Michael Hudson: Super Imperialism, 3rd Edition

Yves here. Congrats to Michael Hudson for reissuing Super Imperialism. How many writers have books that have withstood the test of time?

Hudson bought back the rights from his publisher and revised and updated it. If you haven’t read Super-Imperialism, now is the time to make up for that lapse. Or you can donate at Hudson’s Paetron page.

The updated and expanded 3rd edition of Super Imperialism: The Economic Strategy of American Empire is now available.

This highly respected study of U.S. financial diplomacy explores the faults built into the core of the World Bank and the IMF at their inception. Forensic detail reveals how the world’s core economic functions were sculpted to preserve US financial hegemony. Difficult to detect at the time, these problems have since become explicit as the failure of the international economic order has become apparent; the IMF and World Bank were set up to give aid to developing countries, but instead many of the world’s poorest countries have been plunged into insurmountable debt crises.

The book became famous for detailing how the removal of the gold standard left the world’s central banks with only one alternative vehicle: to hold their international reserves in U.S. Treasury securities.

The result was a self-financing circular flow of U.S. military spending and the investment takeover of foreign economies. The larger America’s balance-of-payments deficit grew, the more dollars ended up in the hands of central banks and sovereign wealth funds. Machiavelli could not have planned it better. By participating in this circular flow, nations in effect financed their own economic and military encirclement.

Hudson’s critique of the destructive course of the international economic system provides important insights into the real motivations at the heart of these institutions – and the increasing tide of opposition that they face around the world.

Ann Pettifor:

In this book Michael Hudson illuminates one of the most powerful forces in global economics – one which is hidden, and widely misunderstood. It is the use by the United States of a “money-pump” – an economic contraption which liberally pumps out money to finance extravagant US consumption and spending. This “money-pump” works at almost no cost to Americans, and at considerable cost to those who pour dollars into the “pump” – the rest of us. That is why this book is vital reading.

This magisterial account of US imperialism is extraordinary in its range and immediacy. It was clearly written at a time when the events were still fresh in the memory of the author, and so has an authenticity missing in later accounts of the US’s decisive changes to the global economy.”

Herman Kahn (1972):

You’ve shown how the United States has run rings around Britain and every other empire-building nation in history. We’ve pulled off the greatest rip-off ever achieved.

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  1. The Rev Kev

    Russian President Vladimir Putin was just saying how ‘Washington itself is undermining the US dollar as the world’s reserve currency by using it as an instrument of sanctions abroad, while raising the national debt and inflating at home.’

    I do not know if it is true, but I read once that having the dollar as a reserve currency allows the US to export its inflation to the rest of the world. And if it stopped being so, well, Katy bar the door-


    If the good doctor has updated his book, it looks like I will have to add it to my book list as I was wondering which of his books to buy.

    1. BlakeFelix

      I think that’s true, dollar inflation hits foreign dollar holders also. And if they decide to dump their dollar holdings those dollars(theoretically) show up as a wave of inflation. That said, I am not sure how much worse it would be than what is going on now already.

      1. lance ringquist

        nafta billy clintons disastrous free trade policies have destroyed the worlds ability to cope with inflation

        Weak demand has consumer price inflation cooling off in China.

        But prices for goods from China’s factories are rising at a record pace.

        this really exposes the china is now a rich country as a fraud. I measure a country’s ability to consume much of what they make, as a true sign of wealth.

        china has always had weak internal demand, much of what they make is for exports, thus inflation is built into the equation, as well as deflated wages, soaring debt, and poverty for us.


    2. Mel

      It’s true. Super-Imperialism will prove it.
      All his books are good. Trade, Development, and Foreign Debt is slanted more than the others toward professionals, I think, and this amateur finds it slow going, because of the detail. I’ve started on a side trip through Sir James Steuart to get up to speed before I move on.

    3. eg

      I strongly recommend “Killing the Host,” “J is for Junk Economics” and “And Forgive Them Their Debts.” “America’s Protectionist Takeoff” is also very good, but maybe narrow in scope for the general reader.

  2. JohnA

    Michael Hudson puts to shame all the sham winners of the sham in honour of the Nobel Prize award in economics.

    1. Telee

      So True! Michael Hudson is one of those rare human being who opens up new, valid and timely perspectives. Very few people have that ability. He is a most valuable resource.

      1. LowellHighlander

        Yes, he most certainly is one of those rare economists who opens up new, valid, and timely perspectives.

        And guess whose books won’t be taught in economics courses at graduate programs?

        [John Kenneth Galbraith’s books aren’t taught at many – if any – colleges and universities in America anymore, and his books used to be on the Best Seller list.]

  3. Sound of the Suburbs

    I have read the second edition.
    Michael Hudson was the first person in the US to realise how the exorbitant privilege actually worked and he had to explain it to everyone else.

    We may be missing something.
    Different people have different parts of the story.
    I have added this from MMT.

    This shows the US (46.30 mins.)
    The private sector going negative is the problem as you can see in the chart. This is when the financial crises occur.
    When the Government deficit covered the trade deficit they were fine, but then they tried to balance the budget
    As the Government goes positive, into Bill Clinton’s surplus, the private sector is going negative causing a financial crisis.
    The current account deficit/surplus, public deficit/surplus and private deficit/surplus are all tied together and sum to zero.

    The exorbitant privilege requires Keynesian thinking, where Government debt and deficits don’t matter, and this allows dollars to flow out of the US into the world.
    The new thinking of neoliberalism tried to balance the budget, and that flow of dollars had to come from somewhere else, the private sector.

  4. philnc

    Hudson is to 20th (and now, 21st) century financial capitalism what Marx was to 19th (and through the work of those that followed, 20th) century industrial capitalism. Hudson’s analyses are crucial to understanding what the hell is going on, and where they’re probably going.

  5. Steven

    Hudson’s Super Imperialism (SI) contains the core insight into Hudson’s life work and the mechanism that is destroying the US and global economies and the planet. Without SI, The Bubble, Financial Capitalism, Junk Economics, Killing the Host could not have functioned. If the world’s economic and political leadership was in the hands of people who possessed a “logical definition of wealth” SI at least might not have festered as long as it has.

    Instead, that leadership has been in the hands of people like Donald Trump, people who don’t need more money but relentlessly pursue it, even at the cost of viability for national and global economics and the health of the planet. They pursue it because it is the only way they can “keep” score in the only game they seem to know how to play. SI contains the explanation for the petrodollar warfare that has raged since the last decade of the 20th century.

    The strategic consideration that has guided those ill-conceived adventures – and continues to guide US foreign policy – is preservation of the ability to exchange debt created on the keyboards of Western banks and treasuries, mainly US, for the rest of the world’s real wealth.
    The Nobel Prize winning chemist Frederick Soddy listed three ingredients of wealth: natural energy (basically fossil fuels), discovery and diligence. Control of the world’s supplies of natural energy is still important for the preservation of SI. But what is becoming a priority is control of the source for the other two ingredients, i.e. cheap third-world labor. Hence the ‘pivot to Asia’.
    For US policy makers, having stripped the continent of its once abundant natural resources to produce products the rest of the world doesn’t need or can’t afford (so their constituents can accumulate yet more money) exporting jobs and factories was the only avenue open so they could continue to play money games.

    Anyhow, you get the idea. By all means, if you haven’t already, read the book. I am going to make my third trip through it with this new edition.

    1. Mike Elwin

      On the Product Details section of the book’s Amazon page, you can send a message to the publisher that you’d like a Kindle edition. Mr Hudson’s publisher is a very small outfit in Berkeley, so I imagine they’ll pay attention. There are programs that reformat book manuscripts for Kindle; I think Amazon might offer a service, too. In any case, it’s certainly possible to produce a Kindle edition.

      1. Jokerstein

        Done! The 2nd edition is available, but that was from a different publisher, Pluto Press. Given that Prof Hudson probably used the same tools to create the 3rd edition, I hope we can get an ebook – local libraries, with crunched budgets, are not likely to buy this volume :-(

      2. Jokerstein

        In fact, I can create ebooks myself, and would love to work on this, if Prof Hudson would be agreeable.

        More than happy for NC to pass my email to MH if he expresses interest.

  6. Huey Long

    Thanks for this post NC and thanks for revising and updating your work Dr. Hudson.

    I just ordered my copy, can’t wait to see how it stacks up to the original I read a few years back.

  7. TimD

    Thanks to deindustrialization, the US has a huge trade deficit – around $700 billion per year – along with a large fiscal deficit – that has averaged over $1 trillion per year since 2000. This leads to a situation where America pays for its spending by taking on debt and selling off assets. As history tells us, it is all good until someone loses an eye, or something. But it is more than people being willing to hold onto the dollar or its assets, the country’s economic growth is decelerating and has dropped to about 2% – which is 1/2 of what the country grew at the last time it had a balanced budget.

    This slow growth, combined with growing inequality has made it harder for the average American to make it. My thinking is that they were frustrated enough to elect Trump – especially after he told them he would fix the trade deals and make the rich pay. He was lying of course but the only politician telling Americans they were getting the short end was undermined by the DNC.

    1. Jack Parsons

      I think of the causality as going the other way.

      If you had a printing press for money, would you bother to work? Sure, you might putter around in an office or volunteer at the library, but would you sweat a real job? This is the US’s position: the country prints money for the world, so there is no point for the country to do real work. Thus, deindustrialization. Yes, the causality goes both ways in a feedback loop, but this is a big factor.

      1. TimD

        When a country pays for its imports with money instead of services or goods, it is supplying IOUs to its trading partners. They take these IOUs and either hold them for interest or buy American companies, real estate or debt instruments. We hear about luxury real estate in Manhattan that does not house people, this type of demand skews the market and makes it harder for the typical family to find affordable housing. Certain people do well by this twist in the market and many do not. Hence the increasing inequality in the US.

  8. Jack Parsons

    There is a miniature version of dollar hegemony, operated by France.

    The Central African Franc (CAF) is the trading currency used by most of the former French colonies in Africa. The banks are in Paris. If an African country goes off the CAF, French troops are dispatched.


    “Former” French colonies indeed. This was “post-colonialism”- low-key colonialism without the expense of posting permanent troops to the colony.

  9. James Simpson

    Regarding the World Bank, the media – including much on the Left – seems to regard the possibility that Ivanka Trump might have been appointed its head as of far more interest and importance than the appalling impact of World Bank practices on the Global South and on climate change.

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