Gowan, Peter (2003) U.S. Hegemony Today in Monthly Review Volume 55,
Issue3, July-August.
U.S. Hegemony Today.
by Peter Gowan
American hegemony since 1945 has been structurally different in its degree
and type of dominance from that of any other power in the history of
capitalism. Instead of simply being the biggest power with the biggest
capitalism among a number of great powers, the United States was able to
exercise political dominance over the entire capitalist core. Before 1945
different capitalist centers had geographically different zones of political
and economic dominance. The United States ended that arrangement, making the
whole capitalist world its geographical sphere of political dominance. On
this basis it shaped and reshaped the conditions and forms of international
capital accumulation throughout the capitalist world.
The question today is whether the United States can continue this system in
the post-Cold War world. This is the question that has been obsessing
American and other state leaders since 1989, and it is the governing item on
the agenda of the Bush administration just as it was on the agenda of the
Clinton administration. As the Bush Senior administration noted correctly in
its 1992 draft Defense Planning Guidance, the key threat to this kind of
American hegemony lies in regionalist political challenges from the two
other main centers of core capitalism: those at the western and at the
eastern ends of Eurasia. The U.S. grand strategy since the collapse of the
Soviet Bloc has sought to ensure that such regionalist political
developments do not force the United States into accepting a more collegial
political center of world capitalism.
The resulting conflicts and aggressive power plays by the United States are
thus focused today principally upon competition between capitalist centers,
not direct conflicts between the United States and international labor and
the anti-imperialist left. This article attempts to explore the forms and
substance of intercapitalist relations in the post-1945 era of American
hegemony.
American Hegemonism: The Cold War Hub-and-Spokes Model
American hegemonism during the Cold War was widely seen, on the left as well
as the right, as really nothing more than American leadership of a core
capitalist partnership. In other words, the core capitalist states were seen
as having established a deep, organic, cooperative affiance to defeat
Communism, manage international capital accumulation, and keep the South
open and under control. On this view, the United States was simply the first
among equals, enjoying that status because of its size. Marxists had a model
for this: a Kautskyite "ultra-imperialism." And this vision was even
radicalized in the 1990s into conceptions of a transnational capitalist
class across the core, with a shared identity and shared fundamental
interests to match. But this view is not, and has not been, the case.
There was indeed a partnership of core capitalist states during the Cold War
in the fight against Communism and to keep the South under control.
Institutions like the international financial institutions, the General
Agreement on Tariffs and Trade (GATT), and the security alliances as well as
Western cooperation in the UN indicated this.
But there was not only partnership. There was also American political
dominance over the other core states. The partnership and its institutional
expressions could be thought of as a superstructure. But underpinning that
superstructure was a deeper structure of American political dominance.
This deep structure derived from the ability of the United States to create
a particular kind of hub-and-spokes structure of relations which ensured
that for each of the main core capitalist states its political relationship
with the U.S. hub was more crucial to its vital interests than any other
possible relationship with any other power.
During the Cold War this hub-and-spokes arrangement of dependency operated
as a political system, which continually reproduced itself. This system was
constructed in the second half of the l940s when all the main capitalist
centers in Eurasia were desperately dependent upon the United States in
almost every field: West Germany and Japan were occupied by the United
States, the capitalist classes of France and Italy were weak and threatened
internally, while the French state was desperate for help to regain and
retain its empire as well as being worried about a German revival; Britain
was financially crippled and desperate for resources to retain its empire.
All needed dollars and American imports.
In these conditions the U.S. ruling elites, under the guidance of Dean
Acheson, hit upon a masterly concept for assuring long-term American
political dominance over the entire core. It offered to help all the main
capitalist states with their particular key concerns, whether imperial or
for reintegration into the state system, or fear of each other, or in some
cases fear of domestic Communism. But at the same time it asked them to join
U.S. centered alliances for a military confrontation with the Soviet Bloc
and Communism.
Once the other powers had accepted the governing character of the global
cleavage between the "free world" and the "Communist enemy," overriding all
other possible political cleavages, the United States swiftly made that
cleavage the basis for a continuous military confrontation with the
Communist world. And it also drove the cleavage into the domestic political
systems of the allies: the basis upon which a party was to be treated as
legitimate within these domestic political systems was to be how the party
stood on the global divide.
In the generalized military confrontation with the Soviet Union the United
States became the protector power, since if a war broke out between the
United States and the Soviet Union, the allies of the United States lacked
the military capacity to defend their territories from Soviet conventional
forces. And the United States thus acquired the rights of such a protector
power: a substantial degree of control and supervision of each ally's
military and foreign policy strategies, as well as an insistence on an
overriding allegiance to the relationship with the United States, not to be
substituted by any other affiance relationship. And in return for
guaranteeing their security, the United States could ask for special rights
and privileges both in the political and indeed the economic field. The
result was thus a unipolar capitalist world in which the United States had
the right to take unilateral decisions on the great global cleavage with the
Communist Bloc.
This set of political relationships at an interstate level was then
buttressed by the structure of the allies' domestic political systems. These
effectively precluded the possibility of political leaderships emerging
legitimately on an international line of opposition to the global politics
of the United States.
A further beauty of this system was that it gave the basis for rebuilding
aggressive bourgeois parties within the allied states. Such parties could
trump parties of labor and the left by being the most aggressive anti-Soviet
and anti-Communist political force. And they could use the military threat
and the ideological connection between social democrats and Communists as
weapons against domestic demands for social reform. Thus the interests of
domestic capitalist power and strong pro-Americanism became virtual synonyms
in most allied states.
The one weak center in this system was French Gaullism, for long the main
political force on the right in France and a nationalist force rather than a
Cold War pro-American force. De Gaulle withdrew from the military structure
of NATO and removed U.S. troops from France, while simultaneously taking
strong stands against some U.S. political drives in the South. But France
did not leave the Alliance itself and was in most respects still strongly
linked to the United States in East-West relations. French attempts in the
early 1960s to form a bloc with Germany and the attempt of the West
Europeans to form a common position on Israeli-Arab relations in the early
1970s were both easily defeated.
This set of dependencies was supplemented by others as the West European
empires crumbled. The core states found that their links to oil and raw
material suppliers in the South and the protection of the investments in the
South depended increasingly on American power and operations in the South.
If the U.S. sanctions were imposed on, say, an important supplier of oil,
the core state which had been buying that oil or whose company was
extracting it, would be suddenly cut off. And if a revolution or coup d'etat
threatened the foreign investments of any core capitalism, crushing the
challenge would typically require either direct help from the United States
or its acquiescence.
The U.S. role as leader of the core in controlling the South was weakened by
its defeat in Vietnam, but it managed to use proxy forces along with its sea
and air power and capacity for covert action to sustain this system. It is
worth stressing that this set of Cold War arrangements was not some sort of
trick or bluff. There was a genuine Cold War confrontation and it did, on
the whole, serve the interests of all the core capitalist states very well.
There was bound to be a degree of conflict between the Soviet Union and the
capitalist world and there was bound to be deep hostility between Communist
Parties and the various capitalist classes where Communism was a threat. But
these antipathies did not necessarily mean a massive expansion of American
power into Eurasia, turning the rest of the core capitalist states into
subaltern allies. This was the achievement of the Achesonian system.
Combining Development Paths for Other Capitalist States with Structures
Assisting the Dominance of U.S. Capitalism
This political system was a necessary but not a sufficient condition for
sustained U.S. hegemony over the capitalist core. Sustained hegemony
required that the United States could offer a development path for other
core capitalist classes while at the same time structuring the patterns of
international capital accumulation in ways that facilitated a leading
position for American capitalism.
A development path is not just about economics. It is also about politics.
Capitalist classes must be confident that they have a secure path towards
their own enrichment--an effective way of extracting value out of production
activity They must also have a path to the strengthening of the political
authority of their state over their population: economics and politics must
combine in what is at bottom an overall social power strategy of
development.
But another central issue in this area is the obvious tension between
providing a development path for other core capitalisms and assuring the
continued dominance of American capitalism. For thirty years the United
States triumphantly achieved this task, but its efforts to restructure
patterns of accumulation from the 1970s on were fraught with tensions and
problems.
In the first phase of the postwar period, war destruction and economic
dislocation in Eurasia offered the possibility of a great postwar
reconstruction boom. And American capitalism was the bearer of a new type of
industrial capitalism with very dynamic possibilities. The so-called Fordist
type of capitalism was different from the typical interwar and nineteenth
century European form of capitalism. This had involved using workers only
for production, while the products of the most advanced industries were to
be sold to middle-class markets around the world. The Fordist idea gave the
industrial workers the possibility of a role also in "realization," as
consumers of the products of advanced industries. And when this idea was
linked to the power of the labor movements that emerged in a number of West
European societies after the Second World War, often Communist led, and was
linked also to Keynesian ideas of class compromise in economics and to fears
of Communism, the basis was laid for a powerful economic growth dynamic in
Western Europe based upon a great deepening of domestic product markets. (1)
These production arrangements were sufficiently dynamic to draw the social
democratic labor movements into stable cooperation with the new social
order, giving the state concerned a solid basis for establishing liberal
democracy. In societies where this class coalition was too shaky, the United
States backed authoritarian regimes, as in the Mediterranean European states
(with Italy as a half-way house), in South Korea, and Taiwan.
Fitting these development paths together with the dominance of American
capitalism was relatively easy in the 1947-1970 period. On the one hand, the
U.S. planners took the strategic decision to revive both German and Japanese
capitalisms as the industrial hubs of their respective regions. These
centers were thus destined to become the main competitors of American
capitalism in the central field of industrial competition. But at the same
time, they were also the most strongly controlled and dependent in the
political field, as quasi-protectorates and were thus most susceptible to
U.S. political pressure.
For twenty years Washington's strategy for assuring the dominance of U.S.
capitalism was centered on opening European labor markets to U.S. capital
and opening product markets to U.S. industrial goods. On one side,
Washington's 1954 economic agreement with Germany guaranteed that German
product and labor markets would be open to U.S. products and foreign direct
investments. On the other side, Washington pushed for a treaty-based West
European integration which would guarantee in international law the openness
of each West European economy to the products of other West European
economies. Thus, from their West German base, American industrial capitals
would have access to the product markets of the whole of Western Europe.
The result was a single unified political and economic space covering the
entire capitalist core under U.S. political and economic leadership. On this
basis, the U.S. and other core states could act in partnership to control
the South.
The 1970s Crunch and the Drive for New Development Paths Favoring U.S.
Ascendancy
As Robert Brenner has so graphically demonstrated, by the 1970s the United
States faced a powerful competitive challenge from the industrial
capitalisms of Germany and Japan. And the Fordist path had also produced an
industrial labor movement with great social power and a large measure of
entrenched security. The result was a crisis of core-wide development
strategy. The old strategy could have been continued, but it would have
involved a deepening of collegial management of international economics, a
deeper corporatist collaboration with labor and a more inclusive arrangement
with the South. Some capitalist groups argued for this in the 1970s, as in
the Brandt Commission. But victory was achieved by the Anglo-American New
Right's program.
This involved a rollback of the social power of labor in the core countries,
a rollback of the social coalitions for state-centered development in the
South, and a return to the forms of capitalism that had existed in the
pre-1945 period and before the New Deal. Post-1945 restrictions on the
property rights of capital were to be swept away: capital would no longer be
treated as an instrument for achieving social goals such as full employment
and social welfare; it would be treated as king. State social policy would
be governed by the priority of serving capital in all fields. And capital no
longer meant industrial output: it meant money capital, the largest possible
pyramids of finance, looking for the most profitable rate of return in any
direction at home and abroad. Tightly parcelized and controlled credit
systems were swept away, controls on the right to move financial property in
any direction were abolished, public services and state industrial sectors
would be offered to money capital, macroeconomic po licy was to be geared to
protecting the value of money capital, fiscal policy was to be geared to
freeing money capital from taxation. This was a program for a return to the
late nineteenth century capitalism of J. P. Morgan or Barings. Labor was to
be shoved out the door again, allowed only to press its collective nose
against the icy window to gaze at the feasting financial barons and their
political toadies within. Keynes was dead, the rentiers were back, waving
books by Hayek and hailing the new road from the supposed postwar serfdom of
capital. (2)
But linked to this recidivist program for social change within capitalist
societies was also a new set of inflections of the effort to maintain the
dominance of American capitalism. To understand this we must first examine
how the United States sought to structure the international political
economy in the postwar period to combine development paths for all with the
ascendancy of U.S. capitalism.
The American Playing Field for International Capitalism
The ideology of the postwar international economy was free trade on a
multilateral basis. The idea was that international economics within the
capitalist world was radically separated from politics and the international
economy was based not only on common rules applicable to all, but on rules
that were derived from the norms and principles of free trade, enabling
comparative advantage to drive the international division of labor for the
benefit of all.
But the United States never really had a free trade approach to
international economics, nor a multilateralist approach. The basic tradition
was to open others' markets to whatever sectors U.S. business was strongest
in, while protecting U.S. sectors which could face superior competitors. The
U.S. principle was reciprocity rather than most-favored-nation
multilateralism. And this tradition persisted throughout the postwar period.
At the same time these policies were partly concealed by other features of
the American approach: U.S. postwar expansion was led less by trade than by
foreign direct investment--a pattern that has persisted to the present day.
Sales revenues from American overseas subsidiaries have been, and remain far
larger than U.S. export revenues. Thus for the most dynamic and
internationalized sectors of U.S. business the key issues were not so much
tariffs and quotas and safeguards--the traditional stuff of trade
politics--but access to labor markets abroad for U.S. capitals under very
favorable terms. Thus the United States ensured, when the European Economic
Community was created, that it would treat U.S. capitals (unlike other
foreign capitals) as if they were European, with full "national treatment."
Secondly, the United States did allow international economics to be governed
by legal procedural rules to a very great extent. It did not, on the whole,
support managed trade geared to volume targets. Formally, the Uni ted States
remained outside the GAIT regime--the U.S. Senate never ratified GAIT. But
it allowed the GAIT system to work in a legal sense, by and large.
The fact that international economic exchanges were largely governed by
legal procedural rules was very important because it gave capitalists
everywhere a large measure of predictability and security for their
operations. But the legal rules themselves were "positive law," not
norm-based on liberal free trade principles. The world of international
trade law thus became a thicket of power-driven interests in which arguments
were won less by those on the side of the angels of liberalism than by those
able to pay the biggest lawyers' fees and able to use market power threats
to settle arguments about trade rights.
Against this background we can note the ways in which the United States
sought to maintain its capitalism's dominance on an international level. The
general goal has been to assure U.S. leadership in new growth sectors and to
ensure U.S. entry into (and supervision of) new growth centers. New growth
sectors are in the so-called high-tech fields, especially technologies with
a wide impact across economies. New growth centers are those countries or
regions experiencing rapid, sustained economic growth; such centers need to
be both penetrated by U.S. capitals and brought under U.S. political
dominance so that the United States can have leverage over their future
development path.
Very important in ensuring leadership in new growth sectors is American
industrial policy and not least the role of the military budget in such
policy. This can fund research and development which can generate new growth
technologies. It can also prime the pump with large military-related
investments in relevant infrastructure and with the U.S. state acting as an
initial market for the products. No other core capitalist country has an
equivalent set of instruments for launching new growth sector technologies.
When U.S. fears arise that another center may be developing new growth
sectors of global reach, we can see how it is inclined to sweep aside the
liberal rhetoric and demand managed trade, using political threats. The
classic example here was its confrontations with Japan in the late 1980s and
early 1990s over microchips and semiconductors over which the United States
simply imposed a bilateral managed trade regime.
As far as new growth centers have been concerned, U.S. attitudes to
exclusion have again been demonstrated by the example of Japan in the 1980s
and also other East and Southeast Asian countries in the 1990s, with its
insistent pressure for opening up to the entry of U.S. capitals: the classic
example here would be the U.S. Department of the Treasury's operations
towards South Korea in 1997-1998. And for a new growth center such as China,
the drive to assure a liberal political regime easily influenced by U.S.
leverage is evident today. A key lever for exerting pressure on new growth
centers is that of opening the U.S. market to their products in exchange for
their opening their asset and other markets to the entry of U.S. capitals.
But the recidivist turn to private finance-centered capitalism in the United
States and its U.K. satellite was combined with an important new range of
instruments for assuring the dominance of U.S. capitalism. The most
important of these is what I have called elsewhere the Dollar Wall Street
Regime (DWSR). (3)
The Imperial Monetary Shift and the Dollar Wall Street Regime
Any idea of a free trade level playing field in international economics has
been premised on the assumption of a homogeneous, stable international
monetary system. Multilateral steps eliminating trade barriers make no sense
as a level playing field if a leading state can then manipulate exchange
rates at will and free itself from the payments disciplines applying to
other states. And when that leading state is also the producer of the
world's main international currency, you have something like an imperial
economic framework facing other capitalisms. You also have a monetary
framework constantly generating payments crises and debt crises all over the
place--except in the state issuing the lead currency. That is why, from the
nineteenth century until the early 1970s, all author ities accepted the need
for a stable, homogeneous international monetary order. But then the
American authorities broke with that tradition and turned in just such an
imperial direction.
The first step was taken with the closing of the Gold Window in August
1971--a conscious strategic decision, planned far in advance, entailing a
conscious rejection of a new, reformed homogeneous international monetary
order. (4) This was followed by the effective sabotage by the United States
of attempts by the rest of the capitalist states to construct a new system
in the early 1970s. (5) And after an agreement to manage the dollar exchange
rate with the deutschmark and the yen at the Rambouillet Summit of 1975, the
United States in fact soon went its own way, eventually dismissing the whole
idea of such management in the early Reagan years.
The result has been quasi-imperial in two main respects. First, by
fragmenting the international monetary system, it pushes economic operators
and states to seek stability by operating almost entirely within what is in
effect a dollar bloc. The only alternative to extreme monetary instability
is to regionalize their operations behind a monetary shield of their own, as
the West Europeans chose to do beginning with the de facto construction of
the deutschmark bloc in 1979.
Secondly, by freeing the dollar from the constraints of any international
anchor and rules common to all, the United States could unilaterally
subordinate international monetary conditions to the perceived requirements
of American capitalism. When the United States was in recession, the U.S.
authorities could drive the dollar down to generate export-led revival; when
the United States was rising into boom, the Treasury Department could swing
the dollar up massively against other currencies.
Some believe that these gigantic swings in exchange rates are steered not by
governments but by financial markets and foreign exchange markets. This is
trivially true but actually false. These markets are situated principally in
New York and its London satellite. The biggest players in these markets take
their cue in exchange rate issues from every word and gesture of the
Treasury Department's authorities and every move by the authorities of the
Federal Reserve Bank of New York. And since the two sides share
fundamentally common interests, the U.S. Treasury Department can use the
main financial market operators precisely as instruments and multipliers of
public policy. (6)
The full force of this power to swing the dollar's value in great arcs can
be appreciated when we remember the consequences of the dollar's role as the
main monetary unit of account and as the main means of payment for oil and
many other international products. However much the dollar swings one way or
the other, prices do not change for these products for those operating in
the dollar zone. Furthermore, because of the dollar's dominance as a means
of payment, the United States can run up huge current account deficits and
enormous external debts without facing the kind of monetary payments
constraints facing other states.
The dominance of the dollar is not simply the result of the size of the U.S.
economy. It is also and very importantly the result of two other things:
politics and finance. A state that protects regimes and trade routes all
over the world can, as Britain showed with its sterling area, gain the
privileges of having a world money. So can the United States. A state that
controls the sources of world oil politically can ensure that oil is priced
and largely paid for in dollars and thus can defend the dollar's
international dominance. And a state which is the most politically secure in
the world is a very safe place for storing financial property, thus ensuring
huge inflows of funds into New York and its London (offshore) satellite. And
a state with the largest, most liquid financial market in the world is the
least risky place to store wealth since you can swiftly move your wealth out
for other purposes in such large, liquid markets.
The central structure of postwar capitalist economies had been the national
columns running from the state through a tightly brigaded financial system
to the industrial structures. The Anglo-American return to a Morgan-Barings
style financial capitalism placed the private financial pyramids at the
heart of the system, the industrial structures taking their places alongside
real estate, private housing finance, private health care and a host of
other private services, with the state's role redefined as the protector and
service-provider for this new structure.
The rise of the DWSR, assisted by the diplomatic efforts of Washington and
London, opened the possibility of a vast new field of expansion outwards for
American capitalism. Just as New York financial pyramids in the late
nineteenth century acquired dominance over industrial capitalism further
west by financing its development, so American financial pyramids at the end
of the twentieth century could acquire dominance over industrial capitalists
across the rest of the core. By sweeping away all restrictions on the
centralization of American finance and by drawing Main Street under the sway
of Wall Street, the American authorities gave American financial pyramids an
overwhelming edge in international finance by the end of the 1980s. With the
structural instability in exchange rates, industrial capitals in Europe and
in East Asia could not securely expand their sales in the United States
through export strategies. They had to expand their operations through
mounting production operations in all three centers. And with overcapacity
in most established industrial sectors, and the consequent need rapidly to
seize international markets with new products, it could be hoped that the
need to link up with American finance would be overwhelming.
Changes were also sought in the institutional structure of capitalism to
ensure that industrial companies were dependent on securities markets and to
ensure that hostile takeovers were permitted, with the intent that
productive assets across the capitalist world would fall into American
ownership and a vast transnational centralization of capital would be
possible. And in conditions of generalized capitalist stagnation and crisis
in much of the world, paradoxically governments and banks and industrial
companies could be desperate for American finance to tide them over, giving
American finance capitalism ever widening circles of control over
international capitalism. International monetary instability greatly
enhanced these possibilities.
The drive to transform capitalism across the capitalist world into a new
private-finance-centered social system increasingly integrated into an
international capitalism dominated by the DWSR has continued for twenty
years. It is widely assumed that the entire capitalist core has accepted
this drive and changed accordingly. The idea of a globalized economy
governed by neoliberalism expresses this assumption. Yet in reality we have
seen much more tension-ridden relations between capitalist centers, despite
the fact that in all centers there has been a drive to shift soda] power
from labor to capital. The concept of neoliberalism captures the generalized
drive against the social power of labor. But it does not capture the
parallel tension-ridden relations between the three main centers of
capitalism.
Thus while it is true that the West European states and Japan have
liberalized financial systems, scrapped capital controls and accepted the
forcing open of other financial systems and service sectors through the WTO
and other mechanisms, it is also true that neither the West Europeans nor
the East Asians have fully embraced the U.S. model and the U.S. program for
the world economy. The West Europeans built a regional monetary shield
against the dollar system and combined an adaptive deal with the United
States on the WTO with efforts greatly to strengthen their own economic and
regulatory integration through the EU. And in East Asia also there have been
strong reactive tendencies towards regional networks.
Neither in Western Europe nor in East Asia have these defensive reactions
been taken on behalf of labor. Far from it. The West European regionalist
defense mechanisms have simultaneously been mechanisms for eroding the
social power of labor, most obviously in the policy framework for the euro,
which is patently geared towards driving through a qualitative weakening of
the rights and bargaining strength of labor, particularly in Germany.
It is also true that no other capitalist center has advanced an alternative
program for international capital accumulation or proclaimed its own
capitalism as an alternative model to that of the United States. Only
through the emergence of such an alternative can the advance of the U.S.
model be checked or defeated. And indeed, the risks of advancing such an
alternative would be very great. It could after all stimulate labor to join
the challenge. It could split the capitalist core's approach to the South in
political economy matters, opening the way towards resistance to common
transatlantic economic interests in the South. And above all it could
delegitimize the American model even within the United States itself. All
these possible consequences would ensure that any important center offering
an alternative would face ferocious resistance from the United States and
its transnational supporters.
The fact that neither the German nor the Japanese capitalist classes and
states have embraced the new American system is extremely important and it
is all the more remarkable given the gigantic pressures from the 1995-2000
American boom. But the boom has now turned out to have been a bubble, and
the American bubble has turned out to have involved a great deal of
parasitic and predatory activity, actually undermining the American
productive base as in the paradigmatic case of Enron. This marks a very
substantial setback for the drive to reorganize American and international
capitalism to assure U.S. capitalist dominance through the first half of the
twenty-first century.
New Challenges to American Hegemony and U.S. Responses
Against this background we can more easily appreciate the challenges to U.S.
hegemony in the post-Cold War period. We will first examine the challenges
and then consider the possible strategies of the United States for meeting
them.
The Soviet Bloc collapse has had a number of negative consequences for the
exercise of U.S. political dominance over the capitalist core. The East
Asian capitalisms (Japan, South Korea and Taiwan) remain dependent on U.S.
military power for their security, but largely as a result of U.S. policies.
This is most obvious in the case of South Korea. If the U.S. were to sign a
peace treaty with the North and assure its security, South Korean security
dependence on the U.S. would be ended.
But the security dependence of Western Europe on U.S. military capacity
ended with the disappearance of the Soviet Union. This has opened up a very
considerable threat to America's global political dominance because it has
facilitated a turn on the part of West European continental states toward
building an increasingly strong political caucus and thereby undermining the
hub-and-spokes division and dependency of West European states in the field
of international politics.
The West European states did not turn towards stronger political integration
out of some collective will to launch some sort of bid for world leadership,
supplanting the United States. They did so because of the confluence of a
number of specific pressures and needs. Germany desired to bind other West
European states more closely around it, worrying that its greatly enhanced
power might lead its neighbors (not least France) to want to gang up against
it. Since France (and Britain) resisted a decisive move to a federal
democratic EU, the obvious alternative was that of a strong political bloc
in international politics. There was also the perceived need to present a
common political as well as economic front to East Central Europe, and the
obvious instrument for doing this was through strengthening the EU as the
political instrument for processing German and other West European policies
towards the East.
Critically, the EU was being used as the main instrument for transforming
social relations within its member states in a "neoliberal" direction. The
basic idea was to use European social democratic enthusiasm for European
unity against European social democratic commitment to labor rights. But in
the 1990s, the European economies were stagnating with high unemployment and
the EU lacked any genuine democratic legitimacy. Therefore, to enhance the
authority of the EU in pursuit of neoliberalism, new policy areas and
activities were sought which would appeal to the European center left. Many
of these were in the international political field: campaigns on human
rights, environmentalism, arms control, aid and a host of other such causes.
No longer legitimating the EU as a social model for the world, the EU states
sought to legitimate it as the supreme global champion of the pacification
of the world through international law rather than power politics.
The drive for monetary union and the establishment of the euro was
perceived, rightly, in continental Western Europe as requiring a greatly
strengthened political base; but gaining such a base was very difficult,
especially because of the continued divisions within French state elites on
French national strategy. What could be called a Mitterrandist wing was
committed to France as a regionalist power, focused on leading Western
Europe through the EU--a national strategy requiring very close
collaboration with Germany; but the other wing, which could be called the
Chirac tendency, defined French national strategy in terms of France being a
small global power, with its bomb and seat on the UN Security Council. And
as for the British role, it was principally directed to being the champion
in the EU of the Anglo-American model of private-finance centered capitalism
and to trying to break up the political cohesion of the EU.
But from an American grand strategy perspective, the erosion of the
hub-and-spokes dependency in Europe and the pressures in Western Europe
towards political unity constituted a fundamental medium-term threat to
American global hegemony. The possibility of an equally large political,
financial, and industrial center in Europe could not possibly be anything
other than a fundamental power threat. But it was one that could not be
acknowledged because since 1947, the United States had itself championed
European integration. And although that policy had become increasingly
declaratory rather than operational by the 1980s, the bulk of the European
intelligentsia and, it seems, much of the political elites did not grasp
just what a threat they posed to the U.S. from this angle: a threat
equivalent to China, Japan, and South Korea getting together as an East
Asian union modeled on the EU, and a threat all the more insidious for being
difficult to denounce publicly.
The problem posed by the EU was also connected to the drive for
consolidation of the new Anglo-American program for a world of private
finance-centered capitalism, led by an imperial dollar and centered in the
American financial pyramids. If the euro was consolidated and euroland built
a genuinely unified financial base, the pressures towards federal political
unity would be very strong, and within such a federal Europe pressures for a
kind of capitalist society different from the Anglo-American model would
become very strong. The fact that the huge range of U.S. subsidiaries in the
EU-half of all U.S. affiliate business sales abroad are in the EU-benefited
greatly from the EU political economy structures (including the euro) made
this threat to the United States all the more insidious.
A further threat derived from the possibility that Western Europe could find
increasing common ground with East Asia on a wide range of issues in the
international political economy: a common hostility to the imperial dollar
and the potentially lethal financial strikes by U.S. operators (despite the
fact that West European operators had also participated in the operations of
U.S. banks and the U.S. Treasury in the East Asian cr1sis).
The ideological basis for American military power projection during the Cold
War had been the supposed massive military threat from the Soviet Bloc and
Communism. This was largely accepted as legitimating the aggressive use of
military coercion against pro-Soviet forces and regimes. But with the end of
the Cold War, the aggressive use of U.S. military power faced serious
legitimation problems. Many voices were raised for military aggression to be
outlawed unless it was expressly sanctioned by the Security Council, as laid
down in the UN Charter. And West European governments supported this line.
Attempts by the Clinton administration to identify a new string of
enemies--the so-called rogue states, dubbed such in 1994--were branded by
many, including European governments, as exaggerated and inappropriate, and
efforts by the U.S. government to enforce sanctions against Iran and Libya
as well as Cuba were flouted by U.S. allies in Western Europe while the
blockade against Iraq was also challenged.
This West European effort to place political-legal constraints on the U.S.
use of its major political instrument--its capacity for military
aggression-actually contained the seeds of a new world order concept which
can be very attractive to other capitalist states but which is thoroughly
subversive of the entire way in which the American state is configured. The
West European idea, expressed most cogently by German policy elites is that
the Atlantic world should dominate the rest of the world by means of
international public law. The Atlantic states, following the example of West
European integration, should voluntarily subordinate themselves to
international legal rules constraining their sovereign autonomy. They should
then ask others wishing access to their markets and close political
relations to subordinate themselves to the same rules. And states which
egregiously flout the norms supposedly underlying the rules of the
international system should then be subject to coercive sanctions,
including, but only as a final resort approved by the Security Council,
military force. The imperial secret of the whole concept lies in who writes
the rules in the first place. If this is done by the Atlantic states, they
can dress them up as being universalist-liberal norm-based rules while in
devilish detail they are simply "positive law" rules serving the interests
of the Atlantic states. The model here is, of course, the European-inspired
WTO which presents its rules as rooted in universalist-liberal free trade
norms while in fact they are a concoction of positive law rules serving
Atlantic capitalist interests. Under this world order concept, military
coercive power operates not in opposition to international law but as its
enforcer.
Yet the United States has no tradition whatever of subordinating itself to
international treaty-based law and it has no interest in a world order in
which military force becomes operational only as a last resort. Yet the West
European idea attracts powerful support from other core capitalist states as
well as from many states in the South. Such support is indicated by the EU's
success, in the teeth of U.S. opposition, on issues such as the
international Criminal Court and the Kyoto Protocols.
These problems contributed to new potential challenges within the United
States itself. While the U.S. capitalist class and its political leaders
were overwhelmingly committed to maintaining and extending U.S. political
dominance and the continued expansion of U.S. capitals on a global scale,
the end of the Cold War raised the threat of majorities in the U.S.
electorate demanding that U.S. governments prioritize domestic improvement
and reallocate resources from the military field and overseas expansion to
tackling problems at home. Though committed to rebuilding U.S. global
political dominance, the Clinton administration did not attempt to mobilize
a broad popular constituency for power projection abroad. The boom of the
second half of the 1990s eased this potential pressure but did not solve the
basic political problem, which had been demonstrated so strongly by the
eviction of Bush Senior from the White House despite his Gulf War victory.
We should add the fundamental geopolitical problem inherent in the turns of
Russia and China towards capitalism. These turns undermined their useful
status as potential threats to a Western Europe and Japan in need of U.S.
military services for protection. They also set up competitive pressures
within the core countries to gain privileged relations with these two states
and privileged access to their labor and product markets and resources and
assets. The obvious danger from an American point of view was that in the
West a Germany anchored within a more cohesive EU could establish a
privileged partnership with Russia, while some or all of the East Asian
capitalisms could link up with China in a strong regional network that could
weaken American leverage and economic penetration.
A final consequence of the Soviet Bloc collapse for American political
leverage was the following paradox America was the purest of symbols of
capitalism and thus the defeat of Communism should have, and in many ways
did, greatly enhance the attractive power of the American capitalist model.
Yet at the same time, the deepest source of American political power during
the postwar period lay in the fact that capitalist classes throughout the
world knew that they could rely upon the United States to help crush labor
or socialist challenges to their power. Yet, with the great decline of this
threat after the Soviet collapse, this particular American service was also
facing significant redundancy. Indeed, there was a growing tendency for
liberals and others in the core capitalist countries to argue that the
greatest challenge to the world came not from the enemies of liberalism and
democracy but from the deep and growing divide between North and South as
well as from environmental crises. And on this agenda the Uni ted States was
identified as a major source of problems, rather than as a provider of
solutions. And as the 1990s wore on, the pernicious, destructive
consequences of the DWSR and of the WTO regimes generated a growing
opposition from young people in the North as well as from social movements
in the South.
Thus, by the end of the 1990s there were plentiful indications that the
United States was facing multiple challenges as a result of the Soviet Bloc
collapse and its consequences. The most serious of these challenges came
from what for many is a surprising quarter: Western Europe.
The Bush-Lieberman Counter-Punch
There is abundant evidence that in the face of the challenges of the Soviet
Bloc collapse a consensus quickly emerged in the United States for the
American state to attempt to transfer its political hegemony from one over
the capitalist core to one over the globe as a whole. (7) Ways would be
found to bind all the main powers across Eurasia into hub-and-spokes
dependency relations with the U.S. of a kind that would ensure that each
such power would privilege its desire to accommodate U.S. political thrusts
over all other options.
The main emphasis of the Clinton administration was upon economic statecraft
and upon driving through the program for a new global accumulation regime in
which U.S. rentier-centered capitalism would be central. "Economic
globalization" and the operations of the U.S. Treasury were at the heart of
the Clinton approach on a global scale. But at the same time, in the
political field, the priority was to re-establish U.S. dominance over
Western Europe and over its expansion eastward. The Clinton administration,
building on Bush Senior's success in keeping Germany in NATO and thus
preserving the NATO structure, successfully undermined West European
attempts to resolve the Yugoslav crisis outside the NATO framework. Its
Bosnia victory over West European efforts to resolve the crisis was followed
by NATO's eastward expansion, a polarization against Russia in the Kosovo
War, and the consolidation of strong American political ties with Poland,
the Baltic states, Bulgaria, and Romania. But what the Clinton administratio
n failed to prevent was the continuing efforts to strengthen the political
cohesion of Western Europe, its search for greater autonomy and its drive to
restrict the political value of U.S. military power.
The West European states responded to U.S. geopolitical maneuvers in Europe
by what could be called subversive bandwagoning. They went along with each
U.S. thrust, on Bosnia, in the Yugoslav war, and vis-a-vis Russia and NATO
enlargement, but they simultaneously also responded by trying to strengthen
their own regional political unity, most notably in the case of the European
Security and Defense Policy, but in other areas as well. And the chief
problem for the United States from a strategic point of view was precisely
this West European effort at unity and autonomy on international political
questions.
The Bush administration came into office determined to crack the Europeanist
nut. September 11, 2001 gave them their opportunity. They announced a new
strategic doctrine which utterly repudiates the entire Europeanist position
on world order. The new strategic doctrine focused on the legitimate use of
force, rogue states, and the politics of the Middle East. The Bush
administration then called for war against Iraq as an operationalization of
this strategic doctrine. It turned to the West European states and asked
them if they wished to get on the bandwagon this time, adding that they
faced only two choices: being for the United States or against it.
Lieberman and all other leading Democrats either supported this line or went
along with it. Bush was acting firmly within the programmatic and strategic
consensus of the American capitalist class since 1990. Cheney is not a
marginal figure, he is a central figure amongst American class political
leaders.
The American attack on Iraq had a number of objectives, in the region and on
a global scale (including U.S. control of world oil). But among the global
targets, ending the growing cohesion and influence of Western Europe was
central.
The war has split Western Europe as intended. It has not, however, produced
a strategic victory for the U.S. efforts to consolidate the hub-and-spokes
dependencies basis for a unipolar hegemony. That remains a long way off, and
the path to it must include not only military-political victories and large
geopolitical maneuvers across Eurasia, but also the political consolidation
of the recidivist private-finance-centered rentier capitalism and the
imperial dollar across the whole capitalist core.
Conclusions
Postwar American capitalism and the American state were an advance for
Western European capitalism over what had gone before, in the inter-war
period. The Europeanist capitalist program for world politics would now be
an advance on the American way today, both in the military-political field
and to some degree in the social field. Ironically, this is in large part
because of the advances made in Western Europe under American and-to be
honest about history--Soviet and Communist influence. But we are now in a
chaotic world where the American state is probably too weak to win on a
global scale, while the West Europeans and East Asians are probably too weak
and divided to shift the direction of world politics in a more pacific and
socially inclusive direction.
The U.S. drive to remilitarize world politics as the basis for consolidating
its global hegemony in the post-Cold War conditions will tend to generate a
vast and heterogeneous coalition of opposition across the globe for some
time to come. It will also generate great suffering in many parts of the
South. At the same time, the new rentier-centered capitalism is a recipe for
social regression on a global scale.
A global left, centered on international labor movements will arise to
oppose the American global program. Already many around the world, most of
whom are not socialists, reject the U.S. program. They recognize that the
real challenge for capitalism is to demonstrate that it can tackle the
North-South divide. It is possible to imagine a capitalism that could tackle
this divide: the kind of New Deal-Keynesian-Social Democratic capitalism
that accepted the Welfare State model after the Second World War. But that
capitalism was born under the spur of the challenge from Stalingrad and a
gigantic international Communist movement, with an alternative social
program. Without that spur today, we have the old story of chaos, wars,
imperialist exploitation-all the things that make Hobson's book on the
nature of finance capitalism at the start of the twentieth century fresh and
topical today.
Notes
(1.) The pattern was somewhat different in Japan and East Asia, where the
power of labor was much weaker, U.S. military-related demand during the
Korean War was much stronger, and where an export-oriented growth strategy
directed at the U.S. market was much stronger.
(2.) The new (Anglo-) American capitalist model is typically presented in
the language of economics and called monetarism or a free market
deregulation approach or "neoliberal" economics. But it was as much about
politics as economics: about freeing the state from its social commitments
to the mass of citizens and using the state's powers much more narrowly to
enhance the social power of capital. It is simultaneously a new way of
expanding outwards in both politics and economics.
(3.) Peter Gowan, The Global Gamble (Verso, 1999)
(4.) Joanne Gowa, Closing the Gold Window. Domestic Politics and the End of
Bretton Woods (Cornell University Press, Ithaca and London, 1983).
(5.) John Williamson, The Failure of international Monetary Reform 1971-1974
(New York New York University Press, 1977)
(6.) This is not to deny that there are objective limits to U.S. Treasury
efforts, but these limits are wide. A useful discussion of the failings of
mainstream economic explanations for exchange rate swings can be found in
Paul de Grauwe, International Money (Oxford University Press, 1996).
(7.) Paul Wolfowitz has written persuasively about the emerging programmatic
consensus. See Paul Wolfowitz, "Remembering the Future," The National
interest 59, Spring, 2000. The programmatic convergence between the
Wolfowitz-Lewis Libby positions in the 1992 Defense Planning Guidance and
the conceptions of the Clinton administration are evident in Clinton
National Security Adviser Anthony Lake's key policy statements: see Anthony
Lake "From Containment to Enlargement," School of Advanced International
Studies, Johns Hopkins University, Washington D.C., September 21, 1993, and
Anthony Lake, "Laying the Foundation for a Post-Cold War World: National
Security in the 21st Century" Speech to the Chicago Council on Foreign
Relations May 24, 1996.
Peter Gowan is an editor of New Left Review, and professor of international
relations at Metropolitan University in London. He is the author of The
Global Gamble: Washington's Faustian Bid for World Dominance (Verso Books,
1999).
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