27.03.2008
Global imperialism and WTO
Has there been a fundamental change in the nature of imperialism? In arguing for the defence of the classical Leninist position, Gerry Downing looks at the nature of world trade and the role of the World Trade Organisation
A range of views on the nature of modern imperialism has been revealed within the Hands Off the People of Iran campaign, the CPGB and the Campaign for a Marxist Party. And now the newly formed Trotskyist Tendency of the CMP has been obliged to admit there are two positions within its ranks on the subject.
Is the classical Leninist analysis of global capitalism outdated and therefore wrong? Not in my view. The WTO demonstrates that the relationships between oppressor and oppressed nations are far more exploitatively acute today than when Lenin wrote Imperialism, the highest stage of capitalism in 1916. We shall look at the advantages and disadvantages arising from global trade for the developed (imperialist) and developing (third world) countries using Kenneth Waltz’s ‘contemporary realist theory’ and its critics.1
Waltz developed his theory from Hobbes and Hume. Aristotle is the other source of contemporary political theory on the nature of the state - or more accurately on what a state’s nature should be - though Hume may be seen as a bridging ideological influence between the two. Marxism as a ‘perfectionist’ theory of human nature identifies Aristotle as its political ancestor in this regard.
The Hobbs-Hume-Waltz theory sees human nature as violently acquisitive, necessitating an authoritative sovereign with the monopoly of legitimate violence ruling over a state. If we did not accept this, Hobbes believed we would revert back to a state of nature in which we lost all culture, science and art and our lives would be lived in “continual fear, and danger of violent death”. Life would be “solitary, poor, nasty, brutish and short”. Liberal parliamentary democracy in the advanced metropolitan countries, built on rights won in struggle, was necessary in the first place in order to liberate the creative energy of modern capitalism, but has evolved to take account, and to contain, the organised strength of the modern working class. No such constraints operate in the sphere of global trade.
Aristotle’s perfectionist view proposed a participatory democracy, where all citizens (women, slaves and foreigners not included) consent freely to a state authority because they have participated in making its rules themselves and are therefore obeying them in order to ‘live the good life’, which Aristotle held to be the point of human existence.
For relationships between states and for international trade the Hobbs-Hume-Waltz scenario recognises anarchy as the ruling force: the strongest impose their will on the weakest. Waltz’s postulate is that of necessity in the international sphere the Hobbsian state of nature operates.
The WTO, then, might be characterised as egalitarian Aristotelian in its formal rules and structures (unlike the World Bank and International Monetary Fund, which are ruled by bureaucracies answerable politically in the final analyses to the USA and its allies), but Waltzian in its actual practice.
Many reformist idealists have hopes that Aristotle - or more specifically those today who aspire to the realisation of his approach - will be able to advance their perfectionist cause through WTO structures via alliances between the developing countries, and may even divide the developed world by seeking partial agreements and temporary alliances with, for example, the European Union to counter the influence of the USA. In our view this is a fool’s illusion.
Other views range from those on the political right, who regard this ‘rule of the strong’ state of affairs as entirely desirable in order to secure the privileges of the wealthy, to those on the revolutionary left, who think we should recognise reality and set about doing something about changing it to an international communist society.
Let us therefore look at the theory and practice of the WTO. Even though it is not a world government in trade terms and therefore does not have an international monopoly of legitimate force, it can be argued that Aristotelian principles do apply and member-states observe a very high level of compliance with its rules because they themselves have agreed to them and so see them as a reflection of their own will.
But they have done so because they had very little option. Trade is the only, if by no means certain, road to development in the modern world. Not to join the WTO would leave a backward country forever isolated in primitiveness. Once its population is aware of the possible benefits of the modern world, reliance on a self-sufficient subsistence agricultural economy, producing food, clothing and primitive shelters for family or purely local consumption, becomes totally socially unacceptable. The growth of cities (since 2006 housing for the first time in human history over half the world’s population), TV, radio, the internet and mobile phones connects with the consciousness of everyone on the planet and inevitably destroys primitiveness.
Hume pointed out that government did not simply coerce to provide security for their citizens, but coordinated society to make commerce and exchange possible, or at least flow more freely. Therefore the WTO can be seen as a seat of governance which can function quite well without a monopoly of force. But each state faces its own security dilemma. If it becomes over-reliant on a trading partner and then political conflict opens up - Europe’s reliance on Russia’s natural gas is a case in point - then it becomes apparent in hindsight that it would have been better to forgo some trade and growth potential in order to be able to escape the possibility of economic blockade or blackmail. But imperialist Europe did not anticipate that the pro-western mafia government of Boris Yeltsin would give way to the more independently assertive imperialist government of Vladimir Putin/Dmitry Medvedev and so is vulnerable to Russian measures, as Putin and Medvedev still like to remind its leaders now and again.
Comparative advantage theory says that all states should benefit from specialised trade, all other things being equal. However, these things are not equal and never will be under the present system. If a developing country specialises in one or two primary products, then the only way to increase its wealth is to step up production. But if all developing countries step up production of coffee, for example, as they did in the 1980s, the market becomes flooded and the price of coffee falls, resulting in trade immiserisation. Rwanda is a monoculture totally dependant on coffee because of its history as a German and then Belgian colony. The International Coffee Agreement quota system collapsed in 1987 and the IMF imposed a brutal structural adjustment programme, which devalued the Rwandan franc by 50% in 1990, resulting in “massive inflation and significant increases in the price of fuel and food”.2
Arguably the 1994 genocide was a direct consequence, together with a population density that was the highest in Africa, with the previous ethnic divisions exploited by the ‘divide and conquer’ policy of the Belgium colonial masters and the invasion by Tutsi-influenced Uganda, a tool of US imperialism. Many self-proclaimed revolutionary socialists responded to this conflict with a humanitarian outcry against the Hutu militias who carried out the genocide, without laying the main blame on imperialism and its iniquitous system of world trade which produced the situation in the first place.
So developing countries must diversify and begin to develop manufacturing industry to escape this vulnerability. Increased incomes in wealthy countries translate into a far higher proportion of high-tech consumer goods than primary products. Yet WTO rules - increasingly intervening in services, banking and defence of patents - prevent protection for infant industries, whilst permitting subsidies for agricultural sectors in advanced countries. This effectively denies to the poorest countries the path to growth which imperialist countries have taken in the past. The absence of a skilled workforce, poor infrastructure and lack of capital make entry of the poorest countries into the world of high-tech products - with their high start-up costs and high profits - all but impossible.
The Cancun round of trade talks collapsed in September 2003 because the USA, Japan and the EU continued to subsidise their agriculture massively (the EU pays out for cows at the rate of $2 a day - more than the income of half the world’s population), whilst demanding the liberalisation of developing countries’ markets.3 Solidarity by developing countries held the line then, but the wealthy countries and companies were able to impose bilateral trade agreements (the USA’s ‘most favoured nation’ status being a case in point) and pack WTO conferences with legal expertise, which the third world was unable to match.
Agreements often included terms of trade which were not understood until it was too late. We have the example of tomato puree, where the southern EU countries subsidised their industries and then, having secured the abolition of tariffs in Senegal in 1994, flooded its market and all but destroyed its home industry by 1996. Production of tomato puree in Senegal fell from 73,000 tons in 1991 to 20,000 in 1996, while European imports jumped from 62 tons (!) in 1994 to 5,348 tons in 1996.4 No nation with effective sovereignty would allow this to happen to it.
We therefore have to come down on the side of the pessimists and acknowledge the Waltz realists are closer to an unpalatable truth. Anarchy does rule in world markets under the guise of the formally egalitarian WTO. The weakest do go to the wall, even if sectors of the population of former third world countries still join the rich man’s club. The wealthy imperialist states are still shifting the balance of power in their favour, although they are prepared to allow a limited few new members into the premier division.
Since 1900 Argentina has threatened but failed to make the transition from a semi-colonial country to an imperialist one; perhaps Korea, India, China, etc will make it (some of their population already have), but for the bulk of humanity, despite the current rise in the price of primary produce, there is no possibility under the present system. And what will the current financial sub-prime credit crunch do to these international relations? We can be certain that the USA, Barack Obama notwithstanding, will opt for a military solution to its impending recession and financial humiliation.
An international governance of an entirely different type is required for genuinely global development - a world federation of workers’ states, where the bogus Aristotelian egalitarianism of the WTO is replaced by planned global development for the advancement of everyone on the planet.
Notes
1. Waltz’s initial contribution to the field of political science was his 1959 book, Man, the state and war (Columbia 1954), which classified theories of international relations into three categories, or images. The first image explained international politics as being driven primarily by actions of individual men, or outcomes of psychological forces. The second image explained it as being driven by the domestic regimes of states, while the third focused on the role of systemic factors, or the effect that international anarchy was exerting on state behaviour. ‘Anarchy’ in this context is meant not as a condition of chaos or disorder, but one in which there is no sovereign body that governs nation-states. These images also became known as ‘levels of analysis’ (see en.wikipedia.org/wiki/Kenneth_Waltz).
2. AG Marshall Western involvement in the Rwandan genocide : www.globalresearch.ca/index.php?context=va&aid=8189
3. The Group of 23 (G23), led by Brazil, South Africa, India and China, successfully resisted pressure for liberalisation in 2003, but its victory was short-lived. Eventually further unilateral pressure, mainly by the US, secured most of the imperialist demands.
4. S Bromley, M Mackintosh, W Brown and M Wuyts (eds) A world of whose making? Making the international: economic interdependence and political order London 2004, p38.