiaxing set sail. Since then, the fire of socialism has been ignited in the East, and China, once troubled and hopeless, has a direction!

Two

After the failure of the Great Revolution, the Communist Party member Xia Minghan was arrested in Hankou and wrote a farewell to his wife before his heroic death: “Tossing his head and shed blood, Minghan has long been taken care of. Everyone needs what he needs, and the revolutionary cause will be passed on from generation to generation. Hong Zhu Keep the thoughts of each other, and the red cloud hopes for perfection. Persevere in the revolution and follow my will and vowed to pass on the truth to the world.” In those stormy years, like Xia Minghan, he did not regret nine deaths for his communist belief and firmly believed in the revolutionary ideals. There are more than tens of thousands of martyrs who have realized it. Once they recognized their beliefs and doctrines, they never hesitated or wavered, and did not hesitate to water the “communist blossoms” with youth and blood. continue

Category : Capitalism | China | Socialism | Blog
24
Mar

Comic on “The Opium Ban in China” from the weekly De Amsterdammer, December 2 1906

Toward an Understanding of China’s Historical Political Economy and Its Relationship to Contemporary China

By Ken Hammond
MROnline

March 3, 2021 – The contemporary political economy of the People’s Republic of China, the nature of the Chinese system, has been the subject of much discussion and debate in mainstream academic, media, and political circles, as well as on the left.1 Since the end of the 1970s, China has pursued policies of “reform and opening” (gaige kaifang,) to develop its economy, a process that has resulted in the massive growth of production, China’s emergence as a major player in global trade, and the lifting of around 800 million people out of poverty, while at the same time generating serious problems of inequality, corruption, and environmental stress. At the heart of this project has been the decision by the Communist Party, originally under the guidance of Deng Xiaoping, then carrying on through successive changes of leadership, to use the mechanisms of the marketplace to develop the productive economy. How should this situation be characterized? Is it capitalism, state capitalism, market socialism?2

One can only make sense of contemporary China with a clear understanding of the country’s economic history.3 A historical materialist analysis of the nature of China’s political economic order over the course of history, especially the last thousand years, can illuminate critical aspects of the present. A serious engagement with the complexities of China’s historical economic systems must take into account knowledge about the Chinese past that was not available to Karl Marx, allowing us to go beyond the vagaries of the Asiatic mode of production and transcend the limitations of earlier theorizations of the “sprouts of capitalism” (ziben zhuyi de mengya) by historians in China in the 1950s and ’60s.4 Applying categories and modes of analysis derived from Marx’s Capital and other writings to the understanding of China’s early modern history and exploring the relevance of that history to contemporary China are the main tasks of this essay.

From the period of the Tang-Song transition, roughly the ninth and tenth centuries, China developed a commercial capitalist economy that encompassed a largely urban manufacturing sector and also reshaped agricultural production in much of the empire. A ruling class evolved that was a hybrid of the long-established landowning elite and the early modern commercial stratum, which managed the economic affairs of the country through a blend of private agency and the operations of the imperial state. Through much of China’s imperial past, the state maintained a complex, not always consistent, role in economic affairs, seeking both to support the livelihood of the people, promote prosperity, constrain the pursuit of private profit, and regulate the functions of markets. This historical relationship has inflected the developmental itinerary of the country and is reflected in the deployment of the theory and practice of “socialism with Chinese characteristics” and the “socialist market economy.”

II
China’s recorded history goes back more than 3,200 years and can be usefully divided into four major periods: (1) antiquity, from the beginning to the end of the third century BCE; (2) the middle period, from the second century BCE to the tenth century CE; (3) the early modern period, from the tenth through the eighteenth centuries; and (4) modern China, from the end of the eighteenth century to the present.5 Throughout antiquity, China was ruled by an elite of warriors who controlled the land, collecting tribute from their subjects. Economic activity was largely locally self-sufficient, with a small layer of high-value elite trade centered on the royal court(s). Over time, a professional administrative elite developed, often referred to as the literati because of their mastery of the written records of history and their shared literary culture. These administrative officials were often rewarded with grants of land, and over time these became hereditary property, though the sovereign always retained ultimate ownership.6

The middle period began with the unification of the empire and the consolidation of the imperial system under the Han dynasty (202 BCE–220 CE). During this period, private ownership of land became a practical reality, while in theory the empire continued to belong to the ruler, now the emperor. Many officials in government service built up significant land holdings, while other great families emerged based on their local acquisition of agricultural assets. This was a complex, long-term process, with large landed estates forming by the later Han, which became the underpinning for the political influence of the landowning class. Over the centuries of the middle period, China developed an aristocratic elite, with quasi-official status and a strong transmission of wealth across generations. China went through periods of internal division after the collapse of the Han dynasty in 220, and then renewed imperial unification under the Sui and Tang dynasties (589–618 and 618–907, respectively). Recruitment for service in the imperial government, which was largely pursued through a process of recommendation by serving officials, allowed established families to place their sons in careers in official life and perpetuate the power of the elite. This aristocratic class effectively dominated the state, which served to promote and protect its interests.7

Alongside the estates of the great families there was a sector of agricultural production organized around small holders, managed through a system of land tenure maintained by the imperial state, which regularly redistributed land to male heads of village households who, in turn, were taxed in grain and cloth products. The system varied in its specifics in different parts of the empire but was a clear example of state oversight and management of economic activity. This oversight also extended to urban centers and markets. Imperial law restricted the number and location of markets and established strict controls over their operations. This blend of aristocratic estates, state-managed distribution of small holdings, and tightly regulated urban markets was not in any sense feudal in its economic or political organization and functioning.8

By the ninth century, changes began to emerge in China’s cities and countryside. The Tang dynasty had been deeply shaken by the An Lushan Rebellion in 755–63, and the long-established aristocracy began to decline. But even before this, the very success of the imperial system of economic management had given rise to contradictions within the economy. Its potential for growth and development exceeded the parameters of state oversight, and new forces began to push beyond the regulations of the government. The power of the dominant elite and the control of urban space by official overseers weakened. Markets began to spread outside areas that had been designated and monitored by the state and to become more integrated into residential areas. Private ownership of farmland expanded beyond the great estates and the land subject to government distribution. The imperial court maintained a role in the production and distribution of certain key commodities through government monopolies, a practice that had its roots centuries earlier in the Han dynasty. But the overall role of the state in economic affairs declined, just as the class basis of imperial rule was itself dramatically altered.

In the later ninth century, further rebellions destroyed much of the elite’s wealth and the institutional infrastructure that had legitimized and maintained its power and prestige. Rebellious peasants attacked the estates of the wealthy, killed many members of the elite, and burned the documents that validated their status and power. The fall of the Tang in 907 led to the chaos of the Five Dynasties and Sixteen Kingdoms, with small regional states contending for power through chronic warfare and further destruction, until the Zhao brothers established the Song dynasty in 960 and reunified the empire over the ensuing decade. The warfare of this age of transition cleared the way for the further transformation of China’s economic and political order. The old aristocracy was gone, but the ownership of land and the control of agricultural production was still the primary mode of wealth accumulation.9

As the Song dynasty (960–1279) consolidated its power, a new elite emerged, formally based on the attainment of merit through education, but practically grounded in the riches produced on their estates. These provided the resources to support the education of sons in the Confucian classical traditions that formed the basis of the imperial civil examination system, which became the main vector for entry into service in the bureaucratic administration of the empire. Not all landowning families produced examination graduates or government officials. The class of landed wealth was more extensive than the group of literati who staffed the imperial state, and relations between members of this class in their capacity as local elites or as representatives of imperial power could be complex. This larger class is often referred to as the gentry, and the overall landowning class may be designated, perhaps somewhat awkwardly, the literati/gentry.10

This reconfiguration of the landholding elite took place in tandem with the further development of a commercial economy in China. Markets proliferated, woven together by networks of long-distance trade spanning the empire and linking up with larger global systems. New forms of capital valorization and accumulation took shape within an increasingly monetized economy. Division of labor both within productive enterprises and on a regional geographic basis, as well as ongoing technological innovation, drove enhancements in productivity. New developments in banking and financial operations facilitated the mobilization and allocation of capital.11 This is the key to understanding the early modern period that began in the ninth and tenth centuries and continued, with dramatic advances and retreats, throughout the following eight hundred years, across several dynastic transitions, down to the beginning of the modern era at the turn of the nineteenth century. It is the emergence of China’s early modern capitalist commercial economy and its development over the following years that must be understood to enable a better comprehension of China’s recent pursuit of “socialism with Chinese characteristics.” continue

Category : Capitalism | China | Blog
20
Apr

Fromm was famous for this critique of consumer capitalism as well as for his penetrating studies of authoritarianism. He was a significantly influential figure on U.S. radical thought during the second half of the 20th Century.

 

By Kieran Durkin
Marxist Sociology Blog

April 15, 2020 – Erich Fromm (1900-1980), who passed forty years ago March of this year, was a leading Marxian sociologist who made considerable contributions to U.S. sociology and to U.S. Marxism. Best known for books such as Escape from Freedom, The Sane Society, and The Art of Loving, Fromm’s account of authoritarianism and critique of mid-twentieth century “consumer capitalism” influenced millions both inside and outside of academia.

Prior to arriving in the U.S. in the early 1930s, amidst the rise of Nazism in Germany, Fromm, who was raised in an orthodox Jewish family, was a central member of the early Frankfurt Institute for Social Research. There he worked alongside Max Horkheimer on an interdisciplinary project that sought to mix social philosophy with the empirical social sciences. Having studied sociology under Alfred Weber (Max Weber’s less famous brother) at Ruprecht-Karls-University in Heidelberg, followed by training at the famous Berlin Psychoanalytical Institute, Fromm was given central responsibility for the Frankfurt institute’s attempts at synthesizing sociology and psychoanalysis.

One of the first manifestations of this synthesis was an innovative study of manual and white-collar German workers, which was led by Fromm along with Hilde Weiss. Through use of an interpretative questionnaire, Fromm and Weiss were able to reveal that while the majority of respondents identified with the left-wing slogans of their party their radicalism was considerably reduced in more subtle and seemingly unpolitical questions – pointing to what Fromm argued was evidence of an “authoritarian” character.

Although the study itself wasn’t published until the 1980s, under the title The Working Class in Weimar Germany – this was at least partly due to the breakdown in Fromm’s relationship with Horkheimer – it is clear that it shed considerable light on what transpired in Nazi Germany, as well as telling us something about the nature of the left-wing authoritarianism.

Escape from Freedom, Fromm’s most famous work, was published in 1941, after he had left the Institute (Fromm was effectively pushed out to make way for Theodor Adorno in 1939). The central theme of Escape from Freedom was that Europe, which had hitherto been marching towards greater and greater forms of political freedom, and even towards socialism, over the course of the preceding centuries, had capitulated to fascism. Fromm wanted to try to understand this process in order to explain how and why it was that Nazism had taken hold in Germany, and why so many individuals came to support Hitler.

Like most Marxist analyses at the time, Fromm focused on the role of the lower-middle classes. He argued that the decline of their socio-economic status in the face of monopoly capitalism and hyperinflation alongside the defeat Germany suffered in the First World War and ensuing Treaty of Versailles had a deep psychological effect, removing traditional psychological supports and mechanisms of self-esteem.

In an expanded Marxian account, in which ideas and emotions played an important mediating role, Fromm identified deep feelings of anxiety and powerlessness in this class, which Hitler was able to capitalize on, with his sadomasochistic messages of love for the strong and hate for the weak (not to mention a racial program that raises “true-born” Germans to the pinnacle of the evolutionary ladder), which provided the means of escape from intolerable psychological burdens experienced on a mass basis.

Fromm’s next engagement with Marxism came in the form of his The Sane Society (1955). The book is notable for its criticism of Marx, particularly of his account of revolution. Fromm argued that the famous statement that concludes The Communist Manifesto, that the workers “have nothing to lose but their chains,” contains a profound psychological error. With their chains they have also to lose all those irrational needs and satisfactions which developed because these chains were worn. Because of this, Fromm argued that we need a concept of “revolutionary humanism,” of revolution not only in terms of external barriers, but internal ones too, one that deals with the roots of sadomasochistic passions, sexism, racism, and other forms of character that aren’t necessarily going disappear immediately in a new society.

The Sane Society also contained an extended critique of mid-twentieth century U.S. capitalism, which for Fromm was an essentially bureaucratic form of mass-consumer capitalism. As part of this critique, Fromm put forward the notion of the “marketing orientation” to describe what he saw as the newly dominant form of personality that was associated with this stage of capitalism. A social psychological refraction of the Marxian notion of alienation, the marketing orientation for Fromm was one in which people experience themselves and others as commodities, literally as something to be marketed.

Fromm’s critique of contemporary capitalism continued a year later in The Art of Loving, perhaps his best-known work. Not the most obviously socialist or Marxist book (in fact, Herbert Marcuse criticized Fromm for supposedly betraying radical thought, and becoming a “sermonistic social worker”) Fromm was nevertheless adamant that “[t]he principle underlying capitalistic society and the principle of love are incompatible,” and thus that the criticism of love (which, as he understood it, referred to the antithesis of narcissistic, racist, sexist and other forms of interpersonal relations) was also a criticism of capitalism and the ways in which it mitigated against genuine forms of love that would manifest in a more human society. Fromm believed that we must analyze the conditions for the possibility of realizing love and integrity in the present society and seek to strengthen them.

It is also during the 1950s that Fromm joins American Socialist Party-Social Democratic Federation and seeks to rewrite its program. The resulting document, although rejected for this purpose, was published as Let Man Prevail (1958). It marks out Fromm’s distinctive form of Marxism, which he here calls “radical humanism” and characterizes as a democratic, humanist form of socialism. This analysis is deepened in 1960, in May Man Prevail?, an analysis of Soviet Communism that was intended to influence the move to unilateral disarmament during the Cold War.

Fromm’s most significant contribution to U.S. Marxism, however, was Marx’s Concept of Man (1961). Containing the first full English translation of Marx’s 1844 Economic and Philosophical Manuscripts, prefaced by a few short essays by Fromm, Marx’s Concept of Man helped to popularize Marx in the U.S., as well as counteract some of the more common misinterpretations of Marx.

Fromm’s contribution to Marxism continued during the 1960s, with the publication of Beyond the Chains of Illusion (1962), in which Fromm developed his Freudo-Marxism social psychological theory of social character. Fromm was also responsible for the publication of Socialist Humanism: An International Symposium (1965), an impressive global collection of humanist Marxists and socialists, largely from Eastern Europe (including many from the Yugoslav Praxis school) but also from Africa and India.

In the years that followed, Fromm was a prominent figure in the anti-War left, influencing Martin Luther King Jr. and writing The Revolution of Hope, an attempt to influence the 1968 Presidential election. Aware of criticisms of such apparent social democratic reformism, Fromm protested that “if one is not concerned with the steps between the present and the future, one does not deal with politics, radical or otherwise.” He also wrote, Social Character in a Mexican Village (1970), The Anatomy of Human Destructiveness (1973), and To Have or To Be? (1976), all of which further developed his distinctive Freudo-Marxian inspired humanist sociology.

Looking back on Fromm’s legacy today, at a point where sociologists and Marxists are increasingly returning to his work, it is clear that what Fromm left us is a nuanced form of Marxian sociology that can help account for the relations between economic life, political movements, and inner emotional dynamism that underpin many of the changes that we are witness to in the current world situation. In a situation that is rapidly moving into dangerous territory, in what promises to be a recession as deep as 1929, we could do worse today than to look to Fromm for assistance.

Kieran Durkin is Marie Sklodowska-Curie Global Fellow at University of York, and Visiting Scholar at University of California Santa Barbara, where he is conducting the first dedicated study of the Humanist Marxist tradition. He is author of The Radical Humanism of Erich Fromm, and editor with Joan Braune of Erich Fromm’s Critical Theory: Hope, Humanism, and the Future.

Category : Capitalism | Marxism | Philosophy | Theory | Blog
4
Apr

Women bang pots and pans to show their support for the emergency services dealing with the coronavirus outbreak © Atul Loke/Panos Pictures

 

The novelist on how coronavirus threatens India — and what the country, and the world, should do next

By Arundhati Roy
Financial Times

April 3, 2020 – Who can use the term “gone viral” now without shuddering a little? Who can look at anything any more — a door handle, a cardboard carton, a bag of vegetables — without imagining it swarming with those unseeable, undead, unliving blobs dotted with suction pads waiting to fasten themselves on to our lungs?

Who can think of kissing a stranger, jumping on to a bus or sending their child to school without feeling real fear? Who can think of ordinary pleasure and not assess its risk? Who among us is not a quack epidemiologist, virologist, statistician and prophet? Which scientist or doctor is not secretly praying for a miracle? Which priest is not — secretly, at least — submitting to science?

And even while the virus proliferates, who could not be thrilled by the swell of birdsong in cities, peacocks dancing at traffic crossings and the silence in the skies?

The number of cases worldwide this week crept over a million. More than 50,000 people have died already. Projections suggest that number will swell to hundreds of thousands, perhaps more. The virus has moved freely along the pathways of trade and international capital, and the terrible illness it has brought in its wake has locked humans down in their countries, their cities and their homes.

But unlike the flow of capital, this virus seeks proliferation, not profit, and has, therefore, inadvertently, to some extent, reversed the direction of the flow. It has mocked immigration controls, biometrics, digital surveillance and every other kind of data analytics, and struck hardest — thus far — in the richest, most powerful nations of the world, bringing the engine of capitalism to a juddering halt. Temporarily perhaps, but at least long enough for us to examine its parts, make an assessment and decide whether we want to help fix it, or look for a better engine.

The mandarins who are managing this pandemic are fond of speaking of war. They don’t even use war as a metaphor, they use it literally. But if it really were a war, then who would be better prepared than the US? If it were not masks and gloves that its frontline soldiers needed, but guns, smart bombs, bunker busters, submarines, fighter jets and nuclear bombs, would there be a shortage?

Night after night, from halfway across the world, some of us watch the New York governor’s press briefings with a fascination that is hard to explain. We follow the statistics, and hear the stories of overwhelmed hospitals in the US, of underpaid, overworked nurses having to make masks out of garbage bin liners and old raincoats, risking everything to bring succour to the sick. About states being forced to bid against each other for ventilators, about doctors’ dilemmas over which patient should get one and which left to die. And we think to ourselves, “My God! This is America!”

The tragedy is immediate, real, epic and unfolding before our eyes. But it isn’t new. It is the wreckage of a train that has been careening down the track for years. Who doesn’t remember the videos of “patient dumping” — sick people, still in their hospital gowns, butt naked, being surreptitiously dumped on street corners? Hospital doors have too often been closed to the less fortunate citizens of the US. It hasn’t mattered how sick they’ve been, or how much they’ve suffered. continue

Category : Capitalism | Globalization | India | Blog
24
Mar

 

 

 

 

 

 

 

 

 

 

 

 

Members of the Wayuu ethnic group watch as a U.S. army helicopter arrives for a joint exercise in the “Tres Bocas” area in northern Colombia on March 13, 2020. JUAN BARRETO / AFP VIA GETTY IMAGES

By William I. Robinson
Truthout

March 23, 2020 – What does a virus have to do with war and repression? The coronavirus has disrupted global supply networks and spread panic throughout the world’s stock markets. The pandemic will pass, not without a heavy toll. But in the larger picture, the fallout from the virus exposes the fragility of a global economy that never fully recovered from the 2008 financial collapse and has been teetering on the brink of renewed crisis for years.

The crisis of global capitalism is as much structural as it is political. Politically, the system faces a crisis of capitalist hegemony and state legitimacy. As is now well-known, the level of global social polarization and inequality is unprecedented. In 2018, the richest 1 percent of humanity controlled more than half of the world’s wealth while the bottom 80 percent had to make do with just 4.5 percent of this wealth. Such stark global inequalities are politically explosive, and to the extent that the system is simply unable to reverse them, it turns to ever more violent forms of containment to manage immiserated populations.

Structurally, the system faces a crisis of what is known as overaccumulation. As inequalities escalate, the system churns out more and more wealth that the mass of working people cannot actually consume. As a result, the global market cannot absorb the output of the global economy. Overaccumulation refers to a situation in which enormous amounts of capital (profits) are accumulated, yet this capital cannot be reinvested profitably and becomes stagnant.

Indeed, corporations enjoyed record profits during the 2010s at the same time that corporate investment declined. Worldwide corporate cash reserves topped $12 trillion in 2017, more than the foreign exchange reserves of the world’s central governments, yet transnational corporations cannot find enough opportunities to profitably reinvest their profits. As this uninvested capital accumulates, enormous pressures build up to find outlets for unloading the surplus. By the 21st century, the transnational capitalist class turned to several mechanisms in order to sustain global accumulation in the face of overaccumulation, above all, financial speculation in the global casino, along with the plunder of public finances, debt-driven growth and state-organized militarized accumulation.

Militarized Accumulation

It is the last of these mechanisms, what I have termed militarized accumulation, that I want to focus on here. The crisis is pushing us toward a veritable global police state. The global economy is becoming ever more dependent on the development and deployment of systems of warfare, social control and repression, apart from political considerations, simply as a means of making profit and continuing to accumulate capital in the face of stagnation. The so-called wars on drugs and terrorism; the undeclared wars on immigrants, refugees, gangs, and poor, dark-skinned and working-class youth more generally; the construction of border walls, immigrant jails, prison-industrial complexes, systems of mass surveillance, and the spread of private security guard and mercenary companies, have all become major sources of profit-making.

The events of September 11, 2001, marked the start of an era of a permanent global war in which logistics, warfare, intelligence, repression, surveillance, and even military personnel are more and more the privatized domain of transnational capital. Criminalization of surplus humanity activates state-sanctioned repression that opens up new profit-making opportunities for the transnational capitalist class. Permanent war involves endless cycles of destruction and reconstruction, each phase in the cycle fueling new rounds and accumulation, and also results in the ongoing enclosure of resources that become available to the capitalist class.

Criminalization of surplus humanity activates state-sanctioned repression that opens up new profit-making opportunities for the transnational capitalist class.

 
The Pentagon budget increased 91 percent in real terms between 1998 and 2011, while worldwide, total defense outlays grew by 50 percent from 2006 to 2015, from $1.4 trillion to $2.03 trillion, although this figure does not take into account secret budgets, contingency operations and “homeland security” spending. The global market in homeland security reached $431 billion in 2018 and was expected to climb to $606 billion by 2024. In the decade from 2001 to 2011, military industry profits nearly quadrupled. In total, the United States spent a mind-boggling nearly $6 trillion from 2001 to 2018 on its Middle East wars alone.

Led by the United States as the predominant world power, military expansion in different countries has taken place through parallel (and often conflictive) processes, yet all show the same relationship between state militarization and global capital accumulation. In 2015, for instance, the Chinese government announced that it was setting out to develop its own military-industrial complex modeled after the United States, in which private capital would assume the leading role. Worldwide, official state military outlays in 2015 represented about 3 percent of the gross world product of $75 trillion (this does not include state military spending not made public).

But militarized accumulation involves vastly more than activities generated by state military budgets. There are immense sums involved in state spending and private corporate accumulation through militarization and other forms of generating profit through repressive social control that do not involve militarization per se, such as structural controls over the poor through debt collection enforcement mechanisms or accumulation opportunities opened up by criminalization.

The Privatization of War and Repression
The various wars, conflicts, and campaigns of social control and repression around the world involve the fusion of private accumulation with state militarization. In this relationship, the state facilitates the expansion of opportunities for private capital to accumulate through militarization. The most obvious way that the state opens up these opportunities is to facilitate global weapons sales by military-industrial-security firms, the amounts of which have reached unprecedented levels. Between 2003 and 2010 alone, the Global South bought nearly half a trillion dollars in weapons from global arms dealers. Global weapons sales by the top 100 weapons manufacturers and military service companies increased by 38 percent between 2002 and 2016.

Global weapons sales by the top 100 weapons manufacturers and military service companies increased by 38 percent between 2002 and 2016.

 
The U.S.-led wars in Iraq and Afghanistan precipitated the explosion in private military and security contractors around the world deployed to protect the transnational capitalist class. Private military contractors in Iraq and Afghanistan during the height of those wars exceeded the number of U.S. combat troops in both countries, and outnumbered U.S. troops in Afghanistan by a three-to-one margin. Beyond the United States, private military and security firms have proliferated worldwide and their deployment is not limited to the major conflict zones in the Middle East, South Asia and Africa. In his study, Corporate Warriors, P.W. Singer documents how privatized military forces (PMFs) have come to play an ever more central role in military conflicts and wars. “A new global industry has emerged,” he noted. “It is outsourcing and privatization of a twenty-first century variety, and it changes many of the old rules of international politics and warfare. It has become global in both its scope and activity.” Beyond the many based in the United States, PMFs come from numerous countries around the world, including Russia, South Africa, Colombia, Mexico, India, the EU countries and Israel, among others.

Beyond wars, PMFs open up access to economic resources and corporate investment opportunities — deployed, for instance, to mining areas and oil fields — leading Singer to term PMFs “investment enablers.” PMF clients include states, corporations, landowners, nongovernmental organizations, even the Colombian and Mexican drug cartels. From 2005 to 2010, the Pentagon contracted some 150 firms from around the world for support and security operations in Iraq alone. By 2018, private military companies employed some 15 million people around the world, deploying forces to guard corporate property; provide personal security for corporate executives and their families; collect data; conduct police, paramilitary, counterinsurgency and surveillance operations; carry out mass crowd control and repression of protesters; manage prisons; run private detention and interrogation facilities; and participate in outright warfare.

Meanwhile, the private security (policing) business is one of the fastest growing economic sectors in many countries and has come to overshadow public security around the world. According to Singer, the amount spent on private security in 2003, the year of the invasion of Iraq, was 73 percent higher than that spent in the public sphere, and three times as many persons were employed in private forces as in official law enforcement agencies. In parts of Asia, the private security industry grew at 20 percent to 30 percent per year. Perhaps the biggest explosion of private security was the near complete breakdown of public agencies in post-Soviet Russia, with over 10,000 new security firms opening since 1989. There were an outstanding 20 million private security workers worldwide in 2017, and the industry was expected to be worth over $240 billion by 2020. In half of the world’s countries, private security agents outnumber police officers.

As all of global society becomes a highly surveilled and controlled and wildly profitable battlespace, we must not forget that the technologies of the global police state are driven as much, or more, by the campaign to open up new outlets for accumulation as they are by strategic or political considerations. The rise of the digital economy and the blurring of the boundaries between military and civilian sectors fuse several fractions of capital — especially finance, military-industrial and tech companies — around a combined process of financial speculation and militarized accumulation. The market for new social control systems made possible by digital technology runs into the hundreds of billions. The global biometrics market, for instance, was expected to jump from its $15 billion value in 2015 to $35 billion by 2020.

Criminalization of the poor, racially oppressed, immigrants, refugees and other vulnerable communities is the most clear-cut method of accumulation by repression.

 
As the tech industry emerged in the 1990s, it was from its inception tied to the military-industrial-security complex and the global police state. Over the years, for instance, Google has supplied mapping technology used by the U.S. Army in Iraq, hosted data for the Central Intelligence Agency, indexed the National Security Agency’s vast intelligence databases, built military robots, co-launched a spy satellite with the Pentagon, and leased its cloud computing platform to help police departments predict crime. Amazon, Facebook, Microsoft and the other tech giants are thoroughly intertwined with the military-industrial and security complex.

Criminalization and the War on Immigrants and Refugees

Criminalization of the poor, racially oppressed, immigrants, refugees and other vulnerable communities is the most clear-cut method of accumulation by repression. This type of criminalization activates “legitimate” state repression to enforce the accumulation of capital, whereby the state turns to private capital to carry out repression against those criminalized.

There has been a rapid increase in imprisonment in countries around the world, led by the United States, which has been exporting its own system of mass incarceration. In 2019, it was involved in the prison systems of at least 33 different countries, while the global prison population grew by 24 percent from 2000 to 2018. This carceral state opens up enormous opportunities at multiple levels for militarized accumulation. Worldwide, there were in the early 21st century some 200 privately operated prisons on all continents and many more “public-private partnerships” that involved privatized prison services and other forms of for-profit custodial services such as privatized electronic monitoring programs. The countries that were developing private prisons ranged from most member states of the European Union, to Israel, Russia, Thailand, Hong Kong, South Africa, New Zealand, Ecuador, Australia, Costa Rica, Chile, Peru, Brazil and Canada.

Those criminalized include millions of migrants and refugees around the world. Repressive state controls over the migrant and refugee population and criminalization of non-citizen workers makes this sector of the global working class vulnerable to super-exploitation and hyper-surveillance. In turn, this self-same repression in and of itself becomes an ever more important source of accumulation for transnational capital. Every phase in the war on migrants and refugees has become a wellspring of profit making, from private, for-profit migrant jails and the provision of services inside them such as health care, food, phone systems, to other ancillary activities of the deportation regime, such as government contracting of private charter flights to ferry deportees back home, and the equipping of armies of border agents.

Undocumented immigrants constitute the fastest-growing sector of the U.S. prison population and are detained in private migrant jails and deported by private companies contracted out by the U.S. state. As of 2010, there were 270 immigration jails in the U.S. that caged on any given day over 30,000 immigrants and annually locked up some 400,000 individuals, compared to just a few dozen people in immigrant detention each day prior to the 1980s. From 2010 to 2018, federal spending on these detentions jumped from $1.8 billion to $3.1 billion. Given that such for-profit prison companies as CoreCivic and GEO Group are traded on the Wall Street stock exchange, investors from anywhere around the world may buy and sell their stock, and in this way, develop a stake in immigrant repression quite removed from, if not entirely independent, of the more pointed political and ideological objectives of this repression.

Every phase in the war on migrants and refugees has become a wellspring of profit making.

 
In the United States, the border security industry was set to double in value from $305 billion in 2011 to some $740 billion in 2023. Mexican researcher Juan Manuel Sandoval traces how the U.S.-Mexico border region has been reconfigured into a “global space for the expansion of transnational capital.” This “global space” is centered on the U.S. side around high-tech military and aerospace related industries, military bases, and the deploying of other civilian and military forces for combating “immigration, drug trafficking, and terrorism through a strategy of low-intensity warfare.” On the Mexican side, it involves the expansion of maquiladoras (sweatshops), mining and industry in the framework of capitalist globalization and North American integration.

The tech sector in the United States has become heavily involved in the war on immigrants as Silicon Valley plays an increasingly central role in the expansion and acceleration of arrests, detentions and deportations. As their profits rise from participation in this war, leading tech companies have in turn pushed for an expansion of incarceration and deportation of immigrants, and lobbied the state to use their innovative social control and surveillance technologies in anti-immigrant campaigns.

In Europe, the refugee crisis and EU’s program to “secure borders” has provided a bonanza to military and security companies providing equipment to border military forces, surveillance systems and information technology infrastructure. The budget for the EU public-private border security agency, Frontex, increased a whopping 3,688 percent between 2005 and 2016, while the European border security market was expected to nearly double, from some $18 billion in 2015 to approximately $34 billion in 2022.

The Coronavirus Is Not to Blame

When the pandemic comes to an end, we will be left with a global economy even more dependent on militarized accumulation than before the virus hit.
As stock markets around the world began to plummet starting in late February, mainstream commentators blamed the coronavirus for the mounting crisis. But the virus was only the spark that ignited the financial implosion. The plunge in stock markets suggests that for some time to come, financial speculation will be less able to serve as an outlet for over-accumulated capital. When the pandemic comes to an end, we will be left with a global economy even more dependent on militarized accumulation than before the virus hit.

We must remember that accumulation by war, social control and repression is driven by a dual logic of providing outlets for over-accumulated capital in the face of stagnation, and of social control and repression as capitalist hegemony breaks down. The more the global economy comes to depend on militarization and conflict, the greater the drive to war and the higher the stakes for humanity. There is a built-in war drive to the current course of capitalist globalization. Historically, wars have pulled the capitalist system out of crisis while they have also served to deflect attention from political tensions and problems of legitimacy. Whether or not a global police state driven by the twin imperatives of social control and militarized accumulation becomes entrenched is contingent on the outcome of the struggles raging around the world among social and class forces and their competing political projects.

William I. Robinson is professor of sociology, global studies and Latin American studies at the University of California at Santa Barbara. His most recent book is Global Capitalism and the Crisis of Humanity. This article draws on the author’s forthcoming book, The Global Police State, which will be released by Pluto Press in July 2020.

Category : Capitalism | Ecology | Fascism | Globalization | Marxism | Neoliberalism | Blog