Behind the military superiority of the US empire lie major weaknesses. Walden Bello and John Rees discuss the problems facing America's rulers.
Walden Bello: US imperialism today, despite its seeming power, is in crisis. This crisis has several different dimensions. There is a crisis at the economic level (the state of global capitalism), the military-political level and the ideological level. It is the way that the crisis of overproduction at the economic level, the crisis of overextension at the military-political level and the crisis of legitimacy at the ideological level relate to one another that constitutes the uniqueness of this period.
The crisis of global capitalism
This crisis has been variously termed by Robert Brenner and others as overcapacity, overaccumulation - a crisis of profitability. What basically this crisis relates to is the growing gap between the tremendous capacity of global capitalism to be able to produce and its limited global capacity to consume the commodities it produces. If we look at the post-war period between the late 1940s and the mid-1970s this was a period of tremendous growth, particularly in the central capitalist powers led by the US where there were 6 to 10 percent growth rates. This growth then began to stagger and became unstable from the late 1970s, and we saw a significant lowering in the average growth rates of the central capitalist economies. There was especially a crisis in industry. By the late 1990s profits in US industry, which were already quite low, had come to a halt.
In response to this crisis at the level of production, US and European capital began to derive more and more of its profits from finance - from speculation. This was essentially squeezing 'value' out of already created value. From the beginning of the 1980s this crisis of profitability in industry and the migration of capital to the financial sector was marked by tremendous efforts to eliminate capital controls among the various capitalist powers. As late as the mid-1970s to late 1970s, there were very strict capital controls that divided the different capitalist powers. But with the Thatcher-Reagan revolution the drive to eliminate the barriers to the flow of speculative capital among the central capitalist countries became overwhelming.
Another area whereby capitalism tried to counteract the decline in profitability at the level of industry was a major effort to more effectively subjugate Third World economies to global capitalism. Of course this is not a new insight. Rosa Luxemburg had always stressed how the so called underdeveloped world was very central to the maintenance of the profitability of the central capitalist economies. There was this overwhelming thrust to consistently bring more and more areas of the Third World into effectively being penetrated, thoroughly and comprehensively, by global capital.
Therefore there was a tremendous flow of investment towards the Third World beginning in the 1980s - initially to the so called east Asian newly industrialising countries, then to the South East Asian newly industrialising countries and, of course, in the last decade the tremendous flow of capital into China ($53 billion of investment flowed into China in 2003 alone).
This drive for more effective capital penetration of developing countries has taken two main forms: firstly, the more effective subjugation of these countries through structural adjustment and neo-liberal policies; secondly, the elimination of capital controls that were preventing effective flow, particularly of speculative capital, into these economies.
This has of course been a very unstable process. Globally, especially over the last decade, we have seen - aside from lowered growth rates in the central capitalist economies - a succession of financial crises, longer and longer periods of stagnation in the boom and bust cycle and US economic processes marked by tremendous and insolvable trade deficits and debt crisis, making the US the main debtor in the global economy.
The different capitalist powers have moved from a period of relative cooperation during the post-war period to greater and greater competition in the last 15 years. The state and exchange rates have increasingly been used to generate growth in one capitalist power at the expense of others. The US, for instance, has done so at the expense of Europe and Japan. Some people say that this could also coincide with what they call the end of the long wave of capitalist growth that began in the late 1940s. If we buy this theory, the idea is that since the mid-1980s we have had a period of descent as the technologies that marked this period were fully exploited, and the system has come overall into a period of descent.
The crisis of overextension
The US elite has always been aware of this gap between the goals of the US empire and the resources available to be able to attain those goals. Overextension refers to the gap between goals and resources. Since the early postwar period debate about how the US should manage its global military and political power has been ongoing. After the war there was the conflict between people like George Kennan - the former chief foreign policy studies officer of the State Department - who said that the US should choose very selectively those areas in the world that it considers very vital to its interests, and focus on 'defending those areas'. There was a conflict between this approach and the type of thinking embedded in National Security Council Memorandum 68. This saw US power as infinite in terms of resources, and therefore able to expand and extend its power to many points throughout the world without having to worry about the gap between resources and goals.
This overextension, and the way that the NSC68 people dominated that debate in the 1950s and 1960s, led to the battle in Vietnam in the 1960s and early 1970s. In the 1990s we again saw this debate arising between people like Clinton and Madeleine Albright, who saw very many uses for US power including the intervention in Kosovo, and people like Colin Powell, who was very worried about the ways to extend US power. This resulted in the articulation of the so called 'Powell doctrine', which was really a rehash of the 'Weinberger doctrine' during the Reagan era. In the light of the bombing of the US Marine base in Lebanon, Weinberger, the defence secretary, argued that Lebanon threatened to suck the US into an unwinnable war. It was therefore better to cut and run, and this is what Reagan did.
In any event, the 'Powell doctrine' said that if we have to intervene, we have to do so with massive force from the very beginning or not intervene at all, because we risk getting caught up in a Vietnam-type situation. This debate, and the reality of overextension, has of course become very evident during the Bush period. We've had the Project for the New American Century. This was thought up by the neoconservatives who saw no bounds to US power and pooh-poohed any sort of concerns about overextension. This was the doctrine that guided the US intervention in Iraq. The proponents of this doctrine were so confident in US ability to control things militarily that they thought that 135,000 troops would be able to do the job.
Two years later it is clear that the US is overextended in Iraq. Some US military analysts have said that the only way to stabilise Iraq is with at least 500,000 US troops - some say a million are needed. But there is no way that that level of ground troop intervention will be reached without provoking tremendous civil strife in US society.
At the same time as the US is internally overextended in Iraq and the insurgency is winning, we have a situation whereby the focus on Iraq has basically led to a number of major setbacks for US policy: whether it is in Latin America, where the revolt against neo-liberalism and US power is definitely on the rise; in Europe, where clearly the Atlantic alliance has died with increasing competition, both economic and political; in Afghanistan, where the US is pinned down; or in a number of other areas in the world where, clearly, to talk about the interventionary capability of the US, one has to talk about ground troops' capability, and that is the weak point of the US at the moment.
The crisis of legitimacy
The US has of course always been a unilateral power. But it has also combined at times a multilateralist cloak to this unilateral power. The US has worked its will through agencies like the World Bank and the IMF. Now, the only way the US can work through these institutions, having them appear independent although pushing US interests, is if it is willing to make concessions at some point. Clearly during the Bush period the US has used the WTO, the IMF and the World Bank directly as extensions of its power to the detriment of its own relations with even the other capitalist powers, like the EU and Japan. The latest brazen subjugation of these institutions directly to US power has been the appointment of Paul Wolfowitz as head of the World Bank.
The other thing is that bourgeois democracy, especially in the 1980s and 1990s, has been the mechanism by which the US has tried to re-establish ideological hegemony among the Third World countries. Throughout the developing world we have had the emergence of bourgeois democratic governments, reaching a peak in the 1990s. This has, however, been shortlived, mainly because the US has taken the leadership in using the bourgeois democracies to establish neo-liberal policies. It could not do this through the authoritarian dictatorships which had lost their legitimacy, and so it did this through regimes like that of Corazon C Aquino in the Philippines, Benazir Bhutto in Pakistan and Alberto Fujimori in Peru. The economic project of neo-liberalism itself thereby became the main subverter of these bourgeois democratic systems that Clinton was trying very hard to push in the Third World.
So today, whether you look at Pakistan, Latin America or the Philippines, all these sorts of US-sponsored bourgeois democracies from which it has drawn a lot of its legitimacy in the Third World are in tremendous crisis. In the case I am most familiar with, the Philippines, the liberal democratic state is on its last legs.
But the crisis of bourgeois democracy is not just in the Third World. We have seen a growing crisis in the west, very acutely in the US, where democracy as really being corporate democracy is very clear to large sections of the population. And the other face of US democracy - liberalism - has been assaulted by tremendous attacks on civil liberties like the Patriot Act. And so I think we can say that liberal democracy in the US itself is in a crisis at this point in time.
It is the coming together of these three levels of crisis which constitutes the uniqueness of the situation of the US in the world today, and we see a process of unravelling of US power. However, this unravelling is not going to come very quickly - it is a stop and go process, it will take some time, but clearly it is there, it is occurring. The question for the US elite therefore is how to stabilise this situation. We must never of course underestimate the capacity of the US elite to be able to stabilise the situation. But I am increasingly of the belief that the US will not be able to stabilise it without turning into a more authoritarian state.
Here is why our project in opposition to this crisis of empire is extremely important today, and it is important to be able to articulate it. Whether we call our project socialism, or economic or popular democracy, I think the essence of this project is re-embedding the market and economic interests back into society, to the control of our values and the control of the people. This is the project that we must really articulate and popularise, because if we do not meet the challenge of the crisis of the empire, then something worse can take the place of the current system.
John Rees: To understand the drive to war in the capitalist system we have to analyse something that has been absolutely fundamental about capitalism since its inception. This is a contrast between the economic structure of the system and its state structure. The economic structure of capitalism is above all about competition. Competition is by definition an unbounded and international process. The competition between different units of capital - for markets, for sources of cheap raw material, for labour - is something which happens on a global scale. It may now happen more intensively than it has done in the past, but capitalism was from its inception a global system. As a system of competition, capitalism necessarily pushes beyond all and any particular geographical boundaries.
When we look at the states in the system - the nation-states that have come to rigidly define the way in which modern societies are organised - they are by definition the very opposite. They are, in the old sociological definition, 'those bodies which exercise a monopoly of physical force in a given geographical area'. They are, in contrast to the economic system, by definition geographically bounded entities. So the state system as it's developed in the history of capitalism, and the international mechanism of competition and production as it's developed in the history of capitalism, stand to an important degree as opposed entities.
The unbounded and international nature of economic competition always pushes the states beyond their existing boundaries. And therefore the conflict between states is something which is written into the economic DNA of the capitalist system.
Now this contrast is, in a way, true of capitalism at all times and in all places. In analysing the system, however, the knack is to describe how it exists at a particular time, in a particular era, and in specific places. This basic abstraction that I've described was there in the struggle between the East India Company of the Dutch republic and the East India Company of the British state, in the scramble for Africa, in the competition which resulted in the 20th century in two world wars. But it's obvious that in each of these cases the configuration was very different. And therefore the business of properly analysing the world in which we live is to make this work specifically.
So what has changed in our world, and what is specific about the form of state rivalry in our time? The most immediately important contrast is between the way in which the state system was organised for the entire period after the Second World War up until 1989, and what has happened since. The bipolar world which emerged at the end of the Second World War between the Western allies and the Soviet bloc defined the competition even in those areas which weren't immediately reducible to this conflict. For the entirety of that period, a particular form of military competition and a particular ideological justification for that bipolar structure of the world existed on a global scale. But in 1989 that all changed, and it changed dramatically and in ways that are still being worked through the global system.
It is perhaps still too early to tell the full consequences of the collapse of the Soviet Union and the disappearance of the Soviet Empire in eastern Europe. It opened up for the first time in the post-war period a huge area of the globe that was previously closed to western states, their military and strategic planners, their diplomats and corporations. If we want to understand the single most important thing about the shape of our world today, it is that since 1989 there has been something like a new scramble for Africa conducted over the area which the Pentagon planners describe as the Eurasian land mass. This is everything from western Europe, through the former Soviet central Asian republics, up to the borders of China, and including the Middle East. Or, to define this area by the wars of the recent period, everything from the Balkans, through Iraq and the Middle East, to Afghanistan.
That process of rushing into that vacuum, of western corporations, of US and Nato alliances, of military bases, is perhaps the single most important hub around which this Project for the New American Century turns. Because in that area and on its borders are not simply the most important natural resources in this world - the oil resources of the Middle East. There is also the strategic business of holding together in that area an extended Nato alliance - from western Europe, into the former east European states, into the Baltic states and the bases that are now proliferating across central Asia. And there is, geographically, the hub of competition with both the rising power of China and the old adversary, the remains of the Russian empire.
On the level of military capability, the US is overwhelmingly dominant. The end of the Cold War eradicated its major military challenger. And it left the US in a situation militarily where despite there being for some period a decline in the percentage of its economic wealth being spent on armaments, it became overwhelmingly superior to its rivals. This was particularly so in comparison to those 'rogue states', as the US strategic planners described them.
So the US is militarily a dominant force, but economically it's a different story. At the end of the Second World War the US accounted for half of all manufacturing in the world. The US economy during the war was the only major economy in which both armaments production and the civilian economy grew at the same time. At one point in the war the US shipping industry was launching ships faster than the German navy could sink them. At the end of the war the US economy was so dominant that Marshall aid could be used to reconstruct economically - and tied to that economic aid, then as now, politically - the economies of the rest of the industrialised world.
Today there is a very different situation. Of course the US economy is still a huge economy. But the share of the US economy now is not 50 percent of global manufacturing but 22 percent, and falling. It is now an economy which is sustained by an enormous bubble of debt, sustained in truth by other economies in the world. When the Bush administration talks about not being interested in nation building, it's not because it wouldn't want to, but because it can't. When it talks about leaving a 'light footprint' in Afghanistan, it's because the possibility of economically reconstructing a tiny, broken economy is not something which is in the minds of the dominant elite.
And so here there is a real weakness, because the question is not, 'Why does the US keep winning the wars it fights?' Because its military superiority makes the answer obvious. The real question is, 'Why does it have to keep fighting them?' It has to keep fighting them because its overwhelming strength is a military strength, and it can get this way what it cannot get by simply relying on its economic power.
The slowing of growth rates has an enormously important domestic consequence too. Put simply, it now takes two wages in the US to sustain the same standard of living that was sustained by one wage at the end of the 1960s. And this 20 year long process of stagnation and slump, which spawned a 20-year offensive on trade unions, on real wages and on the welfare state, is at the root of something very important politically. It is at the root of the disaffection between the mass of the people and their governments. It is at the root of the crisis of legitimacy in the parliamentary democracies. It is the inability to deliver economically which breeds the disaffection at home and abroad. And it is ultimately on this economic substratum that the international unity of the anti-war, anti-globalisation and anti-capitalist movements rests. It is the economic basis, the common social experience, from which is born international solidarity.