By Alain Badiou
24 January 2023
via Verso Blog

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

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.

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]

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

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.

+ + + + +

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).

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

Still, the good news is that the economy is ultimately a human creation. It therefore can be—and is now, albeit often in very harmful ways—collectively managed. Even better news is that there is widespread creativity and innovation building a new economy right now in the shell of the old. In some cases, people are doing so consciously—in other words, in their work, they are pursuing a vision of replacing the overall economic system with one that would prioritize solidarity. More often, though, these innovators are claiming ownership of their community and their local economies without explicitly seeking to build a solidarity economy. But in this pragmatic, practical, problem-solving work, these economy-building movement leaders are laying crucial building blocks of a different, more humane form of economic and social organization.

But what do we mean by the phrase solidarity economy? As was noted last year in the Nonprofit Quarterly, when moving toward an economy that is rooted in principles of solidarity, there is neither a “ready-made” formula nor a “one-size-fits-all” approach. A solidarity economy is, however, organized around some core values—solidarity, participatory democracy, equity in all dimensions, sustainability, and pluralism.18 In terms of its theoretical base, the solidarity economy builds on the notion of economic democracy—namely, the idea that principles of popular sovereignty should be applied to management of the economy.19

The notion of a solidarity economy is also based on lessons from the failures of twentieth-century state socialism. The core solidarity economy values of pluralism, participatory democracy, and sustainability are a direct response to the lessons learned from state socialism’s overreliance on centralized decision-making, as is the solidarity economy movement’s overall emphasis on the importance of decentralization and federation.

A mistaken assumption of state socialism was its implicit postulate that economic management of our collective home meant management from the top. The work of the late Elinor Ostrom, who was awarded the Nobel Prize in Economic Sciences in 2009, points to the fallacy of this assumption. Her Nobel Prize lecture is titled “Beyond Markets and States: Polycentric Governance of Complex Economic Systems.” Ostrom’s research focused on the organization of what she called “common pool resources.” To pick a prominent example, the free-for-all dumping of carbon into the air could be considered a degradation of the common pool resource of our global atmosphere, resulting in climate change. Among her conclusions: more often than not, effective resource management solutions come from the bottom rather than the top. Ostrom also argued that “a core goal of public policy should be to facilitate the development of institutions that bring out the best in humans.”20 This also happens to be a good way to summarize a central goal of the solidarity economy movement.

Putting Solidarity Economy Values Into Practice

So, what practical, pragmatic lessons can be learned from economic justice movements today? Here are a few:

Mutual Aid. The COVID-19 pandemic has lifted mutual aid out of obscurity and made evident to all the practicality of solidarity as an operating principle. An article published last year in Frontiers in Psychology noted the fundamental role that mutual aid played in promoting community health and well-being during the pandemic in the United Kingdom. It called for sustaining such practices even after the pandemic finally subsides, by (among other things) prioritizing community-level interventions, and recognizing their importance in public policy in developing “long-term community responses.”21

Democratic Planning. Participatory democracy is sometimes described as a pie-in-the-sky concept; but participatory budgeting in the United States is, increasingly, shifting from a niche idea to a serious mechanism for the public to take ownership of public resources and plan their use in a democratic way.22

Take the city of Seattle, Washington. In response to calls to defund the police, the city council allocated

$30 million to be distributed through a public planning process. The process was sometimes contentious, but it succeeded in giving BIPOC communities in Seattle an opportunity to self-determine the investments that they needed. As city council member Debora Juarez said, when the council geared up to approve the measure, “We don’t need to tell BIPOC communities what they need. We just need to listen and deliver.”23

Figure 1: Seattle, $30 million Participatory Budgeting
(as adopted by City Council on August 9, 2021)26

Housing: $8.8 million
•  $4.6 million: Subsidized homeownership projects, with target outreach to households of color

•  $1.8 million: Wealth-building education for residents, artists, and business owners of color

•  $1 million: City contracting help for construction businesses owned by women and people of color

•  $875,000: Help for homeowners to keep their properties

•  $250,000: Study on potential lease-to-own program

•  $250,000: Consultant work on housing for union apprentices

Small businesses: $7.5 million

•  $5 million: Grants and subsidized loans to small businesses, including those owned by people of color

•  $2.5 million: Consultant support for small businesses

Education: $7.5 million

•  $4 million: Various student and teacher programs, with focus on youth of color

•  $2 million: Cultural programs aimed at youth of color

•  $1.5 million: Programs for youth involved in the criminal legal system

Health: $6.2 million

•  $1.7 million: Programs helping residents of color with healthcare careers

•  $1.5 million: Innovative healing programs at community health centers

•  $1 million: Efforts to secure healthcare for residents without coverage, with focus on communities of color

•  $750,000: Healthy food programs aimed at communities of color

•  $550,000: Environmental justice grants for community organizations that focus on people of color

•  $500,000: Healthcare mentorships and internships for youth of color

•  $250,000: Farm-to-table programs aimed at youth of color

Political economist Gar Alperovitz has noted that the issue of democratic planning is a central challenge for building a post-capitalist economy.24 There is, quite obviously, a lot more work to do to build governance structures that can allow for effective democratic input into economic planning at the regional and national level. Nonetheless, nascent though they may be, local examples of democratic planning, such as in Seattle, are building a critical knowledge base in this direction.25

Workplace Democracy. Employees typically spend around half of their waking hours at their workplace. All too often, they are excluded from any democratic decision-making beyond what’s for lunch. The transformative potential of fostering workplace democracy is enormous, and data suggest that it pays off in terms of productivity, job quality, job satisfaction, and employee retention. Employee ownership is a hot trend these days, especially given the so-called “silver tsunami”—the impending retirement of the baby boom generation of small business owners.27 There are two major avenues of employee ownership: an employee stock ownership plan (ESOP) and a worker cooperative. Both have been shown to improve business performance.

ESOPs give workers shares of stock in their workplace, and are by far the more widespread model. While workers in some ESOPs have a controlling interest, the vast majority do not. Worker cooperatives, by contrast, are owned and controlled by the workers, thus hardwiring workplace democracy into the structure. While ESOPs are a step in the right direction, worker co-ops are a better strategy to build democracy in the workplace.

Sustainability. At the Midwest Organic and Sustainable Education Service (MOSES), executive director Lori Stern sees regenerative agriculture as a means to apply solidarity economy principles to build “a more equitable and resilient system that puts farmers, workers, and eaters in control.” Her organization pursues this vision through a range of strategies, including increasing connections between farmers (including by building domestic supply chains), promoting cooperative ownership structures, and food system policy advocacy. Stern adds that, “The emerging farming solidarity economy is a sum of a range of practices, rooted in solidarity economy principles of pluralism, democracy, equity, mutualism, and sustainability. The connected and circular nature of life on a diverse farm forms the ecosystem that enables all to thrive.”28

Equity and Reparations. There are many inspiring examples of how a genuine solidarity economy, organizing effectively, combines equity and community ownership. One example comes from Humboldt, California, where Cooperation Humboldt—an organization with an explicit solidarity economy mission—has partnered with the local Wiyot nation. This partnership has involved committing to paying an honor tax of 1 percent of Cooperation Humboldt’s annual budget to the Wiyot nation, in acknowledgment that Humboldt is unceded Wiyot ancestral territory. Such reparations are integral to a solidarity economy.29

But Is Systemic Change Possible?

We conclude where we began. We respect those, such as Chris Benner and Manuel Pastor, who advocate for the broad application of solidarity principles in our economy but seek to do so within the framework of the existing economic system.30 Benner and Pastor note that “we have reached a point where our fundamental economic structures are driving unprecedented inequality, social divisions, and ecological destruction, amidst a politics of polarization, fragmentation, and alienation,” and ask if we cannot “build a better economy” out of a sense of mutuality.31 That is, indeed, the right question to ask.

Where we differ is in our contention that advocates of a solidarity economy must be brave enough to admit that building an alternative economics that is truly based on cooperation will very likely require systemic change beyond capitalism.32 In particular, we believe the separation of the overwhelming majority of people from meaningful ownership of the economy is a central flaw of capitalism that fosters division, creates concentration of wealth and power, encourages corruption (and cheating—anything to get an edge), and, ultimately, undermines solidarity. This is not to deny the need to fight for reforms; however, it is also to affirm the need for movements to retain the imagination to envision systemic transformation, even while fighting for reforms such as the ones obtained by solidarity economy advocates in Seattle.

Where we agree with Benner and Pastor is in the necessity of rooting social change in social movements. The struggle for a solidarity economy is a practical one, and there is no path forward without social movement. As the late sociologist Erik Olin Wright noted, “If processes of social reproduction were comprehensive, and fully coherent, then there would be little possibility for effective strategies of radical social transformation.”33 But Wright was an optimist, and he added that “even when the spaces are limited, they can allow for transformations that matter.”34

That remains the work. It begins with imagining an economy beyond capitalism. Is this possible? Not only is it possible, it’s a must, if we truly want to work toward an economy that we can all claim as our own.

Notes
1. Steve Dubb, “Ownership as Social Relation: Nonprofit Strategies to Build Community Wealth through Land,” Nonprofit Quarterly, December 11, 2018, org/ownership-as-social-relation-nonprofit-strategies-to-build-community-wealth-through-land.

2. Ophelia Akanjo, “The Great Resignation—A Call for Change in Organizational Culture,” Nonprofit Quarterly, February 16, 2022, org/the-great-resignation-a-call-for-change-in-organizational-culture.

3. Manuel Pastor et , “Solidarity Economics: OUR Movement, OUR Economy” (UC Santa Cruz Institute for Social Transformation and USC Dornsife Equity Research Institute, November 4, 2021, virtual), transform.ucsc.edu/event/solidarity-economics/.

4. Bryan Lindsley, “Our Change Systems Solutions—FAQs,” National Fund for Workforce Solutions, Washington, C., accessed April 2, 2022, nationalfund.org/our-solutions/change-systems-for-improved-outcomes/frequently-asked-questions-about-our-change-systems-solution.

5. Cyndi Suarez, “Systems Change Is All about Shifting Power,” Nonprofit Quarterly, October 1, 2019, org/systems-change-is-all-about-shifting-power.

6. See, for example, Our Call to Reimagine Capitalism in America (Redwood City, CA: Omidyar Network, September 2020); and Rebecca Henderson, Reimagining Capitalism in a World on Fire (New York: PublicAffairs, 2020). See also Rebecca Henderson, website for Reimagining Capitalism in a World on Fire, accessed May 2, 2022, org.

7. Matthew Robison, “Are People Naturally Inclined to Cooperate or Be Selfish?” Scientific American, September 1, 2014, scientificamerican.com/article/are-people-naturally-inclined-to-cooperate-or-be-selfish.

8. Jeffrey Sachs, “Twentieth-century political economy: a brief history of global capitalism,” Oxford Review of Economic Policy 15, no. 4 (December 1999): 92.

9. Joseph Inikori, “Atlantic Slavery and the Rise of the Capitalist Global Economy.” Supplement, Current Anthropology 61, no. S22 (October 2020): S166–67.

10. Shawn Sprague, “The S. productivity slowdown: an economy-wide and industry-level analysis,” Monthly Labor Review, April 2021, www.bls.gov/opub/mlr/2021/article/the-us-productivity-slowdown-the-economy-wide-and-industry-level-analysis.htm.

11. Nabil Ahmed et , Inequality kills: The unparalleled action needed to combat unprecedented inequality in the wake of COVID-19 (Oxford, UK: Oxfam Great Britain, January 17, 2022), 10.
12. David Leonhardt, “The Black-White Wage Gap Is as Big as It Was in 1950,” New York Times, June 25, 2020, com/2020/06/25/opinion/sunday/race-wage-gap.html.

13. Heather Long and Andrew Van Dam, “The black-white economic divide is as wide as it was in 1968,” Washington Post, June 4, 2020, washingtonpost.com/business/2020/06/04/economic-divide-black-households; and Rachel Siegel, “Wealth gaps between Black and White families persisted even at the height of the economic expansion,” Washington Post, September 28, 2020, washingtonpost.com/business/2020/09/28/wealth-gap-fed.

14. World Meteorological Organization, “2021 one of the seven warmest years on record, WMO consolidated data shows,” press release 19012022, January 19, 2022, public.wmo.int/en/media/press-release/2021-one-of-seven-warmest-years-record-wmo-consolidated-data-shows.

15, Ashoka Mukpo, “As nature declines, so does human quality of life, study finds,” Mongabay, February 9, 2021, mongabay.com/2021/02/as-nature-declines-so-does-human-quality-of-life-study-finds.

16. “The Oikos of God: Economy and Ecology in the Global Household,” Interfaith Center for Sustainable Development, accessed May 3, 2022, com/the-oikos-of-god-economy-and-ecology-in-the-global-household.

17. “Wold Population Dashboard,” United Nations Population Fund, 2022, accessed May 3, 2022, org/data/world-population-dashboard.

18. Emily Kawano, “Imaginal Cells of the Solidarity Economy,” Nonprofit Quarterly 28, 2 (Summer 2021): 48–55, nonprofitquarterly.org/imaginal-cells-of-the-solidarity-economy/.

19, Ted Howard, Steve Dubb, and Sarah McKinley, “Economic Democracy,” in Achieving Sustainability: Visions, Principles, and Practices, Debra Rowe (New York: Macmillan Reference USA, 2014), 231–39.

20. Elinor Ostrom, “Beyond Markets and States: Polycentric Governance of Complex Economic Systems” (Nobel Prize lecture, Aula Magna, Stockholm University, Stockholm, December 8, 2009), org/uploads/2018/06/ostrom_lecture.pdf.

21. Maria Fernandes-Jesus et , “More Than a COVID-19 Response: Sustaining Mutual Aid Groups During and Beyond the Pandemic,” Frontiers in Psychology 12 (October 20, 2021).

22. See Michael Menser, “From Defunding to Reinvestment: Why We Need to Scale Participatory Budgeting,” Nonprofit Quarterly, June 25, 2020, nonprofitquarterly.org/from-defunding-to-reinvestment-why-we-need-to-scale-participatory-budgeting.

23. Daniel Beekman, “Seattle will invest $30 million in strategies recommended by panel for communities of color,” Seattle Times, last modified August 10, 2021, com/seattle-news/politics/seattle-will-invest-30-million-in-strategies-recommended-by-panel-for-communities-of-color. See also Daniel Beekman, “Seattle Mayor Durkan sends proposal to City Council for $30 million promised to communities of color,” Seattle Times, last modified July 13, 2021, seattletimes.com/seattle-news/politics/seattle-mayor-durkan-sends-proposal-to-city-council-for-30-million-promised-to-communities-of-color/.

24. Gar Alperovitz,” Building a Democratic Economy: Sketch of a Pluralist Commonwealth,” Nonprofit Quarterly 27, 1 (Spring 2020): 50–57, nonprfitquarterly.org/building-a-democratic-economy-sketch-of-a-pluralist-commonwealth/.

25. Steve Dubb, “Seattle Launches $30 million Participatory Budgeting Process,” Nonprofit Quarterly, February 5, 2021, org/seattle-launches-30-million-participatory-budgeting-process/.

26. For these data, see Beekman, “Seattle Mayor Durkan sends proposal to City Council for $30 million promised to communities of color.”

27. Steve Dubb, “Can Employee Ownership Hold Back a Tsunami of Small Business Closures?” Nonprofit Quarterly, November 27, 2017, org/can-employee-ownership-hold-back-tsunami-small-business-closures.

28. Lori Stern, “Rethinking Food with Solidarity in Mind: Lessons from COVID-19,” Nonprofit Quarterly, October 20, 2021, org/rethinking-food-with-solidarity-in-mind-lessons-from-covid-19.

29. Michelle Vassel and David Cobb, “An Indigenous Community Land Trust Rises: Making Land Back a Reality,” Nonprofit Quarterly, October 13, 2021, org/an-indigenous-community-land-trust-rises-making-land-back-a-reality.

30. Chris Benner and Manuel Pastor, Solidarity Economics: Why Mutuality and Movements Matter (Cambridge, UK: Polity Press, 2021), 2.

31. Ibid.

32, Emily Kawano and Julie Matthaei, “System Change: A Basic Primer to the Solidarity Economy,” Nonprofit Quarterly, July 8, 2020, org/system-change-a-basic-primer-to-the-solidarity-economy.

33. Erik Olin Wright, “Elements of a Theory of Transformation,” in Envisioning Real Utopias (London: Verso Books, 2010), 290.

34. Ibid.

Steve Dubb is a senior editor at NPQ, where he directs NPQ’s economic justice program, including NPQ’s Economy Remix column. Steve has worked with cooperatives and nonprofits for over two decades, including twelve years at The Democracy Collaborative and three years as executive director of NASCO (North American Students of Cooperation). In his work, Steve has authored, co-authored and edited numerous reports; participated in and facilitated learning cohorts; designed community building strategies; and helped build the field of community wealth building. Steve is the lead author of Building Wealth: The Asset-Based Approach to Solving Social and Economic Problems (Aspen 2005) and coauthor (with Rita Hodges) of The Road Half Traveled: University Engagement at a Crossroads, published by MSU Press in 2012. In 2016, Steve curated and authored Conversations on Community Wealth Building, a collection of interviews of community builders that Steve had conducted over the previous decade.

Emily Kawano is a cofounder of the US Solidarity Economic Network, codirector of Wellspring Cooperatives in Springfield, Massachusetts, and is a member of NPQ’s economic justice advisory committee.

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.

This belief and doctrine is shining with the light of ideals. The “Communist Manifesto” described: “Instead of the old bourgeois society where there are classes and class antagonisms, there will be such a union, where the free development of everyone is the condition for the free development of all people.” In the new world, the value of human beings comes first. There is no exploitation or oppression, labor is glorious, labor is supreme, everyone is equal and prosperous, and close to each other… This is a new world that transcends the capitalist world, and it is also the Chinese nation since ancient times. The longing for “Great Harmony in the World” has attracted countless advanced elements who are excited, fascinated, and practiced.

This belief and doctrine reveals the law of social development and evolution. The general trend of the world is huge, and those who follow it will survive, and those who go against it will perish. The Communist Party of China is the vanguard of the working class, represents the direction of advanced productive forces, and represents the trend of historical progress. Armed with scientific theories and mastering the laws of social development, the party has the consciousness to lead social changes and advance the cause of justice, and it has the power to be invincible and indomitable.

This belief and doctrine guide the revolution to victory. The Chinese Communists, with Mao Zedong as the main representative, used Marxist standpoints and methods to analyze China’s national conditions and solve China’s problems. They clearly stated that the task of the Chinese revolution is to overthrow the oppression of the “three mountains” of imperialism, feudalism, and bureaucratic capitalism. China The road of the revolution is to encircle the cities from the countryside and seize power by armed force. The power of the Chinese revolution is the working class, the peasantry, the petty bourgeoisie, and the national bourgeoisie under certain conditions. The proletariat is the leading force and the people are the true heroes. The Chinese revolution must It is divided into two stages: the democratic revolution and the socialist revolution… These scientific understandings are shining with the brilliance of Marxist truth everywhere, leading the Chinese revolution to surging forward.

The revolutionary ideal is higher than the sky. It was under the torch of ideals and beliefs that our party mobilized the masses of workers and peasants, dared to make surprise charges, and successfully advanced the Northern Expedition; it was under the torch of ideals and beliefs that the surviving Communists buried the bodies of their companions slaughtered by the reactionaries and took them. Raising weapons, walking into the mountains and forests, and embarking on new battles; it was under the torch of ideals and beliefs that the Red Army soldiers rushed through the natural dangers, fought strong enemies, climbed the snowy mountains, and crossed the grass. “The harder the bones of the wind and rain, the stronger the ambition of wild vegetables to satisfy their hunger.” , Completed the 25,000-mile long march that shines through the annals of human history; it was under the torch of ideals and beliefs that the party and the people used perseverance and bloody battle to the end, wrote the national song of resisting Japanese militarism, and achieved resistance to foreign aggression. Victory in the end; it was precisely under the torch of ideals and beliefs that the heroic People’s Liberation Army defeated the Kuomintang reactionary forces of 8 million in only three years, demonstrating what is meant by “if the sky is sentimental, the sky is also old, and the righteous world is the vicissitudes of life.”

“Critical weapons can’t replace the criticism of weapons. Material power can only be destroyed by material power.” 28 years of bloody battle and 28 years of hard work, our country has changed from a bullying “sick man in East Asia” to an admiration for the world. In the “Oriental Lion Awakening”, our people have changed from being slaves to cattle and horses to masters with high spirits. The victory of the Chinese revolution is the great practice of the Chinese Communists in using Marxism to save China, and the great course of scientific truth showing its strength!

Three

On June 30, 1949, Mao Zedong published “On the People’s Democratic Dictatorship” and stated that we must pass through the People’s Republic, from an agricultural country to an industrial country, and from a new democratic society to a socialist society and a communist society. The founding of the People’s Republic of China is the historical result of combining the principles of scientific socialism with the reality of the Chinese revolution. It also marked the development and growth of the cause of human progress and the forces of socialism, and ushered in the great era of socialism in the East of the world.

This is an era of innovating and changing the world. In the face of many difficulties and tests, the Chinese Communist Party led the people to quickly heal the wounds of war and restore the national economy, and realized the socialist transformation of agriculture, handicrafts, and capitalist industry and commerce in a unique form in China, and creatively completed the transition from the new democratic revolution. The transformation of the socialist revolution successfully achieved the most profound and greatest social transformation in Chinese history. The vigorous land reform enabled more than 300 million peasants to obtain 700 million mu of land and production materials free of charge; the 1954 Constitution fixed the principles of people’s democracy and socialism in the form of a fundamental law; the People’s Congress system and the leadership of the Communist Party of China The system of party cooperation and political consultation, and the system of regional ethnic autonomy have built the “four beams and eight pillars” of the socialist system…In this ancient and youthful country, the Chinese people are building towering socialist buildings and savoring the taste of a happy life.

This is an era of vigor and passion. “Every second is working to create a socialist society.” The Chengdu-Chongqing Railway, planned in the late Qing Dynasty, was still a dotted line on the map for more than 40 years before the founding of New China. After the official start in 1950, it took only two years to complete the line; 156 key projects and 694 construction projects during the “First Five-Year Plan” period The completion has laid a solid foundation for socialist industrialization; the treatment of the Huai River and the Yellow River and the Yangtze River have achieved significant results, and the construction of farmland water conservancy has been spreading nationwide; the national urban and rural health care network has basically formed, smallpox, cholera, schistosomiasis, malaria, plague, etc. Diseases may be eradicated or effectively prevented… The new people’s regime has awakened tremendous productivity, and the new socialist system has activated the people’s energy and promoted the people’s well-being.

This is an era of heroes and high morale. For peace, Volunteer soldiers went abroad to fight and wrote a majestic epic with “less steel, more gas” and “more steel and less gas”; to remove the “poor oil and less oil” hat, “Iron Man” Wang Jinxi led the drilling team to fight against the sky. I would rather live less than 20 years, and desperately want to win big oil fields”; in order to change the face of poverty and backwardness, Jiao Yulu, the role model of the county party committee secretary, led the people of Lankao to rectify the “three evils”. To lay a solid foundation for the country’s self-reliance, Qian Xuesen, Qian Sanqiang, Deng Jiaxian and a large number of scientific researchers sprinkled their sweat and blood on the vast Gobi, creating the miracle of “two bombs and one star”… There are countless named heroes and no one. The hero who left his name, with flesh and blood and strong arms, shoulders the responsibility of the nation and the glory of the Republic.

“The roads and blue strands lead to mountains and forests.” Building socialism in a large eastern country with a relatively backward economy and culture and a large population is like climbing an unreached mountain. There are no straight roads to walk and no ready-made paths to follow. We rely on the power of “the people to create history” and the advantage of “concentrating our strength to do great things” to create one after another miracle that can be recorded in the history of the Chinese nation and humanity. With the spirit of “revolution and desperation”, with the courage of “ten thousand years too long, fighting for the day and night”, we painted the most beautiful picture of socialist new China on a land of more than 9.6 million square kilometers. We have also suffered serious setbacks like the “Cultural Revolution” on the road of exploration and exploration. The painful lessons are worth learning forever.

Whether it is flat or rugged, whether it is sunshine or wind or rain, the party leads the people in exploring the path of socialism. History has proven: “Not only are we good at destroying an old world, we will also be good at building a new world”!

Four

“What is socialism? How to build socialism?” The Chinese Communists have never stopped answering this historical question that echoes over China. From profoundly revealing the “ten major relationships” between socialist construction and socialist transformation, to promptly making the important conclusion that the main social contradiction in our country has been transformed into “the contradiction between the advanced socialist system and the backward social productive forces”, to the clear presentation To correctly handle the contradictions among the people is precious exploration and difficult progress.

The Third Plenary Session of the Eleventh Central Committee of the Party was a great turning point in the history of the Party and the history of New China. Stop using “class struggle as the key link”, shift the focus of the work of the whole party to socialist modernization, and re-establish the ideological line of emancipating the mind and seeking truth from facts…In order to build socialism, the Chinese Communist Party leads the people to promote a great new revolution. Started the great voyage of reform and opening up.

Poverty is not socialism! Deng Xiaoping pointed out: “The essence of socialism is to liberate the productive forces, develop productive forces, eliminate exploitation, eliminate polarization, and ultimately achieve common prosperity.” In order to adapt production relations to the development of productive forces, the household contract responsibility system with joint output has been widely implemented, and special economic zones have been implemented first. In the first test, township and village enterprises have sprung up, reforms in the scientific and technological system are intensified, the pattern of opening to the outside world has been accelerated, and the vitality and creativity hidden in the broad masses of people are fully bursting out.

Take your own path and build socialism with Chinese characteristics! We are deeply aware that our country is and will be in the primary stage of socialism for a long time. We propose the party’s basic line in the primary stage of socialism, actively develop a basic economic system with public ownership as the mainstay and the common development of multiple ownership economies, and constantly improve the socialist market economic system. , Put forward the goal of a well-off society and a step-by-step strategy of modernization, and created and developed socialism with Chinese characteristics.

Adhere to the socialist direction of reform and opening up! Adhere to reform and opening up and adhere to the four basic principles. These two basic points are closely linked and cannot be partial or neglected. We adhere to the socialist material civilization and spiritual civilization “to grasp both hands and both hands must be hard”, firmly promote the new great project of party building, comprehensively promote the construction of socialist economic, political, cultural, social, and ecological civilization with Chinese characteristics, and let the people Share the fruits of reform and development and put realistic wings on the ideals of socialism.

Over the past 40 years of reform and opening up, China’s economic aggregate has surpassed Italy, France, the United Kingdom, Germany, and Japan, ranking second in the world; China’s people’s living standards have continued to improve and have entered the ranks of middle- and high-income countries; , Dense railways, west-to-east gas transmission, south-to-north water transfer, towering dams, towering bridges, and the transformation of the sky; China also defeated historically rare major natural disasters such as floods, rain, snow and freezing, earthquakes, and major epidemics such as SARS, and withstood Asia The financial crisis and the international financial crisis have been severely tested, and they have become more calm and upright after the storm.

Advance by grasping the logic of historical advancement, and develop in conformity with the trend of the development of the times. The surging great practice of the turbulent land of China shows that only socialism can develop China, and only reform and opening up can make China catch up with the times in great strides and let the people live a happy life. The road of socialism with Chinese characteristics is getting wider and wider!

Five

The majestic and majestic cause of socialism has condensed the arduousness and dedication of generations of Communists, and it carries the sustenance and aspirations of many sages and heroes. When the baton of history was passed on again, General Secretary Xi Jinping’s words were sonorous: The task of our generation of Communists is to continue to write down the great essay of upholding and developing socialism with Chinese characteristics!

The 19th National Congress of the Party solemnly declared to the entire party, the country and the world: “After long-term efforts, socialism with Chinese characteristics has entered a new era. This is a new historical direction for my country’s development.”

In the new era of China, the ideal banner is bright and high. In the face of the world without major changes in a century, General Secretary Xi Jinping led the entire party and the people to take the overall situation, respond to the situation, and initiate new situations. The party and the country have made historic achievements and realized historic changes. The Chinese nation is more than ever before in history. Close to the great goal of national rejuvenation. The Chinese people’s belief in Marxism and communism has become stronger, their belief in socialism with Chinese characteristics has become stronger, and their confidence in realizing the great rejuvenation of the Chinese nation has never been higher.

In the new era, China has a strong and strong driving force for development. From the comprehensive and deepening reforms of the Third Plenary Session of the Eighteenth Central Committee, to comprehensively governing the country according to law and building a well-off society in an all-round way, to comprehensively administering the party strictly and promoting social revolution through the party’s self-revolution, from adhering to and improving the socialist system with Chinese characteristics, to Based on the new development stage, implementing new development concepts, building a new development pattern, promoting high-quality development, and building a socialist modern country in an all-round way, the strategic layout of socialism with Chinese characteristics is becoming more and more perfect, and the direction and goals of modernization are becoming more clear.

In China in the new era, the status of the people is fully demonstrated. “The country is the people, and the people are the country”, the echo of the original intention travels through time and space. “The people’s yearning for a better life is our goal”, the sonorous declaration hardened the iron into a nail. In order to realize the millennium long-cherished wish of the Chinese people to get rid of poverty, the party led the people to fight poverty. The broad masses of cadres and the masses in poverty-stricken areas worked tenaciously. The first secretary and cadres in the villages devoted all their efforts to the precise alignment of cooperation between the east and the west. With efforts, families of poor folks feel the warmth of the big socialist family, and the silent mountains are full of vitality and hope.

In the new era of China, the strength of unity has never been ahead. Faced with the peak of technology, we never back down. Chang’e flew into the sky, the dragon enters the sea, sky-eye gazing, and the Beidou network. Not long ago, the “Zhurong” rover successfully landed on Mars after a 295-day journey. In the face of bullying and suppression, we have never succumbed. The whole party and the whole country have the courage to fight and win, to gather strength and twist into a rope. The unprecedented new crown pneumonia epidemic has closely linked the destiny of each of us with the destiny of the country and the collective. 1.4 billion Chinese people are connected with their hearts, guarding their homes and protecting the country, creating a great miracle in the history of human anti-epidemic struggle…Socialism The advantages of the system have been greatly demonstrated.

There is righteousness in the heaven and the earth, and Cang Ming is awe-inspiring. If socialism, as the just cause of mankind and the pursuit of lofty values, endows the new era with the most distinctive background and the heaviest confidence; then, with its most magnificent practice, the new era has endowed scientific socialism with newness. Ideological dimension, a new historical height.

In April 2021, General Secretary Xi Jinping made a special trip to Quanzhou, Guangxi to pay homage to the Red Army’s Long March Xiangjiang Battle Memorial Park. He said emotionally that once the fire of ideals and belief is ignited, great spiritual power will be produced. We must cherish the memory of revolutionary martyrs and continue the Communist Party. People’s spiritual blood, firm ideals and beliefs, and forge revolutionary will.

Looking back at 87 years ago, on the Long March road and on the banks of the Xiangjiang River, countless Red Army soldiers fought fiercely to preserve the fire of the revolution. They dyed the long journey and rolled the river with blood. These fighters, who are mostly in their twenties, or even fifteen or sixteen, are optimistic and tenacious because they have the belief in the victory of the revolution and their longing for a better society of socialism and communism. This is the eternal gene of a party, and the code of a nation’s prosperity from decline.

Today, we can comfort all the ancestors and heroes of the century: at this moment, the sun of socialism is shining in the shadows of the strugglers and the smiling faces of children, and the banner of socialism with Chinese characteristics is leading the great rejuvenation of the Chinese nation. An unprecedented bright prospect. We will surely create even greater miracles that will admire the world, and will surely realize the most lofty and great ideals of the Communists!  (Translated by Google Translate)

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.”

III
China’s “commercial revolution” in the Song dynasty has long been recognized, beginning with the work of Naito Konan and the   Kyoto School of Marxist historians in Japan in the 1930s.12 But the intellectual constraints imposed by the orthodoxies of Soviet economic and historical thought, with the centrality of a stagist sequence of development that had to be applied to all societies around the world, meant that China could not be seen as having had a capitalist system before the arrival of European imperialism in the nineteenth century. China was either viewed as part of the Asiatic mode of production, which had remained essentially static and unchanging in a primitive form of feudalism over three millennia, or was assimilated into the succession of historical eras enshrined in Joseph Stalin’s 1938 Dialectical and Historical Materialism.13 Marx’s original formulation of the Asiatic mode of production was primarily concerned with India and was based on partial and often faulty information. His knowledge of China was severely limited by both the imperialist biases of most writers and the minimal access to Chinese-language sources available then. It is time to place China’s early modern political economy in a clearer perspective. Let us consider the organization and functioning of production and circulation in early modern China in Marxist terms.14

In volume one of Capital, Marx investigates and delineates several key features of capitalism as it had developed in Europe, most particularly in England. In his preface to the first edition, he makes clear that while he is relying primarily on the analysis of the dynamics of capital as it developed in the West, he sees the characteristics that he discerns in that context as applicable to a broader definition of capitalism as a system.15 Beginning with the commodity and commodity production—that is, production for exchange on the market—he goes on to discuss money as the universal commodity, the process of the valorization of capital (M-C-M’) based on the exploitation of labor power, the mechanisms of wage labor, the division of labor as the means of maximizing that exploitation, and the ongoing imperative of accumulation of capital. These are key defining elements of a capitalist mode of production.16

All of these are present in China from the Song dynasty on. Markets flourished and proliferated, woven together into networks of exchange that spanned the empire and linked up to larger regional and global systems. Commodity production, with sophisticated divisions of labor both across space and within enterprises, expanded dramatically. The growth of China’s capitalist system of manufacturing—which ranged from the elaborate putting-out system of the silk and cotton textile industries to the massive complex of ceramic kilns at Jingdezhen, the largest industrial center in the world before the nineteenth century—also reshaped the sphere of agricultural production.17 China had a sophisticated system of private property in land, and the buying and selling of real property was carried on and documented through the use of legally binding contracts enforceable through the imperial judicial system.18 Farming became increasingly commercialized, with production for national market distribution coming to form significant portions of production in provinces like Sichuan and Hunan. Tenant farming and agricultural day labor grew in importance. Wage and contract labor were central to the manufacturing sector in Jiangnan and elsewhere, from spinners and weavers to ceramics workers and carvers of woodblock printing boards. Strikes and other forms of labor unrest were recurrent in cities like Suzhou and Wuxi.19

China is a large and complex geographic space, with considerable variation and distinctive regional subunits, called macroregions, as theorized by G. William Skinner.20 Each of these is as large as a major European state. Early capitalism in China was by no means equally developed across the empire. Some regions, such as the northwest or the southwest, were much less commercially developed than others, such as the Jiangnan area of the Yangtze River delta, the southeast coast, the corridor along the Grand Canal, or the long valley of the Yangtze. China’s early capitalism was most highly evolved in Jiangnan, where networks of urban production and distribution facilitated sophisticated systems of capital accumulation and deployment. In European history, given the fragmentation of political authority into small and conflicting territorial spaces, the consideration of the economy of England as a discrete unit of analysis, as opposed to a larger European whole, has been the norm. Given China’s vast territorial extent and complex internal macroregional variation, the understanding of early Chinese capitalism as a distinctive formation within the overall expanse of imperial space seems like a more useful approach than attempting to fit the empire as a whole into a monolithic categorization.21

The point is not that China was just like Europe (or, more properly, the other way around, given the chronological sequence of developments), but that the fundamental attributes of capitalism, as explicated in Capital, were also present there, in their own historically and culturally specific forms. China’s early modern political economy, a distinctive form of early capitalism, emerged in the Song dynasty and persisted through periods of growth and contraction across the following Yuan and Ming eras and into the final Qing dynasty. Two aspects of this historical trajectory are of particular interest in understanding the distinctive course of development that characterized China’s early modernity in contrast to the later path of European experience. One is the span of time, which extended over some eight centuries; the other is the nature of class formation and interaction.

IV
Early modernity in China was not a linear process of development leading to a fully modern industrial economy. Early Chinese capitalism, despite going through periods of dynamic growth and transformation, remained essentially commercial capitalism at the level of manufacture, as described in chapter 14 of the first volume of Capital.22 This was a more sophisticated system of production than simple handicraft activities by individual households, but, other than in the special case of the kiln city of Jingdezhen, was not organized into large-scale industrial enterprises. Production was carried out through complicated networks of social relations, in workshops and households, while distribution was largely managed by networks of merchants spanning multiple provinces in interconnecting webs of commerce. Financial mechanisms of credit and banking facilitated long-distance trade.23 These structural features first arose in the Song dynasty and were elaborated and refined in the Ming and Qing dynasties. But the course of economic life, as of China’s history overall, was not one of smooth and tranquil progress. In the twelfth century, the Song lost control of the northern half of the empire to invaders from the northeast called the Jurchen, who established their own dynasty. In the thirteenth century, the rise of the Mongols plunged the remnant Southern Song into a decades-long war of resistance that ended in the collapse of the dynasty and the creation of the Mongol-ruled Yuan as its successor. These wars, and the often anticommercial policies of the Mongols during their century of rule, caused great destruction to China’s population and economy. The Mongols engaged in high-value international trade, but the domestic commercial economy declined during their time in power, though the most highly developed Jiangnan region seems to have fared better than other parts of the empire. When the Ming dynasty was founded in 1368, after central China had been further devastated by disease and the rebellions that overthrew the Yuan, the first emperor was actively hostile to merchant wealth and promoted a physiocratic vision of society based on small landholding and local self-sufficiency, although the empire-spanning network of roadways that he developed for imperial communications also facilitated the revival of long-distance trade.24

The fifteenth and sixteenth centuries saw a dramatic revival of China’s early capitalism, as production and trade across the empire flourished and the international demand for Chinese goods such as tea, porcelain, and silk and cotton textiles drew increasing amounts of silver, first from Japan and then from the mines of the Spanish New World empire via the Manila galleon trade, into China.25 Ongoing technological innovations drove improvements in productivity and quality that made Chinese manufactures ever more popular in global markets. But by the mid–seventeenth century, contradictions within Ming society and politics led to the collapse of the dynasty, and yet another invasion by a non-Chinese coalition led by the Manchus seized power and installed the Qing dynasty in 1644. In the eighteenth century, China recovered from the traumas of the dynastic transition, and a final era of early capitalist prosperity ensued.26

In 1793, the British king George III sent a diplomatic mission to China, led by Lord George Macartney, to seek new trade relations. Foreigners were allowed to trade with China in a regulated system at the port of Guangzhou, known to Westerners as Canton, in the far south of the empire. The British, imbued with the new ideology of free trade and on the cusp of the Industrial Revolution, wanted China to open more ports and allow a permanent diplomatic presence in Beijing. The Qianlong emperor declined these requests and reminded the British, in a letter to King George, that China had all it needed within its own borders and had no wish for the inferior products of the West. But while this remained the case, a combination of domestic and international factors was about to bring an end to China’s early modern capitalist age. Limits on the capacity of agriculture to sustain continuing population growth began to erode material standards of living. The rise of England’s modern industrial economy brought both inexpensive goods to compete with China’s domestic products and the military capacity to force the Qing government to open the empire to Western imperialism. A new era was beginning.

V
Early modern capitalism in China endured across many centuries, with periods of expansion and contraction, but with a persistent drive toward greater sophistication and productivity, and with the accumulation of wealth derived from the extraction of surplus value from labor power reviving after each era of destruction. This generated a wealthy stratum of merchants and investors, largely urban in residence, and distinct from the more traditional elite of landowning households that, through their domination of the Confucian civil service examination system, controlled the operations of the imperial government. Within the discursive field of Confucian thought there was a strong tradition of aversion to commercial wealth and disrespect for those who lived on the profits of trade. Merchants and their sons (and sometimes grandsons) were legally excluded from participation in the examination system, and thus effectively from political power. With the rise of early capitalism and the emergence of a wealthy commercial elite, these ideas began to be challenged and changed by some thinkers. While merchants never came to be fully entitled to an equal role in the examination system or to a political status matching that of the literati/gentry elite, a convergence of interests drove a slow process of cultural adjustment that created a hybrid class more complex than either a purely land- or commerce-based elite. This change in attitude, in political culture, was driven by the convergent material interests and actions of both agricultural and manufacturing producers.27

As China’s economy became more differentiated, with regional specialization in the production of certain commodities and the attendant growth of long-distance trade in both manufactured goods and foodstuffs, commercialized farming became increasingly profitable and landowning families sought new ways to invest their wealth. Merchants and investors in manufacturing activities also were generating wealth and seeking to further expand the valorization and accumulation of their capital. At the same time, many members of the commercial elite sought to position themselves socially as the equals of the literati/gentry in status and prestige by engaging in patronage of religious establishments, cultural pursuits such as the collecting of art or the assembling of libraries, or the building of elaborate mansions and gardens.28

The intersection of the interests and ambitions of landowning and commercial elites came about through the process of investment in economic activities. Members of the literati/gentry elite directed some of their wealth into the businesses of merchants and manufacturers, and shared in the profits of those enterprises. These economic strategies resulted in a convergence of interests rather than a relationship of antagonism. This is in some ways a stark contrast with the later history of class conflict between the rising bourgeoisie and the older feudal aristocracy in Europe, but it is not without parallel. Indeed, in an 1850 review of a book on the seventeenth-century English Revolution by the French politician François Guizot, Marx described a similar convergence of class interests:

This class of large landowners allied with the bourgeoisie…was not, as were the French feudal landowners of 1789, in conflict with the vital interests of the bourgeoisie, but rather in complete harmony with them. Their estates were indeed not feudal but bourgeois property. On the one hand, they provided the industrial bourgeoisie with the population necessary to operate the manufacturing system, and on the other hand, they were in a position to raise agricultural development to the level corresponding to that of industry and commerce. Hence their common interests with the bourgeoisie: hence their alliance.29

The convergence of interests between the landed literati/gentry and the largely urban commercial/manufacturing elite in China persisted, and perhaps deepened, across the span of early modern times. Both sides of this ruling-class collaboration of course remained dedicated to the extraction of surplus value from the labor of workers, whether on farms, in workshops, households, or the marketplace. This hybridity was also reflected in economic thought and government policy. The imperial state was not a strong advocate for commercial interests, but nonetheless often played a role in economic life that benefitted both manufacturing and exchange. The construction and maintenance of roads and canals facilitated the growth of long-distance trade. Government intervention in some critical commodity markets, especially grain, often served to stabilize prices and buffer the extremes of market fluctuations, thus protecting both the livelihoods of consumers and the ongoing operations of merchants.30 The interplay of elite interests and state policy varied over time but was always complex and could certainly be contentious. Fundamental to China’s Confucian political culture was the idea that the state’s primary purpose was to create and maintain conditions of stability and security that would allow the people to pursue their livelihoods in a moderately prosperous society. Debates as to how best to achieve this ideal could be sharp, and different policy orientations predominated at various times, but the active role of the state in economic life was always a part of the mix.

This process of intellectual and cultural change went beyond the purely economic realm. In the preface   to A Contribution to the Critique of Political Economy, written in 1859, Marx notes that, in the social production of their existence, men enter into definite, necessary relations, which are independent of their will, namely, relations of production corresponding to a determinate stage of development of their material forces of production. The totality of these relations of production constitutes the economic structure of society, the real foundation on which there arises a legal and political superstructure and to which there correspond definite forms of social consciousness.31

In China, as early capitalism developed from the Song dynasty onward, new “forms of social consciousness” reflecting these new material realities also took shape. This became especially apparent by the Ming dynasty as a new merchant culture, drawing on particular elements within the broad discursive field of Confucian thought, articulated the hybridity of China’s elite society. The integration of elite elements based in manufacturing and trade with the long-established land-based literati/gentry yielded new ideas that revealed the mutual influence of new realities and older cultural beliefs and behaviors. Merchants engaged in practices of cultural patronage and aesthetic consumption in emulation of existing “gentlemanly” norms, endowing Buddhist religious institutions, building gardens, and assembling library collections. Confucian thought was influenced by market culture, as exemplified by the emergence of “ledgers of merit and demerit,” a form of moral accountancy in which individuals produced balance sheets for their conduct, or in the production of manuals of business practice that sought to navigate the complex relationship between the pursuit of profit and the maintenance of proper social relationships of community and stability. Imperial Confucianism remained the dominant ideology of the state, and within social elites, but it was adapted and adjusted to fit with the new material realities of commercial and manufacturing capitalism.32

The form of capitalism that emerged in China during the early modern period was marked by distinctive forms of power relations. Rather than evolving an antagonistic contradiction between an urban bourgeois class of merchants and manufacturers and a conservative feudal aristocracy of landowning great families, China developed a hybrid elite in that landed and commercial interests converged and functioned as the ruling class through the instrumentality of the imperial state. China’s historical itinerary did not lead to a bourgeois revolution taking power, but rather yielded a balance of elite forces and interests that remained hegemonic across repeated transitions in dynastic rule and that endeavored to shape the policies and practices of the imperial state in its own interests.

The government was tasked at a minimum with providing the security and stability needed to allow people to pursue their livelihoods, though the state could also play a more proactive role in economic life from time to time. Imperial dynasties built and maintained important infrastructure that facilitated long-distance trade, such as the Grand Canal and other water transport systems, or the imperial post roads that spanned the empire. Government monopolies in certain critical commodities were used to buffer some of the extremes of market supply and demand and curtail excessive profit seeking by private capital. Interventions in the all-important grain markets were deployed to sustain consumers in times of bad harvests and shortages. The imperial state was hardly a mercantilist actor, but it did contribute to the development and flourishing of China’s commercial capitalism.

VI
This understanding of China’s past can help illuminate some aspects of the country’s contemporary economic and political formations. China today is a society emerging from a long period of humiliation and oppression at the hands of Western imperialism, and from the turmoil and devastation of decades of revolutionary conflict and the Japanese invasion and occupation from 1937 to 1945. China’s early modern order proved unable to transcend its own limitations and was incapable of meeting the challenges of foreign intrusion and domination. By the late eighteenth century, the Qing empire had begun to face serious economic challenges, with population growth pushing against the limits of agricultural production within the established systems of land tenure and productive technologies. While the Qianlong emperor could still reject Britain’s overtures for free trade in 1793 based on China’s superior economic position, contradictions within the existing mode of production were intensifying.

The Industrial Revolution unleashed both immense productive capacities and powerful new military capabilities that, combined with the ideology of free trade promoted by the competitive imperatives of capitalist production and the ideas of Adam Smith and other political economists, transformed first the British and then other Europeans’ relations with the rest of the world in a wave of colonialist expansionism that fundamentally reconfigured the global economic and political order. China was subordinated to Western imperialism. Its long-vibrant commercial capitalism, already under pressure from internal difficulties, rapidly succumbed to foreign competition. European industrial capitalism reconfigured global relationships, creating a planetary division of labor within which China, though never made a colony of an individual Western power, assumed a subordinate role as a source of raw materials and as a market for European manufactured products. New Chinese capitalist elements began to appear in the late nineteenth century, but they struggled against the dominance of foreign businesses and finance. Western capital and the national governments that served it developed and maintained their power based on a monopoly of industrial productive technologies. The colonial system, which included China’s semicolonial position, preserved this monopoly until the Soviet Union began to develop its own industrial capacity in the 1920s.

In the countryside, the landed elite maintained much of its power and cultural preeminence, but, even there, wealth dwindled and prolonged instability eroded social cohesion. The imperial system staggered to its final collapse in the early twentieth century, and nearly four decades of political conflict and foreign invasion followed, destroying countless lives and further impoverishing the country. In the absence of a coherent national government, the extraction of surplus from agricultural production by local elites intensified and was exacerbated by warlord taxation and the corrupt practices of the nationalist regime. The Japanese invasion of 1937 and the war of resistance that lasted until 1945 brought further hardship and destruction to both urban and rural China.

Only with the victory of the revolution led by the Communist Party and the Red Army could the construction of a new modern China get underway. Land reform between 1948 and 1952 swept away the last vestiges of the old gentry landowning class in the countryside and created the conditions for building a new agriculture based on collective ownership and planned development.33 The industrial economy was nationalized in stages in the early 1950s, then began to grow through the deployment of capital from surpluses in both agriculture and manufacturing according to a series of five-year plans developed from the mid–1950s onward.

Experiments with varying forms of industrial management sought new ways to contribute to the development of a modern socialist economy.34 Aid and technical assistance from the Soviet Union and the Eastern European socialist states was crucial in the first decade of the People’s Republic. China was able begin developing a modern industrial sector distinct from the Western monopoly.

The path of socialist construction was contentious and deep divisions over how best to advance led to decades of struggle and conflict within the party and in society. The years from 1949 to 1979 saw successes and failures, advances and retreats. Dramatic improvements were made in public health, with average life expectancy rising significantly while infant mortality fell. National infrastructure in transportation and communication was massively expanded, as were reservoirs and other hydraulic resources, and overall economic growth averaged over 3 percent per year. Basic social services were provided and education was extended to most of the country’s young people.35

Nonetheless, by 1979 China remained a poor country as population growth negated some of the increases in production and a focus on heavy industry and infrastructure kept household consumption at basic levels. In a series of decisions at the end of the 1970s and the beginning of the ’80s, the Communist Party decided to embark on a path of “reform and opening to the outside” (????) aimed at rapidly developing the economy and reorienting production both to meeting the needs of domestic consumers and to creating an export sector that would generate further growth through profits and the accumulation of foreign exchange. At the heart of this process was the decision to use the mechanisms of the market to develop the productive economy. In other words, a certain amount of private capital would be allowed to function within the economy, in tandem with or parallel to the continuing operations of state-owned enterprises and other forms of socialist industry and agriculture. Foreign capital would be welcomed in joint ventures, initially limited to special economic zones but eventually spreading to the country at large.

This was not a blank check written to a new capitalist class. The decision to embrace the use of markets as a driver of development was premised on the ongoing key role of the Communist Party in China’s political and economic system. The party would continue to be the guiding force shaping policy and practice, and would oversee the country’s progress toward a level of prosperity where the needs of all people could be met and where a more equitable social order could be engendered. This is the vision that is characterized as socialism with Chinese characteristics, (Zhongguo tese shehui zhuyi, ????????).36

Though not without shortcomings and contradictions, China’s economy entered into an era of remarkable expansion as a result of these policies and practices. The Chinese economy’s growth rates often exceeded 10 percent over the next three decades and, in the pre-COVID years, were still growing by more than 6 percent annually. Productive capacity expanded rapidly and modern technologies were acquired, in part through joint venture partnerships with foreign capital. China also began to invest heavily in research and development to be able to pursue technological innovation with reduced reliance on foreign inputs. Hundreds of millions of people were lifted out of poverty, material standards of living rose dramatically, and China emerged on the world stage as an increasingly important player in global economic life.

China’s economy today is a hybrid of state and other collectively owned enterprises, ranging from huge national entities to county or township level factories or workshops (about 45 percent of asset ownership), and a private sector that includes both domestic businesses and international joint ventures (about 35 percent of asset ownership). Another 20 percent of businesses fall into an intermediate zone, with a blend of public and private ownership.37 State-owned enterprises, at both the central and local levels, form the core of the productive economy and infrastructure, predominate in banking and finance, and are the single largest source of government revenue, but the private sector has also assumed major proportions, with a number of world class corporations playing leading roles and an ever-growing number of billionaires. The private sector currently accounts for a little over half of all employment in industry, though more than 40 percent of China’s people still live and work in the agricultural sector, where land is owned by the state and leased to households. Production in both the industrial and agricultural sectors, by both public and private enterprises, is geared to a system of domestic and international markets. Much of China’s growth has come through its exports to the global economy, but domestic consumption is being increasingly expanded.

The rationale for the reform policies can be understood in part within the theoretical parameters of Marxist and Leninist experience. In the Communist Manifesto and many other writings, Marx and Frederick Engels were very clear on the power of capitalist markets to drive innovation and development. V. I. Lenin turned to market mechanisms under the New Economic Policies in the dark years after the Civil War in Russia to jumpstart the growth of the new Soviet economy. The creative power of markets always threatens to become a reckless monstrosity, like the demons conjured by the sorcerer’s apprentice. This is why the careful oversight of the party is critical to China’s future.38

In a discussion of the development of reform policies in November 2013, Xi Jinping set out the party’s position: “In 1992 the Party’s 14th National Congress stipulated that China’s economic reform aimed at establishing a socialist market economy, allowing the market to play a basic role in allocating resources under state macro control.” He noted that “there are still many problems. The market lacks order, and many people seek economic benefits through unjustified means.” He also emphasized that “we must unswervingly consolidate and develop the public economy, persist in the leading role of public ownership, give full play to the leading role of the state-owned economy, and incessantly increase its vitality, leveraging power and impact.”39 Over recent years, the party and the government have pursued an aggressive campaign against corruption, expanded regulatory oversight of industry and finance in both the public and private sectors, and promoted ideals of social responsibility and socialist values. These policies and practices suggest the complexity and dynamism of the relationship between the party, the state, and private economic actors.

Under the policies of reform, China now has capitalists, but it does not have a capitalist class that can control the state and shape it to its own interests. The practical effects of the leading role of the party can be seen in the ways in which the most dangerous aspects of capitalist economics are being buffered and constrained today. China continues to devote major resources to eliminating poverty, a key benchmark of which was achieved in November 2020 when the last few counties, in Guizhou province, that had lagged behind the internationally recognized definition of absolute poverty were finally designated as having emerged from that status. China must further improve the livelihoods of its people, but it is making steady progress in that direction. The serious environmental problems, which peaked in the first decade of the twenty-first century, are being addressed, and China’s commitment to be carbon neutral by 2060 is a clear statement of the priority of ongoing engagement with the ecology of the country.40 China is also developing a culture of what are sometimes called “patriotic entrepreneurs”— capitalists who understand that, in socialism with Chinese characteristics, they have a place within a unique social system, a hybrid of markets and planning, a blend of public and private ownership, and that they have a responsibility to contribute to the development not only of their own enterprises, but to the enhancement of the people’s livelihoods.41 The operations of the United Front Department of the party have been expanded in recent years as another means of managing the relationship between the party and other social and political elements.42 The party and the state thus are pursuing practical policies and actions to direct social resources to further development, and a program of cultural politics to ensure that the operations of private capital are integrated within the overall goals of socialist development.

The political and legal infrastructure of the People’s Republic, in particular the public ownership of land and the system of household registration, ensures that, just as there is no bourgeoisie, there is also no true proletariat. Workers in China are not compelled to sell their labor power in the marketplace because they have no property. The system of socialist ownership means that everyone in China has economic resources for their maintenance. Individuals are registered in their native places and have access to land as a place to live and to at least minimal social services such as education and health care. The importance of this was clearly demonstrated during the financial crisis of 2008 and beyond, when, with the downturn in demand for goods produced in and exported from China, some twenty million workers were laid off from factories in places like Shenzhen and Shanghai. These workers were not simply cast out and left to their own devices, but instead could return to their home villages, where they remained entitled to the support of the socialist system. As China adjusted to the new demand structure of the global economy, and as productive activity revived in the following years, workers could return to their former employment or seek new opportunities without having been reduced to poverty and immiseration. The provision of dibao (??), the basic level of support in rural China, is not enough to maintain a truly comfortable way of life, which is why so many young people from the countryside have sought better economic opportunities in factory or construction work in the cities, but it did serve to bridge the period of unemployment caused by the global crisis.

Workers have also been able to use the mechanisms of socialist legality to pursue their economic interests within China’s rapidly developing economy. The All-China Federation of Trade Unions has represented workers across the country, and workers and citizens in general have exercised their rights to protest, petition, and litigate through the courts to address issues from wages and working conditions to corruption and abuse of power by officials to the dangers of environmental pollution. Beyond the operations of the union federation, Chinese workers have been militant in pursuing their interests through protests and wildcat strikes. Workers and other citizens take the law and their rights seriously and regularly engage in direct action to pursue their interests. This can be portrayed as a sign of alienation, but may perhaps more properly be seen as indicating their understanding and application of their civil powers.43 China’s socialist government and the Communist Party thus serve both to restrain the potential excesses and abuses of new capitalist elements and to maintain the central role of the working class within economic and social life.

This is not to say that workers who leave their native villages to seek employment in factories or on constructions sites are not acting out of economic motivations, nor that their labor power does not generate surplus value that is, at this stage in the developmental process, appropriated by private capital or even state-owned enterprises and other kinds of collectively owned enterprises. This is part of the bargain, part of the experiment on which the Communist Party embarked to develop China’s productive economy and accumulate wealth that leads first to a socialism of a “moderately prosperous society” (????) and eventually to the level of material abundance that is the threshold and foundation of a communist future. There are risks and challenges along this path. The growth that has been achieved has not come without costs. The use of market mechanisms implied the acceptance of certain contradictions that are inherent in their operations. Inequality in the country has increased sharply, as, to paraphrase Deng Xiaoping, some people got rich first. Environmental stresses became a serious problem, with pollution of the air, water, and soil damaging people’s health and undermining the quality of life. Corruption became a critical legal and political issue. The Communist Party has made great efforts to address these contradictions, but also remains committed to the path of reform. The process of experimentation and innovation that has unfolded in the course of the reform era is sometimes called “crossing the river by feeling the rocks” (mozhe shitou guohe, ??????) and perhaps constitutes a course of “two steps forward, one step back” as history advances.

In her book The Transformation of Chinese Socialism, Lin Chun writes that “it is no easy task to ‘join the market in order to beat it’ via relinking, borrowing, and embracing.” She goes on to ask:

Might “private” capital be simultaneously “social” in a socialized market to serve public interests? Could such a market survive and eventually overcome the capitalist world market, and on what historical and institutional basis? Imposing these questions, we can recognize the truism that even a socialist society cannot avoid being “structurally dependent on capital.”… On the other hand, however, the preserved demarcation between capital and capitalism indicates the feasibility of preventing the logic of profit from colonizing the political, social, and cultural spheres—that is, if the right agency and institutions can be put in place.44

The historical outcome of China’s experiment with building a socialist market economy, “socialism with Chinese characteristics,” remains an open question. China’s remarkable success at coping with the COVID-19 pandemic and mobilizing social resources to address public health as a human right, in contrast to the catastrophic failures of capitalist, profit-seeking health care systems in the United States and the West, suggests that, while much work remains to be done, the country may indeed be on a path to socialist modernity. Looking at the history of the People’s Republic since 1949 provides one view of the complexities of China’s pursuit of a modern industrial, socialist system.

VII
Another way to consider the current reform era and the nature of China’s twenty-first-century political economy is in the longer perspective of China’s early modern capitalist history. The “Chinese characteristics” of China’s socialism can be understood in part as a structural and cultural redeployment of features we have seen in the Song-Qing era. The complex dialectic of the state seeking to both encourage and constrain the dynamism of capitalist markets that was pursued by imperial bureaucrats, to varying degrees at different times, resonates with the hybridity of public and private economic agents in China today. The shaping of a culturally specific political and economic consciousness through the interplay of market dynamics and select themes and currents within the broad field of Confucian thought and values, subordinating the single-minded pursuit of short-term profit to a longer perspective of socially responsible accumulation, perhaps foreshadowed today’s evocation of the ideal of “patriotic entrepreneurs.”

This does not mean that the People’s Republic is simply a new version of the old empire, old wine in new bottles, but rather that both the interplay of market forces and government policy in later imperial China and the present system of market socialism, or socialism with Chinese characteristics, constitute distinct modes of production that can be best understood in a historical materialist analysis that recognizes both their relationship to broader global processes of economic history and their developmental linkages to deep currents of continuity in Chinese material and cultural life. The key difference is of course the class nature of the state, which in imperial times was the instrument of class rule by the hybrid landed-commercial ruling elite, but is today, with the leading role of the Communist Party, the management committee for the building of a new social order, at least aspirationally, and to a significant extent, practically, based on the interests and wishes of the working class. This remains a work in progress, as history continues to move.

Appreciating the specificities of China’s history and its present path within the overall framework of a historical materialist perspective allows us to move beyond trying to assimilate all forms of capitalism, all paths toward socialism, all versions of early modernity, to a single universal template. It is the mode of analysis that must be universal, and the data must drive the conclusions. The analytical perspective derived from Capital and Marx’s other writings does not mean we need to seek and find the exact same totality in every place to be able to apply a precise definition of capitalism, and to fit the experience of different peoples in different places into a monolithic narrative flow. A nuanced application of Marx’s methods to the particularities of place and time will yield results of greater practical utility in both the understanding of the past and an engagement with contemporary developments.

Notes:
1. See, for example, Yan Xuetong, Leadership and the Rise of Great Powers (Princeton: Princeton University Press, 2019); Zhang Weiwei, The China Wave: Rise of a Civilizational State (Hackensack, NJ: World Century Publishing, 2012); Yukon Huang, Cracking the China Conundrum: Why Conventional Economic Wisdom is Wrong (Oxford: Oxford University Press, 2017); Wang Hui, China’s Twentieth Century (London: Verso, 2016); Charles Horner, Rising China and Its Postmodern Fate (Athens, GA: University of Georgia Press, 2009).
2. The argument that China has capitulated to a capitalist system has been made many times since the beginning of the reform era. See, inter alia, William Hinton, The Great Reversal: The Privatization of China, 1978–1989 (New York: Monthly Review Press, 1990); Eli Friedman, “Why China Is Capitalist: Toward an Anti-Nationalist Anti-Imperialism,” Spectre, July 15, 2020.
3. A basic overview is provided in Richard von Glahn, The Economic History of China: From Antiquity to the Nineteenth Century (Cambridge: Cambridge University Press, 2016).
4.  For a good account in English of Chinese writing about the Asiatic mode of production through the 1980s, see Timothy Brook, The Asiatic Mode of Production in China (Armonk, NY: M. E. Sharpe, 1989). Chinese scholarship on economic history and the question of the “sprouts of capitalism” includes, inter alia, (1250–1850)
5. Much writing on Chinese history continues to be organized on the basis of imperial dynasties. Broader categories are useful for understanding long-term trends and developments, yet there is not a consensus on the appropriate terminology. Most scholars accept the term antiquity, but some continue to refer to the middle period as medieval, while the term early modern is adopted by a growing number of scholars, but with varying period definitions. Some continue to prefer the term late imperial for this period. For a critical discussion of periodization and a characterization of the last thousand years of Chinese history, see Richard von Glahn, “Imagining Premodern China,” in The Song-Yuan-Ming Transition in Chinese History, ed. Paul Jakov Smith and Richard von Glahn (Cambridge, MA: Harvard University Asia Center, 2003), 35–70.
6. Hsu Cho-Yun, Ancient China in Transition: An Analysis of Social Mobility, 722–222 BC (Stanford: Stanford University Press, 1965).
7. Zhang Chuanxi, “Growth of the Feudal Economy,” in The History of Chinese Civilization: Qin, Han, Wei, Jin, and the Northern and Southern Dynasties (221 BCE–581 CE), ed. Yuan Xingpei, Yan Wenming, Zhang Chuanxi, and Lou Yulie (Cambridge: Cambridge University Press, 2012), 139–95. The use of the term feudal in this chapter title reflects the continuing influence of Soviet-era orthodoxies.
8. Joseph P. McDermott and Shiba Yoshinbu, “Economic Change in China, 960–1279,” in The Cambridge History of China, vol. 5, part 2, Sung China, 960–1279, ed. John W. Chaffee and Denis Twitchett (Cambridge: Cambridge University Press, 2015), 321–436.
9.  Nicolas Tackett, The Destruction of the Medieval Chinese Aristocracy (Cambridge, MA: Harvard University Asia Center, 2014).
10.  The use of the term gentry is problematic, given its derivation from European social history, but is conventionally established in Anglophone Chinese history and is retained here in tandem with literati to delineate the dual nature of the landowning elite as both local and imperial.
11.  Shiba Yoshinobu, Commerce and Society in Sung China (Ann Arbor: Center for Chinese Studies, 1992); William Guanglin Liu, The Chinese Market Economy, 1000–1500 (Albany: SUNY Press, 2015); McDermott and Shiba, “Economic Change in China, 960–1279.”
12,  Joshua A. Fogel, Politics and Sinology: The Case of Naito Konan (1866–1934) (Cambridge, MA: Harvard University Press, 1984).
13.  Joseph Stalin, “Dialectical and Historical Materialism” and Other Writings (Graphyco, 2020).
14. Earlier efforts to situate China in relation to the European development of capitalism are summarized in Timothy Brook and Gregory Blue, eds., China and Historical Capitalism: Genealogies of Sinological Knowledge (Cambridge: Cambridge University Press, 1999). See also David Faure, China and Capitalism: A History of Business Enterprises in Modern China (Hong Kong: Hong Kong University Press, 2006). For an exploration of the history of capitalism on a global basis, using non-Marxist definitions including private property rights, contracts enforceable by third parties, markets with responsive prices, and supportive governments, see Larry Neal and Jefferey G. Williamson, The Cambridge History of Capitalism, vol. 1, The Rise of Capitalism: From Ancient Origins to 1848 (Cambridge: Cambridge University Press, 2014).
15. Recent scholarship has highlighted the ways in which Marx also articulated, in Capital, the Grundrisse, and elsewhere, a recognition that the course of European economic history and development was not the only or inevitable path for all societies around the world. Kevin B. Anderson, Marx at the Margins: On Nationalism, Ethnicity, and Non-Western Societies (Chicago: University of Chicago Press, 2016); Marcello Musto, The Last Years of Karl Marx, An Intellectual Biography (Stanford: Stanford University Press, 2020).
16. Karl Marx, Capital: A Critique of Political Economy, vol. 1 (London: Penguin Books, 1990).
17. On the industrial complex at Jingdezhen, see Anne Gerritsen, The City of Blue and White: Chinese Porcelain and the Early Modern World (Cambridge: Cambridge University Press, 2020).
18.  Valerie Hansen, Negotiating Daily Life in Traditional China: How Ordinary People Used Contracts, 600–1400 (New Haven: Yale University Press, 1995); Madeleine Zelin, Jonathan K. Ocko, and Robert Gardella, eds., Contract and Property in Early Modern China (Stanford: Stanford University Press, 2004).
19.  Michael Marmé, Suzhou: Where the Goods of All Provinces Converge (Stanford: Stanford University Press, 2005).
20.  G. William Skinner, ed., The City in Late Imperial China (Stanford: Stanford University Press, 1965).
21.  For an incisive discussion of the question of comparability, see Kenneth Pomeranz, The Great Divergence: China, Europe, and the Making of the Modern World Economy (Princeton: Princeton University Press, 2001).
22.  Marx, Capital, vol. 1, 455–91.
23. These features of commercial capitalism in China are comparable to those in Europe, as outlined in Jairus Banaji, A Brief History of Commercial Capitalism (Chicago: Haymarket, 2020).
24. Timothy Brook, “Communications and Commerce,” in The Cambridge History of China, vol. 8, The Ming Dynasty, 1368–1644, part 2 (Cambridge: Cambridge University Press, 1998), 579–707.
25. Arturo Giraldez, The Age of Trade: The Manila Galleons and the Dawn of the Global Economy (Boulder: Rowman and Littlefield, 2015).
26. Jie Zhao, Brush, Seal, and Abacus: Troubled Vitality in Late Ming China’s Economic Heartland, 1500–1644 (Hong Kong: Chinese University of Hong Kong Press, 2018); Timothy Brook, The Confusions of Pleasure: Commerce and Culture in Ming China (Berkeley: University of California Press, 1999).
27.  Margherita Zanasi, Economic Thought in Modern China: Market and Consumption, c. 1500–1937 (Cambridge: Cambridge University Press, 2020).
28. Timothy Brook, Praying for Power: Buddhism and the Formation of Gentry Society in Late Ming China (Cambridge, MA: Harvard-Yen-Ching Institute, 1996).
29. Karl Marx, Surveys from Exile (London: Verso, 2010), 254.
30. William T. Rowe, Saving the World: Chen Hongmou and Elite Consciousness in Eighteenth Century China (Stanford: Stanford University Press, 2002).
31. Karl Marx, preface and introduction to A Contribution to the Critique of Political Economy (Beijing: Foreign Languages Press, 1976), 3.
32. Cynthia Joanne Brokaw, Ledgers of Merit and Demerit: Social Change and Moral Order in Late Imperial China (Princeton: Princeton University Press, 2016); Richard Lufrano, Honorable Merchants: Commerce and Self-Cultivation in Late Imperial China (Honolulu: University of Hawaii Press, 1997).
33. William Hinton, Fanshen: A Documentary of Revolution in a Chinese Village (New York: Vintage, 1966).
34. Franz Schurmann, Ideology and Organization in Communist China (Berkeley: University of California Press, 1966).
35 Jean Chesneaux, China: The People’s Republic, 1949–1976 (New York: Pantheon, 1979).
36. The phrase “socialism with Chinese characteristics” has itself gone through a process of transformation. It was originally developed in the 1950s in the context of Mao Zedong’s efforts to promote his vision of economic development as distinct from the Soviet experience. Deng Xiaoping redeployed the term in the 1980s and it has continued to be adapted to China’s ongoing policy developments. Under Xi Jinping, it has been expanded to become “socialism with Chinese characteristics for a new era.”
37. Nicholas Borst, “State-Owned Enterprises and Investing in China,” Seafarer, November 2019.
38. Domenico Losurdo, “Has China Turned to Capitalism? Reflections on the Transition from Capitalism to Socialism,” International Critical Thought 7, no. 1 (2017): 15–31.
39. Xi Jinping, The Governance of China, I (Beijing: Foreign Languages Press, 2014), 83–86.
40. Barbara Finamore, Will China Save the Planet? (Cambridge: Polity, 2018).
41. “Chinese Entrepreneurs Urged to Show Patriotism,” Apple Daily, December 14, 2020.
42. Takashi Suzuki, “China’s United Front Work in the Xi Jinping Era: Institutional Developments and Activities,” Journal of Contemporary East Asian Studies 8, no. 1 (2019): 83–98.
43. Ching Kwan Lee, Against the Law: Labor Protests in China’s Rustbelt and Sunbelt (Berkeley: University of California Press, 2007).
44. Lin Chun, The Transformation of Chinese Socialism (Durham: Duke University Press, 2006), 251–52.

About Ken Hammond
Ken Hammond is a professor of East Asian and global history at New Mexico State University. He is the author of five books and numerous articles on Chinese political and cultural history, as well as a thirty-six-lecture series, From Yao to Mao: 5000 Years of Chinese History. He has been an activist since he was in Students for a Democratic Society as an undergrad at Kent State University from 1968 to 1971. He is currently working with Pivot to Peace, an organization dedicated to promoting better understanding and avoiding conflict between the United States and China. He can be reached at khammond[at]nmsu.edu

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.

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.

At least not until now — because now, in the era of the virus, a poor person’s sickness can affect a wealthy society’s health. And yet, even now, Bernie Sanders, the senator who has relentlessly campaigned for healthcare for all, is considered an outlier in his bid for the White House, even by his own party.

The tragedy is the wreckage of a train that has been careening down the track for years

And what of my country, my poor-rich country, India, suspended somewhere between feudalism and religious fundamentalism, caste and capitalism, ruled by far-right Hindu nationalists?

In December, while China was fighting the outbreak of the virus in Wuhan, the government of India was dealing with a mass uprising by hundreds of thousands of its citizens protesting against the brazenly discriminatory anti-Muslim citizenship law it had just passed in parliament.

The first case of Covid-19 was reported in India on January 30, only days after the honourable chief guest of our Republic Day Parade, Amazon forest-eater and Covid-denier Jair Bolsonaro, had left Delhi. But there was too much to do in February for the virus to be accommodated in the ruling party’s timetable. There was the official visit of President Donald Trump scheduled for the last week of the month. He had been lured by the promise of an audience of 1m people in a sports stadium in the state of Gujarat. All that took money, and a great deal of time.

Then there were the Delhi Assembly elections that the Bharatiya Janata Party was slated to lose unless it upped its game, which it did, unleashing a vicious, no-holds-barred Hindu nationalist campaign, replete with threats of physical violence and the shooting of “traitors”.

It lost anyway. So then there was punishment to be meted out to Delhi’s Muslims, who were blamed for the humiliation. Armed mobs of Hindu vigilantes, backed by the police, attacked Muslims in the working-class neighbourhoods of north-east Delhi. Houses, shops, mosques and schools were burnt. Muslims who had been expecting the attack fought back. More than 50 people, Muslims and some Hindus, were killed.

Thousands moved into refugee camps in local graveyards. Mutilated bodies were still being pulled out of the network of filthy, stinking drains when government officials had their first meeting about Covid-19 and most Indians first began to hear about the existence of something called hand sanitiser.

March was busy too. The first two weeks were devoted to toppling the Congress government in the central Indian state of Madhya Pradesh and installing a BJP government in its place. On March 11 the World Health Organization declared that Covid-19 was a pandemic. Two days later, on March 13, the health ministry said that corona “is not a health emergency”.

Finally, on March 19, the Indian prime minister addressed the nation. He hadn’t done much homework. He borrowed the playbook from France and Italy. He told us of the need for “social distancing” (easy to understand for a society so steeped in the practice of caste) and called for a day of “people’s curfew” on March 22. He said nothing about what his government was going to do in the crisis, but he asked people to come out on their balconies, and ring bells and bang their pots and pans to salute health workers.

He didn’t mention that, until that very moment, India had been exporting protective gear and respiratory equipment, instead of keeping it for Indian health workers and hospitals.

Not surprisingly, Narendra Modi’s request was met with great enthusiasm. There were pot-banging marches, community dances and processions. Not much social distancing. In the days that followed, men jumped into barrels of sacred cow dung, and BJP supporters threw cow-urine drinking parties. Not to be outdone, many Muslim organisations declared that the Almighty was the answer to the virus and called for the faithful to gather in mosques in numbers.

On March 24, at 8pm, Modi appeared on TV again to announce that, from midnight onwards, all of India would be under lockdown. Markets would be closed. All transport, public as well as private, would be disallowed.

He said he was taking this decision not just as a prime minister, but as our family elder. Who else can decide, without consulting the state governments that would have to deal with the fallout of this decision, that a nation of 1.38bn people should be locked down with zero preparation and with four hours’ notice? His methods definitely give the impression that India’s prime minister thinks of citizens as a hostile force that needs to be ambushed, taken by surprise, but never trusted.

Locked down we were. Many health professionals and epidemiologists have applauded this move. Perhaps they are right in theory. But surely none of them can support the calamitous lack of planning or preparedness that turned the world’s biggest, most punitive lockdown into the exact opposite of what it was meant to achieve.

The man who loves spectacles created the mother of all spectacles.

A resident wears a face mask in Mumbai, where the usually bustling streets are almost deserted.?.?. © Varinder Chawla/MEGA

As an appalled world watched, India revealed herself in all her shame — her brutal, structural, social and economic inequality, her callous indifference to suffering.

The lockdown worked like a chemical experiment that suddenly illuminated hidden things. As shops, restaurants, factories and the construction industry shut down, as the wealthy and the middle classes enclosed themselves in gated colonies, our towns and megacities began to extrude their working-class citizens — their migrant workers — like so much unwanted accrual.

Many driven out by their employers and landlords, millions of impoverished, hungry, thirsty people, young and old, men, women, children, sick people, blind people, disabled people, with nowhere else to go, with no public transport in sight, began a long march home to their villages. They walked for days, towards Badaun, Agra, Azamgarh, Aligarh, Lucknow, Gorakhpur — hundreds of kilometres away. Some died on the way.

Our towns and megacities began to extrude their working-class citizens like so much unwanted accrual

They knew they were going home potentially to slow starvation. Perhaps they even knew they could be carrying the virus with them, and would infect their families, their parents and grandparents back home, but they desperately needed a shred of familiarity, shelter and dignity, as well as food, if not love.

As they walked, some were beaten brutally and humiliated by the police, who were charged with strictly enforcing the curfew. Young men were made to crouch and frog jump down the highway. Outside the town of Bareilly, one group was herded together and hosed down with chemical spray.

A few days later, worried that the fleeing population would spread the virus to villages, the government sealed state borders even for walkers. People who had been walking for days were stopped and forced to return to camps in the cities they had just been forced to leave.

Among older people it evoked memories of the population transfer of 1947, when India was divided and Pakistan was born. Except that this current exodus was driven by class divisions, not religion. Even still, these were not India’s poorest people. These were people who had (at least until now) work in the city and homes to return to. The jobless, the homeless and the despairing remained where they were, in the cities as well as the countryside, where deep distress was growing long before this tragedy occurred. All through these horrible days, the home affairs minister Amit Shah remained absent from public view.

n the walking began in Delhi, I used a press pass from a magazine I frequently write for to drive to Ghazipur, on the border between Delhi and Uttar Pradesh.

The scene was biblical. Or perhaps not. The Bible could not have known numbers such as these. The lockdown to enforce physical distancing had resulted in the opposite — physical compression on an unthinkable scale. This is true even within India’s towns and cities. The main roads might be empty, but the poor are sealed into cramped quarters in slums and shanties.

Every one of the walking people I spoke to was worried about the virus. But it was less real, less present in their lives than looming unemployment, starvation and the violence of the police. Of all the people I spoke to that day, including a group of Muslim tailors who had only weeks ago survived the anti-Muslim attacks, one man’s words especially troubled me. He was a carpenter called Ramjeet, who planned to walk all the way to Gorakhpur near the Nepal border.

“Maybe when Modiji decided to do this, nobody told him about us. Maybe he doesn’t know about us”, he said.

“Us” means approximately 460m people.

State governments in India (as in the US) have showed more heart and understanding in the crisis. Trade unions, private citizens and other collectives are distributing food and emergency rations. The central government has been slow to respond to their desperate appeals for funds. It turns out that the prime minister’s National Relief Fund has no ready cash available. Instead, money from well-wishers is pouring into the somewhat mysterious new PM-CARES fund. Pre-packaged meals with Modi’s face on them have begun to appear.

In addition to this, the prime minister has shared his yoga nidra videos, in which a morphed, animated Modi with a dream body demonstrates yoga asanas to help people deal with the stress of self-isolation.

The narcissism is deeply troubling. Perhaps one of the asanas could be a request-asana in which Modi requests the French prime minister to allow us to renege on the very troublesome Rafale fighter jet deal and use that €7.8bn for desperately needed emergency measures to support a few million hungry people. Surely the French will understand.

As the lockdown enters its second week, supply chains have broken, medicines and essential supplies are running low. Thousands of truck drivers are still marooned on the highways, with little food and water. Standing crops, ready to be harvested, are slowly rotting.

The economic crisis is here. The political crisis is ongoing. The mainstream media has incorporated the Covid story into its 24/7 toxic anti-Muslim campaign. An organisation called the Tablighi Jamaat, which held a meeting in Delhi before the lockdown was announced, has turned out to be a “super spreader”. That is being used to stigmatise and demonise Muslims. The overall tone suggests that Muslims invented the virus and have deliberately spread it as a form of jihad.

The Covid crisis is still to come. Or not. We don’t know. If and when it does, we can be sure it will be dealt with, with all the prevailing prejudices of religion, caste and class completely in place.

Today (April 2) in India, there are almost 2,000 confirmed cases and 58 deaths. These are surely unreliable numbers, based on woefully few tests. Expert opinion varies wildly. Some predict millions of cases. Others think the toll will be far less. We may never know the real contours of the crisis, even when it hits us. All we know is that the run on hospitals has not yet begun.

India’s public hospitals and clinics — which are unable to cope with the almost 1m children who die of diarrhoea, malnutrition and other health issues every year, with the hundreds of thousands of tuberculosis patients (a quarter of the world’s cases), with a vast anaemic and malnourished population vulnerable to any number of minor illnesses that prove fatal for them — will not be able to cope with a crisis that is like what Europe and the US are dealing with now.

All healthcare is more or less on hold as hospitals have been turned over to the service of the virus. The trauma centre of the legendary All India Institute of Medical Sciences in Delhi is closed, the hundreds of cancer patients known as cancer refugees who live on the roads outside that huge hospital driven away like cattle.

A boy wearing a protective mask ventures on to a balcony in Srinagar, which recorded Kashmir’s first coronavirus death in late March © eyevine
People will fall sick and die at home. We may never know their stories. They may not even become statistics. We can only hope that the studies that say the virus likes cold weather are correct (though other researchers have cast doubt on this). Never have a people longed so irrationally and so much for a burning, punishing Indian summer.

What is this thing that has happened to us? It’s a virus, yes. In and of itself it holds no moral brief. But it is definitely more than a virus. Some believe it’s God’s way of bringing us to our senses. Others that it’s a Chinese conspiracy to take over the world.

Whatever it is, coronavirus has made the mighty kneel and brought the world to a halt like nothing else could. Our minds are still racing back and forth, longing for a return to “normality”, trying to stitch our future to our past and refusing to acknowledge the rupture. But the rupture exists. And in the midst of this terrible despair, it offers us a chance to rethink the doomsday machine we have built for ourselves. Nothing could be worse than a return to normality.

Historically, pandemics have forced humans to break with the past and imagine their world anew. This one is no different. It is a portal, a gateway between one world and the next.

We can choose to walk through it, dragging the carcasses of our prejudice and hatred, our avarice, our data banks and dead ideas, our dead rivers and smoky skies behind us. Or we can walk through lightly, with little luggage, ready to imagine another world. And ready to fight for it.

Arundhati Roy’s latest novel is ‘The Ministry of Utmost Happiness’

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.