Yves here. Keep in mind that a big reason that economists, alone among social scientists, got a seat at the policy table, was concern about the way Russia managed to industrialize within a generation, something no bourgeois/market economy had achieved. The fear was that a command and control system could indeed outproduce a free enterprise economy, hence the need for the tender stewardship of experts to make sure those Commies didn’t outdo private capital. In other words, indirectly supporting Rob Urie’s thesis, the measure of success of both systems was their productive output. Until the US went hog wild for offshoring, that meant the level and efficiency of industrialization.
By Robert Urie, author of Zen Economics, artist, and musician who publishes The Journal of Belligerent Pontification on Substack
In the US, within the context of a never-ending Cold War, ideology is put forward as the dividing line between nations and peoples. As is the case with religion, social practices that are claimed to be radically different, or even oppositional, share most of their central characteristics between them. In terms of political economy, the major ideologies of fascism, capitalism, and communism have long been claimed to be oppositional— and they often have been militarily by way of competing economic interests, as each reflected different strategies for industrializing.
American claims against Soviet economic development in the twentieth century were over the form of industrialization, not the fact of it. Like ‘science,’ the fact of industrialization has long been considered ideologically neutral, even as its particular forms were considered antithetical, even irreconcilable. However, the purpose of this piece isn’t to reconcile competing ideologies, but rather to look through to the facts which industrialization imposes. While V.I. Lenin laid imperialism at the feet of capitalism, this piece argues that industrialization sets in motion a global contest for industrial inputs, and with it, political violence.
Graph: while apples-to-apples GDP comparisons between countries can be complicated by currency fluctuations and inflation rates, this graph of China’s versus the US’s GDP (in PPP terms) is generally representative of the relationship, irrespective of these complications. After trailing US GDP for decades, China moved ahead of the US during the Great Recession. Given that ‘economic competition’ is the US’s stated rationale for war with Russia and China, the Great Recession appears to have spelled the end of American economic hegemony. Now ‘we’ get war. Source: St. Louis Federal Reserve.
The world’s best living economist, Michael Hudson, whose focus of inquiry has long been Western imperialism, has in recent years, and following from Lenin, devoted significant effort to distinguishing financial capitalism from its industrial predecessor. Supporting his thesis has been the fact that the most capitalist nation on earth, the US, has also been the most aggressively imperialistic. However, with China having now industrialized while still claiming ideological difference with the West, the global race to secure industrial inputs threatens to reignite global imperialist wars.
This isn’t to argue that China’s industrialization is in-and-of-itself motivating renewed imperial tensions. It is to argue that by way of the industrial process, competition for industrial inputs is doing so. While Americans respond with patriotic fervor to misleading nonsense about ‘freedom versus tyranny,’ industrial production provides the material basis for conflict between industrialized nations. Before age, isolation, and intellectual brittleness melted their brains, US officials clearly stated that the US motive for war with Russia was the threat that the Nord Stream LNG pipelines from Russia to Germany posed to ‘American’ interests.
To understand the conundrum from the American perspective, there is no space between the views of Joe Biden and Donald Trump regarding the US ‘right’ to seize industrial resources from sovereign nations. Mr. Trump has said so explicitly on multiple occasions. Mr. Biden defers to the Cold War canard of ‘freedom versus tyranny’ to claim a moral basis for his Hitlerian moves to light the world on fire. But the US also has a material basis for this conflict in the political control that is bought through the control of industrial inputs.
Since the mid-nineteenth century, industrialization has taken place in fits and starts around the world. Oddly (not), different ideological forms of political economy, e.g. communism, capitalism, fascism, didn’t challenge the logic of industrialization. For instance, amongst the participants in WWI, several were early to industrialize (US, Britain) and several were later to industrialize (Germany, Russia). The emergence of communism in 1917, with the Bolshevik Revolution, challenged capitalist economic organization, but not the imperative to industrialize.
That this imperative both preceded and followed WWI is hardly an accident. WWI was the first industrial war. Machine guns mowed down soldiers by the tens of thousands. Aerial bombardment facilitated the distribution of chemical and biological weapons. Monstrous machines were pitted against one another in scenes reminiscent or earlier portrayals of hell. For any nation that wanted to launch a war, or just protect itself from the imperial ambitions of others, industrialization was imperative.
Capitalist explainers tend to focus on the ‘stuff’ of industrial production, consumer goods and labor-saving devices (capital). Capitalist economists (aka ‘economists’) begin their explanations of capitalism with either imagined or real human wants (‘demand’), or sui generis economic production (‘supply’). But why would capitalists and communists both rely on the methods of industry even as they derided the competing ideological forms of social organization imagined to circumscribe it? Again, ideological difference was reflected in the form of social organization around industrialization, and not its material facts.
The Western critique of communist industrialization centered on the relative inefficiency of the communist form of industry (state direction), not on the shared imperative to industrialize. But the value of industrial output is socially determined. Capitalists long focused on creating consumer societies while the communists educated their people and provided healthcare. One can debate the merits of either vision, but both used industry as a central method to realize it.
In a broad sense, industrialization represents a path to generating certain types of wealth. Resources are gathered, and through the industrial process, are transformed into ‘wealth.’ Theories were developed to explain why certain types of wealth (‘capital’) are necessary to create other types of wealth (e.g. consumer goods). Institutional relationships were created through the industrialization process. In this way, industrial inputs aren’t ‘capitalist’ in the sense of being universally distributed. They exist in some geographic locations and not in others.
Contemporary Western economics places industrial dependencies in markets, ignoring the long history of imperialist wars to secure industrial inputs. WWI was the prime example of this tendency. Nations battled one another to control ‘wealth,’ including the industrial inputs that kept them in the fight. A later example from WWII illustrates this tendency. Japan entered WWII with an industrial economy but no secure supply of oil to keep it running. Understanding this, the Americans set up a naval blockade in the Pacific to prevent oil-laden ships from delivering oil to Japan. The Japanese faced the choice of shutting down their war machine or trying to end the naval blockade by bombing Pearl Harbor. They chose the latter.
This slice of history was brought into the present when the US purposely and significantly deindustrialized over the last half century. While this isn’t evident in the dollar value of US industrial output, it is evident in what types of industrial goods are being made, and the greatly shrunken level of manufacturing employment (graph below). The US is also currently engaged in two hot wars (Ukraine, Israel), and just launched a third (by letting Israel bomb the Iranian consulate in Damascus, Syria). Irrespective of differences in their forms of social organization, Chinese, German, and American industries all need resources that they don’t control.
In theory China has a different form of political economy (‘communist’) than the US (‘capitalist’). And it certainly seems (so far) to have avoided some of the pitfalls of financial capitalism via its state-banking system. With V. I. Lenin’s claim of the relationship of late-stage capitalism to imperialism in mind, will China respond differently (than the US) to being cut out of industrial resources through Western militarism? In other words, were the US to conduct a regime change operation in a nation that Chinese industry is dependent upon for industrial inputs, will China act militarily to regain control of the needed resources?
In more generic terms, will the revival of crude capitalist imperialism by the Biden administration result in a global race by nations to 1) militarize, in order 2) to secure industrial inputs? As discussed below, Europe has little choice but to do these or perish. The US ended relative energy security for Europe when it blew up the Nord Stream pipelines. Americans who question how reliable Russian LNG (liquified natural gas) really was need to take a hard look in the mirror. The Nord Stream pipelines were destroyed without a Plan B by the Americans, the people who blew it up. Whereas the Russians 1) had a plan and 2) the infrastructure to bring it to fruition, the Americans have a ten-year time frame for securing LNG deliveries to Europe.
Graph: the Biden administration’s much- touted revival of US manufacturing has gotten manufacturing employment in the US back to where it was before the Covid-19 epidemic began in 2020. It still remains far below levels prior to 2001. Given that ‘economic competitiveness’ is the rationale for the US war against Russia in Ukraine, Mr. Biden is now in theory ‘trying’ to get back the jobs that his support for NAFTA in the early – mid 1990s, eliminated. Source: St. Louis Federal Reserve.
The base question here: is industry possible without imperialism? The decision of the US to deindustrialize, or more precisely, to outsource some industrial production, complicates assessments. As the US deindustrialized from the 1980s to the Great Recession, but particularly from the moment that China was elevated within the WTO (2001), the Americans became increasingly predisposed to a benign view of industrial competition. Now, having woken up from this imperial slumber, the US 1) lacks to ability to manufacture the weapons it will need 2) to fight the wars that it has already started.
This isn’t to overstate the case. The bipartisan George W. Bush-era war against Iraq was likely the least strategically coherent, most murderous, imperial adventure in post-WWII history. The list of nations destined for US regime change operations obtained by retired US General Wesley Clark in 2003 indicated no diminution in American blood-lust or imperial ambitions. The particular idiocy of the present is that the US gave away the industrial base that it now needs to pursue its renewed imperial ambitions.
Prior to the start of Russia’s SMO (Special Military Operation, now war) in Ukraine, developed Europe was buying LNG (liquified natural gas) from Russia at a discounted price. European industry benefitted from this arrangement because the discounted price raised profits. The arrangement ultimately gave Russia substantial political control over Europe because the withdrawal of Russian LNG would remove an instantiated source and would force European industry to pay a market price for LNG.
The destruction of the Nord Stream pipelines proceeded without the requisite planning needed to avoid an economic catastrophe for Europe. The American ‘plan,’ if it can be called that, is to spend several billion dollars over the next decade to build the infrastructure needed to deliver LNG produced by US based producers to Europe at twice or more the price that it had been paying to Russia. This price difference will render energy-intensive industries in Europe economically unviable, and slash profits for the industries that remain by the amount of the difference between the price of the ‘American’ LNG and the discounted price charged by the Russians.
Graph: the term ‘greedflation’ is the case where corporate power has allowed corporations to unilaterally raise prices, thereby raising their profits. In capitalist economics, competition and regulation are supposed to prevent this. In fact, regulators long ago abandoned placing limits on corporate power, trusting— against history and economic logic, that ‘markets’ would prevent the accrual of market power. While the Biden administration has revived some anti-trust activity, its economic policies continue to favor economic consolidation in the hands of the oligarchs. Source; St. Louis Federal Reserve.
The question for which a satisfactory answer has yet to be given is why Europe went along with the American project in Ukraine? The ‘East versus West’ coalitions formed from it feature a cooperative East versus a vicious, petty, and tired West. The political misleaderships of Europe may be acceding to US plans to control the volume and price of energy inputs into European industry in the near-term, but doing so in the longer term will mean a severe decline for European industry. Moreover, simple geography argues against the success of the American plan. By geography alone, Russian LNG is the ‘efficient’ choice to transport.
Having jettisoned its basic industries, the US has no coherent plan to rebuild its own industrial base. The Biden administration came into office promising that its plan to build out EVs (electric vehicles) would jump start a global effort to solve mounting environmental woes. But its plan wasn’t to build EVs. The plan was to propose tax incentives for ‘green’ companies to build EVs. It was quickly determined that without building out the infrastructure needed to support the use of EVs, that few people— including auto manufacturers and electric utility executives, were on board with the build out. Rather than quickly moving to build the necessary infrastructure, the Biden administration simply backed away from its EV effort.
With the US currently engaged in two-plus wars, with no realistic way of manufacturing the weapons and materiel to fight them, and having primary responsibility for most of the environmental woes now accumulating, and no social interest in realistically addressing them, the future looks bleak. However, the West exists on the same planet as the collective East. Much like industries that lack industrial resources, producing toxic environmental effects on a shared planet is untenable in the longer term. Both suggest future geopolitical conflict.
Economist Michael Hudson, following from V.I. Lenin, has long argued that financial capitalism is a burden imposed on industrial capitalism via rent extraction and imperialism. While agreeing with Hudson on the point regarding financial capitalism, industrial capitalism produces its own burdens. Chinese officials have spent the last forty years scouring the earth to secure the inputs (resources) needed for Chinese industrial production. During this time the Americans have launched massively destructive wars in Nicaragua, El Salvador, Guatemala, Serbia, Iraq, Afghanistan, Libya, Yemen, Syria, and now Russia, Gaza, and Iran.
The question then is whether imperialism is idiosyncratic, or a function of industrialization and / or capitalism? Lenin’s argument depends in part on his theory of the genesis of state under capitalism. In this theory (following from Marx), the state exists to serve the interests of powerful capitalists. However, the nominally communist Chinese state promotes the interests of ‘Chinese’ industries through locating and negotiating for industrial inputs under the theory that doing so benefits the state via an integrated theory of the state (graph below).
A historical difference between this (implied) Chinese view and the view in capitalist states that private ownership and control of industry is efficient, is that the latter (US) relies on the state to launch imperial wars and squeeze international competitors using state power. For instance, blowing up the Nord Stream pipeline produced no conceivable benefit for the American people and put us in direct conflict with a nuclear armed power (Russia).
The Western ‘we’ involved in doing so is an abstraction. US state actions to support large-scale oil and gas producers (e.g. Chevron, ExxonMobil) miss that the concern isn’t reciprocal— the people who run these companies see Americans as prey, cannon fodder, and an annoyance, not fellow travelers. ‘American’ producers of LNG have destroyed aquifers across the nation with fracking waste. And the methane leaking from current and retired gas wells greatly increases US responsibility for climate change.
While American officials appear to be finally seeing some of the economic consequences of the neoliberal epoch, there appears to be little understanding of how these consequences actually came about. This is almost certainly because the same officials charged with seeing the consequences in the present didn’t anticipate them when they were proposing the policies that produced them. Additionally, class relation in the West have it that rich Westerners benefit from policies that harm the rest of us. Corporate profits rise in proportion to the environmental harms that rich Americans unload on the rest of us.
Graph: the growth of wealth in China in recent decades has largely been a function of growth in private wealth. The richest ten percent in China own nearly as much of the national wealth as in the US. A central difference is that the rich in China don’t control the Chinese government (yet), like they do in the US. Will the Chinese government stand idly by if foreign imperialists (US) threaten this private wealth through resource imperialism? And given China’s foresight in securing contracts for industrial inputs, how will it react when the US moves to take these resources (think: Iraq 2003)? Source: Stanford University.
While Wall Street may be the most powerful cheerleader for gratuitous slaughter in the world today, bringing it to heel would likely do little to reduce the imperialist impulse that is currently driving US wars abroad. In capitalist terms, financialization can be understood as a method of transferring wealth from the people that created it to its newly minted owners via economic rent extraction and financial gamesmanship. The question then: is this also the purpose of China’s state-banking system? In other words, did China’s new ownership class create the wealth that it owns, or did financial gamesmanship simply place this ownership in its hands?
As with much in life, the answers are likely 1) partially and 2) yes, respectively. As metaphor, years ago yours truly was able to get unsecured ‘inside’ funding at a rate of one-quarter of one-percent at a time when credit card borrowers were paying 19.99%. The difference was proximity to the dealer desks on Wall Street. Given that both loan types (credit cards and the inside rate) were unsecured, the risks to the lenders were similar. Absent the proximity to power, the rates should have been the same. In this sense, financial capitalism is a way to make the rich and powerful, richer and more powerful. In this example, the money saved in interest charges (19.99 – 0.25 = 19.74%) represents a transfer of wealth to the rich (I didn’t keep the difference, it was passed along).
The American rhetorical ‘pivot’ from markets to war began about when China’s GDP eclipsed that of the US during the Great Recession (top graph above). In fact, without China’s massive fiscal expansion while the US and EU were in neoliberal-inspired austerity (2010 – 2015), ‘the West’ never would have recovered. And while American wars tend to be explained in geostrategic terms, both World Wars featured races to control industrial inputs to support the burgeoning industrialization of the epoch.
Here’s the problem: given the advent of industrial warfare, any nation that doesn’t want to be invaded and controlled by other nations has no choice but to industrialize. This truth promoted both aggressive and defensive industrialization. Those bent on world domination (US, Brits, Nazis), saw industrialization as a race to control the resources that serve as industrial inputs. And the nations that can shove their environmental harms onto others most effectively see a benefit in terms of national product / profits.
The conclusion here has yet to be written. Unlike the US, China hasn’t engaged in military conquest to secure industrial inputs in modern history. Looking forward, possibly it will and possibly it won’t. There are particulars, like the US existing between two vast oceans, that may well have led its political ‘leaders’ to develop skewed assessments of the potential risks and rewards of overseas military action. And US hatred of Russia is both racist (anti-Slav) and a residual of the imperial ambitions of the American ruling class in the lead up to WWI.
The goal here isn’t to charge China, or any other nation, with actions that it has not taken. It is to argue that the circumstances that might lead it to do so are rapidly accumulating. The material basis of this conflict is the resources that serve as industrial inputs. As ‘the East’ has reacted to American imperial ambitions with Russia’s SMO, now war, against NATO in Ukraine, the US is dangerously flailing about. So, to the point made above, with little to no interest in engaging in imperialist conflagrations, will the other nations of the world respond to American imperialism abroad militarily? Would doing so make them imperialist? Is this a distinction without a difference?
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The original sin of all -isms is the refusal to face the fact that we live in a biophysical world, not a socioeconomical one. The consequence of which fact is that there are such things as laws of thermodynamics, of conservation of matter and energy, etc., i.e. there can be no perpetual motion machines, no material inputs magically poofed into existence, and no infinite growth.
Yet infinite growth was what communism chased just as much as capitalism. Even though it didn’t actually require it, while capitalism does (the mechanism of compound interest creates that requirement). Communism could have been a real alternative on that most important of issues and thus pointed the way forward towards salvation for humanity as a whole, but it wasn’t and it didn’t.
There is a crucial difference between Soviet “imperialism” and the Western imperialism though. All empires in history have sucked real wealth out of the periphery towards the center. Soviets did the opposite — they actually subsidized the periphery from the center, both within the USSR and within the broader Eastern Bloc. Russia subsidized the other republics with oil and other resources, and as a result they were a net recipient of real wealth and enjoyed a higher standard of living while living standards were worst in the Russian central and southwestern Siberian regions. Outside the country, the USSR sent cheap resources to Eastern Europe in exchange for some industrial and agricultural goods that were in reality of unequal value and it was a subsidy in real terms, the effect of which was that most of those countries lived better than people in the USSR.
The West has never done that — it has always been ruthless exploitation, sucking resources out of the colonies (official in the past, unofficial today), and repression of the living standards in the periphery of the empire.
China is kind of in the middle because it imports real resources but it exports finished goods, i.e. embodied cheap Chinese labor and efficient manufacturing (plus its own coal and nuclear power), so it has been a roughly equal trade for most of the recent decades in real biophysical terms, but it is now trying to redirect resources towards it too, thus the looming conflicts. For it too shares that original sin of refusing to adopt a steady-state economic model, which is the only viable alternative for the long-term future.
P.S. The problem with voluntarily abandoning growth as an objective is that if your neighbors don’t do the same, then they will annihilate you eventually (as the article accurately points too with its reference to WWI and industrialized warfare), and then what we are left with is everybody being unsustainable and chasing growth. It’s only a stable situation if everyone behaves and the emergence of rogue actors is strictly prevented. Which is very hard to achieve — we don’t have even a single non-rogue actor right now in the world…
I’m not sure I understand your insinuation that communism was aiming for infinite growth, if anything it aims for productivity growth to the point where labour requirements for sustenance are made nominal through automation and technology and highly efficient modes of production. No socialist country was or is anywhere close to that, what year exactly should the USSR have stopped developing it’s economy?
“China … imports real resources but it exports finished goods, i.e. embodied cheap Chinese labor and efficient manufacturing (plus its own coal and nuclear power), so it has been a roughly equal trade for most of the recent decades in real biophysical terms, but it is now trying to redirect resources towards it too, thus the looming conflicts. For it too shares that original sin of refusing to adopt a steady-state economic model, which is the only viable alternative for the long-term future.”
What China is doing is both developing economically and offering development in turn. Simply look to the economic relationships of China and Ethiopia or Madagascar or Bangladesh or Laos. Building a high-speed rail line to and through landlocked Laos or rice plantations in Madagascar, has allowed for sustained increasingly high-productivity development in these countries.
But the thing is that no high speed rail should ever be built through the Laos mountains if it’s for the purposes of “economic development”, because it will have the same effects as roads through the Amazon, and Madagascar is one of the greatest ecological tragedies on the planet as is, so how is converting yet more land to farming a positive there?
What Madagascar needs is a one-child policy plus reforestation and cordoning off of 80% of the land as a nature reserve that cannot be touched.
The health of the planet as a whole should come first, and there have to hard brakes on “economic development” or we all die. In fact, the global economy is already between 10x and 100x too large and needs to shrink accordingly.
How is the Chinese model helping achieve that? It isn’t, it is going in the exact opposite direction. Despite the enormous good that the one-child policy did, but that was made largely meaningless by the growth in the economy, and it was abandoned anyway.
But the thing is that no high speed rail should ever be built through the Laos mountains if it’s for the purposes of “economic development”, because it will have the same effects as roads through the Amazon, and Madagascar is one of the greatest ecological tragedies on the planet as is, so how is converting yet more land to farming a positive there?
[ Thank you so much, but I think Laos and Madagascar can and will choose their own development plans from here. After all, Laos was never given a choice before being subject to years of bombing by the United States when Laos was not even at war. Madagascar was a colony long enough to warrant being free from here, but the French are welcome to bargain over development with the former colony now.
I would really like to think Madagascar and Laos, being free, will develop successfully.
As for China, domestically, development is remarkably green and strikes me as proceeding wonderfully. ]
China is anything but green.
If you were to suddenly end the existence of all other humans on the planet and leave China alone, at current rates of consumption of resources and emission of CO2 and other pollutants, let alone the future projected ones, the planet would be headed to the exact same fate as it is currently, it will just take slightly longer.
And no, Laos and Madagascar do not have the right to choose their own development plans. Nobody has that right.
This is the gigantic failure of “multipolarity” and the current quest against the “globalists”.
There will be no long-term survival for the human species without a global government and draconian relentless controls over consumption and procreation worldwide. Thus a certain kind of “globalism” is not optional, it is mandatory.
The problem with the current “globalists” is that their vision for the future is “we keep the current model as it is and expand our control over the whole planet while we help ourselves to an ever greater share of the shrinking pie”. There is zero concern for the long-term future of the species and the planet in that plan.
But there is also zero such concern in the “multipolarity” delusion — there the plan is basically the same but looting and pillaging (of the environment and the subservient classes) is more distributed and divided into domains.
That’s the whole extent of the “alternative” being provided.
People are swallowing it hook, line and sinker, because it is an “alternative”, and no other is provided. But that doesn’t mean it is a viable alternative.
Anyone who is talking about economic growth as if is a good thing needs to be treated as an extremely dangerous lunatic who belongs in the asylum. Or worse.
There are a handful of what are considered to be socialist policies that naturally lower birth rates below replacement values without demanding people have fewer children. Generous pensions (in that they allow you to actually live above the poverty line), Free education (inclusive of women), True equal rights for all, and free access to birth control/abortions.
Draconian controls to control procreation are completely unnecessary.
Agree with all the rest, more or less.
There is the alternative view that war is less a Marxian competition for resources and more a “march of folly” that happens between competing elites. After all Europe had plenty of wars prior to industrialization and when Barbara Tuchman wrote A Distant Mirror she used the 14th century as her analogue for the 20th. Violence itself needs to draw on some inner core of aggression that is only tenuously connected to the rational even if past eras obsessed over “honor” as an explanation for their duels and battles. Sill even this rationalization seemed more real than he current one involving “isms” and the supposed zeal for democracy among the privileged and wealthy who became so by exploiting all those masses.
Which is to say that as long as war is seen as a natural “extension of politics by other means” then we will never have peace. And we may not have a world given nuclear weapons.
It may be time for a new framework that sees all this less through the lens of economics and relies more on simple intuition. Putin has been making the case for “multipolarity” even as the cable propagandists paint him as some kind of Bond villain. But a large part of our problem is that we get people like Biden and yes Trump too as leaders. Our world is getting dumber even as it desperately needs to get smarter.
Yes, there were plenty of wars before the 20th century (the Italian city-states are a great example), but it was, to use a distinction Big Serge makes, a world of “cabinet wars”: wars mostly fought by employed mercenaries which had short durations and mostly quick resolutions. The industrial world inaugurated the “people’s wars” (in fact, inaugurated by the French revolution but mostly established as facr during the Franco-Prussian Wars, as he argues), far more destructive and intense than anything which came before except maybe the most destructive of religious convulsions such as the Thirty Years War, which by their own nature were fratricidal to a degree perhaps not seen since.
So yes, the Clausewitz logic clearly produces wars, but it doesn’t specify the kind of war engendered, which may be even more important.
It’s one thing for the elite to be outnumbered 20 to 1 vs millions to 1…and the industrial wars proved their nervousness about that fact.
But we still have the cabinet wars too and I believe his argument was that this is the only kind of war the US military is still capable of fighting. The Bomb seems to have put the stymie on the world wars–so far.
So if we use Tuchman to deem Biden our new Kaiser Wilhelm then that’s maybe not so far off. Both have/had character flaws that provoke “folly.”
The industrial world didn’t really inaugurate those wars, the objective measure is the proportion of the population that was exterminated in a war, and hunter-gatherer tribal warfare was quite genocidal and regularly exceeded those metrics for WWI, WWII ad the Thirty Years War.
The key variable is in-group/out-group separation.
Italian city states waged war in that way because there was very little such separation — it was small city states that spoke the same language and shared the same culture, and were of a thoroughly mercantile mindset, alliances constantly shifted, the people who fought the wars were mercenaries who switched allegiances all the time, and if anything, they saw each other as the in-group (on a professional level) and so did the various princes that hired them (as a class).
Once you have a strong in-group/out-group division, then the genocidal tendencies that we all harbor deep inside us come to the surface. It has always been that way for hundreds of thousands of years, and nothing has really changed other than the means of destruction. The industrial world didn’t suddenly bring all that into existence.
P.S. Regarding the point about the princes and mercenaries having a certain affinity for each other even as they were waging war, that also hasn’t really changed. You see it right as we speak with the SMO. The cardinal rule is that elites don’t touch other elites. One side — the Russians — is religiously sticking to that rule, the other not quite so much, but still mostly respects it (or rather, doesn’t really have the same definition of “elite”). Thus we have half a million grunts slaughtered in industrial fashion on the killing fields of the Donbass, and NATO and the Ukrainians are committing daily atrocities against Russian civilians, for a while now on pre-war Russian territory too, and yet Zelensky and co. are alive and well, and nobody has touched the Western dear partners either. The whole war could have ended with a series of missile strikes on Ukrainian leadership. I am not talking just about the several dozen public faces, obviously the overall structure is much larger, but this isn’t the Middle East where the resistance against Israel and the US is a bottom up phenomenon, and if you take out leadership, you only mobilize the masses to fight you even more determinedly, it is the exact opposite as Ukro-Nazism is a project of the elites, so if you take out the several thousand people driving it — political leadership, military and intelligence, the oligarchs, the media and academia ideologues, etc. — and if you make their Western puppet masters genuinely afraid for their lives too, it will all collapse.
But the Kremlin hasn’t done that and has instead gone with industrial slaughter of the peasants. How do we explain that other than with the obvious fact that the people in the Kremlin do not have all that much concern about the peasants? And that they don’t want to place themselves and their own Russian oligarch buddies at any risk of retaliatory action?
It has gotten to an absolutely ridiculous point by now — Russian media seems to be under orders not to comment much on what is happening in Belgorod and Donetsk, and to not bring up the issue during Q&A sessions either, but on a couple occasions Putin did touch on it, and what he said was astonishing — “I am seething about the events in Belgorod, but what can we do? We could bomb Kiev the same way, but why go down to their level and what will that accomplish?”. Notice the false dichotomy framing — as if the only option for reaction to terrorist shelling of Russian cities is terrorist shelling of Ukrainian cities. Precise strikes on the political and military leadership that order those terrorist acts (and then publicly gloated about it, as Zelensky did) are completely excluded from the set of available options.
Ukro-Nazism, like all Nazism, certainly is an elite project and was installed top down.
But it is, like all fascist movements, also to a degree definitely a mass movement.
And all the committed, highly motivated nazis, which still are only a fraction of the population of course but certainly far more than a couple thousand, very much see themselves as an elite, THE true elite in fact.
They have their own structures and networks that are not reduceable to the networks of the generic elites, they have infiltrated and thoroughly subverted every aspect of the state and the security forces and a lot of society far beyond that.
They are a serious power in their own right, a parallel elite to the normal kleptocratic elite that helped them get power but by this point quite likely less dependent on those than the kleptocrats are on them.
They are ambitious, very cunning, have a deep bench and lots of people who unlike the run of the mill kleptocrats are willing to die for the cause if necessary, they most likely despise and look down on the cowardly kleptocrats and they are both perfectly willing to intimidate and murder the kleptocrats, Zelensky included, and capable of replacing them with their own folk.
As far as they are concerned, they are using the kleptocrats for their goals at least as much as the other way round.
And unlike the kleptocrats they still have plenty of ordinary Ukrainians who might not be themselves fully committed Nazis but who are still willing to follow them, looking up to them, considering them to be heroes or at least totally terrified of them.
They can unlike the kleptocrats point to their undeniable bravery, their martial valor and resilience, to their sharing the hardships and sacrifices of the ordinary people.
They are definitely terrible, terrible “heroes” but in the absence of discernable alternatives and under the circumstances they remain attractive to many.
They also can and to a degree do already capitalise on the betrayel of both the West and the local oligarchs.
These are people who as utterly twisted as they are know exactly what they are doing, who have plenty of agency of their own above and beyond oligarch interests or western interests, they have still a lot of a reservoir of skill and experience, are very good at organising and motivating people and as they see it they have cunningly been hiding behind their puppet alibi jew and a degenerate oligarchy they tolerated
because that was an arrangement that the western sponsors would find most attractive.
There is plenty of talk about the necessity of finishing the Nationalist Revolution which would mean the elimation of Zelensky and the pushing aside of the oligarchs for a complete fascist takeover.
Gordon Hahn for example has argued that this is a likely possibility.
I don’t think it anywhere that easy to take out those people with any number of targeted strikes.
Any individual in the regular ukro elite can be replaced easily enough as well, be it by some nazi, a generic ukro elite deep bencher or someone parachuted in from the West, but if one tried to truly target all of them, well, I suspect most of them would flee the country to form a government in exile long before more than a fraction of them could realistically be killed off.
I doubt that playing whack a mole with them, wasting missiles on individuals and in the processost likely killing plenty of civilians anyway, especially when going after civilian PMC type elites in academia, media, etc, is as practical as you suggest.
Especially in a country that is seen as disposable in it’s entirety by it’s western masters.
Going after western elites themselves in theory at least has a LOT more potential and is certainly an incredibly attractive concept, a delight to imagine.
But it is also much more difficult still and insanely dangerous.
Western elites are already flirting with Armageddon over the danger of becoming somewhat less rich and being unable to control ALL of the world.
You don’t think they’d immediately go global, nuclear holocaust theoment they realized their own precious lifes were in serious danger?
There reaction certainly would not be restricted to attacking russian elites, not a chance.
Besides, western elites are very easily replaceable too, much more so than russian ones, considering how incredibly low the requirements for actual abilities amongst western elites are and how enormous the overproduction of mind- and soulless elite drone apparatchicks.
It’s sadly quite likely that Russia will have to go for a de-capitating strike against the US, but when it comes to that, though I think they will try to be as discrminating as possible even then, I doubt they will be able to avoid destroying much more than just some elite individuals.
It would a Singular now or never thing and they’d have to really make it count to try and prevent the US from annihilating them in return which easily could turn out to be impossible no matter what they attempt anyway.
As wonderful as simply blowing away the oh so richly death deserving “elites” both in Ukraine and the West would be, I’m far from convinced it would be easily realizable or that what realistically could be done would necessarily be sufficient and effective for ending the war and if it did work I fear it would pretty much guarantee the world being blown up.
Empirically, decapitation works — it’s been a month since there have been no USV attacks on Crimea, which coincided precisely with the moment when Zelensky held that award ceremony in Odessa for those who were carrying out the attacks, and then an Iskander arrived a few minutes after he left.
It is also very important for deterrence. Sure, they will be replaced. But if they know they will be taken out if they commit war crimes on a daily basis, they will think twice about doing it. And vice versa, Zelensky feels he can threaten more terrorism in Belgorod in his nightly live stream and gloat about what was already done because he currently feels safe. For that purpose alone, spending a few missiles on a few demonstrative punitive decapitation strikes is more than worth it. Also, for booting internal cohesion and trust in the authorities at home. After all, the Kremlin has a duty to protect its own people and when you are the largest nuclear power in the world, with a massive conventional arsenal too, and you just shrug it off with “what can we do?” while your own cities are being bombed daily, you are sending a very bad message to your own population regarding how much value it has for you. That is how you get a 1917 eventually…
Yes, there was a big drone attack on Crimea on March 3 and then the attack on Odessa about a week later.
But Ukraine is already pretty much out of long-range missiles supplied by the West. And it’s so out of air defenses that the Russian air force is able to drop lots of heavy glide bombs. The terminal decline in air defense missiles (made more acute by Russia’s increasing success in taking out missile launch platforms) is forcing Ukraine to husband its diminishing resources.
So I am not sure correlation here is causation, particularly since Ukraine is still promising to attack the Kerch Bridge again this year, and those promises were made after the Iskander attack.
Correlation is not causation. Ukraine has been running out of missiles of all sorts for a while. Ukraine HAS
Alright, I think I find myself agreeing to a degree.
They probably should kill Zelensky, for example, plus a bunch of other big kahunas.
Pulverize a couple ministeries, perhaps parliament while it is in session if they manage to sneak a Zircon in quickly enough before the scum can be evacuated to a deep bunker.
Though the government collapsing totally and everything dissolving into smaller roving armies of Nazi terrorists that no longer have a single comnand structure could actually end Up prolonging instead of shortening the fighting, so that should be avoided.
I think any kind of 1917 scenario in Russia is an extremely remote possibility though, there is none of the conditions that made that revolution possible.
If anything such a scenario would seem much more plausible in Ukraine, though unfortunately I doubt it there too.
In 1917 Russia was losing a war against Germany, a war that MANY had long concluded was a stupid unecessary, frivolous war that served no purpose, that had cost millions of soldiers their lifes and caused widespread impoverishnent.
A war against an adversary that was unlike the Germany two governments later Not an existential enemy, an adversary that at the time Russia actually could capitulate to without having to fear being utterly annihilated.
There were huge highly organised, heavily armed, highly disciplined and motivated revolutionary groups with mass support and deep roots around that had been at war with the state for quite a while.
These groups could very quickly and effectively fill any power vacuum.
There is absolutely nothing remotely comparable to any of that in today’s Russia.
If there is anything that all the failed regime change operations of the US in the past decades should tell us it is that revolutions are rare and very difficult to pull of, that most people don’t revolt, almost no matter what happens and that most revolts that ARE attempted fail.
I suspect it is their own history or at least the theme park version of it that tends to lead especially Americans to constantly believe other countries’ are somehow on the brink of revolution when they almost never are.
And despite the fact that late stage Czarist Russia was positively crawling with those well armed, well disciplined and motivated revolutionaries with highly competent and charismatic leaders and considerable support in the populace, they still couldn’t overthrow the state themselves but merely make use of the chaos caused by the mass revolt of soldiers and sailors that indeed had seen their lifes callously wasted in huge numbers and who saw no path to a possible victory, which is pretty much the opposite to the situation of the russian army in Ukraine today.
Frankly, I would Not want to be in the skin of some poor dumb russian civilians that were dumb enough to try anything against the government and thus try to stab the army in the back and rob them of their victory (which in this case actually would kinda be what they would be doing).
I certainly wouldn’t want to be that poor shmock of a wannabe revolutionary when the pissed of army has to march home because of them.
The key question:
Is it better for the government to control the corporations or for corporations to control the government. The answer will be clear in a few more years.
Ummm. In theory, and occassionally in practice, governments are accountable to the public – either through the pressure of the street or through voting. Where are the checks and balances and accountability on corporate power? Currently through government.
Familiarity with the Vioxx scandal (or Bhopal) means there is no need to wait a few years. In China, the authors of the melamine scandal (6 dead) paid with their lives. In the US the authors of the Vioxx scandal (with tens to hundreds of thousands of deaths) got bonuses.
Philosophically, I oppose the death penalty as barbaric, but would have excepted the board of directors and the entire suite of executive officers.
https://en.wikipedia.org/wiki/2008_Chinese_milk_scandal#Response
https://www.ucsusa.org/resources/merck-manipulated-science-about-drug-vioxx
I think we have examples of how this works out already. A very short summary could be as follows
One example is based on the Roaring Twenties, Great Depression, and WW2. This sequence of decades represents a laissez-faire expansion, a collapse when the financial speculation implodes, a change in government (FDR) to impose regulation and government programs during the Great Depression, and then WW2 (which results in a almost complete planned economy run by the government). The failure of capitalism at the start of the Great Depression resulted in a federal government which effectively took control of the economy to a level which has actually been called even greater than was imposed by the Nazis party in Germany, and that level of control increased during the war.
The second example is pick a point in the more recent history of America as a transition to when corporate control of government starts or is achieved. This could be anywhere from the Carter Presidency to the end of the Clinton Presidency. Rob’s article provides data as to when corporations gain more control (profits quickly increase).
Compare the results. The first period resulted in the firm establishment of American empire (whether that empire is good or evil, the point is that it is achieved.), and a period of American economic prosperity. (Even Ike thought that the New Deal was was not something that Republicans should try to undo.) The second example is essentially the long slow end of the American empire abroad, a divided population at home as the blue collar middle class is destroyed, political unrest (as Americans want neither candidate), and economic uncertainty for the vast majority of Americans. But corporations have record profits, and Wall St does great no matter what happens in the real world.
GM is right that all economies want infinite growth which is incompatible with reality. This was called out explicitly all the way back in 1971, and I see no constraints being imposed to avoid the consequences of unlimited growth, but would suggest that a government controlled by corporations cannot impose limits since this would potential reduce profits:
The Limits to Growth https://en.wikipedia.org/wiki/The_Limits_to_Growth
I am no fan of the current science of “economics”.
economics is so scientifically bankrupt. they do not use proper methodologies. they dont even model time as continuous. as an engineering student, whenever i look at econ curriculum i am deeply disturbed. some people are doing good work (michael hudson for one!) but so much of mainstream economics does all their math and science wrong. it sickens me so. truly, mainstream economics is merely a vessel for power and not a real science.
I have a feeling that if corporations controlled government, there would be a steady diet of inflation for the people of the land. As long as government works for its population, it will feel compelled to regulate corporations in order to defeat inflation that eats away the wealth of the population.
Europe purchased primarily pipeline natural gas (not liquified) from Russia and small amounts of Russian LNG delivered by ships. Germany, IIRC, did not have any LNG terminals. EU sanctions and the destruction of 3 of 4 Nordstream pipeline strings caused dependence on US and Qatari LNG delivered by ship at 4x the cost of Russian pipeline gas. I believe through shutdown of gas-intensive industries that LNG deliveries have successfully supplanted Russian gas, albeit at very high prices. The US had a plan B to deindustrialize Europe, sell it high cost LNG and to start exposing the US gas markets to world pricing. Plan B worked.
Germany, IIRC, did not have any LNG terminals.
Correct. Since the war started, Germany has been frantically setting up floating regasification units to enable the import of LNG.
I believe through shutdown of gas-intensive industries that LNG deliveries have successfully supplanted Russian gas, albeit at very high prices.
It has — the proportion of Russian gas in EU imports is now about 15%, instead of about 40% in the past.
However: Europe is indeed importing more LNG, but that LNG is increasingly sourced from… Russia. The major LNG terminals are in France, the Netherlands, Belgium, Portugal, and especially Spain. These countries import LNG, regasify it, and re-export it to other countries via the European network of pipelines.
Sometimes, the shift to LNG has unexpected consequences: Russia has increased its share of the gas market in Greece from 36% to 47% at the same time that gas exports to Greece via pipelines have diminished.
Russia might not be able to grow its LNG exports, because the USA have imposed sanctions specifically targeting this sector. The immediate result is that the construction in South Korea of LNG tankers for Russia stopped — with at least one South Korean shipyard wondering what to do with tankers ordered by Novatek and specially built for arctic conditions. In Russia itself, the sanctions caused the construction of LNG terminals and LNG tankers to stall — they relied at least partly on Korean and French technology. Sanctions will also hinder the commercialization of LNG — since shipping companies in Russia and Cyprus (with Russian capital) chartering LNG tankers are newly on the sanctions list.
So, the more successful the sanctions ,the more doomed we are in the small continent. According to plan.
Thanks for that. I was getting a bit unsure of this history as the author seemed to conflate all NG with LNG. The liquid part being what makes putting it on ships possible but also expensive.
And, don’t forget that the main reason the US decided to take out Assad was that he had decided the gas pipeline from Qatar to Europe would not be allowed through Syria.
A very high stakes game being played there. A war in a Syria ever since.
clear and concise, excellent article.
thank you.
“The world’s best living economist, Michael Hudson”
Nice to see that in print, and I’m sure many on here will agree with it. Most other economists don’t think so, unfortunately.
I’m not an economist, nor an expert on Hudson Theory, but in a world with Elvira Nabiullina, I can’t say for certain I agree with the sentiment.
That sentence, and the one immediately following, just about robbed me of interest.
Not much by way of zen in this one, least not that i picked up on – zen is another thing i’m not an expert in.
Urie makes an important point when he references the Iraq War as being waged to deny Russia & China (primarily) access to Iraqi oil & gas. Both countries had been working with Iraq to build oil infrastructure & had long-term leases worth tens of billions when the US wrecking ball abrogated the contracts, leaving Russia & China holding the bag.
Now we have the (impending) war with Iran, with potentially even greater stakes. The other issue that looms large is that this insatiable rush to control industry inputs (Fossil fuels, mineral resources, etc.) is taking place in the context of increasing resource scarcity/costs, and the hard limits of ecological constraints.
See my comment above for the reason for the war in Syria. Notable that Russia stepped in to prevent NATO winning that one.
The Neoliberal belief was that getting government out of the way and allowing business to follow profit maximization was pretty much the end for industrialization in the West. Why would a company pay good union wages and follow all kinds of regulations when it could move offshore pay a small fraction in labor cost, not have to deal with as many regulations and make a lot more profit. Those years seemed golden, the stock market was going crazy, the wealthy were buying jets and mansions and the propaganda mills were telling the world, if you are smart enough and work hard enough you can join this party too.
As much as I disagree with JB Say, the act of supplying a good or service does create demand and moving the supply offshore broke that relationship. As a response we saw consumers and governments getting deeper into debt as the US and many other Neoliberal countries started running trade deficits, with slow economic growth and a large need for pump-priming. The only way this situation can get turned around is if manufacturing comes back home and to do so successfully it will have to be cost competitive with the lowest-cost producers. That means more automation and lower wages at a time when many Americans are having trouble keeping their heads above water. No wonder Biden sees China as a huge threat.
It wasn’t just high union wages but also the medical benefits that were often included in the union contracts. Since the US has the most expensive healthcare in the world, that helped mightily to make US labor uncompetitive when compared to Chinese labor. Any hope of recapturing manufacturing in the US thus depends on lowering the costs of healthcare via a universal single payer system, e.g. Medicare for all. In other words, as Yves would say, naga happen.
“It wasn’t just high union wages but also the medical benefits that were often included in the union contracts…”
An important observation, and remember that the high cost of medical benefits did not lead to relatively better American health outcomes rather than the reverse.
Add to that housing costs and education costs, all fully loaded and maximally inflated onto the population…
>>>The only way this situation can get turned around is if manufacturing comes back home and to do so successfully it will have to be cost competitive with the lowest-cost producers.
The first two centuries of United States the use of tariffs was routine. It allowed the creation of American manufacturing and the middle class.
Thank you!
American industry can only become cost competitive if it is protected as America has done in the past with tariffs and industrial policy. This is nothing new. What’s new is the neoliberal attitude that America could retain relevance in the world, but not make anything (and everything that goes along with that assumption).
America has flushed away a national advantage which it took a century to create, all to make a little bit more profit every quarter and keep Wall St happy. A century.
Anybody that says “this will all be fixed in a couple years” is a complete fool.
That will deal with products to be imported in the US. The thing remains that the US will still stay uncompetitive internationally, with its costs of production to high to entice anyone from abroad to buy its wares…
Yes, it is a situation fraught with peril. There are ways to reduce those costs that have been around a long time, and have been discussed on this blog, but it consists of industrial and public policy that are directly contrary to neoliberalism, but were common practice for hundreds of years as western countries developed. And America is large enough, and has the resources, to be it’s own supplier and market.
Here are the top exports from 2022:
Source: https://www.worldstopexports.com/united-states-top-10-exports/
For comparison, the last time I checked, America was close to importing $1T worth of goods from China every year. This was about when Trump started the China talk so it might have gone down.
But remember that tariffs were not originally to protect an industry, these were to protect the workers in that industry.
The United States was an autarchy through the 1970s and into the 1980s. Only certain high end manufactured items like German optics or foods like coffee, chocolate, and bananas had to be imported. Everything at home was American made: furniture, kitchen appliances, clothing, tools, and the car.
The minimum wage in California today should be over $30 per hour to match the standard of living my family was having in 1968 with the minimum wage being at $1.60. Food, housing, clothing, education, and medical care were all more affordable and of better quality. The stuff that we buy today is just garbage. It does not matter what country makes it. It is overpriced garbage. The difference in both cost and quality has been used to give grotesquely fabulous wealth to the American 1% And to be fair, to the Chinese and Indian oligarchs as well.
With all the homeless, the disappearing medical system, and the garbage being sold, just how great is the wealth disparity between the bottom half of Americans and everyone else?
The problem is that if you think that the sociopaths who rule us will quietly accept that they are no longer undisputed hegemon, then I have a very isolated and self-sufficient island to sell you.
Don’t sell that island Mr Finster – you may need it in a few years. I hope you will take me in.
I think that was the thinking at the limit that pushed Lenin to really go to the deep end… If I don’t kill them, they will kill us…
How to keep the oligarchy under control is the biggest sociopolitical problem humanity has faced (since the hierarchization), is facing, and it will be facing for the forseeable future.
Only masive, masive tragedies – climate calamities, nuclear wars, will lead to an intransigent population that might develop as a habit the flaying of the rich, a la Bolton House. Not lyinching but flaying people alive.
And then the cycle will repeat again.
Isn’t the question here, “Is defensive action also imperialist?” The Caspian is multinational. The gas and oil reserves are divided by treaty according to national boundaries. But, hypothetically, if the region were aggressively attacked in order for other nations to procure those resources and the Caspian nations counter attacked, then both sides might be considered “imperialist.” So the whole political mess is gobbledegook. Likewise for the eastern Mediterranean gas fields. Not to mention that global economics is now so interbred that control of individual resources is counterproductive. “Imperialism” is itself now counterproductive. So when it comes to private interests commandeering national military forces to secure those interests and all sides charge off to war like those nutty old crusaders it’s just another food fight. A food fight that now creates devastation and toxic pollution exponentially more than men in tin hats riding horses and carrying the flag of the Cross as if it were justification. Nutshell: the world needs to create a rational protocol for allocating resources to achieve rational objectives. Rational private objectives aren’t necessarily mutually exclusive from an inclusive new protocol that would protect the environment and secure a decent future for all of us. But misspent corporate profits can be a problem. So perhaps some new laws about the purpose of money and how it needs to be used is an idea whose time has come because the “free market” experiment seems to have failed, or at least come to the end of its usefulness.
Re: “Is defensive action also imperialist?”, I phrase the problem a bit differently.
Defensive industrialization— as in industrializing to avoid being preyed upon, sets in motion the need for industrial inputs.
This doesn’t make nations imperialist per se. As the discussion above of the USSR suggests, Soviet outreach wasn’t about plunder. In that sense, it wasn’t imperialist.
While in moral and political senses, the Soviet case is fundamentally different from the US blowing up the Nord Stream pipelines, following the unilaterally abrogated (by US) nuclear weapons treaties, the Russians have devoted many resources to militarizing.
In other words, before industrialization these questions are academic, while after industrialization they are fundamental to the continued existence of governments and nations.
Meanwhile, not on topic, but relevant:
“On 18 March, 2022, scientists at the Concordia research station on the east Antarctic plateau documented a remarkable event. They recorded the largest jump in temperature ever measured at a meteorological centre on Earth. According to their instruments, the region that day experienced a rise of 38.5C above its seasonal average: a world record.
This startling leap – in the coldest place on the planet – left polar researchers struggling for words to describe it. “It is simply mind-boggling,” said Prof Michael Meredith, science leader at the British Antarctic Survey. “In sub-zero temperatures such a massive leap is tolerable but if we had a 40C rise in the UK now that would take temperatures for a spring day to over 50C – and that would be deadly for the population.”
https://www.theguardian.com/environment/2024/apr/06/simply-mind-boggling-world-record-temperature-jump-in-antarctic-raises-fears-of-catastrophe
Capitalism is driven by profits.
Capitalists, in order to increase profits, are focused on conquering markets and to do that they simply have to develop production. But what happens when the market is conquered? Imperialism, also known as the monopolist stage of capitalism, begins. When one no longer can increase profits through having an ever increasing consumer base, one has to either cut production costs or increase commodity prices. Stealing global south countries resources at gunpoint, inflating commodity prices, creating financial products, cutting jobs and wages, etc are all monopolists ways of increasing profits. Capitalism is no longer focused on production but on maintaining the current relations of production in the world, this is leading to a multitude of contradictions.
Communism, on the other hand, is driven by production.
The materialist conception of history, historical materialism, conclusion is that production is the chief determinant force of the development of society. Thus in order to reach a higher stage of development (Communism), one has to develop the productive forces of society (the people and the instruments of production). China does not engage on wars to secure resources because it hinders the productive forces, not only of China but of the other nations. The win-win way is mutually beneficial trade relations, this way both countries can develop their productive forces. The USSR hindered its own productive forces by subsidizing other poorer countries by unequal exchange relations, one of the many reasons that lead to its own demise.
That’s a key distinction: profits vs. purpose, clearly seen playing out in Ukraine as Russia, spending one tenth the US’ bloated military budget, continues to produce superior weapons. Why? US weapons are built on cost plus contracts (i.e. more profitable the more costly they are) while Russian weapons are purpose-built.
Marx, among others, pointed out that in competitive markets, capitalists would drive profits toward zero. The tendency to monopolize (or oligopolize), and pursue unproductive outputs like weapons is just a way to forestall that tendency.
The vast majority of the smartphone technology that’s supposed to save us from inevitably declining profits was produced by military/government research, and technological innovation is yet another way to prevent profits from declining. The Chinese have a Confucian past that is suspicious of innovation for its own sake, and reveres tradition.
Interesting times.
The following sentence says it all :
“Here’s the problem: given the advent of industrial warfare, any nation that doesn’t want to be invaded and controlled by other nations has no choice but to industrialize.”
This is the key-point in the article. But the fact that industrialization emerged in the very particular cultural context of Western Europe shaped the character of Western-Modernity as we know it (hegemony, extraction, violence, etc… ). It is my contention that the Chinese system of logic, which is radically different than out Western system of societal logic, will guide the country on a radically different path. I will try to summarize the logic, at work in this hypothesis, as best as I can here under.
Industrialization emerged in Western Europe
The industrialization of Western Europe was the outcome of the intersection of the Enlightenment and the largely dormant financial richness that long distance merchants had accumulated over the past centuries. And this intersection was itself the outcome of the evolution of the knowledge paradigm that successful Frankish long distance merchants had converted to in mid 12th century. This conversion de-facto enfolded Early-Modernity and created the conditions for the emergence of the Enlightenment and of the industrial revolution.
In short the paradigm of Modernity is “the belief in the reason that is at work in the transformation of sterile money in a dynamic process of capital accumulation”. Fernand Braudel mentions. in the volume 1, of “Civilization and Capitalism”, titled “The Structures of Everyday Life” that the appellation “sterile money” was a term used in the Champagne fairs and in the Italian city-states by the late 12th century while the appellation “Capitale”, or “from the head” in Latin or “of the ultimate importance” in old French, was used to designate the transformation of sterile money in a certain quantity of Eastern-Mediterranean luxury goods that were indeed of the ultimate importance in the minds of these Frank long distance merchants.
The history of Western-Modernity violently taught non-Western-Europeans that the capitalist economic system is unbeatable and Marx even wrote that it was the most potent revolutionary force in the history of humanity which indicates that he was a partisan of Western-Modernity. Non-Western-Europeans eventually learned that to survive, the expansion of the cultural impact of Western-Modernity, there was only one solution : converting to its historical worldview (the technical rationality of Western-Modernity) and of its daily-culture in the largest sense which includes the economy (capitalism).
The Chinese dream of a Chinese-Modernity
The Chinese decided to borrow the instruments of Western-Modernity in the 1970’s because they had understood that Western big capital holders had engaged their societies in a silent revolution, at the turn of the 1960’s and 1970’s, that was expanding their reach to the whole world (globalization) while expanding the knowledge paradigm of Western-Modernity from “the transformation of sterile money” to “the transformation of debt into a dynamic process of capital accumulation” (financialization).
Quantitative scientific approaches later illustrated that the outcome of this silent revolution was the expansion of the FIRE sector of the economy which was the outcome of a short few decades of financialization.
But the Chinese only borrowed the instruments of Western-Modernity they never converted to the worldview of Western-Modernity. Their own worldview procures them their shared societal logic. They call this worldview “Chinese Traditional Culture” (CTC) an evolved form of animism. And Chinese citizens have been returning en masse to CTC since the end of the 2010’s. The authorities are now promoting it extensively through their media. In this particular context the appellation Communist Party of China has to be understood as the original name of the Communist dynasty that followed the Ching dynasty (only 38 years of dynastic interruption). And the name of a dynasty never gets changed along its path.
Marxism lost its popular character and it is no longer more popular than in the West. The present socialist turning is due solely to the personality of Xi Jinping who is the sole remaining hardcore communist militant in the whole party. He jumped on the band-wagon of CTC because its communitarian character is reproduced in socialism and communism. The appellation CPC induces Westerners to believe that China is communist. But in reality the Chinese are no longer moved by Marxism. They are fully immersed in their societal system of logic which is the rationality of the Chinese Traditional Culture.
Conclusion
There is no evidence that I know of that China is going to follow the path traced by the West. The formation of its power society was never driven by power. It was driven by the culture. Culture was the power that unified the “Tribal Cultural Confederations” (TCC’s) under the guidance of the wisest among the tribal (wo)men of knowledge also called the sage. Over time TCC’s imperceptibly transformed into “Power Cultural Confederations”. Imperial governance only appeared in about 220 BC.
The fact is that the implementation of sovereign power in China remained constantly in the hands of the men of knowledge. And this remains true until this very day. In contrast the exercise of sovereign power in the West was constantly in the hands of the men of power which is certainly part of the explanation of the violence that accompanied Western-Modernity. But the foundational worldview of power societies and the axioms of civilization that they ushered in are at least as important.
The present application of the Chinese societal system of logic, in international relations, seems to confirm my thesis. But the great convergence, of Western societal atomization with a world in disorder and with the multiple side-effects of Western-Modernity that threaten life on earth, will after all most probably derail the dream of a Chinese-Modernity.
Thanks for the very thoughtful comment.
In an earlier life (this one, just earlier), I had long conversations with advisors to the previous Chinese government who to a person made the point that political stability (not being overthrown) is a top priority.
So, while I appreciate the philosophical / ontological difference that you bring to light, other imperial powers seem intent on ‘reining China in, ‘ as I believe the American explanation of Janet Yellen’s recent attempted shamefest / beg-a-thon has been described.
Should the Chinese government perceive a threat to its continued existence caused by imperial competition, it will face the choice of watching as internal political stability is threatened by external actors, or doing what it believes is necessary to stem the threat.
To be clear, I prefer your optimism. But it is outside of my experience.
Thanks for your insight.
Not being overthrown is indeed the legacy of a 2000 years old centralized governance system. But what the “advisors to the previous Chinese government” did not tell you is that the instrument of China’s historical survival as a nation was rooted in the power of attraction of CTC that the conquerors themselves converted to (I refer to the Mongol and Manchou reigns over China). By the way CTC’s cultural power of attraction has been theorized in writing since as early as the Zhou “Power Cultural Confederation” under the appellation “Tian Xia” that Zhao Tingyang popularized a few years back in “All under Heaven: The Tianxia System for a Possible World Order“.
I wish that you were right about me being an optimist but as the conclusion of my initial comment indicates I’m all but an optimist. You come to this conclusion because you imagine that the Chinese government could be “doing what it believes is necessary to stem the threat” from a US “reining China in”. The image, that came to my mind reading this, is that China could be lashing out in a military adventure to try to break the USA. But semantically this contains the pre-supposition that China could act in the same fashion as the West. It simply can’t because its societal logic is rooted in the complementary polarities of animist knowledge formation while the societal logic of the West is rooted in the dualism and the fight to death of its opposites that Aristotle laid out so well in his “Metaphysics“.
China is already “doing what it believes is necessary to stem the threat”. But its plans are not following the Western societal logic of violence. It decided to counter Obama and H. Clinton’s “Trans-Pacific Partnership”, a pincer move to exclude it from the Pacific, by looking West and opening the land routes of “the new silk road”, or “OBOR”, through Eurasia and the “Tri-Continental-Area” (TCA) that self-centered Europeans refer to as Middle-East. The maritime Silk Road was a distraction to hide the essence of China’s view of the future which is that a new form of global world-order will emerge in the TCA.
Seen what happens today in Gaza, and the complete loss of credibility suffered by the USA in consequence, the Chinese have now a unique opportunity to shape a ‘rapprochement’ between the Jewish and the Palestinian people. You will perhaps think that this is an optimistic view but was the ‘rapprochement’ between Saudi-Arabia and Iran not an optimistic view before it was announced to the world ?
On your last point, the State of Israel cannot exist without US support, and the US will not allow Israel to participate in such a deal.
In addition, if you have been following the war, virtually the entire population of Israel is behind the project to exterminate the Palestinians. And they are enthusiastic about the viciousness. They will not go back. They view this fight as existential.
There was a time decades ago when israel was fairly evenly split between those that might consider a Muslim state and those that wouldn’t. The small fraction of the former that remained in Israel on Oct 6 have probably mostly left by now, and imo won’t return after the war. But the seculars were imo the most productive…
Anyway, I find myself more pessimistic than MoA seems to be in today’s post. Looks to me as a long, very bloody struggle. Unbelievably sad… Jews and Muslims lived in relative peace and harmony for four centuries since both were evicted from Spain. Then Israel was forcibly imposed.
You are absolutely right in the short term. But history unfolds over the long haul. This is why thinking about the present implies paying attention to what the past has already engaged as our emergent near future.
The Gaza story has terminally annihilated the Geopolitical credibility of the USA that had already been suffering badly under the march of NATO toward defeat against Russia in Ukraine. This has terminally united the nations of the Global-South (85% of the world population) in their rejection of Western hegemony. In the meantime the stunning economic success, of China over the last 30 years, has proven in their eyes that TINA (There Is No Alternative) is definitively dead and that TIDAA (There Is Definitely An Alternative) has already emerged. This has definitely changed the mental disposition of non-Western-countries to the possibility of a better future for their people.
In other words the Geopolitical landscape is now entering into an irreversible transition from the Hegemony of Western-Modernity to what comes after Western-Modernity. The BRICS have been sold by the Alternative media as being the seed of the new world-order. But China has always refused to engage itself on this path. It still prefers a reformed United Nations that includes all countries on earth. But its patience is visibly thinning at the sight of a Western foreign affairs establishment that has been flying ever further outside of reality.
When China’s illusions, about a reformed United Nations, finally dissipate, in the not too distant future, the necessity to build a whole new set of international institutions will suddenly down in the minds and the institutionalization of the BRICS will start in earnest which will transform into something akin to a “United Nations of the South” that will animate the building of a brand new world-order. This is when a network, of — high speed rail-roads — freeways — internet cables — high speed electricity transmission lines — etc, will crisscross the Tri-Continental-Area to connect the 3 continents forming “the Island world” that was so dear to John Mackinder.
The realization, of such a plan, implies that China’s diplomacy first has to succeed reconciling Jews and Palestinians to the idea that a viable future awaits both of them. What I describe here is the calculus that animates Chinese Geo-strategists. This calculus will naturally evolve by integrating new facts emerging on the ground that will eventually adapt the form of the final outcome of the Geopolitical game that is in play.
Sorry, there is going to be no long term. The foundations of civilization will start to crack in 30 years, if not sooner, due to global warming (disruption to food supplies, mass migration, the increase in the level of diseases, which do better in average hotter temperatures) and resource wars. On top of that, as I will post soon, Yellen totally and utterly discredited the point by making it as badly as one could possibly make it, and then voicing it selfishly, as a US issue, but China already has an overproduction problem (more than available, and in some key cases, global markets) will absorb. That will result not only in protectionist retaliation as China refuses to back down, but dislocation within China, as factories in the oversupply sectors will be unprofitable (losses to equity holder) and loans to them will need to be restructured or written off. That = losses to banks, which = losses to depositors. The last time this move played, China delivered losses to depositors via financial repression, with savers getting close to zero interest when inflation was 6% or more.
I totally agree with you that power societies and civilization will not survive the great convergence of the side-effects of Western-Modernity :
— Loss of societal cohesion and societal atomization in Western countries that no longer can handle any large scale national project successfully even winning a World War !
— International disorder, the formation of Regional Economic Blocks, and the rising risk of nuclear confrontations in different theaters
— The worldwide side-effects, of Western-Modernity, are destabilizing the Geo-bio-chemical state of the earth which is responsible for the 6th mass-extinction (climate change, plastic nano particle that invade living cells, and so on and on)
The convergence, and interaction between all these factors, leaves no longer any place for doubt. At the least power societies and civilization will go extinct and at the worst Homo-Sapiens will go extinct. But the fact is that we are still alive and the world of Homo-Sapiens continues to run its course.
My comment at 4.02 was focusing on how China is gaming its interconnection of “the Island world”… In the context, of the technical rationality of Western-Modernity, I can’t stop thinking that this plan is brilliant. But the fact is that the US has detached itself from this rationality. And in this sense China’s rational behavior today may be seen as illusory.
When you reach this kind of conclusion an existential question arises about how to be coherent in your personal daily life. I mention this question because more and more people, and more importantly more and more young people, are confronted to this question without finding any satisfying answers which results in a build-up of anxiety in the mind that easily shifts into mental distress.
Is this not the core question of our times ?
Would love to hear, at some future point, your reflections on what you call the power societies of the West.
I also agree with you that the question of how to be coherent in our personal lives when Western leadership initiatives for shaping our external world seem more and more insane–is a core question of our time.
“Marxism lost its popular character and it is no longer more popular than in the West. The present socialist turning is due solely to the personality of Xi Jinping who is the sole remaining hardcore communist militant in the whole party. He jumped on the bandwagon of CTC because its communitarian character is reproduced in socialism and communism…”
A thoughtful comment indeed. However, the Chinese consider their country as “socialist with Chinese characteristics.” Xi Jinping is the chosen president of China, a wildly popular president who is neither hardcore nor militant but merely thoughtful in reflecting what China is and is becoming and looking after a party and government that is meant to serve the understood needs of 1.4 billion Chinese.
The Hongwu Emperor fought corruption tirelessly:
“Had I thoroughly eradicated corrupt officials in addition to those already imprisoned I would have been dealing with two thousand men from just two prefectures, men with no useful occupation who used my prestige to oppress people. No-one outside government knew how wicked they were, so everyone said my punishments were harsh, for they saw only the severity of the law and didn’t know that these villains had used the government’s good name to engage in evil practices. In the morning I punished a few and, by evening, others had committed the same crimes. I punished those in the evening and next morning there were more violations! Although the corpses of the first had not been removed others were already lined up to follow in their path, day and night! The harsher the punishment, the more violations. I didn’t know what to do, but I couldn’t rest. If I was lenient the law became ineffectual, order deteriorated, people thought me weak and engaged in still more evil practices. If I punished them, others regarded me as a tyrant. How could anyone lead a peaceful life in such circumstances? Really, my situation was dreadful.”
This seems to be also part of the Chinese culture. A powerful aristocracy/oligarchy that defyies the Mandate of Heaven. Please tell us how has China historically dealt with the corruption of the upper class and how that history as well as what cultural aspects the present communist dynasty is using to deal with corruption and control of resources.
1) https://godfree.substack.com/p/corruption-in-china
July 3, 2022
CORRUPTION IN CHINA
Going, Going, never Gone..
By GODFREE ROBERTS
2) Please look to the just published Edelman Trust Index for 2023 and 2024:
https://pbs.twimg.com/media/GKn_q23aoAAKjp1?format=jpg&name=medium
Yes thank you for that very thoughtful comment.
Nice to see Braudel being quoted. His ideas are rarely not relevant.
“It is my contention that the Chinese system of logic, which is radically different than out Western system of societal logic, will guide the country on a radically different path…”
I look at things like the insidiousness of neoliberal economics and a sort of academic monoculture of the global elite and can’t be sure of how things will progress.
Excellent piece. The point that industrialization isn’t an option is well-made: the Global South knows well the consequences of being unable to defend itself from the weapons that can dish out death in an industrial scale (Yemen is a perfect counterpoint: they have the weapons, therefore they can exert their will upon their enemies—recall the war with the Saudis mostly ended once Aramco facilities got blown to pieces).
Of course, as Yves pointed out in a comment in the BRICS piece, demand is a zero-sum game (trade surplus means a demand deficit for someone else), as well as resources also being zero-sum, means the more industry the more war. It’s not a nice prospect. But it’s an unavoidable fact of industrialization, which, again, is hardly an option if one wants to avoid being dominated.
In a broad sense, the Urie essay can be seen as an attempt to understand the relationship between a particular set of economic forces and a particular set of political effects (neoliberalism).
The nature of the competition between “democratic” capitalism and state socialist governments began, as Urie indicates, with attempts by both camps to harness the forces of industrial modernity to improve the economic security and well being of their people. Both sides raced to make promises to their respective constituencies and expand the social contract that prevailed in their respective societies.
But starting in 1973 the economic forces of oil, finance and economic discipline/ “stablization,” began to exert profound political effects on both the Soviet Union and the U.S. as well as Western Europe (no more oil subsidies for Eastern Europe and no more higher living standards for average citizens in the West).
Pools of wealth from global capital markets and energy resources prolonged the breaking of promises in both camps but eventually neoliberalism won the day in both the East (see for example Poland and East Germany as well as Thatcher’s Great Britain and Volcker’s moves in the U.S,)
Read all the gory details in Fritz Bartel “The Triumph of Broken Promises: The End of the Cold War and the Rise of Neoliberalism.”
There are a number of writers — Colin Crouch being one of the most effective with his “The Strange Non-Death of Neoliberalism” — who argue that “getting government out of the way” was a nod to little government ideology that has been superseded by the ongoing development of forms of public-private partnership that can easily start to look pretty corporatist. One of the links today, re UK Labour’s penchant for working out deals with private equity firms, is a good example.
Urie’s article would benefit from looking over the horizon a bit to consider whether what is going on internationally is a phase in the establishment of a coordinated imperialism, in part involving some assurances re access to resources but also extending to markets as well. It would be particularly useful to sort through the range of interested capitalist factions in the US to get a sense of how capable, or inclined, they are to try to work out a deal, as opposed to fantasies of military knockout punches. These dynamics will strongly determine how “neoliberalism” morphs.
This prompted me to update the manufacturing employment graph I have maintained since the 2008 recession.
It’s been four months since the last update and employment as a portion of workforce has continued to decline at its steady pace.
One of the more curious graphs I have made, the steady rate of the decline seems unusual for an economic factor.
Take the money we spend all over the world right now and reinvest it back into america and americans. Use the tax dollars americans pay to make things better.. its not very difficult concept Create projects and programs to incentivize and bring things back to America, continue aid and subsidies to important industries.
Yeah, except that people have been saying this, and identifying the problem as ‘productivism,’ for yonks, right?