Marxism and the inequality of nations

Mike Macnair analyses 'world-system' theory and looks at Boris Kagarlitsky's attempts to overcome its weaknesses with his analysis of Russia

This is the second part of my review of Boris Kagarlitsky’s Empire of the periphery, his history of Russia and its predecessor-states from the earliest times.1 In the first part I outlined Kagarlitsky’s narrative. I argued that the modern evidence argued strongly for Kagarlitsky’s longue durée historical approach to understanding and attempting to change the immediate future (usually called ‘the present’). I argued also that Kagarlitsky is correct to approach the problem of Russia’s place in the world not as a unique special case, but as a particular case of the general problem of inequality between nations in modern capitalist society.

This, in turn, poses the question of the appropriate theoretical tools to approach the problem. Kagarlitsky, as I said last week, uses a broadly Marxist analysis, but one ‘specified’ by the ideas of Bolshevik historian Mikhail Pokrovsky and of the ‘world-systems analysis’ (WSA) of Immanuel Wallerstein and others. Are these the right tools? After all, Pokrovsky opposed Trotsky’s account of Russian history and later aligned with the Stalin faction.2 And though Kagarlitsky draws internationalist conclusions from his analysis, the world-systems theorists started out as third-worldists and are largely now believers in a coming period of Chinese world hegemony.

Pokrovsky and Trotsky

Pokrovsky’s polemic with Trotsky was at least partly a matter of professional amour propre. Pokrovsky was a professional historian trained under the eminent medievalist Paul Vinogradov. In 1910-12 he had edited, and authored most of, a five-volume History of Russia from the earliest times to the development of commercial capitalism. Even in the highly abridged English translation3 it is apparent that this book is one of the classics of the new ‘scientific history’ of the turn of the 19th-20th centuries. Pokrovsky’s argument for the feudal character of medieval Russian society and the ‘commercial’ character of the early modern absolutist regime was based not on ‘orthodox Marxist’ schematism, but, on the contrary, on deep familiarity with the Russian sources and with the best of the contemporary historical literature on medieval western Europe.

However, when Trotsky in 1922 reprinted an enlarged edition of some of his contemporary writings as 1905, he still asserted the ‘Asiatic’ character of the early modern Russian state. In doing so he was casually following the liberal historian, Miliukov (also a leader of the Cadet party), without using or engaging with Pokrovsky’s History. This was sloppy as well as arrogant, and it is understandable that Pokrovsky should have been somewhat exasperated. Trotsky’s dismissive response to Pokrovsky’s criticisms in his second edition of 1905 would have exacerbated the issue.

Professional amour propre is not always unjustified: on the whole we prefer to have trained pilots flying planes ... Slightly analogously, professional history, as it developed from the late 19th century, involves certain specialist skills in reading ancient documents, making use of the full range of sources available, engaging with the modern controversial literature and so on. In this context of the technique of history, Trotsky’s response to Pokrovsky is simply not serious as a historical argument.

That said, there are serious historical arguments in favour of the ‘Asiatic’ character of the early modern tsarist state, or (that is) its character as an independent direct exploiter, without a real independent landlord class like the west European late feudal states of the same period. For example, at the level of studies of particular aspects of the social order, both JM Hittle on the early modern Russian city and Richard Hellie on slavery present evidence of an economic-social order in early modern Russia which is qualitatively different from the economic-social orders of western Europe at this period. Different by an order of magnitude greater than the differences between, for example, the economic-social orders of England before 1688 and Germany at the same period.4

The major problem with this sort of account is the manifest integration in the early modern European trade system of Russian production and export first of the raw materials for shipbuilding, and later of grain. So Pokrovsky argued in the relevant part of his books, and so Kagarlitsky also argues. In this light, the early modern Russian regime’s ‘Asiatic’ characteristics look more analogous to the (very different) systems of forced labour which developing capitalism threw up in various parts of the colonised world.

The underlying political difference between Pokrovsky’s and Trotsky’s historical approaches, though, is somewhat distinct. Does an ‘Asiatic’ recent past inherently prevent the emergence of autonomous capitalism, so as to force a socialist revolution if the country is to ‘modernise’?

Another argument might have been made by Trotsky, but was not in the early phase of the debate, though it became prominent in ‘permanent revolution’ arguments later. This is that the rise of imperialism precludes the emergence of new autonomous capitalisms: the only route open to pre-capitalist societies faced with imperialism is colonisation - or socialist revolution.

The first argument is plainly false. Though medieval Japan is commonly characterised as feudal, Tokugawa Japan could as easily be said to be ‘Asiatic’ as the early modern tsarist regime (this incidentally illustrates the extreme slipperiness of the ‘Asiatic regime’ concept). Yet Japan emerged from the Meiji restoration and the following period as a full-fledged imperialist power.

Japan is almost certainly also an answer to the second argument. By the time of the Meiji restoration in 1867 high imperialism was in full flow of development. It is not the only example. South Korea today is undoubtedly an industrialised capitalist country, albeit subordinate to the US (but then, who isn’t?). But Korea was actually colonised in the full sense by Japan in 1910-45.

If we ask why this happened in South Korea, the answer is fairly obvious: geopolitics. The Chinese revolution made clear to the US state that imperialism through alliance with landlords and pre-capitalist religious elites tends to render the society vulnerable to revolutions of (broadly) a Russian type. In South Korea, the US responded to the Korean war by forcibly subordinating the old elites and subsidising the development of a Korean capitalism. Similar subsidies affected other ‘front-line’ states (including Japan and Taiwan) in the cold war period.

In other words, the emergence of new, fully capitalist societies is not excluded by the phenomenon of imperialism. But it becomes primarily a question of geopolitics. Can the new state forcibly - that is, by actual warfare - thrust itself into relations of semi-equality with existing capitalist regimes and domination over subordinated-colonised societies, as Britain did in 1689-1714, France in 1791-1815 and in the second empire, Germany under Bismarck, and Japan in the 1890s-1900s? Or will the global capitalist hegemon state’s own motivations lead it to subsidise a full development of capitalism, as happened with several front-line states in the cold war period?

Within that framework, however, there is another issue. The ability to act as a great power, both (apparently) in geopolitical competition vis-à-vis the capitalist great powers and by subordinating other countries, does not in itself mean a development of full capitalism: Russia in the 18th-19th centuries is precisely an example of the point, since it was unambiguously a great power and an ‘imperial’ one, yet ‘sub-imperialist’: ‘semi-colonised’ successively by the Netherlands, and by Britain and France.

The problem, to be blunt, was that the domestic development of the forces of production in the Russian core was insufficient to allow a transition to autonomous industrial capitalism comparable to the transitions in Germany and Japan: back to the point, made in the first part of this review, about the low density of population, market nodes and communications.

World systems

To talk of a ‘global capitalist hegemon state’, as I did just now, is to use the language of world-systems theory. But to explain Russia’s failure to achieve autonomous industrial capitalism by insufficiency of the domestic development of the forces and relations of production may seem to be the opposite of the world-systems approach, and in a certain sense it is.

World-systems theory originated with attempts to explain the world as it appeared in the 1970s, looking back on developments since the 1950s.

Through the post-war period of decolonisation and cold war it had more or less been orthodoxy, both ‘west’ and ‘east’, that the ‘developing countries’ could follow the 19th century US, French, German or Japanese path to ‘development’ through tariff protection of national industries for import-substitution. The ‘Soviet bloc’ approach to the issue was considerably more statist than ‘western’ approaches, but the present orthodoxy that free trade and free capital markets are the road to development was marginal.

By the 1970s, however, it was clear that at least the ‘western’ versions of this policy were not producing a reduction in international inequality. As Kagarlitsky puts it in Empire of the periphery, “[t]he more actively the periphery competes, the further it lags behind, and the more it helps the west to sprint ahead” (p260).

The sharpest case was that of Latin America. The South American states had mostly been formally independent since the early 19th century, when they gained independence from Spain. Over a century of formal sovereignty had not allowed a breakthrough into ‘development’, and, indeed, it was clear from US conduct in the 1950s and 60s (and spectacularly in the 1973 US-sponsored coup in Chile) that the US regarded the sovereignty of South American states as limited, just as the ‘Brezhnev doctrine’ held that the sovereignty of eastern European states was limited (the US, of course, still regards the sovereignty of South American states in this way).

The Soviet- or Chinese-style alternatives, as they appeared in the 1970s, produced a degree of equality both internally and between separate Stalinist countries by ‘levelling down’. No Stalinist bureaucrat ever enjoyed material privileges or individually autonomous power comparable to the high capitalist elite in the ‘west’ or even in the ‘south’, and there was, indeed, national development (of steel mills, arms factories, etc) in each separate Stalinist country, though those in eastern Europe were politically subordinate to the USSR. But they did not achieve material equality with the capitalist metropolises of the ‘west’ or, for that matter, with front-line states, like South Korea, which were sponsored into capitalist development by the US.

Arising from these factual circumstances - which are quite plain and continue to exist to this day - there developed theories of ‘dependency’ and ‘unequal exchange’ which explained the systemic international inequality by features of capitalist international trade as such, rather than by the specific forms of high imperialism. (The Leninist theory of imperialism continued to be used by the far left, and by Soviet and ‘official communist’ theorists in the bastardised form of ‘state monopoly capitalism’). These theories were developed first in Latin America. One might add Eric Williams’ arguments in his Capitalism and slavery (1944) for the role of super-exploitation of colonial slaves in funding the industrial revolution in Britain.

Wallerstein, in a recent short introduction to the approach, explains the emergence of world-systems analysis as growing from a combination of dependency theory with three other sources. The first was the rejection of the ‘Eurocentric’ conception of a linear series of stages of historical development, which he identifies as having resulted from Soviet scholars’ re-engagement with the concept of the ‘Asiatic mode of production’ after Stalin’s death in 1953, to some extent lifting the lid on this issue. The second was Paul Sweezy’s side of his debate with Maurice Dobb on the origins of capitalism (1946 and following): Dobb argued that capitalism grew ‘endogenously’ out of the internal dynamics of feudalism in Britain; Sweezy that the European-wide development of international trade was more central. The third was the French Annales school of historians, and in particular the arguments of Fernand Braudel (1902-85) for longue durée history, as opposed to histoire événementielle, the history of events (which usually turned out to be events in state history) and for treating the 16th century Mediterranean as a whole without regard to state boundaries.5

The core of the resulting argument is that at least the capitalist ‘world system’ has to be analysed as a whole, before approaching the specific features of distinct ‘national’ economies. When this is done, it will appear that the system as a whole inherently produces differentiation between ‘core’, ‘semi-periphery’ and ‘periphery’ economic activities, which is reflected both on the systemic scale and within the ‘national’ economies. The key to this differentiation, Wallerstein argues, is the degree of monopolisation of these activities, with high monopolisation yielding high profits and capitalist accumulation. Monopolisation in turn depends partly on state interventions.

The system has duration in the longue durée: there is a past in which it did not exist (variously identified by different world-systems authors), and it will fall into decline. Moreover, its appearance was not inevitable: according to Wallerstein, we have to ask (unlike Marx), why the capitalist world system appeared, not assume that it was a natural outcome of earlier development.6

Capitalism depends on a particular sort of relation to the state: the state must be powerful enough to support monopolisation, but not so powerful that state actors are able to pursue their own goals at the expense of those of the capitalists. This, in turn, entails the system of capitalist states and the emergence and decline of successive capitalist world hegemons (Netherlands, Britain, US).7

The world-systems approach has both great strengths and catastrophic weaknesses. The strengths are essentially three. The first is that it constitutes a break with the erroneous ‘methodological nationalism’ shared by nationalist historians, economic historians, and pro-capitalist economists outside the Austrian school. Methodological nationalism is expressed in Marxist writing as ‘stages theories’ of national development and ‘national roads to socialism’; the so-called ‘law of uneven development’ and its pseudo-internationalist version, the ‘law of uneven and combined development’; and the idea that ‘the imperialist chain breaks at the weakest link’.

More recently, Robert Brenner and his school’s critique of WSA and alternative approach to the emergence of capitalism is essentially grounded in methodological nationalism.8 Methodological nationalism is also reflected in Brenner’s studies of the world economy in the 1990s-2000s: in reality based on country-by-country treatment of the ‘separate but interrelated’ economies of a group of countries, and at that only - in WSA terms - ‘core’ countries.9

The second strength, which is related, is the strength of the empirical evidence. In the first place, WSA addresses the persistence of the phenomena of international inequality and the diversity of their forms through the 20th century more successfully than either the classical Leninist theory of imperialism or ideas of an ‘imperialism of free trade’.10 Secondly, the approach gets to grips with (I will not say fully explains) the abundant evidence for urban wage labour, monetisation of the economy, economic integration through trade, etc from Europe in the late medieval and early modern period, and the emergence at this period of sharpened inequality between nations. In particular, it integrates the early modern mercantile empires far more successfully than do ‘orthodox’ attempts to handle them while clinging to the idea that imperialism is the ‘highest stage of capitalism’. This aspect is central to Kagarlitsky’s use of WSA arguments.

The third strength is the integration of the state and world trade in an economic account which is somewhat Marxisant. It is clear that Marx intended to integrate the state and world trade at a future stage in his critique of political economy, of which the extant parts of Capital are merely a fragment.11 But many Marxists after Marx have read the extant parts of Capital without attention to the fact that the project is radically incomplete. This produces the impression that it is possible to explain the laws of motion of capital without the state and the system of particular states, or with the state merely sitting in the background as an abstract, dematerialised enforcer of property rights and contracts.

I do not think WSA actually succeeds in integrating the state in political economy; in fact, Wallerstein’s attempt to do so in terms of monopoly seems to me clearly unsound, as I will explain below, while Giovanni Arrighi’s The long 20th century (1994) more or less admits failure, by leaving the state as an unexplained ‘territorial logic of domination’. But the WSA theorists are right that the role of the state must be incorporated if political economy is to approach the concrete.

What’s wrong with WSA

In its original 1970s form, WSA supported the third-worldist project of the global ‘south’ delinking from the global ‘north’. This project was an utter failure, for two reasons. The first is the same as the reasons for the failure of Stalinism, which Kagarlitsky discusses (summarised in the first part of the review, last week), and in fact follows from WSA’s own recognition of an integrated world economy and the role of the relative power of states in structuring this economy.

For a ‘peripheral’ state to ‘delink’ without ‘modernising’ is therefore merely to invite military conquest either by a state higher up the world hierarchy or by a local rival. So it is necessary to ‘modernise’. But to ‘modernise’, the ‘peripheral’ state needs to acquire armaments, techniques and material means of production from the states higher up the global hierarchy. This requires insertion in the world economy. And since the ‘peripheral’ state ex hypothesi does not possess these goods monopolised by the ‘core’, the only means of insertion is to bring to the world market ‘peripheral’ economic activities (agriculture, mining, etc, and in recent times textile production and assembly work).

‘Delinking’ as a real project actually only made sense when coupled to linking with the Soviet bloc; but at the time when the first WSA books were being written, the Soviet bloc was already in process of (a) breaking up due to the contradictions between the different national sections of the Stalinist bureaucracies and (b) their competitive insertion in the global capitalist system. Now, of course, it is gone.

Second, WSA defined and still defines the primary axis of inequality in the world as that between countries, and radically downgrades the possibility of global solidarity among members of the same class. Wallerstein’s 2004 book offers a ‘deconstruction’ of the language of class through discussion of household income and the usual post-modernist ‘multiple identifications’,12 an aspect of this general approach.

Let us assume, solely for the sake of argument, that these objections to the Marxist case for the leading role of the working class are defensible. (In fact, they are unsound: the objection is an objection to syndicalist concepts of ‘class’, not to the Marxist conception.13) Even on that assumption, Wallerstein’s argument to minimise class solidarity focuses solely on the subaltern classes, especially workers. But the fatal flaw of the delinking project was not the negative fact that we lack class solidarity of the proletariat. It was the positive fact that the world is characterised by international class solidarity of the capitalist class and related elites.

The flight of capital from the leftist and delinking projects of governments in the global south is as much a matter of the native elites pulling out as of the foreign direct investors; and the US finds no difficulty in building support for its political projects in Latin America among Venezuelan students and managers, Bolivian and Colombian landlords. Equally, the fall of the USSR was as much as anything else an aspiration of sections of the bureaucracy to become one with the global class elite.

With the USSR fallen, WSA is a significant academic niche product, but it cannot be a serious political project. What is left behind is the illusory belief that the rise of China will produce a better world order. It is most unlikely that China can become the next world hegemon - it is too far behind the US in military capability and in the depth of capitalist development which underpins military capability. Moreover, China’s entry into the export of capital to Africa and Latin America so far shows no sign of being anything other than the rise of a new imperialist power. Nor should we expect anything else: Korean and Vietnamese history have plenty of stories to tell us about great-Han racism to parallel European racism, and Tibet and Xinjiang/East Turkestan can tell us stories about it even today.

Theoretical incoherence

Underneath this practical political problem with WSA is theoretical incoherence. This incoherence consists in the fact that a critical strength of WSA is its attempt to grasp the global material division of labour. Yet when WSA authors analyse the economic, the linkage between the material division of labour and the monetary economy disappears. This linkage can only be a classical (Smith-Ricardo) or Marxist labour theory of value. The reason is that marginalist equilibrium economics, which Wallerstein adopts,14 inherently dematerialises the money economy. It does so because it fails to recognise the actual physical limits on the working day and minimum subsistence levels which are expressed in the labour theory of value by the need to exchange at prices which will allow for reproduction.

Arising from this rejection of the labour theory of value is an inability of the WSA theory to do what Wallerstein claims it can: distinguish between the capitalist world system and prior social orders. Wallerstein defines capitalism as accumulation for accumulation’s sake, an idea borrowed from Marx.15 The role of money and markets is silently assumed in this definition, and not explained. An ancient elite slave-owner accumulated slaves, livestock and land for accumulation’s sake, because he (sic)16 was compelled to do so by the internal greasy-pole competitive dynamics of the slave-owner elite. The same is true of an elite feudalist’s accumulation of manors or a pastoralist’s accumulation of cattle and wives/slaves.

Arrighi defines capitalism by the circuit M-C-C’-M’, which is similarly borrowed from Marx. But he leaves out the critical issue of the form of the process represented by the stage C-C’. On Arrighi’s definition, therefore, an urban petty artisan producer integrated in a local market, or a long-distance trader who uses only family and slave labour, in a society dominated by slavery or serfdom, is a ‘capitalist’. In a capitalist society, of course, such a person is in a sense a capitalist - a small one, or ‘petty-bourgeois’ - because the logic of the society as a whole works in that way. Put the same person in a pre-capitalist society and he (sic) is not governed by capitalist logic, but will invest any substantial surplus, not in expanding the business, but in land, public office or whatever else is the primary and most reliable source of surplus in that society.

This may sound like the Brennerites’ objection to a trade-centred account of the origins of capitalism - which is derived from the Dobb line as opposed to Sweezy from the debate of the 1940s, and is in turn very similar to the objections which were made in the early 1930s to Pokrovsky’s use of ‘merchant capitalism’ to explain the early modern tsarist regime.17 This criticism is derived from Marx’s casual comments about ‘merchant capital’, especially in Capital Vol 3, chapter 20.18 As Wallerstein points out, this is merely to criticise WSA for not conforming to Marxist orthodoxy, without questioning whether Marxist orthodoxy is actually correct.19

In fact, I am not using it in this way. My point is that the WSA theorists - or, at least, Wallerstein - claim to be able to identify what is new about the modern world system; but Wallerstein’s definition of capitalism in fact precludes such an analysis (as does Arrighi’s). The problem is reflected in Janet Abu Lughod’s construction of a 13th century ‘world system’ in Before European hegemony (1991), meaning by it simply the existence of Eurasian circuits of long-distance luxury trade. This is generally recognised as a ‘bridge too far’ for WSA. So, all the more, is Andre Gunder Frank’s millennia-long world system in ReOrient (1998), which even Wallerstein rejects.

Merchant capital

The issue of ‘merchant capital’ is nonetheless of substantive importance. The use which has been made of Marx by Brennerite and other critics of trade-centred explanations of the emergence of capital seems to me unsound.

Marx’s argument in Capital Vol 3, chapter 20 is that merchant capital, by organising exchange between ‘undeveloped’ countries and regions, stimulates handicraft production and later manufacture at both ends of the transaction; as a result, industry emerges in these countries and regions, and merchant capital finally become subordinated to industrial capital. In England Marx dates this subordination to the repeal of the Corn Laws (1846). In the context of this argument there is a great deal of talk about the unproductive character of merchant capital, its connection with cheating, coercion, etc.

At the very beginning of the argument, however, Marx says that “nothing could be more absurd than to regard merchant’s capital ... as a particular form of industrial capital, such as, say, mining, agriculture, cattle-raising, manufacture, transport ...” (emphasis added). These are productive activities. Merchant capital, in contrast, is concerned specially with circulation.

But when we consider “merchant capital” down to the modern era, it is precisely connected with transport, whether by pack-train, wagons or - most importantly - ships. This is true down to the era of the steamship lines, which required more capitalisation than mercantile shipping could supply. And transport is indeed - as Marx indicates, aside, in the quote - a productive activity. It moves material goods from places where they have no use-value to places where they do have use-value, quite irrespective of the exchange-value aspect of the operation. The same is true of warehousing, which ‘moves’ goods in time, from times where they have no use-value to times where they do. The circuit of the shipper-merchant or warehouser-merchant’s capital is not, as Marx suggests in places in the chapter, M-C-M’, but M-C-C’-M’.

The question, then, is what is new about the impact of commerce in the later medieval to early modern period. The answer is at least partly a question of scale. The luxury trade supported by the surplus available to the varied medieval elites of Eurasia, discussed by Abu-Lughod, was small-scale and could be transported and warehoused by family and domestic slave labour. Larger-scale transportation remained a state activity.

In contrast, late medieval and early modern shipping begins to move bulk raw materials to be worked up elsewhere. In doing so, it reshapes the economies both of the raw material producer ‘periphery’ and of the handicraft or manufacturing ‘core’.

What makes this possible is larger ships. And these larger ships are both built by, and sailed by, wage-labourers engaged in cooperative activity under capitalist managers. Capitalism in its modern sense, accompanied by proletarianisation, spreads outwards from the shipping industry.20

The technology is not on its own determinative. China in the 15th century possessed - if anything - a higher shipping technology than western Europe. But in that country the imperial state, based on the scholar gentry, intervened to reduce the impact of shipping on a highly regulated domestic economy and break off contacts with the outside world.21 China as a result remained ‘closed’ until the European-led capitalist world-system had built up enough power to break into it by military force in the Opium Wars (1839-42 and 1856-60). In Europe, several individual states attempted to impose controls on trade for the benefit of social order, but none of them were individually strong enough to maintain them, and in the Netherlands and Britain successively capital obtained political power.

Hence, Pokrovsky’s early critics on the question of ‘merchant capital’ were wrong, and Brennerite insistence that it is only wage-labour in agriculture that triggers the emergence of capitalism is also wrong. What is involved is a complex interplay of the development of the forces of production (population growth, ship technology), the relations of production (the availability of ideas of property, contract and in particular of free labour and the labour contract) and state actions.


WSA’s theoretical incoherence is immediately connected to the problem of the state. Arrighi, as I said, leaves the state as an unexplained ‘territorial logic of power’. Wallerstein attempts to integrate the state in the economy through the question of monopoly and quasi-monopoly. But the process begins with the argument that “a totally free market, were it ever to exist, would make impossible the endless accumulation of capital”, because “in such a perfect market, it would always be possible for the buyers to bargain the sellers down to an absolutely minuscule level of profit.” The provision of quasi-monopolies by state backing is then what enables capitalists to make profits. But this argument rests simply on marginalist/equilibrium assumptions - leave aside the fact that not even the maddest marginalist imagines that “perfect market conditions” can possibly exist.

Not all monopolies or quasi-monopolies depend on state backing. Take intellectual property rights (IPRs) which Wallerstein uses as a prominent example because they are today important in the transfer of social surplus product from the periphery to the core. IPRs can perfectly well exist as the legally unprotected possession of trade secrets, and in the earlier history of capitalism this was their predominant form.22 They continue to exist in this form wherever - for example - ‘core country’ technicians have to be employed in high-tech industrial operations in ‘periphery countries’ because of the skills which they carry in their heads (a possessory form of IPR).

Or - more critically to theory - take money. Money can only be money to the extent that it is scarce. Otherwise, it could not serve as a store of value, and if it could not serve as a store of value, it could not serve as a means of exchange (as we have recently seen in Zimbabwe). Money thus necessarily behaves as a ‘quasi-monopoly’ from the standpoint of ‘perfect market’ assumptions. Now in fact money is ‘public’ and therefore normally state money even when it is gold and silver coins, and doing anything more complex with the money quasi-monopoly does require state intervention in the form of the enforcement of debts.

This, in turn, has important implications for the problem of international inequality. At the end of the day capitalists accumulate and monopolise money. To do so they need a state standing behind them to enforce debts and property rights. The relative strengths and geographical reach (navies, etc) of states affect their ability to do so - and hence the ‘strength’ of the currencies states issue and their roles in international transactions. This, in turn, is probably more decisive to the creation of world hegemon states and the subordination of ‘periphery’ countries than the variable quasi-monopolies in IPRs and forms of productive activity which Wallerstein discusses. But money quasi-monopoly phenomena do not fit at all with Wallerstein’s marginalist theory of monopoly, and by excluding the labour theory of value he has also abandoned the possibility of a theory of money.

I said that ‘underneath’ the practical political problem is theoretical incoherence. But in a sense the issue works the other way round. Precisely because WSA is a theory which sees inequality between nations as more important than class inequality, and was originally intended to lead to a statist and class-collaborationist project (of ‘delinking’) in the ‘peripheral countries’, the theory cannot admit the labour theory of value, because this theory internally implies that class ordering is foundational and inequality between nations secondary to the structure of the economy. But the resulting theory is internally incoherent because it both strives to explain the international material division of labour and the political-economic role of states, and disables itself from doing so.

A better version?

Can we have a form of WSA without identifying inequality between nations as more important than class inequality, and hence abandoning Marxist class analysis and producing incoherent theory? The answer is unequivocally yes. The strengths of WSA I have identified above - rejection of methodological nationalism, consistency with the historical empirical evidence, and insistence on the role of the state in the political economy - are perfectly consistent with Marx’s, or Marxist, core claims. The role of states in the political economy is certainly an unsolved problem of Marxist theory, but it is more likely to be tackled effectively on the basis of Marxist arguments than on the basis of those offered by Wallerstein and others. The weaknesses are products of the WSA authors’ third-worldist, class-collaborationist political projects.

Is Kagarlitsky’s use of WSA such a form? This question is more problematic, and interrelates with the question of Kagarlitsky’s use of Pokrovsky.

On the negative side, the critical issue is Russia’s entry into the emergent capitalist world system as a (peculiar sort of) ‘periphery country’ in the 16th century. As I said earlier, Kagarlitsky follows Pokrovsky in arguing that before this entry, Russian society was more or less analogous to western European feudal society. But, though I said that Pokrovsky’s book was a classic of the ‘scientific history’ of around 1900 and informed by a deep knowledge of the sources, that is not the same thing as saying that it is true; and I drew attention to some contrasts which could be made in relation to both the forces of production and to the relations of production.

In form medieval Russia looked like a feudal society. Pokrovsky analogised the 13th century collapse of Kievan Rus to west European feudal development from the 11th-12th century, and so does Kagarlitsky. But the level of the forces of production - population and communications density - in later medieval Russia looks more like the less developed parts of early medieval Europe.23

WSA authors tend to downplay the significance of the development of the forces of production - too much like ‘classical Marxism’. But when we are asking the question why a particular country was incorporated in the world system as a ‘periphery’ rather than as a ‘core’ country the question is unavoidable. In this respect, it seems to me, Kagarlitsky has not thought his way fully beyond the limitations of WSA.

On the other hand, Kagarlitsky displays a much stronger sense of the internal class dynamics, not only of 20th century Russia, but also of the preceding class forms, than ‘classic’ WSA allows. And, at the end of the day, he deploys the Soviet experience precisely to display the bankruptcy of the ‘delinking’ conception and to propose an internationalist approach. This is an enormous strength and demonstrates precisely how a version of WSA working in a Marxist framework can be of practical political use.


1. B Kagarlitsky Empire of the periphery: Russia and the world system London 2007; first part of this review: ‘Studying the past to grasp the future’ Weekly Worker  April 2.
2. Though Stalin in the end made Pokrovsky into an unperson, Pokrovsky, like the jurist Piotr Stuchka, died too early to be ‘trashed’ before his death or liquidated. Introduction to M Pokrovsky Brief history of Russia Orono 1968. On Stuchka see R Sharlet, PB Maggs, P Beirne (eds) introduction to PI Stuchka: selected writings on law and Marxism New York 1988.
3. JD Clarkson, MRM Griffiths, London 1931.
4. JM Hittle The service city Cambridge, Mass 1979; R Hellie Slavery in Russia 1450-1725 Chicago 1982.
5. I Wallerstein World systems analysis: an introduction Durham NC 2004. On Braudel, Wallerstein refers particularly to The Mediterranean and the Mediterranean world in the age of Philip II (1949) though Capitalism and material life 1400-1800 (1979) is closer to WSA’s theoretical approach.
6. I Wallerstein op cit pp16-19 is a conveniently transparent summary.
7. I Wallerstein op cit chapters 2 and 3.
8. Brenner’s essays are collected in Property and progress: the historical origins and social foundations of self-sustaining growth London 2009.
9. R Brenner The economics of global turbulence London 2005; and The boom and the bubble London 2003.
10. More on this in my July-August 2004 Weekly Worker series on imperialism, available among other articles on the topic at www.cpgb.org.uk/theory/imperialism.htm
11. For more on this see my 2006 article, ‘Law and state as holes in Marxist theory’: Critique Vol 34, pp211, 221-222 and literature cited there.
12. I Wallerstein op cit pp32-38.
13. On this see my Revolutionary strategy  London 2008, pp29-30.
14. I Wallerstein op cit pp25-26.
15. I Wallerstein op cit p24: “The system gives priority to the endless accumulation of capital.” The use of the word ‘capital’ does not evade the problem stated in the text, because without the LTV and Marx’s theory of money, which Wallerstein does not use, slaves, cattle and land are just as much ‘capital’ as money is in capitalism. Marx: “Accumulate, accumulate! That is Moses and the prophets!” (Capital Vol 1, chapter 24, section 3: www.marxists.org/archive/marx/works/1867-c1/ch24.htm).
16. I write ‘sic’ here and later because, though there were female slave-owners, etc, they were relatively rare; and pre-capitalist social orders normally anticipated that elite decision-makers would be male; the same is, if anything, more strongly true of the petty proprietors.
17. Brief history  (see note 1) appendix to Vol 1, has Pokrovsky’s (partially self-critical) responses to these criticisms, as well as his criticism of Trotsky.
18. www.marxists.org/archive/marx/works/1894-c3/ch20.htm
19. I Wallerstein op cit p20.
20. Compare, for a relatively late stage of the process, P Linebaugh, M Rediker The many-headed hydra London 2000.
21. Abu-Lughod (pp343-45) argues that this is attributable to an economic collapse in China due to the effects of severance of the land trade route through central Asia by Tamerlane; she admits, however, on the basis of the earlier literature (itself based on Chinese sources) that the decision to close down was taken by the state and influenced by fear of foreign influences.
22. See ‘A bridge too far’ Weekly Worker December 18 2003; and literature cited there.
23. As I said in the first part of this review, compare Kagarlitsky’s chapter 1 with C Wickham Framing the early middle ages Oxford 2005.