COLD WAR, GLOBALISATION AND THE RISE OF US HEGEMONY:1989 AND AFTER

ON MONDAY, I LOOKED AT THE CAUSES OF THE COLD WAR AND OUTLINED THE MAJOR EVENTS up to 1975. WE LEFT THE STORY WITH BOTH SUPERPOWERS IN TROUBLE. YET, BY 1992, THE COLD WAR HAD BEEN WON AND THE USA HAD EMERGED VICTORIOUS. THE DEMOCRATIC AND CAPITALIST WEST HAD TRIUMPHED OVER THE COMMUNIST EAST.

ALTHOUGH THIS LECTURE IS SUPPOSED TO PICK UP THE STORY WITH THE COLLAPSE OF THE SOVIET EMPIRE, I WILL BRIEFLY EXAMINE THE PERIOD FROM 1975 TO 1989.

I WILL THEN CONSIDER HOW THE UNITED STATES OF AMERICA HAS FARED AS THE ONLY SUPERPOWER AND I WILL LOOK AT THE PHENOMENON OF GLOBALISATION.

1975-91: CARTER, REAGAN AND THE “EVIL EMPIRE”

AFTER NIXON’S FALL, HIS VICE-PRESIDENT, GERALD FORD TOOK OVER. IT WAS SAID OF FORD THAT, AS A COLLEGE FOOTBALLER, HE HAD TAKEN TOO MANY BLOWS TO THE HEAD AND AS A RESULT COULD NOT WALK AND CHEW GUM AT THE SAME TIME. IN 1977, HE WAS REPLACED BY JIMMY CARTER, WHO WAS ELECTED LARGELY BECAUSE HE WAS THE POLAR OPPOSITE OF NIXON – HE WAS PURE AS THE DRIVEN SNOW, PIOUS AND SEEN AS A HEALER – AND HIS OPPONENT WAS FORD. HE JUST COULDN’T LOSE.

BUT CARTER WAS A WEAK PRESIDENT. HE WAS A POLITICAL OUTSIDER AND COULD NOT MANAGE THE ECONOMY OR CONGRESS AND HE FOUND HIMSELF BUFFETED BY EVENTS OVERSEAS. HE INHERITED A BAD ECONOMIC SITUATION AND LEFT OFFICE IN 1981BEQUEATHING A WORSE SITUATION.

THERE WAS ALSO A PERCEPTION THAT AMERICA WAS NO LONGER SEEN AS STRONG ABROAD. CARTER’S ATTEMPTS TO EXTEND NUCLEAR DISARMAMENT WERE DERAILED BY THE SOVIET INVASION OF AFGHANISTAN, IN 1979, AND THE FINAL HUMILIATION CAME WITH THE FAILED MILITARY ATTEMPT TO RESCUE THE AMERICAN HOSTAGES IN IRAN, IN 1980.

BY THE EARLY 1980S, AMERICANS WERE LOOKING FOR SOMEONE WHO COULD RESTORE NATIONAL PRIDE, SOMEONE WHO HAD EASILY UNDERSTOOD SOLUTIONS TO COMPLEX PROBLEMS. RONALD REAGAN FITTED THE BILL PERFECTLY. HE ARGUED THAT AMERICA’S PROBLEMS STEMMED FROM TWO THINGS: OVERBEARING GOVERNMENT AND THE SOVIET UNION.

IN HIS FIRST TERM, HE SET ABOUT REDUCING THE SIZE OF THE FEDERAL GOVERNMENT BY SLASHING WELFARE SPENDING AND CUTTING TAXES, THE CLASSIC CONSERVATIVE POLICIES DESIGNED TO INCENTIVISE ENTREPRENEURS AND THE WEALTHY TO INVEST AND CREATE JOBS – KNOWN AS ‘TRICKLE-DOWN’ ECONOMICS. THE PROBLEM WAS THAT HIS ANTI-COMMUNISM LED HIM TO VASTLY INCREASE GOVERNMENT SPENDING OVERALL. HE EMBARKED ON A MASSIVE NEW MILITARY SPENDING PROGRAMME THE CENTREPIECE OF WHICH WAS THE STRATEGIC DEFENSE INITIATIVE, OR “STAR WARS” PROGRAMME. STAR WARS HAD TWIN AIMS: IT WOULD EITHER RENDER THE SOVIET NUCLEAR THREAT VOID BECAUSE IT WOULD SHOOT DOWN THE MISSILES IN FLIGHT AND SO LEAVE THE USSR DEFENCELESS AGAINST AN AMERICAN FIRST STRIKE; OR IT WOULD BANKRUPT THE SOVIET UNION AS IT TRIED TO DEVELOP ITS OWN SYSTEM. THE RESULT FOR THE USA WAS A BALLONING FEDERAL DEFICIT AND AN ECONOMIC SLUMP.

AND REAGAN’S ANTI-COMMUNISM WAS PLAIN FOR ALL TO SEE IN HIS DESCRIPTION OF THE EAST EUROPEAN COUNTIES AS THE “EVIL EMPIRE” AND HIS BACKING FOR THE MUJAHEDEEN RESISTANCE TO THE SOVIETS, INCLUDING OSAMA BIN LADEN IN AFGHANISTAN.

DURING HIS SECOND TERM, REAGAN SAW THE ECONOMY PICKING UP AND EMBARKED ON REFORMS WHICH LAID THE BASIS FOR THE CURRENT ECONOMIC MESS. ALONG WITH HIS FRIEND, MARGARET THATCHER, REAGAN LIFTED THE REGULATION OF BANKS AND THE MONEY MARKETS. THE RESULT WAS AN EXPLOSION OF DEBT AT GOVERNMENT, CORPORATE AND PERSONAL LEVEL AND A STOCK MARKET CRASH IN 1987, AT THE TIME THE MOST SERIOUS CRASH SINCE THE 1930S.

REAGAN’S REPUTATION AS A COLD WAR WARRIOR REMAINED. IN 1983, WHEN A HARDLINE COMMUNIST GOVERNMENT TOOK POWER IN GRENADA, REAGAN SENT IN THE MARINES TO REMOVE BOTH

THE GOVERNMENT AND THE POSSIBILITY OF A SECOND CUBA IN THE CARIBBEAN. REAGAN DID, HOWEVER, MODERATE HIS VIEW OF THE USSR, ESPECIALLY AFTER THE ARRIVAL ON THE SCENE OF MIKHAEL GORBACHEV. HE DISCUSSED NUCLEAR ARMS REDUCTIONS WITH GORBACHEV AND THE TWO BECAME THE FIRST WORLD LEADERS TO ELIMINATE A WHOLE CLASS OF WEAPONS – INTERMEDIATE MISSILES IN EUROPE. BUT STAR WARS REMAINED NON-NEGOTIABLE AND BIGGER REDUCTIONS ELUDED THEM.

1985-91: GORBACHEV, REFORM AND THE FALL OF COMMUNISM

MEANWHILE, THE SOVIET UNION HAD SEEN A SUCCESSION OF OLD LEADERS – BREZHNEV, CHERNENKO AND THEN ANDROPOV. IN 1985, GORBACHEV HAD TAKEN OVER THE LEADERSHIP OF THE COMMUNIST PARTY AND IN 1988 HE BECAME PREDIDENT OF THE USSR. YOUNG AND CHARISMATIC, HE SET ABOUT TRYING TO REFORM THE SOVIET UNION. HIS POLICIES OF GLASNOST OR OPENNESS AND PERESTROIKA (RESTRUCTURING) WERE A LAST DITCH ATTEMPT TO SAVE THE USSR AND THE COMMUNIST PARTY’S LEADING ROLE. HIS MAJOR OBJECTIVES WERE TO BRING CLOSER TIES TO THE WEST AND TO RELIEVE THE BURDEN OF MILITIARY EXPENDITURE CAUSED BY REAGAN’S POLICIES.

GORBACHEV WITHDREW TROOPS FROM AFGHANISTAN AND REPUDIATED THE ‘BREZHNEV DOCTRINE’ UNDER WHICH THE USSR PROCLAIMED ITS RIGHT TO INTERVENE IN THE INTERNAL AFFAIRS OF ANY COMMUNIST COUNTRY. BY 1989, LARGELY PEACEFUL REVOLUTIONS HAD HAPPENED IN POLAND, CZECHOSLOVAKIA, HUNGARY AND BULGARIA. ON 9 NOVEMBER 1989, THE BERLIN WALL CAME DOWN AND THE TWO GERMANIES WERE REUINTED. THE SOVIET EMPIRE HAD COLLAPSED.

FOR ANOTHER TWO YEARS, GORBACHEV APPEARED TO BE SUCCEEDING IN HOLDING THE USSR TOGETHER. BUT ECONOMIC COLLAPSE AND THE SECESSION OF CONSTITUENT REPUBLICS OF THE USSR LED TO A HARDLINE MILITARY COUP IN AUGUST 1991. GORBACHEV WAS CAPTURED BY THE SOLDIERS BUT POOR PLANNING AND A POPULAR REVOLT DESTROYED NOT ONLY THE PLOTTERS BUT ALSO GORBACHEV’S POWER. ON 25 DECEMBER 1991, THE SOVIET FLAG WAS TAKEN DOWN FROM THE KREMLIN.

THE NEW WORLD ORDER

IN 1992, FRANCIS FUKUYAMA, AN AMERICAN POLITICAL SCIENTIST, REFLECTED THE VIEWS OF MANY WHEN HE ARGUED THAT THE VICTORY OF THE WEST IN THE COLD WAR WOULD LEAD TO THE SPREAD OF LIBERAL DEMOCRACY AND FREE MARKET CAPITALISM AROUND THE WORLD. FUKUYAMA SAID THAT THIS MIGHT BE THE FINAL FORM OF HUMAN GOVERNMENT ON THE PLANET AND MIGHT SIGNAL THE ‘END OF HISTORY’.

FUKUYAMA’S TRIUMPHALISM SEEMED TO BE IN TUNE WITH THE TIMES, ESPECIALLY IN THE USA. PRESIDENT GEORGE BUSH SNR HAD PROCLAIMED A ‘NEW WORLD ORDER’ AS THE CAPITALIST WEST PREPARED TO LEAD EASTERN EUROPE TO THE PROMISED LAND OF DEMOCRACY AND PROSPERITY. THE USA WAS NOW THE SOLE SUPERPOWER, UNCHALLENGED IN THE WORLD AND PERHAPS BETTER PLACED THAN AT ANY TIME TO COMPLETE ITS ‘MANIFEST DESTINY’ TO RE-CREATE THE WORLD IN ITS OWN IMAGE.

IN TERMS OF ITS FOREIGN POLICY, THE NEW WORLD ORDER WAS PROFOUNDLY UNSETTLING FOR US POLICYMAKERS. FOR ALL THE HORRORS OF THE COLD WAR THERE HAD BEEN A KIND OF COMFORT ABOUT WORLD AFFAIRS – WASHINGTON KNEW WHO THE ENEMY WAS AND WHERE THEY WERE. EVEN THE NUCLEAR STANDOFF BROUGHT SOME RE-ASSURANCE AS WASHINGTON KNEW THAT THE RUSSIANS WERE NOT SUICIDAL.

AS ONE FORMER HEAD OF THE CIA PUT IT WHEN DESCRIBING THE POST-COLD WAR SITUATION: “WE LIVE NOW IN A JUNGLE FILLED WITH A BEWILDERING VARIETY OF POISONOUS SNAKES, AND IN MANY WAYS THE DRAGON WAS EASIER TO KEEP TRACK OF.”

BUT, BY HIS OWN ADMISSION, BUSH WAS NOT GOOD AT THE “VISION THING”. BUSH SEEMED UNCERTAIN ABOUT HOW TO TRANSLATE US HEGEMONY INTO REAL LEADERSHIP AND THE EXERCISE OF AMERICAN POWER, MOST NOTABLY WHEN HE FAILED TO REMOVE SADDAM HUSSEIN IN THE FIRST GULF WAR. THIS WAS ALSO A SYMPTOM OF BILL CLINTON’S PRESIDENCY WHEN HE AGONISED OVER WHAT TO DO ABOUT THE CIVIL WAR IN THE BALKANS WHEN YUGOSLAVIA IMPLODED.

IF BUSH WAS UNABLE TO ARTICULATE A COHERENT FOREIGN POLICY WHICH REFLECTED US DOMINANCE, THE CAPITALISTS OF WALL STREET HAD NO SUCH DIFFICULTY WHEN IT CAME TO SECURING THE BENEFITS OF THE DESTRUCTION OF COMMUNISM.

IN THE FORMER SOVIET TERRITORIES, INCLUDING RUSSIA, THE SO-CALLED “CHICAGO BOYS” INTRODUCED NEO-LIBERAL CAPITALISM, WHICH RESULTED IN THE IMPOVERISHMENT OF LARGE NUMBERS OF PEOPLE WHO PREVIOUSLY HAD BEEN PROTECTED BY STRONG SOCIAL WELFARE SYSTEMS, WHICH WERE DESTROYED. FOR MANY, CAPITALISM BROUGHT UNEMPLOYMENT, STARVATION AND WORSENING HEALTH. IN RUSSIA, MALE LIFE EXPECTANCY FELL FROM 65 YEARS IN 1989 TO 58 YEARS IN 1994 – IT HAS NOW CLIMBED BACK TO 63 YEARS IN 2010.

FOR THE FORMER COMMUNIST OFFICIALS, THE ONLY ONES WITH ANY EXPERIENCE OF GOVERNMENT, AND THEIR FRIENDS UNDREAMT OF WEALTH WAS THE OUTCOME. THE RUSSIAN OLIGARCHS, WHO BOUGHT RUSSIA’S NATURAL RESOURCES AT KNOCK-DOWN PRICES, ARE THE OTHER SIDE OF THE STORY OF CAPITALISM IN EASTERN EUROPE. AND THESE WEALTHY FEW HAVE CONSOLIDATED THEIR POWER THROUGH THE BALLOT BOX.

NEVERTHELESS, THE WEST HAD ACHIEVED WHAT IT HAD SOUGHT FOR SO LONG – THE EXTENSION OF CAPITALISM INTO THE EAST OF EUROPE AND ACCESS NOT JUST TO THE REGION’S RAW MATERIALS BUT ALSO TO THE NEW MARKETS FOR ITS GOODS AND SERVICES AND TO ITS CHEAP LABOUR FORCE. THE MODEL OF CAPITALISM INTRODUCED INTO THESE COUNTRIES WAS THE FREE MARKET VARIETY – THE HIGHLY UNREGULATED VARIETY.

AND, OF COURSE, CAPITALISM ALSO FOUND NEW HOMES IN OTHER FORMER COMMUNIST COUNTRIES. IN THE PEOPLES’ REPUBLIC OF CHINA, THE COMMUNIST PARTY EMBARKED ON THE TRANSFORMATION OF THE PEASANT ECONOMY INTO A STATE CAPITALIST COMMAND ECONOMY. STATE CAPITALIST BECAUSE THE STATE DICTATED ECONOMIC DECISIONS, OWNED PROPERTY, SUPPLIED LABOUR AND TOOK MUCH OF THE PROFIT. THE NEW CHINESE ECONOMY BECAME THE WORLD’S FACTORY, PRODUCING CHEAP GOODS AND ASSEMBLING THE PERSONAL COMPUTERS WHICH UNDERPINNED THE DEVELOPED WESTERN ECONOMIES. AS WE SHALL SEE, CHEAP GOODS PRODUCED IN CHINA KEPT WESTERN CONSUMERISM GOING EVEN AS WAGES STAGNATED.

THE WAR ON TERROR

THE ELECTION OF GEORGE W BUSH IN THE HIGHLY DUBIOUS ELECTION OF 2000 BROUGHT TO POWER A DOCTRINALLY BASED ADMINISTRATION WHICH HAD NO DOUBTS ABOUT WHAT AMERICAN POWER COULD ACHIEVE. SOON AFTER HIS ELECTION, BUSH REFUSED TO SIGN UP TO THE KYOTO PROTOCOLS ON CLIMATE CHANGE. HE FURTHER CHALLENGED WORLD OPINION WHEN HE ANNOUNCED THAT HE WOULD ABROGATE THE ANTI-BALLISTIC MISSILE TREATY, WHICH HAD BANNED THE DEVELOPMENT OF MISSILE DEFENCE SYSTEMS AND HAD CONTRIBUTED TO THE PREVENTION OF NUCLEAR DESTRUCTION DURING THE COLD WAR. THESE UNILATERALIST POLICIES MADE THE US THE WORLD’S BAD GUY.

HOWEVER THE DEFINING MOMENT OF HIS ADMINISTRATION, AND THE EXCUSE FOR DECLARING THE 21ST CENTURY VERSION OF THE COLD WAR CAME ON 11 SEPTEMBER 2001 WITH THE AERIAL ATTACKS ON NEW YORK AND WASHINGTON. DESPITE BUSH’S POLICIES, THE REST OF THE WORLD DEMONSTRATED ITS SYMPATHY AND SOLIDARITY WITH AMERICA AND AMERICANS – THIS RESPONSE WAS NEAR-UNIVERSAL AND FOUND PRACTICAL FORM IN THE BACKING BUSH RECEIVED FOR THE OVERTHROW OF THE TALEBAN GOVERNMENT IN AFGHANISTAN AND THE ATTEMPTS TO DESTROY AL QAEDA IN WHAT BUSH TERMED THE WAR ON TERROR.

FOR A WHILE IT SEEMED THAT THE BUSH ADMINISTRATION HAD BEEN CONVERTED TO A GENUINELY INTERNATIONALIST POSITION OF WORKING THROUGH THE UN AND ABIDING BY INTERNATIONAL LAW.

THE REALITY, OF COURSE, IS THAT BUSH USED THE 11 SEPTEMBER ATTACKS TO BUILD DOMESTIC SUPPORT FOR THE EXPANSION, AND USE OF, AMERICAN POWER.

ONE THING THE 11 SEPTEMBER ATTACKS PROVED WAS THAT THE US COULD NOT INSULATE ITSELF FROM THE REST OF THE WORLD. INDEED, IT IS THE US WHICH IS THE DRIVING FORCE BEHIND THE CREATION OF THE VERY GLOBALISED CAPITALIST SYSTEM WHICH IT HAS TO DEFEND – ITS CORPORATIONS, ITS OIL, ITS PEOPLE AND ITS MILITARY BASES ARE SPREAD AROUND THE WORLD. ISOLATIONISM, THEREFORE, IS NOT AN OPTION.

BUT NEITHER WAS BUSH’S POLICY INTERNATIONALIST. IN THE PERIOD AFTER 9/11, HE:

- WITHDREW FROM TREATIES CONTROLLING THE DEVELOPMENT AND PRODUCTION OF CHEMICAL AND BIOLOGICAL WEAPONS (AN INTERESTING POSITION GIVEN HIS JUSTIFICATION OF THE WAR IN IRAQ)

- RENOUNCED THE NUCLEAR TEST BAN TREATY, WHICH FOR THE LAST 40 YEARS HAS FORBIDDEN THE DEVELOPMENT OF NUCLEAR WEAPONS BECAUSE HE WANTED TO BUILD “CLEANER” BOMBS (AGAIN, INTERESTING IN COMPARISON TO HIS LINE ON NORTH KOREA AND IRAN BUT IT HELPS TO EXPLAIN HIS ACCEPTANCE OF ISRAEL’S NUCLEAR ARSENAL) AND

- IGNORED THE GENEVA CONVENTION ON PRISONERS OF WAR

BUSH’S POLICY WAS, OF COURSE, HIGHLY UNILATERALIST. THE US USED ITS POWER AND STATUS TO DO MUCH AS IT PLEASED JUST LIKE THE OLD IMPERIAL POWERS.

BY RENOUNCING ITS FREELY ENTERED INTO INTERNATIONAL OBLIGATIONS, BUSH WAS ASSERTING THE US’S RIGHT TO PURSUE ITS OWN INTERESTS ABOVE THOSE OF OTHERS. MORE DANGEROUSLY, BUSH WAS INTENT ON USING AMERICAN MILITARY POWER TO ENFORCE ADHERENCE TO US POLICIES.

- IN 2002, HE APPROVED A NEW NATIONAL SECURITY POLICY WHICH THREATENED PRE-EMPTIVE CONVENTIONAL AND NUCLEAR ATTACKS AGAINST POTENTIAL (NOT ACTUAL, BUT POTENTIAL) THREATS TO US INTERESTS. THIS ILLEGAL POLICY HAS WAS TRIALLED IN IRAQ AND DISPLAYED A SWAGGERING ARROGANCE, REPRESENTING A THREAT TO THE SYSTEM OF INTERNATIONAL RELATIONS

- HE TRASHED INTERNATIONAL AGREEMENTS AND DECADES-OLD US POLICY BY APPROVING ISRAELI ANNEXATION OF PARTS OF THE WEST BANK. HE DID THIS IN DEFIANCE OF INTERNATIONAL LAW.

AND AMERICAN GEOPLOITICAL AND ECONOMIC INTERESTS WERE DISGUISED BY AN IDEALIST FIG LEAF. BUSH JUSTIFIED THE INVASION OF IRAQ AS ACTION TO REMOVE AN EVIL DICTATOR AND TO BRING DEMOCRACY TO THE IRAQIS, NOT TO SECURE ITS OIL AND REMOVE ONE OF ISRAEL’S IMPLACABLE FOES. JUSTIFYING HIS POLICY IN IRAQ, HE SAID THAT THE OCCUPATION WOULD “CHANGE THE WORLD” AND, IN A PERFECT EXPOSITION OF MANIFEST DESTINY, HE ASSERTED THAT, “FREEDOM IS THE ALMIGHTY’S GIFT TO EVERY MAN AND WOMAN IN THIS WORLD, AND AS THE GREATEST POWER ON THE FACE OF THIS EARTH, WE HAVE AN OBLIGATION TO HELP THE SPREAD OF FREEDOM.”

AS ONE AMERICAN HISTORIAN HAS WRITTEN, “THE ASSUMPTION IS THAT WE ARE THE ANOINTED CUSTODIANS OF THE RULES OF INTERNATIONAL BEHAVIOR AND THAT THE FUNCTION OF UNITED STATES POLICY IS TO MARK OTHER NATIONS UP OR DOWN, ACCORDING TO THEIR OBEDIENCE TO OUR RULES.”

THE WAR ON TERROR HAS BEEN USED TO JUSTIFY A VAST INCREASE IN MILITARY SPENDING. SINCE 2001, MILITARY SPENDING HAS RISEN FROM ABOUT 385$BN TO $698BN IN 2011, WHICH IS ABOUT 42% OF THE WORLD’S TOTAL MILITARY SPENDING AND IS MORE THAN THE NEXT TEN HIGHEST SPENDERS COMBINED.

IT HAS ALSO BEEN USED TO JUSTIFY ADDITIONAL SPENDING ON “HOMELAND SECURITY” AND THE RESTRICTIONS ON PERSONAL FREEDOMS SO CHERISHED BY AMERICANS.

AND THE GREAT ADVANTAGE FOR THE MILITARY AND THOSE WHO SEEK TO PROJECT AMERICAN POWER IS THAT THE WAR ON TERROR IS INFINITELY EXTENDABLE. IT HAS LASTED NEARLY 13 YEARS ALREADY, SINCE 2001, AND HAS FOCUSSED SUCCESSIVELY ON AFGHANISTAN, THEN IRAQ, NORTH KOREA IS A PERPETUAL ROGUE NATION, AND IT NOW HAS TRANSFERRED TO AFRICA. AND SOME AMERICAN POLITICIANS WOULD LOVE TO JOIN ISRAEL IN AN ATTACK ON IRAN.

BUT THE WAR ON TERROR IS NOT WITHOUT ITS COMPLICATIONS. AS WE HAVE SEEN, OSAMA BIN LADEN WAS ONCE AN ALLY OF THE AMERICANS DURING THE SOVIET OCCUPATION OF AFGHANISTAN. BIN LADEN WAS ARMED AND FINANCED BY THE AMERICANS BUT BECAME DISILLUSIONED WITH THE

GEOPOLITICAL REALITY THAT THE USA WAS ONLY PLAYING A COLD WAR GAME IN AFGHANISTAN.

ALL OVER THE ARAB WORLD, THE USA HAS BACKED SUPPORTERS OF THE ARAB SPRING, ESPECIALLY IN COUNTRIES WHERE TRADITIONALLY OPPOSED TO US POLICIES, AND TO ISRAEL – NOTABLY IN LIBYA AND SYRIA. BUT IT HAS FOUND THAT ONE UNFORTUNATE CONSEQUENCE OF THE FLOWERING OF POPULAR DISSENT HAS BEEN THE EMERGENCE OF RADICAL MOSLEM ELEMENTS, WHICH HAVE QUICKLY BEEN ASSOCIATED WITH AL-QAEDA. THE RECENT OPENING OF DRONE BASES IN ETHIOPIA, YEMEN, AND THE SEYCHELLES ARE ALL AIMED AT AL-QAEDA ACTIVITY IN AFRICA AND THE MIDDLE EAST – THE MOST RECENT, IN NIGER, WAS ESTABLISHED IN THE WAKE OF THE ATTACK ON A GAS PLANT IN ALGERIA AND THE CIVIL WAR IN MALI.

WITH THE FINANCIAL CRISIS, PRESIDENT OBAMA IS TRYING TO SCALE BACK THE DEFENSE BUDGET AND LIMIT OVERSEAS ENGAGEMENTS AND THE DRONES ARE PART OF THIS STRATEGY. HE HAS ENDED AMERICA’S FIGHTING ROLE IN IRAQ AND WILL DO THE SAME IN AFGHANISTAN BEFORE HE LEAVES OFFICE. DRONES ARE YET ANOTHER WEAPON WHOSE AIM IS TO ALLOW THE USA TO PROJECT ITS POWER ABROAD BUT TO DO SO CHEAPLY AND WITHOUT RISKING AMERICAN CASUALTIES – THEY ARE USUALLY CONTROLLED FROM BASES IN THE USA. BUT THEY REPRESENT ANOTHER PHASE IN THE SEEMINGLY UNENDING WAR ON TERROR.

THE WAR ON TERROR HAS DOMINATED INTERNATIONAL RELATIONS SINCE 2001. BUT IT WAS NOT THE ONLY CHALLENGE TO US HEGEMONY SINCE THE END OF THE COLD WAR.

PRIME AMONG THEM IS THE THREAT POSED TO US DOMINANCE BY THE RISE OF THE PEOPLES REPUBLIC OF CHINA. SINCE THE 19TH CENTURY, AMERICANS HAVE VIEWED THE PROSPECT OF RE-MAKING CHINA IN THEIR IMAGE AS A KIND OF HOLY GRAIL. IN 1899, THE ANNEXATION OF THE PHILLIPINES WAS AIMED AT ESTABLISHING TRADE ROUTES TO THE FAR WEST. THESE AIMS WERE, OF COURSE, FRUSTRATED BY THE NEED TO PRIORITISE EUROPE AND LATTERLY BY THE COMMUNIST REVOLUTION. THE OBJECTIVE OF AMERICAN POLICY WOULD HAVE BEEN TO DEVELOP CHINA AS A MARKET FOR AMERICAN GOODS BUT TO CONTROL ITS ECONOMIC DEVELOPMENT TO PRESERVE AMERICAN SUPERIORITY.

HOWEVER, THE EMERGENCE OF A STATE CAPITALIST ECONOMY IN CHINA IS NOW A CLEAR, LONG-TERM THREAT TO US HEGEMONY. THERE NOW SEEMS LITTLE DOUBT THAT, SOONER OR LATER, CHINA WILL BECOME THE WORLD’S LARGEST ECONOMY AND, IF IT CONTINUES ON THIS PATH, WILL ALSO DEVELOP INTO A COMPLEX AND WEALTHY ECONOMY ALONG WESTERN LINES, WITH ADVANCED MANUFACTURING CAPACITY AND A LARGE AND STRONG WEALTH-OWNING CLASS. AS ITS ECONOMIC POWER GROWS, THE PRC WILL ALSO DEVELOP AN INCREASINGLY STRONG MILITIARY CAPACITY AND AN ABILITY TO PROJECT ITS STRENGTH FIRST REGIONALLY AND THEN GLOBALLY. ALREADY THE PRC IS LOCKED IN A TERRITORIAL DISPUTE WITH JAPAN, IT HAS ACQUIRED ITS FIRST AIRCRAFT CARRIER AND, OF COURSE, THE PEOPLES’ ARMY IS HUGE.

AMERICAN POLICY TOWARDS CHINA HAS BEEN MOSTLY SCHIZOPHENIC. IT HAS SWUNG BETWEEN THE REALISTS’ DESIRE TO ENGAGE WITH CHINA TO SECURE THE BEST ECONOMIC ADVANTAGE, ESPECIALLY THROUGH TRADE. AND THOSE WHO LAMBAST THE CHINESE HUMAN RIGHTS RECORD AS BEING SO BAD THAT THE USA SHOULD HAVE NOTHING TO DO WITH IT. THE GLOBALISERS HAVE BEEN VICTORIOUS AND AMERICAN CORPORATIONS MOVED MANUFACTURING CAPACITY WEST IN THE SEARCH FOR PROFITS. THE CHINESE HAVE, OF COURSE, BENEFITTED AS THEIR ECONOMY HAS GENERATED WEALTH AND JOBS AND ABOUT 400M PPEOPLE HAVE BEEN LIFTED OUT OF POVERTY AS A RESULT.

THE BIG QUESTIONS ARE:- WILL THE PRC BE ABLE TO DEVELOP A SOPHISTICATED

ECONOMY CAPABLE OF GENERATING ENOUGH WEALTH FOR ITS 1.6BN PEOPLE?

- WILL THE CHINESE COMMUNIST PARTY RETAIN CONTROL OF THE PROCESS AND, IF NOT, WILL CHINESE REMAIN IN CONTROL OF ECONOMIC DEVELOPMENT OR WILL FOREIGNERS? THE CHINESE KNOW WHAT HAPPENED IN RUSSIA!

- WHAT WILL BE THE AMERICAN RESPONSE WHEN THE CHINESE DIRECTLY CHALLENGE THEM FOR GLOBAL DOMINANCE?

ANOTHER HEADACHE FOR THE USA HAS BEEN EUROPE. AFTER THE SECOND WORLD WAR AND DURING THE COLD WAR, THE AMERICANS PROVIDED THE MILTARY AND ECONOMIC SUPPORT THE EUROPEANS NEEDED TO REMAIN FREE OF SOVIET DOMINANCE. GERMANY WAS DIVIDED BETWEEN THE COLD WAR ENEMIES, A SITUATION WHICH SUITED EVERYBODY (EXCEPT THE GERMANS) WHO SAW GERMAN POWER AS A THREAT TO PEACE.

SINCE 1992, AS THE AMERICAN MILITARY PRESENCE HAS DIMINISHED AND THE EU HAS GROWN TO AN ASSOCIATION OF 28 COUNTRIES, EUROPE HAS EMERGED AS AN ECONOMIC COMPETITOR AND THE MILITARY LINKS BETWEEN THE USA AND EUROPE HAVE FRAYED BADLY. NATO, THE AMERICAN-LED ALLIANCE WHICH FOUGHT THE COLD WAR HAS LOST ITS SENSE OF PURPOSE. NO LONGER DOES IT ACT AS A UNIFIED ENTITY, INDEED IT HARDLY ACTS AT ALL. AND EUROPE HAS BEGUN TO DEVELOP ITS OWN SEPARATE MILITARY CAPABILITY IN AN EFFORT TO WEAN ITSELF OFF AMERICA.

EUROPE HAS ALSO BEGUN TO EMERGE AS AN ECONOMIC COMPETITOR TO THE USA. WITH A PROTECTED MARKET OF OVER 500M PEOPLE, THE EU IS FAR LARGER THAN THE USA AND HAS BECOME A POWERFUL ECONOMIC ACTOR IN ITS OWN RIGHT. NEVERTHELESS, THE USA SUPPORTED THE ORIGINAL EUROPEAN COAL AND STEEL COMMUNITY AS A MEANS OF BINDING EUROPE’S FRACTIOUS NATIONS TOGETHER IN A PEACEFUL ALLIANCE AND NOW SEES IT AS A GENERALLY FRIENDLY ALLY. WHEN THE OBAMA ADMINISTRATION RECENTLY URGED THE UK TO STAY IN THE EU IT WAS EXPLICITLY ACKNOWLEDGING, ITS DESIRE TO DEAL WITH A STRONG EUROPE WHICH INCLUDES THE UK, ITS MOST TRUSTED OR, FOR SOME, SUBSERVIENT, ALLY.

IN SUMMARY, THE USA HAS BEEN THE WORLD’S ONLY SUPERPOWER SINCE 1992. YET, IT HAS NOT ALWAYS ACTED AS IF IT WAS COMFORTABLE WITH THAT ROLE. AT TIMES IT HAS APPEARED WEAK AND INDECISIVE AND AT OTHERS WITH ARROGANCE AND WITH DISTAIN FOR INTERNATIONAL LAW.

ON THE OTHER HAND AMERICAN CAPITALISM HAS TAKEN FULL ADVANTAGE OF ITS FREEDOM TO ACT ON A GLOBAL SCALE. ON THE BACK OF ITS EXPANSION INTO THE PREVIOUSL FORBIDDEN TERRITORIES OF EASTERN EUROPE AND ASIA, THE AMERICAN ECONOMY GREW BY 30% BETWEEN 1989 AND 1995.

GLOBALISATION

WE HEAR A LOT ABOUT GLOBALISATION – WE ARE TOLD WE LIVE IN A GLOBALISED WORLD AND FOR THOSE OF US WHO CAN REMEMBER THE 1960S AND 1970S WE CAN CERTAINLY SEE THE DIFFERENCES THAT HAVE OCCURRED. SO WHAT IS “GLOBALISATION”.

WELL, ONE DEFINITION HAS IT THAT GLOBALISATION IS THE PROCESS OF INTERNATIONAL INTEGRATION ARISING FROM THE INTERCHANGE OF WORLD VIEWS, PRODUCTS, IDEAS AND OTHER ASPECTS OF CULTURE WHICH DESCRIBES THE INTERPLAY OF MACRO-SOCIAL FORCES. BUT MODERN GLOBALISATION, WHICH DATES FROM THE 1980S, WAS DESCRIBED BY THE IMF AS HAVING FOUR BASIC ASPECTS: TRADE AND TRANSACTIONS, CAPITAL AND INVESTMENT MOVEMENTS, MIGRATION AND THE DISSEMINATION OF KNOWLEDGE.

WE CAN SEE THAT THE EMERGENCE OF GLOBALISATION IS LINKED CLOSELY TO THE VICTORY OF THE WEST IN THE COLD WAR AND THE EMERGENCE OF THE USA AS THE WORLD HEGEMON. THINK BACK TO FRANCIS FUKUYAMA. I AM GOING TO TAKE A BRIEF LOOK AT THE CONSEQUENCES OF ECONOMIC GLOBALISATION, WHICH FORM ONE-HALF OF THE IMF DEFINITION. AND I WILL CONCENTRATE ON THE IMPACT OF GLOBALISATION, SO CLOSELY LINKED WITH AMERICA, ON ITS ECONOMIC DOMINANCE IN THE WORLD.

WE HAVE ALREADY SEEN HOW, DURING REAGAN’S TERM IN OFFICE, FREE MARKET CAPITALISM HAD COME TO THE FORE. AS I HAVE ALREADY MENTIONED, REAGAN SET THE BANKS AND FINANCE HOUSES FREE OF STATE REGULATION. LIBERALISATION OF THE MARKETS IN USA LED TO CHEAP MONEY, LOW INTEREST RATES AND A HUGE EXPANSION IN CREDIT OF ALL KINDS – MORTGAGES, RE-MORTGAGES AND CREDIT CARD DEBT FUELLED PERSONAL SPENDING AND A PROPERTY BOOM. PEOPLE WERE NO LONGER “CUSTOMERS”, THEY BECAME KNOWN AS “CONSUMERS”. CONSUMPTION WAS KING AND THE THROW AWAY SOCIETY CAME OF AGE. OVER TIME, AS WE KNOW NOW TO OUR COST, THE BANKS AND THE FINANCE INDUSTRY GENERALLY DEVISED EVER MORE ARCANE WAYS OF MAKING MONEY OUT OF CONSUMERS – THE BONUS CULTURE BOOMED AS DID EXECUTIVE SALARIES.

WHEREAS IN 1966 EXECUTIVES IN THE USA EARNED ABOUT 25 TIMES MORE THAN THE AVERAGE WAGE FOR EMPLOYEES, BY 2008 IT WAS OVER 300 TIMES MORE.

AND REAGAN CONSOLIDATED THE POWER OF CAPITAL OVER LABOUR. HIS MINERS STRIKE WAS THE BREAKING OF THE AIR TRAFFIC CONTROLLERS’ STRIKE IN 1981 DECLARING IT A “PERIL TO NATIONAL SAFETY”. THE DEFINING IMAGE WAS OF STRIKING CONTROLLERS BEING LED AWAY IN LEG-IRONS. JUST LIKE IN THE UK, REAGAN’S RHETORIC WAS ABOUT CONFRONTING UNION POWER BUT THE REALITY WAS MORE THAN THAT. IT WAS ABOUT THE STRUGGLE BETWEEN CAPITAL AND LABOUR FOR THEIR SHARE OF WEALTH. IN THE USA THE DEFEAT OF ORGANISED LABOUR LED TO A LONG-TERM STAGNATION IN WAGES AND SALARIES – BETWEEN 1980 AND 2005 MEDIAN INCOME IN THE US ROSE BY ONLY 3% FROM $25,000 TO $25,700 (REMEMBER THIS IS PRE-CRASH) – AND AN OVER-RELIANCE ON CREDIT AND A DEPENDENCE ON CHEAP IMPORTED GOODS TO MAINTAIN LIFESTYLE.

IT WAS THIS MODEL OF CAPITALISM WHICH WAS INTRODUCED INTO THE FORMER COMMUNIST COUNTRIES OF EASTERN EUROPE. WESTERN CAPITALISTS WERE ABLE TO MAKE EVEN BIGGER PROFITS BY EXPLOITING THE VAST NEW MARKETS, BY GAINING ACCESS TO RAW MATERIALS, AND BY TAKING ADVANTAGE OF THE ABSENCE OF A DEVELOPED LEGAL STRUCTURE TO CONTROL ITS ACTIVITIES – ALTHOUGH THIS DID NOT ALWAYS WORK IN ITS FAVOUR. MOST GLARINGLY TO WORKERS IN THE WEST, FACTORIES WERE RELOCATED TO THE EAST TO TAKE ADVANTAGE OF THE CHEAP AND PLIABLE LABOUR. THE CAPITALISTS REAPED HIGHER PROFITS AND WORKERS LOST THEIR JOBS. AS IF THIS WASN’T ENOUGH, IN 1994 THE USA, CANADA AND MEXICO SIGNED THE NORTH AMERICAN FREE TRADE AGREEMENT WHICH LED TO THE EXPORT OF MANUFACTURING JOBS FROM THE USA TO CHEAPER MEXICO. AND WE HAVE ALREADY SEEN HOW MANY US CORPORATIONS RELOCATED TO CHINA. SO, BETWEEN 1977 AND 2012 MANUFACTURING EMPLOYMENT HAS FALLEN FROM 19.5M (22% OF THE NON-FARM PAYROLL) TO JUST UNDER 12M (9% OF NON-FARM PAYROLL).

FROM THE 1980S ONWARDS, AMERICAN CORPORATIONS STARTED DOWNSIZING AND RESTRUCTURING AND BETWEEN 1990 AND 1992 2M JOBS WERE LOST – FOR THE FIRST TIME MANY OF THEM WERE

WHITE COLLAR JOBS. AND OTHERS FOUND THEIR SECURE, SALARIED JOBS TURNED INTO PART-TIME JOBS WITH FEW IF ANY BENEFITS. THE RANKS OF THE UNEMPLOYED WERE SWELLED BY FORMER MILITARY PERSONNEL AS THE ARMED FORCES DOWNSIZED AFTER THE COLD WAR.

AS THE TAX TAKE FELL AND FEDERAL UNEMPLOYMENT BENEFITS SOARED, THE DEFICIT BALLONED AND THE EUPHORIA OF THE COLD WAR VICTORY GAVE WAY TO ANXIETY AND RESENTMENT FOR JOE PUBLIC.

OVER TIME, THESE TRENDS, AND OTHERS, HAVE CONTINUED AND HAVE LED TO A HOLLOWING OUT OF THE US LABOUR MARKET. WHAT WE SEE NOW IN THE USA IS A LABOUR FORCE WITH A RELATIVELY SMALL NUMBER OF HIGHLY PAID EXECUTIVES, PROFESSIONALS AND OTHER WHITE-COLLAR WORKERS, VERY FEW WELL PAID JOBS IN INDUSTRY FOR SKILLED WORKERS AND A MASS OF PART-TIME, UNSKILLED AND POORLY PAID WORK TYPIFIED BY THE MCDONALDS BURGER FLIPPER.

IN 1980, THE RICHEST 1% OF AMERICANS OWNED 8% OF NATIONAL WEALTH; AND BY 2007 THEY OWNED 34.6% OF THE COUNTRY’S WEALTH – AND THE NEXT 19% OWNED 50.5%. SO, IN 2007 THE TOP 20% OF AMERICANS OWNED ABOUT 85% OF THE WEALTH – THE MATHS IS EASY TO WORK OUT WHAT THE BOTTOM 80% OWNED. AFTER THE CRASH, THE WEALTH OWNED BY THE TOP 20% ACTUALLY WENT UP TO 87.7%.

AND, OF COURSE, THE CRASH OF 2007 HAPPENED BECAUSE THE BANKS HAD BEEN FREED OF REGULATORY CONTROL AND HAD BECOME GREEDY. IN THE USA, IN THE SEARCH FOR EVER GREATER PROFITS THEY OFFERED MORTGAGES TO PEOPLE WHO WOULD NEVER IN THE PAST HAVE QUALIFIED – THE SO-CALLED SUB-PRIME CONSUMERS. THE PROPERTY BOOM WAS ABLE TO CONTINUE JUST SO LONG AS THESE SUB-PRIME MORTGAGE HOLDERS COULD PAY. BUT, WHEN THE ECONOMY FALTERED, THE MORTAGE HOLDERS DEFAULTED AND THE REST IS HISTORY. AND THE CONTAGION SPREAD AROUND THE WORLD BECAUSE CAPITALISM WAS NO LONGER DEFINED BY NATIONAL BOUNDARIES, IT HAD BECOME A GLOBAL ENTERPRISE – AND THE DOMINOES FELL AROUND THE WORLD.

NOW, WE MUST REMEMBER THAT CAPITALISM IS A CYCLICAL BEAST. SO, WHETHER IT IS A NATIONAL PHENOMENON OR A GLOBAL ONE, WE CAN PREDICT THAT THE GOOD TIMES – HIGH EMPLOYMENT, GOOD PROFITS, AND RISING PROPERTY PRICES – WILL BE FOLLOWED BY A CORRECTION, A RECESSION, AS THE FROTH IS TAKEN OUT OF THE SYSTEM AND THE HEALTH OF THE ECONOMY IS RESTORED. THEN THE CYCLE BEGINS AGAIN. IN THIS CONTEXT, WHAT WE HAVE SEEN OVER THE LAST FIVE OR SIX YEARS IS, ON ONE LEVEL, TO BE EXPECTED. HOWEVER, GLOBALISATION HAS CHANGED THE NATURE OF CAPITALISM IN THE WEST. ECONOMIES ARE NOW RELIANT ON THE SERVICE SECTOR AND MUCH MORE RELIANT ON THE FINANCE INDUSTRY. GLOBALISED CAPITALISM SAYS THAT IF THE BRITISH ARE GOOD AT FINANCE LET THEM DO THAT AND IF THE CHINESE CAN MANUFACTURE CHEAPLY, THEN LET THEM DO THAT. THE PROBLEM IN THE US, THOUGH, IS THAT THE BEDROCK OF MANUFACTURING HAS ERODED TO SUCH AN EXTENT THAT WHILE THE “BOOMS” ARE BETTER, THE “BUSTS” ARE WORSE AND LESS EASY TO RECOVER FROM. AND, AS WE ALL KNOW, THE LACK OF REGULATION MEANT THAT BANKS WERE INEXTRICABLY LINKED TO EACH OTHER BY DEBT – WHEN LEHMANN BROTHERS COLLAPSED, IN 2008, IT VERY NEARLY BROUGHT DOWN THE WHOLE BANKING SYSTEM.

BEFORE THE EVENTS OF 2007, THERE HAD BEEN INDICATIONS THAT GLOBALISATION OF CAPITALISM MIGHT NOT BE A PANACEA. THE FIRST POST COLD WAR SHOCK TO THE SYSTEM CAME WITH THE ASIAN FINANCIAL CRISIS OF 1997-98 WHEN THE ECONOMIES OF SOUTHEAST ASIA FAILED TO COPE, AMONGST OTHER THINGS, WITH THE DEMANDS OF THE RAPIDLY LIBERALISING CAPITAL MARKET, THE IMPACT OF NEW TECHNOLOGY AND INADEQUATE INSTITUTIONAL STRUCTURES TO ENSURE THE PROPER MANAGEMENT OF THOSE MARKETS. THE CRISIS EXPOSED THE GAP BETWEEN MARKET PERCEPTIONS OF THE STRENGTH OF THE NATIONAL ECONOMIES AND THE REALITY THAT THEY WERE LESS ROBUST THAN ANALYSTS THOUGHT.

THEN, IN 2000-01, WE SAW THE DOTCOM COLLAPSE. MAINLY, BUT NOT EXCLUSIVELY AN INDUSTRIALISED ECONOMY PHENOMENON, IT FOLLOWED A LENGTHY PERIOD OF HYPE SURROUNDING THE POTENTIAL INHERENT IN THE INTERNET AND PERSONAL COMPUTING REVOLUTION. BETWEEN 1995 AND 2000, A SPECULATIVE BUBBLE BUILT AROUND INTERNET-BASED

COMPANIES. WITH EXCESS FUNDS SLOSHING AROUND IN THE WORLD’S FINANCIAL MARKETS, SPECULATORS PILED INTO THESE COMPANIES UNTIL REASON WAS RE-ESTABLISHED AND STOCK VALUES WERE CORRECTED WITH WHOLESALE BANKRUPTCY ENSUING. THE CONSEQUENCE WAS A MILD BUT LENGTHY RECESSION IN THE DEVELOPED WORLD.

AND THE AMERICAN DREAM OF A CAPITALIST, CHRISTIAN AND DEMOCRATIC WORLD LED FROM WASHINGTON HAS BEEN FURTHER CHALLENGED BY THE EMERGENCE OF A NUMBER OF RISING ECONOMIES. I HAVE ALREADY SPOKEN ABOUT THE CHALLENGE FROM THE EU AND CHINA. WELL, CHINA IS ONE OF A GROUP OF DEVELOPING COUNTRIES WHICH HAVE BEGUN TO ASSERT THEMSELVES AND WHICH HAVE BEEN RELATIVELY UNDAMAGED BY THE CURRENT CRISIS. KNOWN AS THE BRICS, BRAZIL, RUSSIA, INDIA, CHINA AND SOMETIMES SOUTH AFRICA HAVE TAKEN ADVANTAGE OF THE GLOBALISATION OF THE WORLD ECONOMY TO BUILD THEIR OWN ECONOMIES. THEY HAVE BEGUN TO ACT TOGETHER, ALONG WITH OTHER DEVELOPING COUNTRIES, TO CHALLENGE US POWER. WHILE ONLY CHINA HAS THE POTENTIAL TO BECOME A WORLD POWER IN THE MEDIUM TERM, THE OTHERS ARE STRONG ENOUGH TO EXERT INFLUENCE. ECONOMICALLY AT LEAST, THE MODERN GLOBAL ECONOMY IS VERY DEFINITELY MULTI-POLAR. IN UKRAINE, WE ARE SEEING RUSSIA BEGINNING TO RE-ASSERT ITSELF 20 YEARS AFTER ITS COLLAPSE.

THE COMBINED IMPACT OF THE CRASH IN THE WEST, THE RISE OF THE BRICS, AND OTHER MAINLY ASIAN ECONOMIES, HAS BEEN A SHIFT OF ECONOMIC POWER SOUTH AND EASTWARDS.

INTERESTINGLY, OTHER CHALLENGES TO THE GLOBALISED WORLD LED BY THE USA HAVE COME FROM OUTSIDE OF CAPITALISM AS THE OVERALL SUSTAINABILITY OF PURELY MARKET-DRIVEN GROWTH HAS BEEN QUESTIONED BY DRAMATIC POPULATION GROWTH AND ENVIRONMENTAL DEGRADATION INVOLVING CLIMATE CHANGE AND RAW MATERIAL CONSUMPTION.

THERE IS NOW NEAR UNIVERSAL AGREEMENT THAT GREENHOUSE GAS EMISSIONS ARE CAUSING GLOBAL WARMING. MORE CONTENTIOUS, OF COURSE, IS THE QUESTION OF HOW TO REDUCE

EMISSIONS IN A WAY THAT IS PERCEIVED TO BE FAIR. OF PRIME CONCERN IS THE FACT THAT HISTORICAL RESPONSIBILITY FOR THE EMISSIONS LIES MAINLY WITH DEVELOPED COUNTRIES, WHICH REMAIN DEPENDENT ON CARBON-BASED FUEL SOURCES, WHILE DEVELOPING COUNTRIES HAVE ONLY ONE REALISTIC OPTION IF THEY ARE TO PURSUE AFFORDABLE DEVELOPMENT STRATEGIES AND THAT IS FOSSIL FUEL-BASED. EFFORTS TO FORGE AN ACCEPTABLE INTERNATIONAL FRAMEWORK THAT REDUCES EMISSIONS IN THE FACE OF COMPETING DEMANDS FROM THE DEVELOPING WORLD HAVE NOT BEEN SUCCESSFUL AND SHORT RUN PROSPECTS ARE NOT GOOD. THE KYOTO PROTOCOLS WERE REJECTED BY THE USA, THE WORLD’S LARGEST POLLUTER, AND DID NOT COVER THE GROWING ECONOMICPOWERS, CHINA AND INDIA. UNTIL OBAMA’S RECENT SECOND TERM INAUGURATION, AMERICA HAD STEADFASTLY REFUSED TO COOPERATE WITH ATTEMPTS TO REDUCE EMISSIONS.

IF THERE ARE ALREADY CONCERNS ABOUT THE SUSTAINABILITY OF THE WORLD ECONOMY WITH A GLOBAL POPULATION OF 6.2 BILLION, THEN LONGER TERM THE FUTURE LOOKS BLEAKER STILL. UK GOVERNMENT PROJECTIONS ENVISAGE A GLOBAL POPULATION OF 9.5 BILLION BY 2050. EVEN AT CURRENT LEVELS OF ECONOMIC ACTIVITY, AND BEARING IN MIND DISPARITIES BETWEEN THE DEVELOPED WORLD AND THE DEVELOPING WORLD, THIS PROSPECT HAS ENORMOUS IMPLICATIONS FOR POLICYMAKERS. IF WE HAVE DIFFICULTY IN ARRIVING ATINTERNATIONAL AGREEMENTS TO CONTROL THE WASTE WE PRODUCE NOW, HOW DIFFICULT WILL THIS ISSUE BE IN THE NEAR FUTURE? HOW WILL WE ACCOMMODATE 50% PERCENT MORE CONSUMERS WITHOUT REDUCING PER CAPITA CONSUMPTION OR INCREASING PRODUCTION DRAMATICALLY?

THE PROBLEM BECOMES EVEN MORE COMPLEX IF THE DEVELOPING WORLD SUCCEEDS IN CREATING WEALTHIER SOCIETIES THROUGH GREATER INTEGRATION INTO THE WORLD ECONOMY. EVEN IF THE 2.5 BILLION PEOPLE OF CHINA ANDINDIA DO NOT ATTAIN LEVELS OF WEALTH AND CONSUMPTION SEEN IN THE DEVELOPED WORLD, ANY SIGNIFICANT ECONOMIC DEVELOPMENT WILL MEAN INCREASED PRESSURE ON RESOURCES – SOMETHING WE ARE ALREADY SEEING AS OIL, FOOD AND COMMODITY PRICES SOAR. OVER TIME SIMILAR EFFECTS WILL BE SEEN IN RELATION TO OTHER PRIMARY PRODUCTS, ESPECIALLY PRECIOUS METALS. PRESSURE ON RESOURCES AND POPULATION

GROWTH POSE CHALLENGES FOR THE CONTINUED INTEGRATION OF THE GLOBAL ECONOMY GENERALLY, AND ARE ALREADY, IN COMBINATION WITH THE ECONOMIC CRISIS LEADING SOME TO QUESTION WHETHER WE HAVE ALREADY SEEN THE HIGHPOINT OF GLOBALISATION.

CONCLUSION

THE COLD WAR WAS FOUGHT OVER FORTY YEARS BETWEEN THE US-LED CAPITALIST POWERS AND THE SOVIET UNION AND ITS SURROGATES. WE HAVE SEEN THAT THERE WERE DIFFERENT VIEWS ABOUT WHY THE COLD WAR BROKE OUT, WHETHER AS A RESULT OF SOVIET AGGRESSION, A MIXTURE OF EXPANSIONIST INTENT BY BOTH CAMPS, OR AS A RESULT OF A MISUNDERSTANDING ABOUT THE SECURITY NEEDS OF THE SECOND WORLD WAR ALLIES.

A SIMILAR DEBATE HAS TAKEN PLACE ABOUT THE END OF THE COLD WAR. MANY ARGUE THAT KENNAN WAS RIGHT THAT CONTAINMENT OF SOVIET EXPANSIONISM WOULD ULTIMATELY LEAD TO THE IMPLOSION OF THE SOVIET EMPIRE. MANY OTHERS SUGGEST THAT WHILE THE SOVIETS WERE NEVER ABLE TO BREAK OUT OF THEIR 1945 ZONE OF INFLUENCE IT WAS AMERICAN ECONOMIC PRESSURE – THROUGH THE CONSTANT ARMS RACE AND THE CONSEQUENT SOVIET FAILURE TO DELIVER CONSUMER GOODS TO ITS POPULATIONS THAT SOUNDED ITS DEATH KNELL.AND YET MORE SAY THAT COMMUNISM WAS SIMPLY AN INFERIOR ECONOMIC MODEL AND THAT THE SOVIET EMPIRE ONLY LASTED AS LONG AS IT DID BECAUSE IT WAS A DICTATORSHIP.

US HEGEMONY HAS BEEN THE RESULT. IT IS THE WORLD’S LARGEST ECONOMY, IT HAS BY FAR THE GREATEST MILITARY POWER OF ANY NATION, AND ITS CULTURE IS UBIQUITOUS AS FAST FOOD RESTAURANTS BLOSSOM AND AS HOLLYWOOD PUMPS OUT FILMS WHICH REFLECT AMERICAN VALUES AND AN AMERICAN WORLD VIEW.

IN FOREIGN POLICY AND MILITARY TERMS WE HAVE SEEN THE USA ACT BOTH AS THE RELUCTANT SHERRIFF AND THE OUT AND OUT HEGEMON. BUT EVEN AS 9/11 SHOWED THAT US ISOLATION WAS TRULY AN OUTDATED CONCEPT WE HAVE WITNESSED AMERICANS LOOKING WHISTFULLY BACK AT A PAST WHEN

ISOLATIONISM WAS POSSIBLE, ONE REASON FOR THE RISE OF THE TEA PARTY, FOR EXAMPLE. THE WAR ON TERROR HAS PROVIDED A MODERN VERSION OF THE COLD WAR INVOLVING A RELATIVELY WEAK ENEMY WHICH, WHILE IT DOES NOT THREATEN IMMINENT ANNIHILATION AS THE COLD WAR DID, HAS BECOME THE NEW MOTOR BEHIND THE STRENGTH OF THE MILITARY/INDUSTRIAL COMPLEX WHICH EISENHOWER WARNED AGAINST WHEN HE LEFT THE PRESIDENCY, IN 1961.

BUT IF THE EXTERNAL RECORD IS PATCHY, THE RECORD OF GLOBALISED CAPITAL IS EVEN MORE DIFFICULT TO ASSESS, AND LARGELY DEPENDS ON WHO YOU ARE AND WHERE YOU ARE.

FOR THE BIG CORPORATIONS, THEIR EXECUTIVES, THE POLITICAL CLASSES, AND THE ALREADY WEALTHY, GLOBALISED CAPITALISM HAS BEEN AN UNMITIGATED SUCCESS. ORGANISED LABOUR HAS BEEN CRUSHED AND COMMUNISM HAS BEEN VANQUISHED. CAPITALISM HAS CONQUERED ALL – EVEN THOUGH THE CHINESE COMMUNIST PARTY HAS EMBRACED CAPITALISM AND BROUGHT 400M PEOPLE OUT OF POVERTY IT HAS CREATED THE MODERN EQUIVALENT OF THE URBAN SQUALOR OF THE INDUSTRIAL REVOLUTION. IN THE FORMER SOVIET STATES, THE OLD COMMUNISTS HAVE EMERGED AS A WEALTHY ELITE WITH THE PEOPLE BY AND LARGE REMAINING POOR AND LESS HEALTHY.

IN THE US, GLOBALISED CAPITAL HAS HOLLOWED OUT THE LABOUR FORCE AND PROVIDED FERTILE GROUND FOR THE RIGHT-WING TEA PARTY AND FOX TELEVISION TO RECRUIT IN. TRUE TO ITS RULES, CAPITALISM HAS SOUGHT OUT THE CHEAPEST AND WEAKEST LABOUR FORCES TO EXPLOIT IN ORDER TO PRODUCE PROFITS. AND THE MOST FAVOURABLE TAX REGIMES IN WHICH TO LOCATE THOSE PROFITS.

BUT AS WE KNOW, ALL IS NOT WELL. IT IS NOW PLAIN FOR ALL TO SEE THAT UNREGULATED CAPITALISM IS NOT ONLY ITS OWN WORST ENEMY BUT THE ENEMY OF THE MAJORITY – THE SO-CALLED 99%. WHAT WE DO NOT KNOW YET IS WHETHER GLOBAL CAPITAL WILL WEATHER THIS STORM OR WHETHER IT WILL BE TAMED.