Shifts and Faultlines in the World Economy and Great Power Rivalry by Raymond Lotta

[redwinter]

Shifts and Faultlines in the World Economy
and Great Power Rivalry:
What Is Happening and What It Might Mean

Part 1


by Raymond Lotta

http://www.revcom.us/a/136/lotta_faultlines_pt1-en.html

The first of a series identifying and analyzing major changes in global economic, political, and strategic relations in the world. From the introduction:

What follows is a highly concentrated, though still developing, synthesis of some important trends in the world economy and inter-imperialist relations—and some of the manifestations of this in the structure, functioning, and posture of U.S. imperialism. Some illustrative, benchmark data are woven in.

This is a research essay about changes in global capitalist accumulation, newly emerging relations of strength among imperialist and regional powers, and the force of competitive pressures and tensions. It is about great-power rivalries in a world system based on exploitation. To use an analogy to the complex motions of large parts of the Earth’s crust and upper mantle, this is a discussion of shifting tectonic plates in the world economy: some of their longer-term movements and some of the more sudden and unexpected eruptions.

The analysis builds on the article “Financial Meltdown and the Madness of Imperialism”1 (http://www.revcom.us/a/136/lotta_faultlines_pt1-en.html#footnote1)and is an application, focused on issues of world economics, of Bob Avakian’s conceptualization of this period as one of “transition with potential for great upheaval.”
Continue reading... (http://www.revcom.us/a/136/lotta_faultlines_pt1-en.html)




I'd be interested in reading what people think of the article. There are a few questions that Revolution is putting out there for people to engage with around the issues raised in this piece, including:
The article speaks of a “new economic geography of the planet.” What are some key manifestations of this, especially in the relations among the great powers?
The article says that “globalization is having contradictory effects” in the Third World. How so?
How, underneath all this, is the nature and logic of the capitalist system being expressed? Discuss this from the article: “[T]he compulsion to expand and maximize profit to gain competitive edge; the blind, anarchic growth and the short-term horizons of capitalism; and the inherent tension of a system in which production is highly socialized and globally interconnected, involving the interlinked and collective efforts of thousands and millions of wage-laborers, while the means of producing wealth, the wealth that is socially produced, and even knowledge itself are privately controlled and deployed by a small capitalist class.”

[bretty]

The second question is an interesting one, although my input is not directly from the reading but from other sources. Look at Zimbabwe, Vietnam, etc. for example, After the Structural adjustment programs (look them up on wiki) were implemented they were based on comparative advantage and the privatization of state owned industries. Essentially what ended up happening is inflation of commodities led people to be able to afford less because the SAP's devalued the currency to present an ideal investment market for foreign investors. People, especially those in rural situations, ended up losing things like state owned health care which although maybe not the best health care in the world was at least free.

[BobKKKindle$]

The article says that “globalization is having contradictory effects” in the Third World. How so?There are parallels between the concept of "contradictory effects" and Trotsky's concept of combined and uneven development. The outsourcing of components manufacture and product assembly to the developing world, a process aided by falling transport costs and the elimination of barriers to the movement of capital, has created centers of industrial development, where the proletariat is concentrated in large units of production. This process has occurred alongside the intensification of rural poverty, as the terms of trade for agricultural products and other primary goods have worsened, and the markets of developing countries are flooded with imports agricultural goods sold below the cost of production, due to overproduction in the developed world. These processes have contributed to an increase in income inequality, not just on a global scale, between countries, but also within individual countries which are part of the developing world.

The effects of globalisation are also contradictory in the contrast between the economic changes which are taking place, and the ideological impacts of those changes. Despite the trend towards greater economic integration between states and the resulting decline of the individual nation-state as a useful unit of economic analysis, the developing world has witnessed the growth of nationalist and religious movements (most notably in the form of islamism) which seek to protect cultural values and traditions against the cultural impacts of globalisation and the displacement of accepted social structures due to rapid economic change. How to approach these movements is an issue which socialists will need to deal with if these movements continue to gain mass support.

[redwinter]

On one level, Bobkindles, I think there definitely is a tendency towards "greater economic integration" - but as the article indicates, this is integrating the oppressed countries into the imperialist accumulation process and on a firm basis of exploitation(somewhere, could've been Lotta's America in Decline, I recall reading about the development of railroads in El Salvador by US imperialist finance-capital and how they didn't even link the main population centers of the area in question - but laid tracks straight from the mines to the seaports for export!)

At the same time there is still a certain qualitative degree of development of the productive forces in the Third World, because after all capital itself is what's being exported there...going back to Lenin's point (made polemically in opposition to the big shot Kautsky's crude mischaracterizations) about how it's not simply resource extraction but going over to mainly the exploitation of labor in the oppressed countries that is the key difference that marked the shift to global imperialist monopoly capitalism. However it's important to remember that this isn't the principal aspect of this dialectic - as Trotsky might have argued - and it simply isn't the case that eventually there's going to be a "ripening" of the productive forces in the Third World at a certain point in the future when they'll be "ready" for proletarian revolution. The rise of the bourgeoisie is stunted and distorted in the colonized sections of the world precisely due to the distortion of the accumulation process in favor of the foreign imperialists, leading to the split within the bourgeoisie of the oppressed nations that Mao referred to, between "compradors" (sell outs, those straight up tied to and aligned with the foreign imperialists) and the "national bourgeoisie" (which was seen as a potentially progressive force if under communist leadership, fighting for new-democratic revolution in a colonial or semi-colonial country).

The trend towards two opposing poles of "Jihad vs. McWorld/McCrusade" has been profoundly analyzed by Bob Avakian. From his recent book Away with All Gods: Unchaining the Mind and Radically Changing the World:



Throughout the Third World people are being driven in the millions each year away from the farmlands, where they have lived and tried to eke out an existence under very oppressive conditions but now can no longer do even that: they are being thrown into the urban areas, most often into the sprawling shantytowns, ring after ring of slums, that surround the core of the cities. For the first time in history, it is now the case that half of the world’s population lives in urban areas, including these massive and ever-growing shantytowns.

Being uprooted from their traditional conditions—and the traditional forms in which they have been exploited and oppressed—they are being hurled into a very insecure and unstable existence, unable to be integrated, in any kind of “articulated way,” into the economic and social fabric and functioning of society. In many of these Third World countries, a majority of the people in the urban areas work in the informal economy—for example, as small-scale peddlers or traders, of various kinds, or in underground and illegal activity. To a significant degree because of this, many people are turning to religious fundamentalism to try to give them an anchor, in the midst of all this dislocation and upheaval.

An additional factor in all this is that, in the Third World, these massive and rapid changes and dislocations are occurring in the context of domination and exploitation by foreign imperialists—and this is associated with “local” ruling classes which are economically and politically dependent on and subordinate to imperialism, and are broadly seen as the corrupt agents of an alien power, who also promote the “decadent culture of the West.” This, in the short run, can strengthen the hand of fundamentalist religious forces and leaders who frame opposition to the “corruption” and “Western decadence” of the local ruling classes, and the imperialists to which they are beholden, in terms of returning to, and enforcing with a vengeance, traditional relations, customs, ideas and values which themselves are rooted in the past and embody extreme forms of exploitation and oppression.
(Source: http://rwor.org/a/104/avakian-religion-en.html)


The topic is further explored by Avakian in the rest of the article linked at the end of the quote, but it's definitely worth discussing more...two religions focused on mainly are Islam and Christianity, but it's worth noting the growth in fundamentalist Judaism (Zionism) and fundamentalist Hinduism (with a major Hindu party often unleashing pogroms against the Muslim minority in India) and how these intersect with the shifting tectonics of what's going on in the world right now in a political and economic sense.

By the way, the second part of this series is now out online. I sent out a notice about it already in the Politics board under the China discussion because it's mainly focused on that country in particular, but I'll throw up a link here too for those who have been following this:

PART 2. CHINA’S CAPITALIST DEVELOPMENT AND CHINA’S RISE IN THE WORLD IMPERIALIST SYSTEM: ITS NATURE AND IMPLICATIONS (http://www.revcom.us/a/137/lotta_faultlines_pt2-en.html)

[redwinter]

PART 3: THE EUROPEAN UNION AS A POTENTIAL RIVAL TO U.S. DOMINANCE (http://www.revcom.us/a/138/lotta_faultlines_pt3-en.html)



Great shifts are taking place in the balance of economic strength among the major powers. New faultlines can be discerned in the world economy. U.S. imperialism is still the primary economic and military power in the world imperialist system. But its position is eroding. And potential rivals are emerging.

The enlargement and consolidation of the European Union is a defining feature of this changing economic landscape—with the rise of China perhaps the most dynamic of the big tectonic shifts taking place in the world economy (see Part 2 (http://www.revcom.us/a/137/lotta_faultlines_pt2-en.html) of this series).

The European Union (EU) is a highly developed economic bloc of imperialist and capitalist countries on the European continent. In the last 15 years, the EU has achieved higher levels of economic and financial integration and strengthened its international position. The euro, which is the currency used by 15 EU members, is playing an increasingly important role in world trade and finance. The EU has been more forcefully asserting itself internationally and enhancing military capabilities.

The nature and possible implications of the expansion and strengthening of the European Union in relation to great power rivalry are the topic of Part 3 in this series.

To read the rest of this new installment, visit: http://www.revcom.us/a/138/lotta_faultlines_pt3-en.html

It touches on the enlargement of the EU eastward after the collapse of the Soviet social-imperialist bloc, the causes and effects of the immigration phenomenon (and reactionary backlash) in the EU, the complex geopolitical relations between the EU and other world powers, developments of military power and finance-capital within Europe and internationally, and potential triggers of upheaval within this whole "cauldron of contradictions."