Lithium Protests in Serbia against Rio Tinto

 “Man lives from nature, i.e. nature is his body, and he must maintain a continuing dialogue with it if he is not to die. To say that man’s physical and mental life is linked to nature simply means that nature is linked to itself, for ma n is a part of nature”, 

Karl Marx, Economic and Philosophical Manuscripts of 1844

The last few weeks have seen an explosion of protest in Serbia against proposals to mine and process lithium. Protests involving tens of thousands of people drawn from a range of environmental and socialist organisations have taken place in at least 60 locations throughout the country and have included road blockades and street protests. Many of the protests have been in villages likely to be affected by mining but in addition the main bridge crossing the River Sava in Belgrade has been occupied, while in Serbia’s second largest city of Novi Sad protestors were attacked by thugs believed to be affiliated to the ruling party. The plan to exploit lithium is backed by the government of Aleksandar Vučić. Much of the energy of the protests is directed against proposals to make extraction of minerals easier in Serbia allowing the government to expropriate land and sell off to foreign investors. Distrust of the government has been fuelled by deeper concern at the government’s seeming unwillingness to tackle the country’s environmental problems including the preservation of clean air and water.

Lithium is rapidly becoming the new ‘oil’ in fuel production as it provides the base for battery production in an era where electrified vehicles are promoted as green alternatives to petrol and diesel. The company wishing to mine lithium is Rio Tinto. The Anglo-Australian company discovered lithium in the Loznica region in 2006. Rio Tinto’s pursuit of minerals has a long history. The company was originally based on the Rio Tinto copper, gold and silver mines in Spain. Tensions arose under Generalissimo Francisco Franco’s military dictatorship after 1939 and the company eventually pulled out of the country in 1954 in the aftermath of Franco’s war-time embargo on all exports of pyrites to countries other than the Axis and post war suspicions of his plans to nationalise the company. Rio Tinto is a very profitable concern. Its annual net cash from operating is just under US$45bn (Rio Tinto Annual Report 2020), equivalent to three quarters of Serbia’s total GDP for the same year. In the last year the company has benefited considerably from the partial easing of pandemic restrictions. Commodity prices of minerals such as iron ore have exploded allowing the company to pay out US$9 in dividends, the largest sum in its 148 year history. In this near century and a half of operations Rio Tinto has been no stranger to controversy and even scandal. 2021, however, has been a particularly irksome year for the company. In July the UK government’s Financial Conduct Authority began a probe into the conduct of the company in its underground mining operations for copper and gold at Oyu Tolgoi in Mongolia’s Gobi Desert, by inquiring if the company had breached listing rules in disclosures about the value of Oyu Tolgoi in 2018 and 2019. In 2017 the UK’s Serious Fraud Office began investigations into bribery allegations within the company’s affairs in Guinea. A US$10.5M payment was allegedly made in 2016 to help secure two development blocks for the company at the giant Simandou iron ore mine. Rio Tinto has since dismissed two senior managers over the payment and alerted both the SFO and the US Department of Justice. Most notoriously, Rio Tinto was forced to apologise and accept the resignation of its CEO after it blew up a 46,000 year old sacred Aboriginal site in the Pilbara mining region in North West Australia. Prior excavations at the site, had unearthed almost 7,000 relics including grinding stones, a bone sharpened into a tool and 4,000-year-old braided hair. The demolition of the sacred site took place despite seven years of opposition by the Puutu Kunti Kurrama and Pinikura People. The subsequent government inquiry found that Rio Tinto still held approvals to exploit a further 1,780 aboriginal sites in the Pilbara, made possible by the weak environmental, cultural and heritage protection laws.

Of course, the degradation of the environment as well as the cultural heritage of indigenous peoples is not a new phenomenon, and Rio Tinto is not alone in being a major culprit. Such extractive exploitation was endemic to colonialism and has continued, and will continue, under contemporary capitalism so long as the natural world is commodified in the pursuit of profit. As I have already recorded in a longer article on extractivism “Commodity production by itself does not drive the system forward. Value is substantiated in commodity products during the labour process. Oil, minerals, palm and soybean oil all have a use-value (albeit often quite limited) and exchange-value. The exchange-value is only realised when these commodities are sold, and this is typically so that they can be utilised in production processes.” 

The process of commodification of natural products whether fauna, flora or minerals, also exhibits a ‘lock-in’ effect, whereby one product is selected for exploitation in preference to others for the purpose of value creation. Thus, As Andras Malm shows superbly in Fossil Capital, coal replaced water as the main driver of power generation in 19th century England, driven by the strategic choices made by capitalist entrepreneurs. In the ‘War of Currents’ in late 19th century USA Nikola Tesla’s system of AC electricity distribution appeared superior to the DC system of Thomas Edison, but Edison’s greater wealth and influence allowed him to preserve his monopoly of electrical distribution and the weaker idea dominated. Lithium has been chosen by corporate elites to become the ‘go to’ mineral for use in battery production, by-passing more sustainable alternatives which can be used in the battery process such as hydrogen fuel cells, portable solar panels, or even sea salt water could be developed to generate electricity. Anerobic bacteria that do not require oxygen to survive, can also be used to process acetate and releases electrons.

The problem remains the exploitative dynamic that is endemic to capitalism, whereby our natural world remains considered as a product which can be turned into a commodity. Marx wrote of the human species being part of nature and dependent on nature for its very survival. Capitalism destroys this relationship and alienates us not only from nature but also each other. The protests in Serbia and elsewhere for clean air, water and soil, and the defence of land and heritage by indigenous peoples are part of the same struggle to recreate a just transition to a society based on solidarity and respect for our beautiful planet. 

Mind the Gap! Coronavirus and Conspiracy

The last weekend in August 2020 saw a host of demonstrations in various cities calling for ‘liberation’ from the tyranny of coronavirus lockdown. The participants represented a stange brew of individuals and groups. New age protesters were united by fears of a perceived denial of individual liberty under the deep state and its surveillance technology in the age of ‘Covid 19-84’. The crowd urged us to reject the wearing of protective masks. Coronavirus, they alleged, was a ‘Plandemic‘ conspiracy of the corporate elite led by Bill Gates and a cabal of financial backers grouped around George Soros. The aim of this elite, it is suggested, is to create a New World Order controlled by the rich and powerful. Gates is a particular target, due to his dual activity of being head of the tech giant Microsoft, and his role as world champion of a potential anti-Covid vaccine which would (it is alleged) be added to the haul of vaccines opposed by anti-vaxxers and injected into our bodies with an associated nano-tech microchip to track our every movement.

At the London demonstration the two major speakers were Piers Corbyn and David Icke. Corbyn (P) has made his name as an ‘alternative’ weather forecaster, and claims that the planet is cooling not warming and that climate change is not due to human activity but is a result of solar-lunar activity. For Piers, coronavirus is not a pandemic as he claims there is no evidence of excess deaths in 2020. Lockdowns and mask-wearing are ploys to take away our liberties and freedoms. More sinister are the views of Icke, who received enormous cheers from the crowd when his turn to speak came. Icke has pedalled the conspiracy that coronavirus is a false pandemic and is being used by the state of Israel to test new technologies. Indeed, an antisemitic theme consistently runs through his musings. Icke is banned from Australia for Holocaust Denial and believes that the world is run by giant shape-shifting reptiles. The coronavirus pandemic, he alleges, is constructed by ‘Sabbatian Frankists’ backed financially by the  Rothschilds.

The putrid smell of anti-semitic conspiracy theories, mixed as they are with new age mantra, has unsurprisingly attracted fascist and Nazi attention. At the London demonstration the Nazi contingent was small, and included the unfurling of a banner from the groupuscule British Union of Fascists, using the symbol of the Mosleyites of the 1930s. The demonstrations in Berlin and throughout Germany, however, had a much larger Nazi contingent, with the neo-nazi NPD and the far right anti-migrant (Alternative fur Deutschland) AfD party among others supporting the demonstrations, and leading a breakaway group of a few hundred who broke through barriers and stormed up to the steps of the Reichstag.

The far right presence on such anti mask protests appears to be coagulating around the US-based and Trump supporting QAnon movement. QAnon espouses an alternative ‘reality’ of conspiracy theories embracing anti-semitism and the alleged engagement of Hollywood celebrities and leading politicians in child-trafficking and paedophilia and the extraction of a supposed life extending chemical from the blood of the child victims. Nazis love this sort of thing, as it’s clearly reminiscent of the fake Protocols of the Elders of Zion and ‘blood libel’ conspiracies utilised by the Nazis in their path to power in the 1930s. In Germany itself the QAnon fakeries have been supplemented by the conceptualisation of Querdenken (trans. ‘thinking outside of the box’) which prioritises economic freedom over public health, and believes in a secret plan to create a New World Order under the control of a ‘Deep State’. The supposed focus on libertarianism leads it to reject traditional party politics and call for action which is ‘neither Right nor Left’. In the UK such right wing conspiratorial ideas are so far less organised. One such effort, however, is encapsulated in the newly formed UK Liberty Party whose leadership is made up of disaffected right wing Conservative and UK Independence Party members. The Party’s obsession with ‘individual’ (rather than collective) ‘rights’ draws it to an avowedly free market society. The party’s belief that the ‘government is everywhere’ produces a parallel conspiracy of a deep state out of control and so manifesto commitments include the abolition of state education and the NHS in favour of private education and private health. Personal taxation is to be diminished to a minimum to avoid redistribution of wealth and to enable the abolition of social benefits including the minimum wage, while every citizen should have the right to bear arms to protect their property and ward off dictators.

New Age Conspiracies Meet Their Match?

But what of the many individuals who come from a different direction to conspiracy theory, that of the ‘new age’ people who up to now have made up the majority of anti-mask, anti-vaxx and anti-5G protests? Here the analysis is more complex. Many individuals involved in these campaigns are clearly deeply worried about the deleterious effects of excessive corporate power, increased state surveillance of individuals, and corruption of political elites. They may be horrified by any connections of racism or fascism (but unfortunately are not convinced of the need to throw them off their protests). They share many of the concerns of socialists, and could be won to socialist arguments about the nature of capitalism and how to defeat it. But there is a deep sense of alienation where the state is not trusted. Collective responses through trade union and other forms of social solidarity also appears a remote prospect, as the pitiful response from the majority of trade union leaders to Covid-19 has proved. Some hope may have existed with the election of Jeremy Corbyn to the leadership of the Labour Party, but the Karmerisation of the party has now neutralised and sanitised effective opposition to Tory greed and corruption. The fragmentation of life and work (self-employment, zero hours contracts etc.) has encouraged an individualistic outlook on life, where the only recourse to survival in a hostile world appears to be self care, mindfulness and individual well being. The (sometimes) dubious claims of mindfulness to heal ones’ woes and troubles are mixed with an understandable hostility to the increasing medicalisation of illness, and its lack of attention to the social and economic causes of stress, fatigue and depression. There is also an hostility to academic science, which is presented as a puppet of the regime, and science in general which is perceived to be in the pockets of Big Pharma. As a result an ‘anti-science’ mood develops and the mainstream media (MSM) is eschewed in favour of alternative sources of (even more dubious) youtube channels. An example would be London Real, a youtube channel with over 2 million subscribers that offers to ‘transform your life’ and which contains a heady mix of Covid 19-84 material, anti-science propaganda, and (somewhat bizarrely) interviews with pro-Trump heavyweight boxers. Internet-based ‘influencers’ and comedians such as the US-based JP Sears populate these channels with millions of viewers offering jokey ‘insights’ into the evils of state power and conventional science, but with solutions based on conspiracies alone.

For the far right these developments offer a golden opportunity to construct a world of ‘alternative reality‘  in a world of dislocation exacerbated by Covid-19. The dangers are clear, playing around with the conspiracies of QAnon, has quickly lead to right wing vigilantism and the transcendence from the ‘right to bear arms’ to the ‘right’ to use them against collective forces such as Black Lives Matter that are perceived (wrongly) to threaten the marginal advantages of being white in a world driven by economic, biological, environmental and political crises.

The revolutionary left has a real job to do here, not only to expose the nature and social base of conspiracies but to construct and promote a real alternative to the degradation of capitalism. Such a programme would need to build on workplace economic and social demands for safety in the era of coronavirus, would need to explain the use and misuse of science and technology under capitalism, and be broad enough to provide a way forward to fight the tyranny of corporate power and mass surveillance.

 

 

Tea Breaks, Yoga or Mindfulness: Have We A Choice?

 

teabreakA squeeze on rest breaks in the workplace of all kinds has gathered place in the last decades. Unpaid breaks, or no breaks at all are now increasingly common in the UK. The British Trades Union Congress (TUC) estimates that a total of five million workers now put in an average of 7.4 extra unpaid hours per week. Over a full year for the whole UK economy this amounts to two billion unpaid hours of effective overtime. The squeeze embraces lunch breaks, tea breaks and even toilet breaks. A survey of just over 2000 workers taken in 2017 by workthere recorded an average figure of 34 minutes for a lunch break in the UK but also recorded that many workers now skip their lunch break altogether, and simply eat at their desk while continuing to work. Tea breaks have long been under attack. Strikes in the UK auto and engineering industry in the 1970s and 1990s were often focused on employer attempts to take away such breaks, and since then it has become common practice in other areas such as retailing where big supermarket chains Sainsburys and Asda now insist that tea breaks are unpaid. Paid time to take a toilet break is now a serious area of workplace grievance. Unite the Union has published a report coinciding with World Toilet Day in which it provides evidence of staff at branches of big high-street banks being required to urinate in buckets, and construction sites failing to provide any female toilets. Bus drivers had been denied toilet breaks for up to five hours, and workers in call centres for big financial institutions were told to log in and out to take a toilet break.

The root cause of the squeeze on rest breaks is located in intensified global competition and falling rates of profitability that emerged in the late 1960s. Employers have sought a new regime of capital accumulation (otherwise described as the neo-liberal era of capitalism) in which employers no longer felt the need to abide to the agreed ‘rate for the job’ designed to standardise reward for skills in national labour markets. National collective agreements with trade unions, which preserved rest breaks, began to be threatened as employers sought ‘more for less’ from their workers. Added to this, increased digitalisation and its associated aspects of monitoring, surveillance and control has exacerbated the density of time at work, and hence our need for relief from stress and burnout. Time is broadened and density increased within clock time because snatches of time can be used to look at mobile messages or the computer screen and respond to them while working on something else at the same ‘time’. For employers the resultant risk of time pressed stress among the workforce has legal implications in terms of Cognitive Overflow Syndrome, a newly identifiable legal term to assess the resultant sense of being overwhelmed and stressed. Such legislation is vital to workers’ health, and in France pressure from trade unions has led to a change in the law allowing employees the ‘Right to Disconnect’ from emails and texts once away from work. Avoidance of protective legislation, such as those contained in the European Working Time Directive, is a temptation for employers.  According to the Unpaid Britain report examples of avoidance are suggestive of ‘employer delinquency’ whereby the search for profits through super-exploitation of the workforce outweighs the risks of being caught and fined by regulatory authorities.

The Smokescreen of Mindfulness

Rather than restore rest breaks and give time for workers to recover and recuperate a plethora of mindfulness and well-being programmes are currently being touted by consultants to employers in the UK and elsewhere. Yoga and meditation are undoubtedly positive ways to increase personal feelings of well-being and keep the mind in tune with the body. However, there is also an ethical dimension, as sufficient time is needed for such practice to work, alongside the creation of a particular mind-set that allows healing.  But are employers abusing the beneficial effects of this practice and corrupting its use with short term bursts at the work- station? Have employers, as Žižek suggests, attempting to help people under time stress ‘to fully participate in the capitalist dynamic while retaining the appearance of mental sanity’? For example, at a recent conference supported by organisations including the Chartered Institute of Personnel and Development and the mental health campaign MIND a session was held on Managing the implications of ‘any time, any place’ work. The solutions proffered were ‘wellness’ and ‘wellbeing’ programmes designed to increase personal ‘resilience’. The Stress Management Society go so far as to suggest that consultants may be brought into the workplace to offer ‘desk massage’ and ‘desk yoga’. The responsibility for the symptoms of stress in these programmes are placed back to the individual. Nicole Aschoff (2015) in her book The New Prophets of Capital chimes with this theme and writes that the super-rich such as Oprah Winfrey and Melinda Gates suggest we must examine our inner self or promote charity to alleviate poverty and inequality. Ronald Purcer in his new book McMindfulness (2019) pursues the theme suggesting that ‘corporations, schools, governments and the military have co-opted it [mindfulness] as technique for social control and self-pacification’.

Friday Fatigue and Fika

However, some employers appear to have grasped the negative effect on productivity of new pressures on our time at work by allowing employees to schedule their own hours to complete set tasks over a four-day week, or by working remotely more often from home. The accountancy corporate PwC offers employees contracts lasting a set number of days to complete designated tasks.  The Wellcome Trust is trialling a four-day week and some smaller companies in the creative and design sector are offering the same, hoping to counter the effect of ‘Friday fatigue’. There are limits to the phenomenon of acting without supervision. Yahoo! (now part of Google) announced in 2013 its intention to stop working from home because, as Jackie Reses, human resources director, explained ‘Speed and quality are often sacrificed when we work from home…..We need to be one Yahoo!, and that starts with physically being together’. After many years of decline in time allocated to tea breaks and lunch breaks (and even toilet breaks) a new trend has emerged to introduce Swedish-style fika coffee breaks into the modern British workplace. fikaThe return of the coffee/tea break, while rare is not unprecedented. The New York Times reported in 2014 the case of Bank of America call centre and a pharmaceutical company. A 15-minute coffee break was introduced in the call centre and the pharmaceutical company replaced coffee makers with a larger café area. The newspaper records: ‘The result? Increased sales and less turnover’.  The rationale behind initiatives such as fika are in fact twofold. First, employers have rediscovered the ‘human relations’ approach to personnel management, whereby short bursts of time socialising with work colleagues are supposed to boost workers’ self-worth, enabling them to work smarter and more creatively. Second, the propaganda from the coffee companies, many of whom offer consultancy programmes to employers, praise the benefits of caffeine intake in boosting workers’ energy levels. It is reminiscent of employers offering sugary tea to their workers in the late 18th century as the factory system boomed in Britain. Tea was offered as a stimulant and as an alternative to the watered down or ‘small’ beer normally drank in the absence of clean and un-polluted water.

Slide Down a Shute!

The portrait of the grim modern workplace, overseen with new forms of monitoring, surveillance and control is also being challenged. The gig corporations, otherwise known as the FANGs (Facebook, Amazon, Netflix and Google), are at the centre of increasing temporal density in their prestige HQ and research centres while at the same time exercising extreme temporal flexibility in their outsourced service operations such as Amazon Mechanical Turk. Google’s headquarters office in Mountain View, California is designed so that staff are never more than 150 feet away from a micro-kitchen. Staff can take advantage of free transport to the workplace where they find on-site massage parlours, a games room and swings and ball pits. A micro-swimming pool in which the water flows in the opposite direction to your strokes creates the impression of swimming a lap. Staff have the right to take their dog to work (cats are not allowed as it is decreed that it would be too stressful for them). googleTo avoid walking down the stairs staff can slide down a shute. Induction of new employees even consists of a ‘New Employee Orientation and Arranged Virginity-Loss Night’. Of course, if all these fun and games don’t make you happy and more productive at your work you can always join Goggle’s mindfulness programme, established by Chade-Meng Tan who was given the name Jolly Good Fellow while at the company and would encourage you to ‘search inside yourself’.

Facebook’s engineering HQ in London has 1000 employees with sleep pods to enable time to snooze, artistic workshops with a resident artist, games room (billiards, table tennis, football tables), micro-kitchens and a canteen with free food to which you can bring friends and family.   The privileges are framed within an employer strategy which assumes that money spent on staff benefits will buy employee loyalty and help to keep collective worker organisation at bay. Creative and high skilled workers are thus given a degree of ‘responsible autonomy’, previously identified by industrial relations academics in the 1970s as a managerial strategy fit for purpose within large scale monopoly capitalism.  Rather than separate working and non-working life the FANG approach appears to embrace non-working life aspirations by incorporating them into the working day. Life becomes work and work becomes life. Fun, games and nice food are utilised to bind the company ‘associate’ to corporate objectives.

Resistance?

For workers the net result of is a potential worsening of the experience of work, squeezed by new contractual obligations, new (and renewed) ideological pressures and new forms of monitoring, surveillance and control which restricts their formal opportunities for time ‘off-the-line’ as well as possibilities for them to subvert the employers’ control of time by informal means. This is not to say that resistance is impossible, but simply to admit that the space for subversion of the time-discipline imposed by capital has become more restricted. However, even within this new world of digital artisans staff have begun to self-identify as ‘workers’, rejecting the corporate goals of the giant companies and even making common cause ‘with the cleaners and baristas that serve them’. This is even true in China where workers in tech giants such as Huawei and Alibaba have sparked a national debate of long hours culture by exposing the supposedly illegal practice of being required to work 9am to 9pm, six days a week.  Supermarket workers have begun through their unions to fight back against employer attempts to take away their tea breaks and striking couriers in the gig economy have started to organise against the vagaries and discipline of the .app. Our tea and lunch breaks are precious and cannot be replaced by employer delinquency or half-hearted attempts to placate our minds with workplace yoga, mindfulness or fun and games with colleagues. Resistance is surely not futile.

 

 

Brexit’s New MEPs!!

Readers may be interested in the background of the Brexit Party’s newly elected Members of the European Parliament. A motley crew, with Conservative and/or UKIP backgrounds (apart from the renegade Claire Fox) and dominated by business interests. Here they are.

brexitmps

Back row Rupert Lowe, Robert Rowland, Henrik Overgaard-Nielsen, Jonathan Bullock, Michael Heaver, June Mummery, Martin Daubney. Middle row: Christina Jordan, Annunziata Rees-Mogg, Dr David Bull, Matt Patten, Richard Tice, Lucy Harris, Belinda de Lucy, Alexandra Phillips. Front row: Nigel Farage, Ann Widdecombe, Claire Fox and Andrew Kerr.

Rupert Lowe ex Southampton FC chairman was educated at Radley College and Reading University before gaining a reputation working in the city for companies such as Morgan Grenfell and Deutsche Bank. He was also a board member of the London International Financial Futures Exchange. He founded Secure Retirements, a quoted care home provider, with Andrew Cowen, the former Southampton F.C. Vice Chairman. Lowe holds 21 appointments at 21 active companies.The combined cash at bank value for all businesses where he holds a current appointment equals £10.4m, a combined total current assets value of £35.5m with a total current liabilities of £28.2m and a total current net worth of £103m.

Robert Rowland is a hedge fund manager, who previously worked at  Odey Asset Management,  the firm of Brexit-backer Crispin Odey (who gave £900,000 to the Leave campaign and then made over £200 million betting on the devaluation of the pound). Rowland is Director of Bowdon Capital and he is set to launch a new hedge fund soon, according to Hedgemaven. Mr Rowland’s American wife runs a Chelsea celebrity hair salon. He is also a director of Digme Fitness  and Tickets for Troops (Samantha Cameron is a  patron).

Henrik Overgaard-Nielsen is an NHS Dentist and a trade union representative who is a Danish national and was Co-Chair of the ‘No’ campaign during the Danish referendum on the Maastricht Treaty in 1992.

Jonathan Bullock is an ex UKIP MEP. He began his career working in the House of Commons for MPs Andrew Stewart and Sir Richard Ottaway. He then went onto work in advertising agencies, becoming an account director responsible for a number of accounts. Subsequently he worked for the Advertising Association (1994–1997) and for the British Road Federation (1997–2001), both in similar head of public relations roles. He was appointed Director of Policy at the Chartered Institute of Logistics and Transport in the UK in 2002, working there for five years.

Michael Heaver an ex-aide to Nigel Farage has been campaigning for Brexit for over a decade. He is co-owner and  founder the Westmonster blogsite.

June Mummery is a campaigner with the Lowestoft Fish Market alliance.

Martin Daubney is a former editor of the lads’ magazine Loaded who came to prominence by promoting the idea of an endless male adolescence. The Guardian states that “The real job that Daubney held for eight years at Loaded involved such tasks as shooting radioactive wolves from a helicopter in Chernobyl, taking acid to celebrate LSD’s 40th anniversary, drinking a lot of alcohol, and ogling women’s breasts”.

Christina Jordan is a former nurse

Annunziata Rees-Mogg is the sister of the British right-wing Conservative politician Jacob Rees-Mogg.  Their father was the former Times Editor William Rees-Mogg  who authored books on disaster capitalism and profiting from chaos. She is reported to be independently wealthy, was privately educated and drives a Bentley. She has written for the Daily Telegraph and for eurosceptic magazines. She is currently a director at Wild Search, a headhunter firm that recruits for senior roles in public affairs.  She is well connected in the Conservative party and in 2010 attended a  Republican Party Convention in Minnesota with the International Trade Secretary Liam Fox.  She has twice stood unsuccessfully as a Conservative candidate for the Westminster Parliament.

Dr David Bull is an English television presenter and author. In 2000 Bull founded the creative branding company, Incredibull and in 1998, Bull published his first book, Cool and Celibate?: Sex and No Sex, arguing the benefits of abstinence in teenagers. He is an ambassador for the British Red Cross and a Patron of the Cystic Fibrosis Trust, with whom he has been associated for more than a decade.

Matt Patten is a company director and businessman who has held a string of directorships and is currently listed as a director of West Sussex Agri Ltd. He has previously been a director of international advertising and sports sponsorship agency  M&C Saatchi Sport & Entertainment Limited and deputy chairman of SP Holdings Limited, a sports marketing agency with clients like Rio Ferdinand, Williams F1 and Leeds United FC.  He currently describes himself as a charity director. His Linked In page lists a number of charities including the Mayors Fund for London.

Richard Tice is CEO of the asset management group Quidnet Capital LLP, which has around £500 million of property under management. In autumn 2017, his report “Timebomb: how the university cartel is failing Britain’s students” included recommendations on how to expand two-year degrees.Tice produced a follow-up report on student finances called “Defusing the debt timebomb” which he presented to the Chancellor, Philip Hammond.[20] His intervention was closely followed by the Prime Minister’s launch of a student funding review in February 2018. According to his personal website, he has completed the Cresta Run around 500 times.

Lucy Harris is a journalist and founder of Leavers of London, a pro Leave campaign group.

lucyBelinda de Lucy is also known as Belinda Claire De Camborne.  Her Companies House records state ‘ full-time mother’.  Belinda appeared in a promotional video for the Leave campaign. She is married to Raymond McKeeve, corporate finance partner and private equity specialist at international law firm Jones Day, who sits on the MoD’s Defence Reform Unit. She is a Director of charity Give us time, founded by  International Trade Secretary Liam Fox. She was pictured with Dr Fox at a Tatler magazine function. She has also been pictured at high society functions with Lady Kitty Spencer, daughter of Earl Charles Spencer and a cousin of Prince William.  Lady Kitty Spencer is also a director of Give us Time.

Alexandra Phillips was former head of UKIPs media department before defecting to the Conservative Party and then joining up with Nigel Farage.

Nigel Farage no comment needed.

Ann Widdecombe ditto.

Claire Fox is a former member of the Revolutionary Communist party who is still involved in some of its successor organisations, such as the Academy of Ideas, which she heads. She describes herself as a libertarian and is a panellist on BBC Radio 4’s Moral Maze programme

Andrew Kerr is a solicitor who also runs Englands, an estate agency.

formanLance Forman owns a smoked salmon business.

Brian Monteith is a public relations consultant and former Conservative member of the Scottish parliament. He lives in Tarn, Southern France. He was a member of the Federation of Conservative Students when also organised a successful campaign to take Heriot-Watt out of the National Union of Students. He initially worked as a researcher for Thatcherite London-based think tank, the Centre for Policy Studies.

glancyJames Glancy is a retired Royal Marine Captain.

John Longworth is a British business consultant, and was the director-general of the British Chambers of Commerce from September 2011 until March 2016 when he departed in controversy by breaking with the organisation’s line on Brexit on the day of its conference. He is an advisory board member of Economists for Free Trade and the Institute of Economic Affairs.

Sources: ByLine Times, Guardian, WikiPedia, Lowestoft Journal, Daily Mail

Everything Stops for Tea?

Oh, the factories may be roaring
With a boom-a-lacka, zoom-a-lacka, wee
But there isn’t any roar when the clock strikes four
Everything stops for tea

 November the Nineteenth was World Toilet Day.[1] A possible dead ringer for bad jokes, but a serious matter in other ways, as 4.5 billion people worldwide do not have access to a safe toilet. In the UK, Unite the Union published a report in which it provided evidence of –

staff at branches of big high-street banks being required to urinate in buckets, and construction sites failing to provide any female toilets. Bus drivers had been denied toilet breaks for up to five hours, and workers in call centres for big financial institutions were told to log in and out to take a toilet break.[2]

Such humiliations can be seen after decades of employers’ offensives against workers’ rights in the workplace. Industrial relations academics have long referred to a ‘frontier of control’ whereby a series of battles might take place between the employer and organised workers over seemingly trivial issues (such as tea and toilet breaks) which are symbolic of a much larger war over basic rights and the ability of organised workers, most often through their unions, to push back at employer power.[3] In a grand end game, the ‘frontier of control’ might transcend the employers property ‘rights’ as workers occupy the factory or office in a full-blown explosion of workers’ control.

The history of tea breaks in British workplaces within this context is quite fascinating. The belligerent parsimony and battle consciousness of employers is highlighted, as well as efforts to bind the worker to the employer through practices of paternalism. Employers began giving their workers sugary tea in the late 18th century as the factory system boomed.[4] The stimulant was meant to revive the workforce fromteabreak their gruelling tasks to work ever harder and was an alternative to watered down beer as a refreshment (water was too dangerous to drink). 19th century paternalism, constructed as an employer business model to pacify the workforce in part consolidated the practice as an alternative to the predominant drudgery of the Victorian workplace. Two world wars in the 20th century added to the structured military discipline of work-rest-work for the masses. During WW2 employer paternalism was encouraged by the top Labour representative in the war time coalition government and Minister of Labour Ernest Bevin. He was behind the decision of the BBC in 1941 to launch an hour-long programme Workers Playtime, which was broadcast from factories and offices during lunch hour to boost worker and domestic morale. The programme ran three days each week after the war until 1964 and included among its guests such icons of British entertainment as Tony Hancock, Elsie and Doris Waters (Gert and Daisy), Morecambe and Wise and Julie Andrews.  This structured regime of work, rest and play morphed into a revival of the paternalistic business model in the 1950s and through to the 1960s whereby many enterprises would host a range of clubs and societies such as drama and sports clubs. Some companies (such as the large ladies’ lingerie manufacturer Kayser Bondor in Baldock, Hertfordshire) even housed a swimming pool for staff. Systems of work and office organisation distilled from bureaucratic Taylorism created the socio-technical space for tea breaks to become part of workplace culture and practice, often with the ‘tea lady’ doing the rounds twice a day at the office or the factory.

But the employer always has a problem, in that they can entice the worker into the factory or office with a wage, but they cannot necessarily extract the maximum from the worker’s labour power once inside the walls of the establishment. Cutting back on rest and tea breaks, and monitoring and restricting time taken to go to the toilet, is thus always a temptation for capital, as it seeks to maximise the rate of exploitation of labour. Intensified global competition and falling rates of profitability meant that by the end of the 1960s the temptations to cut workers’ downtime became too much for employers to resist. The old paternalism was thrown in the out basket. The attack on tea breaks appeared to peak as the rise of new and more aggressive management techniques in the spirit of neoliberal globalisation.  In the best organised trade union workplaces the workers fought back. This was certainly the case in the car industry. edwarsdIn 1977 Michael Edwardes was appointed as head of British Leyland motors to restructure the company. His management methods and objectives riled the unions, and he proceeded to try to break the power of the shop stewards at the companies plants by sacking Derek Robinson, the unions’ convenor, in 1979. A long dispute followed which finally ended in February 1980 when Robinson’s dismissal was confirmed. robinsonThe remainder of the year saw an offensive against the employees as jobs were shed wholesale and all production at the MG factory ended. Edwardes also introduced a plan reduce the companies ‘relaxation allowances’, part of which was to shorten and stagger across the day the twice daily tea breaks. 100 paint sprayers went on strike at the Longbridge plant in Birmingham in response, bringing production of the Mini and Allegro cars to a halt. The tea breaks stayed but in shortened form. The press, of course, vilified the strikes in an atmosphere where union ‘bosses and barons’ were blamed for Britain’s economic problems in the new era of Margaret Thatcher as prime minister. However, tensions over tea breaks did not go away, they resurfaced again in 2012 when car workers on the Mini’s production line at Cowley, Oxford (by then owned by BMW) voted by 97 per cent to reject a pay deal which would have also trimmed the tea break time by 11 minutes per day. As the Sun newspaper recorded at the time ‘Time away from the assembly line would be reduced to just 42 minutes in an 11-hour shift, plus an unpaid lunch break. Yet BMW workers in Germany get 50 minutes every EIGHT hours. BMW bosses insist the pay offer at Cowley amounts to six per cent and say they are “disappointed” at the vote.’[5]

tea break strikeIt’s not just in the traditional manufacturing sector that tea and toilet disputes have occurred. Within public services private contractors have rushed to undercut the pay and working conditions of workers transferred from NHS and local authority care services. In July 2017 one of the biggest strikes within the NHS took place as workers across Whipps Cross, Mile End, Royal London and St Bartholomew’s Hospitals in London were transferred to the private Serco corporation in a contract worth £600m. Just three days after taking over the contract Serco proposed to abolish the ten-minute morning tea break. 120 staff immediately walked off the job until the tea breaks were reinstated, and a more generalised strike over pay and dignity within the workplace followed. Indeed, many workers in the sector are squeezed constantly for time. Unpaid breaks, or no breaks at all are common, especially for those such as home care workers who must make their visits within ever decreasing time slots. It is not only the tea break that is under threat but also lunch and rest breaks more generally. A survey of 800 workers by ukactive published in the Daily Telegraph in 2018 found that since 2012 the average lunchtime break has fallen from 33 minutes to 22 minutes. [6] A similar survey of just over 2000 workers taken in 2017 by workthere recorded a higher average figure of 34 minutes for a lunch break but also recorded that many workers now skip their lunch break altogether, and simply eat at their desk while continuing to work. [7]

Why Is This Important?

What is reported here is the phenomenon of unpaid work as rest times are reduced unilaterally and workers feel compelled or pressured to work through recognised or custom-and-practice breaks. The employer, of course, is laughing all the way to the bank. The Trades Union Congress estimates that a total of five million workers put in an average of 7.4 extra unpaid hours per week, missing out on an average of £6,265 pay per working year. Over a full year for the whole UK economy this amounts to two billion unpaid hours of effective overtime, from which employers collectively benefit to the tune of £31.2 bn. of unpaid labour. [8] But this unpaid labour comes on top of the surplus value already extracted from the worker in the normal working day, as she toils part of the day to pay for her wage, and for the rest of the day for the employer’s profit.[9]  It is theft upon theft.

But apart from the everyday theft of our time and energy for those with a workplace to go to the increasing incidence of attacks on rest breaks and lunch times coincides with new departures in the way work is organised. Most notable is the rise of the self-employed category of worker, for whom the concept of ‘paid’ rest and meal breaks is virtually meaningless. selfemployedThere has been an absolute rise in the number of self-employed in the labour market since the 2008 financial crash which appears to be a product of three factors[10]. First there is a decline of decent full-time paid jobs to which the self employed can escape to if they so wished.[11] This is because many of the employed jobs created have been for a low number of hours per week, or on part-time contracts or even zero hours contracts. The existing numbers of self-employed are constantly joined by new entrants to the category of ‘self-employed’ that act to boost the absolute totals. Second, is the bogus categorisation at the employers’ insistence of many contract workers as self-employed. This belies the subordinated status of workers in the gig economy (Deliveroo, Uber etc.) and elsewhere who may or may not otherwise wish for a decent full-time or part-time job as an employee. Third, the contracting out of many professional and technical jobs by employers as they seek to focus on their ‘core’ activities has both increased the pool of self-employed and encouraged the development of cost cutting small contracting businesses. Added to the rise of self-employment (bogus or otherwise) is the increasing likelihood of workers commuting greater distance to work and often working from home for part of the week. Government figures released in 2017 exposed some interesting trends. Commuting trips to work have actually declined in recent years from 7.1 journeys per week in 1998/92 to 5.7 in 2013/14.[12] This is primarily because working from home is growing, both occasionally and on a usual basis. However, for those who do commute the average distance has increased, especially for part-time workers and for women. Both trends act to cut down opportunities for talking to other workers, as people are either at their workplace fewer days per week or have to face longer journeys to and from work and are less likely to stay for union meetings or social occasions.

All this is also important for another reason, that of the propensity and ability of workers to collectively organise. A recent article by Rebecca Gumbrell-McCormick and Richard Hyman restates the evidence that the ability union to organise unions effectively is a product of representative structures in the union that allow for democratic participation by the members.[13]  Such forms of democracy and participation can usually only be achieved by members having the ‘culture of solidarity’ that is built up (often in quantum leaps as well as incrementally) by the experience of being able to meet and talk with one another and to gain confidence by expressing collective solidarity through strikes and collective disputes targeted at the employer.[14] Strikes and disputes not only help build the union by giving it purpose and hence recruiting further members, but also by challenging management’s assumed and often dictated ‘right to manage’ on substantive issues and the ‘frontier of control’. There will always be interference – the ‘dead hand’ of a cautious union bureaucracy will also need to be contested. The failure of the ‘servicing’ model of trade union organising is also arguably a product of the lack of member participation as everything is left to the district full-time official. Contestation with the employer cannot take place without members and activists having the political space and time to meet and talk with one another face-to-face (I will not get distracted here into the debate of social media and trade union organising as I have written on this elsewhere). The employers long offensive against rest breaks, tea breaks and lunch breaks may have a significant effect on workers ability to develop and sustain collective solidarity. This is not to deny more significant reasons for the decline in union coverage (lack of collective agreements, structural/economic change, hostile legislation and so on) but rather to assess the concrete problems union activists may face in organising.[15] Recent examples of the salience of this point are the  UCU strikes in the pre-1992 universities in the UK in 2017, which would not likely have been so possible to sustain without union activists taking the positive decision to ‘walk the corridors and knock doors’ as they agitated among the members.[16] The union also recruited significantly during the dispute. junior doctorsThe junior doctors’ walkouts were initiated not by the BMA but often by groups of flat sharers in major cities who simply wanted to get something done.[17] Action by Deliveroo/Uber Eats couriers was often initiated at small street corner meetings of the workers involved (dependence on an .app means that there are ‘hotspots’ in major cities where you are more likely to pick up an order……couriers gather there as a result).

Tea breaks, lunch breaks and rest allowances are not just necessary for our recuperation and well- being. They also provide political space and time for organising. Save the tea break!

 

[1] http://www.worldtoiletday.info/wtd2018/

[2] https://www.theguardian.com/money/2018/nov/19/thousands-uk-workers-denied-toilet-access-unite?fbclid=IwAR2HUv7xi6XLZJIIjggnN_FKM9-1poBiF4qljZlGv6FTu5SysVYZyL4ERhU

[3] http://www.workerscontrol.net/theorists/frontier-control-study-british-workshop-politics-carter-l-goodrich

[4] Tea was originally sold by chemists and pharmacists as a medicinal compound.

[5] https://www.thesun.co.uk/archives/news/524175/mini-workers-threaten-strike-over-cut-teabreak/

[6] https://www.telegraph.co.uk/news/2018/10/20/average-lunch-break-now-last-just-22-minutes-third-six-years/?icid=registration_eng_nba158433_static&awc=15609_1542734689_c796480ad1741b4b0641e8dc7c681ccc&WT.mc_id=tmgoff_poth-inbaff_tra_hotels&utm_source=201309&utm_medium=AWIN&utm_content=tra_hotels&utm_campaign=www.independent.co.uk

[7]https://www.workthere.com/en-gb/news-guides/research/how-can-the-office-save-the-lunch-break/

[8] https://www.tuc.org.uk/blogs/work-your-proper-hours-day-%E2%80%93-tackling-culture-unpaid-overtime

[9] See Marx’s Capital Volume 1, chapter 10 for an exposition of this process accessible at https://www.marxists.org/archive/marx/works/1867-c1/ch10.htm

[10] Source of graph statistics ONS, labour market report 2016

[11] By ‘decent’ I mean full time permanent jobs with pension benefits, paid training and career progression opportunities.

[12] https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/657839/commuting-in-england-1988-2015.pdf

[13] Gumbrell-McCormick, Rebecca and Hyman, R. (2018) Democracy in trade unions, democracy through trade unions? Economic and Industrial Democracy, ISSN 0143-831X. accessible at http://eprints.bbk.ac.uk/22876/

[14] See Rick Fantasia (1989) Cultures of Solidarity: Consciousness, Action, and Contemporary American Workers, University of California Press.

[15] We must also note the debate on the ‘propensity to strike’ which took place in the 1970s. Kerr and Siegal (1954) had argued that strike propensity is higher in tightly organised communities based on one occupation or industry (e.g. steel, coal-mining) but as Hyman argued in his review of the debate strike proneness is dependent on many other factors and an international comparison of steelworkers, for example, did not bear out Kerr and Siegal’s hypothesis. See Richard Hyman (1972) Strikes. (Fontana).

[16] Anyone who has ever been a smoker will know of the positive socialising effects for discussing workplace issues and ‘gossip’ as the smokers hang around together outside the workplace!

[17] Anectdotal evidence given to the author by the leader of the dispute in Bristol.

Is There a New Cold War?

*First published in Irish Marxist Review

 

Over the last few months there has been speculation that the world has now entered a new period of Cold War. Serious mainstream journals such as the US-based journal The Nation have referred to the escalating nuclear arms race, the expansion of NATO territory to Russia’s borders, Putin’s successful annexation of Crimea, internet hacking accusations, and the expulsion of Russian diplomats following the poisoning of ex-spy Sergei Skripal and his daughter as reasons for concern at the territorial ambitions of both Trump and Putin. Writing in the UK-based New Statesman Professor of War Studies Lawrence Freedman develops an additional argument that Cold War 2.0 is essentially a product of the internet age, offering some continuity with Cold War 1.0, but ratcheted up by the power of propaganda and (dis)information through the web. In pursuing his argument Freedman presses the point that ‘Western governments are never going to be much good at state-sponsored information campaigns. It is worth noting, however, that Russians are convinced that the West is quite brilliant at undermining governments this way, citing as examples the Arab Spring of 2010/11, demonstrations against Putin in Moscow in 2011, and the uprising in Ukraine in 2014 (indicating their difficulty in believing that popular movements can develop without substantial help from foreign agents).’[1]  Others have been dismissive of the ‘New Cold War’ claims. In the American magazine Foreign Policy, Harvard Professor Stephen M. Walt emphasises that the Cold War was a time-specific period in which two super powers, the USA and USSR, engaged in ideological and territorial manoeuvres designed to suppress or destroy the other. The Soviet Union’s demise in 1991 after the fall of the Berlin Wall in 1989, Walt argues, ended this fundamental divide and universalist ideological stand-off. The bi-polar nature of Cold War competition contrasts to a multi-polar world in which we now live. It follows not only the break-up of the Soviet Union but also the rise of alternative centres of global or regional power such as Japan in the 1980s, the ‘soft’ economic and normative power of the European Union, and now China.  The journal Foreign Affairs, published by the US Council on Foreign Relations appears to agree, with another Harvard Professor, Odd Arne Westad, describing attempts to classify a new era of Cold War as ‘terminological laziness’.[2]  While such distinguished professors of international relations beg to differ, we are also mindful of the question of President Trump’s state of mind when making key foreign policy decisions. Is he behaving rationally, why does he keep changing his mind, is there some grand master plan, or is he simply shooting from the hip?

A sober analysis must be mindful of the major political and economic change of the last three decades. The (actual) Cold War began at the end of the second world war and lasted until the collapse of the Soviet Union on December 25th 1991. The USA was experiencing its ‘Golden Age’ of consumer spending and formed hegemony within the western sphere not through territorial expansion (as in the era of European colonial imperialism) but by economic pressure filtered through agencies such as the World Bank and the International Monetary Fund. Should trouble ensue, it was perfectly willing to use its military power to force its hand. Competition from the USSR was real as growth rates in the USSR in the 1950s outstripped those of the West (albeit from a lower base). The USSR had also launched the first space satellite, Laika the dog and then Yuri Gagarin into space, ahead of the USA. The military strategy of the USSR was constructed to keep satellite states in control, and invasions of others’ territory was confined to cementing its own sphere of influence. The resultant economic and military competition led to an escalating arms race, at first terrestrially and then in space. The Soviet bloc seemed bound together by a rhetorical belief in a Communist state, reinforced within the west by Communist Parties who remained loyal to the old Stalinist method of the USSR and a corrupted belief in ‘Socialism In One Country’. The USA and its allies were cemented by an equally mischievous rhetoric of ‘democracy and freedom’. This did not prevent it giving covert and sometimes overt support to right wing dictators abroad and witch-hunting ‘anti-democratic’ communist sympathisers on the home front.  Prominent dissenters in the Soviet bloc were offered asylum status, while numerous spy exchanges confirmed the bargained nature of the Cold War status quo.  The double-sided rhetoric was constructed upon a Soviet model which was designed to protect the interests of the Soviet ruling class and the borders of the Soviet Union, rather than to support genuine workers’ unrest either at home or in the west by encouraging socialism from below. An example was the offer by the large French Communist Party to de Gaulle in exile in 1968 to hold new elections, a lifeline to him which ended the unrest in the factories and on the streets. But the division was not without territorial and ideological problems. A major point of contention in the early years was the efforts by Tito and the Yugoslav League of Communists to support Greek Communist partisans fighting US and British forces in the aftermath of WW2.[3] Stalin needed to preserve the gains of the Yalta Agreement, signed by him, Churchill and Roosevelt in 1945.[4] The Agreement was designed to consolidate a Soviet sphere of influence in post War eastern Europe in exchange for allied control in western Europe. Poland, Hungary and Czechoslovakia as well as the Eastern Balkan states fell within the remit of Stalin, while Italy and Greece were to be in the western sphere. Tito’s offer of help to the Greek communists upset the consensus and was duly rejected by Stalin leading to the Tito-Stalin split of 1948. Churchill had anticipated the coming nature of this divide in his ‘Iron Curtain’ speech, made in the USA in 1946. In his speech Churchill paid tribute to his ‘wartime comrade, Marshall Stalin’ and the strength of the Soviet Union, but berated Tito for ‘hampering’ the arrangements agreed for Italy and Greece by his support for the communists. He forewarned of internal difficulties ahead with the existence of communist ‘fifth columns’ in western Europe which ‘constitute a growing challenge and peril to Christian civilization’.[5] The territorial carving up of Europe was thus imbued with an ideological tinge, however inaccurately coloured that tinge may have been. In the west, the discourse on democracy continued to be belied by the successive US invasions of recalcitrant regimes in ‘backyard’ countries such as Cuba, Grenada, Panama and Haiti, as well as covert support for anti-government forces in Nicaragua, Chile and elsewhere. The USA and USSR never clashed directly, hence the ‘Cold’ nature of the war, but proxy wars were undertaken in hot spot areas, most notably on the Korean peninsular and in Vietnam as well as Cambodia and Laos. The Soviet Union, for its part, invaded both Hungary (in 1956) and Czechoslovakia (in 1968) to punish citizens who had dared to challenge Soviet authority from below. The threat of cold war becoming hot war was real, as nuclear tensions gathered and troops amassed either side of the German divide. At its height the USSR and its satellites placed almost half a million troops in the former East Germany with over 4200 tanks (suppressing the uprising there in 1953), while the US alone had more than 300,000 troops in West Germany.  The divided city of Berlin, with its Wall and networks of spies, thus epitomised the realities of the Cold War, and the fall of the Wall in 1989 was the nail in the coffin of Soviet hegemony. Few, if anyone, had predicted the end of the Cold War, but its end came as Soviet President Gorbachev gave up on believing a now struggling economic bloc could afford to compete either militarily or economically with the West. His introduction of Glasnost (open government) and Perestroika (restructuring) followed US President Reagan’s ratcheting up of his expensive ‘Star Wars’ programme in 1983, designed to out-strip Soviet capabilities from space.  In East Berlin, the Communist leader of the GDR, Erich Honeker, had come to rely on the assumption that the thousands of Soviet tanks and troops based in the GDR would suppress any new uprising. This, he assumed, would be the holding line of the wave of revolt and revolution already infecting the communist states in Poland and Hungary. When Gorbachev visited East Berlin on the 7th October 1989 for the 40th anniversary celebrations of the East German Republic he disarmed the East German Communist regime by stating ‘life punishes those who come too late.’ Soviet troops stayed in their barracks and one month later the Wall came tumbling down. Things would never be the same again as Communist leaders from Moscow to Sofia jumped from state capitalism to market capitalism to save themselves and join the global economic elites. By the end of the year the dominoes had also fallen throughout communist eastern and central Europe, and in 1991 the Cold War, as so conceived, ended with the dissolution of the Soviet Union into separate states.

The period since 1991 has been backgrounded by a boost to neoliberal globalised capitalism. Neoliberal capitalism, and its associated globalisation of the economy, predated the end of the Cold War. Its origins can be traced to the search for new product markets and sources of cheap labour as demand for ‘western’ consumer goods and profits stagnated. By the end of the 1960s investment in capital in the west had created a web of ‘capital-bias’ in manufacturing enterprises that blunted corporate profitability. The living labour of workers, from which surplus value and profit could be extracted, had been increasingly replaced by the dead labour of capital, which rather than create new value simply passed on its existing value. The break down of tariff barriers, the opening-up of new markets, the end of currency controls, and the creation of a new work force outside of the older advanced economies was a way forward for the western corporations. The Soviet bloc, with its own trading arrangements of COMECON, was increasingly encircled by a new wave of western-inspired and controlled economic activity that threatened its own ability to compete. For the Soviet ruling elite, by the end of the 1980s, the idea of opening-up their economies to this process seemed an opportunity rather than threat. Many of the old nomenklatura were enriched in the process, as former state-owned industries and primary production such as oil and coal transferred into their private pockets. Indeed, the former Communists of states from Russia to Hungary to Estonia lapped up the opportunity in a neoliberal orgy of privatisation, and the ‘oligarch’ was born.

For many liberal commentators such as US-based Francis Fukuyama this marked the ‘End of History’, as a new wave of democracy and freedom across the world would begin. He wrote: ‘What we may be witnessing is not just the end of the Cold War, or the passing of a particular period of post-war history, but the end of history as such: that is, the end point of mankind’s ideological evolution and the universalization of Western liberal democracy as the final form of human government.’[6] He was wrong. Rather than heralding a benign atmosphere we witnessed instead a world of increasing instability and unpredictability, which began with the implosion of Yugoslavia in the 1990s, and was riven with new territorial conflicts in the Middle East and elsewhere as states jockeyed for position in a new multi-polar world. Sub-regional ambitions begun to emerge, leading to western invasion and enforced regime change to remove Saddam Hussein in Iraq and Gaddafi in Libya. Rather than see the spread of economic wealth through the neoliberal lie of ‘trickle-down’ economics the world experienced growing inequality and disenfranchisement as neoliberal economics paraded its political authoritarianism. Military threat, rather than dissipate into a liberal utopia, instead gathered pace, conflicts over economics became a conflict over politics. In 2018 the USA has 800 military bases or installations in more than 70 countries, and more than a quarter of a million US troops are deployed overseas.[7] This is clearly not a sign of reduced world tension and liberal democracy as Fukuyama expected, but rather a sign of US military intention on a global scale. The ambitions of the US and its allies to maintain dominance over oil rich states in the middle east has seen the reaction of terrorist activity taking aim at western powers on their home ground. The continuing tragedy of refugees fleeing war and poverty is exacerbated by the proxy wars between Russia and the US in Syria. The Israeli state has been given more green light by the USA to intimidate its neighbours and slaughter Palestinians. The Russian state under Putin, now stripped of its satellites and buffers, has clearly receded as a global military power, but still maintains a nuclear arsenal which matches the USA in numbers (with over 7000 nuclear warheads each). Its active troop numbers are one half of the USA’s and its air and naval power is much smaller (with only one aircraft carrier to the USA’s 20, for example). The strategic approach of the US military appears to create a global rapid response force through air and sea power, as opposed to Russia’s ambitions, echoing the strategy of the old USSR,  to secure land movement (it has many more tanks than the USA and maintains a ‘reserve’ troop force of 2 million).  Indeed, Putin saw fit to ‘secure’ its borders with land-based interventions in both Georgia and Ukraine, and Putin remains confident of imposing Russian strength its in own hinterland. Flashpoints remain in Ukraine, Belarus and the Baltic States. All are former member states of the Soviet Union, but the Baltic States of Estonia, Latvia and Lithuania are now members of both NATO and the European Union. The Ukrainian wars, of course, reflected these tensions with both the European Union and Russia acting to tempt the new Ukrainian state towards them with promises of trade and financial concessions. In the heartland of the old Cold War, we thus see a re-ordering of influence from both Russia (as opposed to the Soviet Union) and the West (in the guise of NATO and in ‘soft’ power terms the EU).

Two further factors need consideration. First is the emergence of China as a world super power following the spectacular growth of its economy over the last two decades. Second, is the change of strategic direction of the USA following the election of Trump. The change in global economic power between China and the USA is remarkable. The USA’s position as leader in world trade in merchandise was eclipsed by China in 2012. In 2001 Chinese share of world trade was only one fifth of that of USA. Moreover, US imports have fallen from 17 per cent of world total to 12 per cent, while its percentage share of exports has fallen from 12 per cent to 8 per cent. This has been accompanied by a rapid increase in Chinese investment overseas, and as part of Beijing’s ‘Going Global’ strategy investment is increasing in high tech industries as the Chinese Communist Party seeks to drive the economy to a higher end of the world’s markets in manufacturing production.[8] China has begun to use its economic weight to begin to flex its muscles at a diplomatic and military level. It has clearly played a major role in the developing political situation on the Korean peninsular. Having established its first overseas military base in the Indian Ocean at Djibouti (on the Horn of Africa) it reportedly now plans another in the South Pacific at Vanuatu near to Australian and New Zealand coastal waters. In the South China Sea it has been developing missiles to deter American warships and reclaiming land to build bases on the disputed Spratly Islands. Five new aircraft carriers are being planned to add to the one already in operation. Meanwhile, as far as troop numbers are concerned, the People’s Liberation Army remains the world’s largest force, with more then two and a quarter million personnel.

We need to observe the moves of President Trump and engage in some ‘Trumpology’ to determine if his plans to invoke new trade wars are a precursor to a hardening military stance, which would give substance to the view that we are entering a new Cold War, albeit of a different kind. Trump’s reaction to the rise of China has in fact swayed between belligerence and accommodation as he implements new tariff regimes against China as well as the EU and near neighbours Canada and Mexico within the North Atlantic Free Trade Agreement (NAFTA). In the first weeks in office Trump created a White House National Trade Council under the directorship of Peter Navarro, the author of Death By China. The substance of the new policy is ‘repatriation’ of international supply chains (especially those involving China) and the construction of alternative ‘domestic’ supply chains within the US. The USA has withdrawn from the Trans-Pacific Partnership (aimed at competition with China) and has announced plans to renegotiate NAFTA and to not ratify the TransAtlantic Trade and Investment Partnership (TTIP) between the US and Europe. This all come on top of Trump’s decision in June 2017 to pull out of the Paris Climate Agreement. Indeed, Trump has even claimed that climate change, if it were to exist, is the fault of the Chinese, when he tweeted in 2012 that ‘the concept of global warming was created by and for the Chinese in order to make U.S. manufacturing non-competitive.’ Yet despite this overt hostility, as in the case of Korea, Trump has been seen to change his mind. He has since raised possibilities of new trade deals with the EU (outside of TTIP), and indeed with China. This ambivalence and ambiguity in Trump’s agenda suggests that a re-ordering of trade arrangements is under way rather than pure destruction and retreat into isolationism and even war (although the possibility of skirmishes between China and the USA in the Pacific or South China sea remains real). Trump represents a solid strand of US protectionism that has a long history within the Republican right, going back at least to the ‘fear’ of the rise of Japan’s new industrial prominence in the 1980s. However, the outcomes of the consequent flirtations with protectionism and trade wars remain unpredictable, with a mixture of resistance, bemusement, and accommodation likely not just within the American ruling elite but with major trading partners such as China, Canada, Mexico and the EU. It would be a mistake, however, to place such ambiguities as a product of Trump’s state of mind. He is certainly racist, misogynist and poisonous in his words, exploiting the soft spots of his opponents with aplomb. But he is conducting a new US strategic offensive for the economy and on the international political stage of which there is some logic, given the fact that international trade represents a much smaller proportion of GDP in the USA than that of its competitors.

We must continue as revolutionary socialists to be aware that the history of capitalism is fraught with economic rivalry between nation states that has the potential to spill from trade to military war. Indeed, the gathering protectionism and imperialist rivalry of the early part of the twentieth century in Europe was a key factor in the consequent world war. The actual Cold War of 1945 to 1991 was a product of the re-ordering of spheres of influence across a European continent ravaged once again by war. It was overlaid with ideological justification (however rhetorical) as two major power blocs, the USA and USSR, sought dominance over their spoils. The multi-polar nature of today’s global economy sees the USA again in prime position, a subdued Russian bear still wishing to defend its lair, and new kids on the bloc in the guise of the EU as a major trading bloc and China as a tiger in the East. The balance of forces remains unstable, and rather than reincarnate a new Cold War we may be better placed in focusing our attention on the instability of our world, and the continued likelihood of mass outbreaks of resistance as the ravages of capitalism in its neoliberal form gather pace. The place and time of such outbreaks are not possible to predict, but the crisis of the Eurozone following the financial crash of 2008, the revolt of the Arab Spring in 2010, continuing war and refugee exodus in the Middle East, and the collapse of centre ground social democratic politics across the western world are all testament to an ongoing political, economic and environmental crisis across our planet.

 

 

[1] Lawrence Freedman ‘Putin’s new Cold War’, New Statesman, 14 March 2018

[2] Odd Arne Westad ‘Has a New Cold War Really Begun?’ Foreign Affairs, 27 March 2018

[3] Although Tito also employed Stalinist method and practice, against his own dissidents in the new Yugoslavia and by supporting Stalinist purges abroad.

[4] Churchill later recalled the encounter in his memoirs: “The moment was apt for business, so I said, ‘Let’s settle about our affairs in the Balkans. Your armies are in Romania and Bulgaria. We have interests, missions, and agents there. Don’t let us get at cross-purposes in small ways. So far as Britain and Russia are concerned, how would it do for you to have ninety percent predominance in Romania, for us to have ninety percent predominance and go fifty-fifty about Yugoslavia.” Churchill wrote the figures down on a slip of paper and pushed it across the table to Stalin. “There was a slight pause. Then he took his blue pencil and made a large tick upon it, and passed it back to us. It was all settled in no more time than it takes to set it down.

[5] http://www.historyplace.com/speeches/ironcurtain.htm

[6]Fukuyama, Francis (1989). “The End of History?”. The National Interest (16): 3–18.

[7] https://www.globalresearch.ca/the-worldwide-network-of-us-military-bases-2/5564

[8] For a more detailed assessment see Martin Upchurch (2018) ‘Is Globalisation Finished’ accessible at http://isj.org.uk/is-globalisation-finished/

Is Globalisation Finished?

*First published in International Socialism

The election of Donald Trump as US president crystallised fears in sections of the financial elites that the world economy was beginning to spin towards a new era of protectionism. Trump used rhetoric during his campaign which echoed right wing populist parties elsewhere in the developed world. In its most virulent form, the envelope of trade protectionism was conjoined with anti-immigrant discourse aimed at Mexicans and other Latinos ‘south of the border’. The message was designed to appeal to workers disaffected and distanced from the neoliberal elite whose free trade policies had supposedly been the cause of job losses as employers sought cheaper labour production locations abroad. The message worked for Trump, as the Democrats had no place to hide from the suggestion that they were to blame. Since taking power Trump’s tilt towards protectionism has caused a row within Washington. The US President has withdrawn the US from the Trans-Pacific Partnership (aimed at competition with China) and plans to renegotiate the North American Free Trade Agreement (NAFTA) and to not ratify the TransAtlantic Trade and Investment Partnership (TTIP) between the US and Europe. According to one source the disagreements are akin to ‘a civil war……..over trade, leading to what one official called “a fiery meeting” in the Oval Office pitting economic nationalists close to Donald Trump against pro-trade moderates from Wall Street.’[1] Writing in the Financial Times in May 2017 Martin Wolf states that Trump ‘appears to be intent on replacing multilateralism with bilateralism, liberalism with protection and predictability with unpredictability.’[2]  These divisions over strategy will not go away soon. One of Trump’s first moves as President was to establish a White House National Trade Council under the directorship of Peter Navarro, the author of the book Death By China which takes aim at US-China trade policies. The substance of the new policy is ‘repatriation’ of international supply chains (especially those involving China) and the construction of alternative ‘domestic’ supply chains within the US.[3] Trump’s decision on June 2nd 2017 to pull out of the Paris Climate Agreement was also dressed up by him as defence of ‘Pittsburgh’ rather than the planet, suggesting a deepening of a long strand of Republican ‘isolationism’ cloaked with economic nationalism. Parallel to these moves Trump has raised possibilities of new trade deals with the EU (outside of TTIP), and indeed with China. This ambivalence and ambiguity in Trump’s agenda suggests that a re-ordering of trade arrangements is under way rather than pure destruction and retreat into protectionism.

The new vogue of trade protectionism, which lays like a shadow over Trump’s policies, also reflects those of right populists/fascists in Europe such as France’s Front Nationale. The protectionist mind set sits side-by-side with the proposition that we have now entered a period where globalisation as we know it is at an end. Indeed, suggestions of globalisation’s demise began more than a decade ago after 9/11, claimed by some commentators as marking the end of the new liberal world order promised by Francis Fukuyama in his 1989 essay The End of History.[4] The ‘end of globalisation’ thesis thus runs as a follow up to the ‘end of history’ nirvana promised by the Fukuyamists.  Prominent in the debate has been the conservative historian Niall Ferguson.[5] Ferguson equates contemporary political developments with that of the period at the beginning of the 20th century, when an earlier period of ‘globalisation’ collapsed into war and economic nationalism.  His approach is affirmed by the work of John Rawlston Saul, who has suggested that after 1995 (his considered ‘high point’ of globalisation) nationalism, ethnicity and religious fundamentalism have all but destroyed the dream of a liberal world order and accentuated division in the political and economic spheres.[6]  Outside of this essentially conservative political assessment has been more measured economic critique, most notably by Hirst and Thompson in their 1999 book Globalisation in Question.[7]  The book drew doubts on the ‘hyperglobalisation’ thesis predicting the end of the nation state, by pointing out that the overwhelming majority of foreign direct investment (FDI) was not between global North and South but was ‘in-house’ and traded between the rich nations, and more often than not within the same corporations over national boundaries. What we are seeing now, however, is a new period of doubt and caveat on the efficacy of globalisation, spurred by economic data showing a reversal of trends from previous decades.

The reversal stems from the breakpoint of the 2008 financial crash. The crash exposed major weaknesses in the neoliberal global business model. Declining rates of profit on investment had stemmed world economic growth, while money shifted into financial speculation eventually burst its own bubble. Since the crash new data has cast doubt on the continuing efficacy of globalisation as an irresistible phenomenon. Free trade, low or non-existent tariffs, and liberal market rules are all part of what we understand as modern day globalisation. If the tide was to be reversed then surely over four decades of ‘globalisation’ would also peter out. This indeed is the view of those writing a very influential article in March 2017 in the Wall Street Journal entitled ‘Whatever Happened to Free Trade?’. The article followed fashion and linked a decade of economic retrenchment to an upsurge in populism. The authors point to the slowdown both in world trade volumes and foreign direct investment (FDI) since the 2008 financial crash, and refer also to the 7000 plus protectionist measures that have been enacted within the world economy since 2009, ‘half of them aimed at China’. Capital controls across borders had also become more severe ‘In all, 31 out of 108 countries tracked by economists Menzie Chinn and Hiro Ito became less open to global capital flows between 2008 and 2014, while 13 became more open. That’s a sharp reversal from the five-year pre-crisis period, when 40 countries became more open to global capital flows and 12 became less open’.[8]

All this would certainly indicate that globalisation may have already had its day in the sun. But if this is the case, how sustainable is the trend away from globalisation, and what are the underlying causes and changes in political economy that have driven these changes? This article seeks to address these questions, first by defining and examining previous waves of globalisation, and second by probing the political ideology behind the neoliberal project which is now under attack.

Trends in Globalisation?

In purely structural and economic terms (rather than cultural or political) we can suggest that the world economy is in a phase of ‘globalisation’ when the rate of growth of world trade is greater than the rate of growth of world production of goods and services. Such a positive ratio would indicate that the world economy is becoming more integrated, as cross-border trade and foreign direct investment increasingly replaces or substitutes for production of goods and services for the home market. When the trend reverses, it generally indicates a period of protectionism and import substitution. This was the case in the inter war years, when tariffs were raised and exchange controls imposed in a period of economic nationalism which began in 1914 as geo-political tension between the Great Powers accelerated. It took a practical form not only in the Great War but also in its aftermath. Between 1913 and 1950, world trade grew at only half the pace of world output of goods and services, indicating the severity of the retrenchment that fed the Great Depression and then the second world war. [9]

However, after the end of WW2 we see a change in the world economy towards more integration. From 1949 until the financial crash of 2008 global trade grew on average at 10 per cent per year outstripping growth of world production by about twofold.[10] The reversal in fortunes in the immediate post war period was clearly a response to US political and economic strategy to reconstruct the capitalist order outside of the Soviet bloc. It was the political engine of war and then the Cold War from which emerged first the Bretton Woods agreement to create a world financial system conducive to open trade and investment and then the Marshall Plan to reconstruct (western) Europe. The variations and developments of the ensuing ‘peak’ globalisation are discussed later but generally the world economy expanded in parallel with globalisation of goods and service production and trade.  Since 2008, however, the process of expansion appears to have been reversed. There was an upturn in world trade in 2010 as the world economy began to recover but since then trade growth has again slowed down massively and settled to around 2.5 per cent growth per year. World production figures, measured in GDP, have also slowed down since the crash and are also now stabilising with growth rates well under 3 per cent by 2015,[11] with rates less than 2 per cent in the developed economies.[12]  This retrenchment appears to have been triggered not only by the crash of 2008, but also by the slowing down of economic growth in the far East, particularly China, which had acted as an engine of both imports and exports within the wider world economy.

We can point to other indicators. For example, the post WW2 period of ‘peak’ globalisation has also been associated with an expansion of production networks and supply chains as enterprises in the global North seek cheaper labour areas to exploit in the global South. However, there is emerging evidence that the rush in the last few decades to expand global supply chains and to outsource production across world networks has also slowed down and in some cases gone into reverse. Large US corporations, for example, such as American Apparel in clothing, Zara in beauty products, IBM in computers and Caterpillar in agricultural machinery who used to spread production across the world in the search for cheap labour, are now switching back to a system of production based on ‘vertical integration’.[13] This assumes a much closer geographical link between R&D and production facilities, whereby consumer market trends can be more quickly and easily accommodated and re-shoring takes place alongside changes in labour practices which may include a new phase of automation.

Trends towards reshoring, however marginal, have also been matched with a decline in world totals of FDI. According to the latest OECD reports, FDI flows decreased by 7 per cent in 2016, dropping to 2.2 per cent of global Gross Domestic Product (GDP),[14] a drop to half the rate of that when compared to the decades of ‘peak globalisation’. Some of this decline is undoubtedly due to economic caution amongst investors following the financial crash, but the OECD also point to evidence of nation states using security concerns as a reason for adding more restrictive measures on both outward and inward FDI. An OECD background note in March 2017 reported this trend ‘Governments are increasingly concerned about the potentially non-commercial objectives of investments by state-owned enterprises or sovereign wealth funds and about the lack of potential reciprocity in terms of the market for corporate control in the country of the investor. Multinational enterprises may also face a resurgence of restrictions on outward investment from their home country’.[15] Such sentiments would seem to match the desire of Trump and others for a new period of ‘economic nationalism’, triggered in part by wider geo-political concerns of competition from China, which is now a net exporter of FDI.

It would be a mistake, however, to view globalisation and its future purely through a statistical lens. Deeper political and economic forces underlay the surface changes found in the statistics, and it is to these deeper forces that we need to turn to develop our understanding. Before doing so, however, we need to consider the history of ‘industrialised’ globalisation, and to learn from its pattern of behaviour.

Globalisation Past.

  “The colonial system ripened, like a hot-house, trade and navigation. The “societies Monopolia” of Luther were powerful levers for concentration of capital. The colonies secured a market for the budding manufactures, and, through the monopoly of the market, an increased accumulation. The treasures captured outside Europe by undisguised looting, enslavement, and murder, floated back to the mother-country and were there turned into capital.” (Marx, Capital Vol 1, Chapter 31: The Genesis of the Industrial Capitalist)

In this passage Marx was highlighting the developing relationship between the forces of empire and trade and capitalism’s need to appropriate funds for further expansion.[16] He was writing as Britain had created its empire from the primitive accumulation of capital based on slavery and exploitation of its colonial ‘possessions’. The competitive advantage that Britain and other European powers enjoyed (together with the USA after the ‘Great Depression’ of 1870 – 1880) was utilised to its maximum to fund the coffers of corporations and the state. Technological advances, with the introduction of the telegraph and steam powered ships aided the process. The system of colonial exploitation was based on trade advantage which although espoused as ‘free’ by its apologists was an expression of economic power backed by military boots on the ground and the Royal Navy at sea. As Engels observed of the contemporary scene. ‘Political economy came into being as a natural result of the expansion of trade, and with its appearance elementary, unscientific huckstering was replaced by a developed system of licensed fraud, an entire science of enrichment’.[17]  Indeed, as John Newsinger describes in his book The Blood Never Dried, during the opium wars in China ‘The British Empire was the largest drug pusher the world has ever seen’.[18]

While trade was the driving force of this earlier period of industrial ‘globalisation’ it was not conducted on a basis which would boost the industrial economy of the colonies. The world’s industrial working class remained firmly rooted in the advanced nations, and the colonies were exploited more for their country specific commodities (tea, cotton, sugar cane etc.) and raw materials (e.g. rubber) rather than their industrial labour power as in our modern period of ‘peak globalisation’. The search for raw materials and commodities threatened to cause inflation as supplies were infinite, and so plunder, extortion and theft became the normal behaviour of the richer colonialists while the living standards of the dispossessed were deliberately suppressed. The financial surpluses extracted through colonialism aided and abetted capital accumulation through the extraction of ever more surplus value from waged workers in new and existing factories in the homeland.  The imperialist projects of the Great Powers were thus a fusion of capitalist expansion and territorial gain. The colonies were simply left behind in the process. Indeed, just taking the case of India, as Mike Davis observes ‘there was no increase in India’s per capita income from 1757 to 1947’.[19] More generally, what we see is that the industrialised world of western Europe and the USA leapt ahead during this time, leaving the colonised world behind. In 1750 the southern and eastern continents had accounted for 73 per cent of world manufacturing production, its share fell to 50 per cent by 1830 and by 1913, at the end of the first globalisation wave, its share stood at just 7.5 per cent.[20] This is important to note, as liberal and conservative historians such as Niall Ferguson will persist in portraying empire as benign and benevolent, when as Davis has portrayed in Late Victorian Holocausts, the British Japanese and US empires left a legacy of dreadful famine and poverty akin to ‘cultural genocide’. The violence of the period is its key feature, and was made necessary to defend the empire from revolt and insurgency. The most notorious incident of British repression in India, for example, took place in 1919 after the arrest of Gandhi, when in Amritsar, Punjab, General Reginald Dyer ordered his guns (held by Gurkhas) to be turned on a crowd of thousands of people listening to pro-independence speeches. Hundreds were massacred on the spot or left to die in the dust as curfew approached. The violent repression continued to the last days of the British empire, and included the torture, summary execution and hanging of over 1000 prisoners in the Mau Mau revolt in Kenya in the 1950s. Britain, of course, was not alone in committing imperialist atrocities and expanding its territory. As Eric Hobsbawm has written the ‘Age of Empire……was essentially an age of state rivalry’.[21] Within this rivalry the plunder was absolute. In the ‘scramble’ for Africa over a 30 year period between 1880 and 1910, 110 million Africans became subjects of five European empires, that of Britain, France, Germany, Italy, Portugal plus the Belgian monarch. By the turn of the 19th century British dominance had begun to fade and by 1913 the four chief economies were the USA (providing 46 per cent share of industrial and mining production, including construction), Germany (23.5 per cent), Britain (19.5 per cent), and France (11 per cent).

Hobsbawm described this emerging variegation in power as a period of ‘growing pluralism’ of the world economy which began to gather pace at the turn of the century. Britain’s share of all exports from Africa, Asia and Latin America fell from one half in 1860 to one quarter by 1900, creating a world which was no longer ‘monocentric’.[22] But then, as today, Britain did not suffer too much from its relative decline in world trade share, as it found a new role as the world economy’s banker and insurance broker in the City of London. Its previous position of domination had left it with considerable overseas ‘assets’ and in 1914 Britain still held 44 per cent of all world overseas investments.[23] But the resulting geo-political tensions caused by the ‘scramble’ for Africa and other parts of the world became like a pressure cooker of geo-political tension. The quarrels between the Great Powers culminated in retrenchment into protectionism followed by the Great War and then two decades of economic turmoil.

From this overview we can distinguish three pertinent features which have shaped globalisation in the past, and which may offer us insights into its present dilemmas and the future.   First, we can see that while the period of Pax Brittannica placed England and then Britain as the monocentric hegemonic power throughout the eighteenth and nineteenth centuries, such power was threatened by new entrants to the game, as state rivalry and polycentric power emerged. The political state rivalry, the pursuit of economics by other means, eventually led to a breakdown of the world system, war and recession. Second, we must note that far from being consensual, or benign, or benevolent, the process of globalisation was violent, entailing famine, murder, torture and state military power to guard against revolt and rebellion. Third, we can note from Marx and Engel’s writings on the first wave of ‘globalisation’ that the process of trade expansion and colonisation was integral to the structural development of capitalism at the time. ‘Political Economy’ flowed from their analysis of why capital needed to plunder outside its industrial heartlands to accumulate. Our task is now to determine if these three key features of the earlier period of globalisation can aid our understanding of the stability or fragility of the neoliberal order and its own particularised project of globalisation. Most importantly, as capitalism continues to falter with a crisis of profitability and in the aftermath of financial turmoil, is Pax Americana waning to such an extent that it is now being replaced by a new order of polycentrism? If this is the case has globalisation peaked, or is it simply morphing into some other form?

Globalisation Reborn

The shift to Pax Americana implies a hegemonic dominance of the USA over world affairs acting both as economic superpower and ‘world policeman’.  Indeed, the view that globalisation is a primary product and objective of a singular state power has pervaded much of the literature on our period of post war ‘peak’ globalisation. The Marxist writers Leo Panitch and Sam Gindin, for example, appear to reduce the explanation for ‘peak’ globalisation to American hegemony and its ability to ‘dis-articulate’ domestic capital in other nation states which, as a result, are ‘no longer represented by a coherent and independent national bourgeoisie’.[24] However, as Alex Callinicos has shown in this journal this position is in many respects an overstatement of the importance of the USA’s ability and willingness to direct its economic and military power in the post war era. It is not the case, for example, ‘that the return to the Great Power rivalries of 1870-1945, while containing an important element of truth, stated baldly implied a simple repetition of earlier historical patterns without taking into account the effects of the concrete forms taken by economic and geopolitical competition in the intervening Cold War era’. [25] In reality, the development of globalisation in the post war period has been a much more complex affair, involving different stages and backgrounded not so much by an overwhelming US hegemony but rather a set of strategic position games of which the USA has played the major, but not all-consuming role. Most notably, rather than the ‘third world’ becoming left behind through imperial dominance as in the first ‘wave’ of globalisation up to 1913 the net result has been an expansion of industrialisation in the global South. This expansion has been encouraged by sources of cheap labour costs in the global South which have been utilised for manufacturing production. By 2005, as de la Dehesa records ‘60 per cent of Northern exports to the South are manufactures, as are 60 per cent of Southern exports to the North (author’s emphasis). In general, the manufactures exported by the North are capital and technology intensive, while those exported by the South are labor intensive’.[26] The industrial expansion has not produced convergence in living standards, rather the reverse, but it has produced a degree of multi-polarity which has made ‘policing’ the world system of nations more difficult.

The stages of development of post war globalisation also need to be analysed in a little more detail to reinforce our assessment of the limits of US hegemony. The process of restructuring the world economy began as the Allies sensed victory towards the end of the war. The Bretton Woods Agreement was signed in 1944. The participants at the three-week long meeting in New Hampshire hotel, included representatives of all 44 of the Allied Powers including the USSR and the emergent new state of Yugoslavia. New supra-national institutions, the International Monetary Fund (IMF), and the World Bank, were created after the meeting to stabilise the world financial system essentially by fixing exchange rates to the dollar (which in turn was fixed to gold). Money would be transferred through the institutions from those states with surplus funds (creditors) to those in deficit (debtors) to preserve the stability of exchange rates and to help boost world trade. Loans would be repaid with interest determined by the IMF/World Bank. US leadership was assured, both institutions were to be based in the USA, with governing and decision-making bodies dominated by creditors. Two thirds of the world’s gold was held at the time in the USA. The final agreement was not ratified by the USSR, which laid claim that the institutions were ‘branches of Wall Street’. [27] The political effect of Bretton Woods was to tie the western powers into a shared economic project of financial and economic reconstruction, albeit under US leadership. This new strategy stood in contrast to the failures of the inter war years, which had seen a retreat into economic nationalism, and then depression and reinvigoration of the drumbeat of war. A secondary development was the creation in 1947 of the General Agreement on Tariffs and Trade (GATT) which was designed to complete multilateral agreements on tariff reductions and to regulate tariffs and to boost world trade. GATT morphed into the World Trade Organisation (WTO) in 1995 and the last round of deals under the process of liberalisation was that struck as part of the Doha Round in 2001. On the geo-political front the end of the Korean war heralded the consolidation of the Cold War. Here the US buttressed its allies in western Europe through Marshall Aid in 1948, which amounted to a total of $17 billion granted in aid in return for purchase of US commodities such as food, fertilizer, machinery and fuel. The plan also had an ideological edge, advancing the cause of institutions that allowed labour representation to promote a social democrat alternative to west Europe’s still large Communist parties. While the Soviet Union and its satellites were offered Marshall Aid, the offers were blocked by Stalin, who in turn developed an alternative ‘Molotov Plan’ in its own sphere of influence. Similar programmes were established by the US for Asian countries fulfilling the ‘Truman Doctrine’ of 1947 which detailed a US mission to create a physical barrier to the territorial spread of ‘Communism’. A need for financial back-up to the doctrine was engendered by the UK’s post war admission that it could no longer finance the suppression of the communists in the ‘borderland’ region between East and West that was Greece. The net effect of these US-led political and economic initiatives was that a new era of military power was established both in the North Atlantic (the Washington Treaty establishing NATO was signed in 1949), and in the Pacific. The borders of this new globalised world were drawn in Cold War terms, relatively fixed in Europe, but less specific in the Far East (until after the Vietnam War), and more fluid in Africa and South and Central America. By accepting US ‘leadership’ smaller nation states could be guaranteed a share, however small, in an advancing world economy within what Giovanni Arrighi has described as a distinct ‘regime of accumulation on a world scale’ associated with a particular (i.e.US) hegemonic state.[28] This new regime provided the necessary political stability and ushered in a ‘golden age’ of capitalism in the immediate post war years as the economy expanded alongside rising real incomes and the mass purchase and production of consumer goods. Behind the golden age however were materials of darker hue – coal and oil. Fossil fuels steamed ahead to shape a world economy in which the mass production of the motor car allowed for further expansion of the cities into the suburbs in what Ian Angus has called the ‘great acceleration’ in carbon emissions.[29] In turn, it then frame-worked the political economy of US and other smaller imperialisms in chasing oil and subjugating oil rich states to their will.

Whilst the new ‘regime of accumulation on a world scale’ was successful in many of its aims (at least from the perspective of the American ruling class) it was not without its problems. Neither US nor indeed Soviet Union ‘hegemony’ was accepted automatically by nation states in the less developed world. Newly independent states (NIS) such as India and Pakistan, many African states and Latin American states, as well as the Titoist regime in Yugoslavia were keen to distance themselves both politically and economically from the major powers. At an inter-state level the desire for independence from both Washington and Moscow took its effect in the establishment of the non-aligned movement following the Bandung Conference in Indonesia in 1955. The main movers of the Conference were the states of Indonesia, Pakistan, India, Burma and Ceylon (Sri Lanka) with other NIS also involved. The Peoples Republic of China was represented at the conference (just six years after the Mao revolution) fuelling US fears of an alternative source of Communist influence.  US post war foreign policy had sought to court anti-colonial elements in the global South, but this brushed against a parallel objective of drawing closer to those very countries (France, Britain, Spain etc.) who had been culprits in colonial misdeeds. This placed US hegemonic intentions with a dilemma, so too did the ‘human rights’ approach of Bandung when framed against the racist Jim Crow laws in the south of the USA. The dilemma was partly solved by a change in the policy of the majority of the European colonial powers towards their colonies. Rebellion from below had first been met with repression, shootings and concentration camps, just like in the old days. But this strategy gave way in the face of continued resistance to one whereby local elites were cultivated to rule their countries, but within the continued remit of the interests of the former colonial masters. In the British case, as Chris Harman records: ‘Even where Britain did try to stand firm against making concessions to the ‘natives’ – as in Kenya, where it bombed villages and herded people into concentration camps where many died, and in Cyprus, where troops used torture – it ended up negotiating a ‘peaceful’ transfer of power to political leaders (Jomo Kenyatta and Archbishop Makarios) whom it had previously imprisoned or exiled’. [30] In political terms US hegemony survived the strains of the break-up of the colonies albeit by seeking accommodation with elites of the newly independent states. The Soviet response was to parallel that of the west, by constructing its own trading bloc (COMECON) and by courting leaders of those states elsewhere who were willing. Flare ups were inevitable, most notably in the Berlin Blockade of 1948/49 and the Cuban missile crisis in 1962, but the Cold War remained cold and allowed western capitalism to expand across the majority of the globe unhindered and policed by growing US imperialism which sought to glue together the pillars of political, economic and territorial power.

But the ‘independence’ of the NIS posed another problem for the US rulers’ intentions to expand global capitalism under its influence.  Efforts were made by many of the NIS to develop their own economies through programmes of ‘import substitution industrialisation’ (ISI), whereby home-grown manufacturing would make up for the deficiencies in domestic industry that had accumulated under centuries of colonialism. Import substitution would act to encourage ‘nation building’ by making the country less dependent on the outside world, but could only be achieved if tariffs on imports were raised and not lowered as required by the Bretton Woods/Washington mantra, and if tight exchange controls were imposed outside of the US$ zone. The ISI approach was particularly virulent in South and Central America, most notably in Mexico, Brazil and in the 1950s Peronist regime in Argentina. Currency exchange rates against the dollar and sterling were kept deliberately low, to encourage exports and to make imports more expensive, while manufacturing was subsidised or nationalised through the state. Such a ‘state capitalist’ approach became adopted by third world regimes where ‘young Turks’ had assumed power by rebellion against the old order, such as in Egypt, Libya or Cuba. The development of a local auto industry was a key feature of the ISI programmes, partly because of the developing demand for autos in the age of oil, and partly because of a sense that an emerging nation state should have its own car brand (alongside a state airline and state railway). In India, for example, the old UK manufactured Morris Oxford was relaunched in 1957 and built within the country as the Morris Ambassador, which for the following 30 years was viewed as the ‘Indian’ car. Some success can be claimed for ISI policies, as the growth rates of those countries pursuing it may testify. One study highlights that ‘by the early 1960s, domestic industry supplied 95% of Mexico’s and 98% of Brazil’s consumer goods. Between 1950 and 1980, Latin America’s industrial output went up six times, keeping well ahead of population growth. Infant mortality fell from 107 per 1,000 live births in 1960 to 69 per 1,000 in 1980, [and] life expectancy rose from 52 to 64 years. In the mid-1950s, Latin America’s economies were growing faster than those of the industrialized West’. [31] ISI was grounded in critical trade theory, taking its cue from debates over ‘dependency’ as it related to a post-colonial world. The associated Singer-Prebisch thesis, developed in 1949 by Hans Singer (a UN economist) and the Argentinian economist Raúl Prebisch, suggested that countries such as the UK went through an early stage of ISI as part of their own development.[32] Indeed, ISI is presumed to work better in a developmental stage as the income elasticity of demand for manufactured goods is greater than that for primary goods such as food. This would mean that as incomes rise, while the demand for food stays roughly the same (assuming no one is starving), the demand for consumer manufactured products rises at a faster rate. If such manufactured goods are produced within the nation state, then a positive cycle of growth ensues. Without ISI, it is suggested by ‘dependency’ theorists as well as neo Marxists such as Immanuel Wallerstein in his presentation of world systems, that structural inequality would develop between the richer nations and the poorer, or the ‘core’ and the ‘periphery’.[33]

By the 1970s the new rulers of the world, crystallised in the alumni of Harvard Business School and the Washington/Treasury nexus, had begun to challenge ISI in a global push for market liberalisation known more colloquially as neoliberal capitalism. However, it was not just the challenge of ISI that produced neoliberal mantra. More importantly, the economies of the advanced industrial nations entered their first crisis during the early part of the decade as growth rates faltered, debts accrued, and inflation soared. Prior to 1973 the expansion of the system was almost unprecedented, As Michael Kidron observed in 1970: ‘High employment, fast economic growth and stability are considered normal’ while the system as a whole had been working ‘twice as fast between 1950 and 1964 as between 1913 and 1950’.[34] The underlying reasons for the onset of the economic reversal from ‘golden’ to ‘leaden’ age have been well rehearsed by authors familiar to this journal over decades.[35] Evidence of a decline in the rate of profits from investment in western corporations from the late 1960s conjoined with the faltering of the ‘permanent arms economy’ as the West German and Japanese growth spurt tailed off and US spending on arms became an increasing burden.[36] The consequences of the slowdown alerted the ruling classes of western nations to the fact that a new way would have to be found to restore profitability, and the forces of the market were to be utilised as a result.

Enter the Market, Enter the Dragon

We can date the beginning of the new wave of economic globalisation from the late 1960s onwards. The process was driven by a desire of the western based financial and industrial elites, increasingly stifled by saturated markets and declining profits on investment, to create new areas for production. This could restore profitability by reducing unit labour costs for certain types of batch and low technology production. The low tech and assembly-based nature of production was to be facilitated by tapping into huge new reserves of labour in the global South, drawn often from the peasantry or urban dispossessed as well as child labour, at skill and wage levels which would be low enough to overcome increased transport to western markets and other infrastructure costs. In Marxist terms it would then be possible for capital to undercut the ‘socially necessary labour time’ required for many manufactured items previously made in the advanced industrial nations. A spin-off from the process would be to create new markets in the rapidly urbanising global South for manufactured goods produced by western multi-national enterprises. An expansion in information technology capability engendered by the silicon chip (from the late 1960s) allowed for a leap forward in logistics capabilities, as did the construction of ships suited to the use of modular containerisation (the first dedicated container ship left Newark, New Jersey in 1956).

The resultant upturn in levels of FDI, and the expansion of the volume of world trade over and beyond that of world production of goods and services that we have alluded to earlier in this article, then gathered pace. However, this seeming juggernaut had to be accompanied by a process of bullying and coercion of the NIS within the global South to open up the necessary markets to western capital. Strategies of ISI would need to be abandoned, import tariffs would need to be reduced or abolished, exchange rate controls would have to be dismantled, and the state subsidisation of domestic industry would have to end if the ‘market’ was to rule supreme in the interests of western capital. This became the new neoliberal stage of capital accumulation strategy. The institutions of Bretton Woods, the World Bank and IMF, were corrupted from their original purpose of alleviating poverty and used instead to work with local interlocutors in the process of coerced globalisation, by bribing and cajoling the political elites in the NIS to accept the pensée unique of neoliberalism in return for a taste of honey in the new globalised economy. As Ngaire Woods has written in her book The Globalizers:

The(new) mission of the IMF and World Bank is not just to define economic programs…..Each institution deploys a mixture of technical advice and coercive power in bargaining with borrowing governments, lending or withholding resources, disbursing or suspending payments, and imposing various forms of conditions. Yet the institutions can successfully deploy this power only where they find and work with sympathetic interlocutors who are both willing and able to embrace the policies preferred by the institutions.[37]

This was sometimes a violent process, drawing parallels with our earlier period of globalisation. The radical journalist John Pilger outlines in his book The New Rulers of the World that where resistance from below was offered the response of the elites was brutal. In Indonesia for example, which under General Suharto was touted as the World Bank’s ‘model pupil’, a million died as the Indonesian regime imposed its will to allow full access for western capital. Pilger further reports that “Within a year of the bloodbath, Indonesia’s economy was effectively redesigned in America, giving the West access to vast mineral wealth, markets and cheap labour – what President Nixon called the greatest prize in Asia.” [38] With the collapse of the Soviet Union and COMECON in 1991, the forces of global market dominance were boosted once more. The ensuing immediate period of ‘peak’ globalisation was thus backgrounded by a seeming victory of market capitalism over the state capitalism of the eastern bloc. This all took place under the Presidency in the USA of Ronald Reagan, who together with Margaret Thatcher placed an immutable seal of approval on private mantras of capital accumulation over that of state direction, consolidating the ideological aspects of neoliberalism in the process.  Indeed, the unrestrained entry of the market carried with it a re-regulation of pre-existing social settlements, most especially in the field of labour protection and state benefits for the old or unemployed, whose social support structures were stripped to their bone on the basis that they were obstacles to free trade and unfettered competition.[39] This is not to say that the ‘state’ was abandoned by political and financial elites as an agent of capital accumulation. As Alex Callinicos reminds us: “ Reagan’s combination of cutting taxes and boosting military spending hugely increased government borrowing, representing, according to Robert Brenner, “the greatest experiment in Keynesianism in the history of the world”.[40] Rather, the state was used as an agency to re-regulate the system in the interests of a new regime of capital accumulation.

But did these new trends represent a monocentric or polycentric distribution of power? Most certainly the leading player was and continues to be the USA, but the first signs of alternative power axis began to appear with the consolidation of the EEC/EU across the Atlantic in the 1970s and then with the rise of Japan in the 1980s. Indeed, the rise of Japan as an industrial powerhouse with new manufacturing methods prompted a state initiative in the US to study Japanese work organisation and to launch the ‘lean production’ model across western enterprise. The resultant book in 1990 by James Womack and colleagues The Machine That Changed the World became the new mantra of business school education not only in the USA but across most of the west, challenging traditional Taylorist methods with new forms of team-working, continuous improvement and lean production.[41] Japan’s new prominence in industrial manufacturing also prompted shifts in global supply chains as the lean production model co-joined with global economic trade networking in an effort to create value added on a worldwide ‘just-in-time’ basis. Auto manufacture, for example, was spread across many countries in the supply chain, and at the final ‘screwdriver’ factory assembly auto parts from a dozen or more countries were added to the chassis. But in more recent years it has been the rise of China that has worried American strategists even more and created further possibilities for polycentrism. The USA’s position as leader in world trade in merchandise was eclipsed by China in 2012, following years of Chinese economic expansion. At the time of China’s entry into the WTO in 2001 Chinese share of world trade was only one fifth of that of USA, so the growth has been spectacular and, of course, accompanied by suspicions of Chinese military ambitions in Far Eastern waters. Since 2000 this growth of China within the world economy has been paralleled by a shrinkage in the importance of the US. US imports have fallen from 17 per cent of world total to 12 per cent over this recent period, while its percentage share of exports has fallen from 12 per cent to 8 per cent.[42]

This relative collapse of US trade hegemony mainly at the hands of China, and to a lesser extent the EU under the powerhouse of Germany, has been accompanied by a rapid increase in Chinese investment overseas, including grants and loans to less developed states made without the stringent neoliberal strings that come attached to similar cash sums from the IMF or World Bank. The majority of Chinese FDI is geared towards natural resource-extraction activities in Africa, Australia, Canada, and Latin America, but as part of Beijing’s ‘Going Global’ strategy investment is increasing in high tech industries as the CCP seeks to drive the economy to a higher end of the world’s markets in manufacturing production. In Australia, for example, which is a major recipient Chinese investment, FDI has been focused in the past on mining by purchasing mines extracting ferrous and non-ferrous metals such as gold, lithium and copper. More recent investment, however, focuses on healthcare and agri-business. [43] It is perhaps this threat from China which is of greater concern to the US elites than that of China’s growing domestic economy. As fossil fuels are challenged by potential climate change regulation, and rare earth metals are purloined by China, then the business model of the USA, based as it is historically on cheap oil and coal becomes threatened. Peak globalisation corresponded with a period of peak oil, and as James Howard Kunstler has argued in The Long Emergency as the peak has passed countries heavily dependent on cheap oil, such as the USA with its car oriented cities and long inter-state transportation distances, may be ‘sleepwalking into the future’.[44]Trump’s appeal for ‘Pittsburgh not Paris’ over an international climate change agreement is a real sign of the times.[45] Chinese multinationals may also become larger players in hoovering up privatised public services at the expense of the US. So a second sign of the times is the threatened post-Brexit trade deal with the UK which may well involve granting access of US multinationals to Britain’s health service.[46]

What Next? 

We are undoubtedly witnessing a re-ordering of the locus of power within the world economy, as the USA’s hegemony is challenged and visions of a more polycentric world continue. This is not the end of globalisation, but rather a reshaping which involves a fragmentation of existing trade relationships as new ones are formed in a new world regime of capital accumulation. Britain’s Brexit and post Brexit negotiations for new trade deals are part of this process, with new deals proposed not just with the USA but with China, India as well as the rest of the EU. However, the whiff of economic nationalism and protectionism is also in the air, driven in part by electoral ambitions to appeal to a working class pacified by anti-import and ‘nothing can be done about globalisation’ rhetoric from trade union leaders and others. It is this economic nationalism which partly explains the search for a new order, particularly on behalf of Trump. Far from such economic nationalism being a new idea it has a longer history within the Republican Party and with Trump himself. Trump’s critique of US trade policy goes as far back as the 1980s, in response to the ‘threat’ from Japan as the new pace-maker in automobile and consumer goods manufacture. As Adam Tooze suggests, Trump has since successfully convinced a large enough section of the Republican Party of his views to make economic nationalism and protectionism a live issue.[47]  Indeed, in real terms a shift towards a more protectionist world would harm the US economy a lot less than its rivals. In the US economy trade (imports and exports) measured about 30 per cent of all GDP in 2014. This is compared to shares of 59 per cent in the UK, 42 per cent in China, 85 per cent in Germany, and up to 167 per cent in smaller industrialised countries such as Belgium.[48]  This makes any protectionist turn less harmful to the USA in aggregate than to its competitors, giving the USA continued asymmetrical bargaining power in negotiations over trade deals. It is this economic power that will continue to be used by the US, most likely with the objective of restricting the lineage of global supply chains by shifting a higher proportion of production towards home based manufacture. However, the strategy is a huge gamble, particularly so as China waits in the wings ready to scoop up the remnants of a new US economic isolationism. The future of globalisation is contingent on the outcomes of such tensions within the US political and financial elites. Let us not also forget that after four decades of an increasingly globalised economy the world is more unequal in terms of wealth distribution than at any time since the early part of the twentieth century. When coupled with a decade of austerity since the financial crash neoliberal capitalism has also awarded its working class with a steady succession of accumulated grievances in the core industrial countries. This is a heady cocktail, the outcome of which is unpredictable.

References

 

Angus, Ian, 2016, Facing the Anthropocene (Monthly Review Press).

Arrighi, Giovanni, 1994 The Long Twentieth Century (London, Verso)

Bairoch, Paul, 1982 ‘International industrialisation levels from 1750 to 1980’ Journal of Economic History, 2

Brenner, Robert, 1998, ‘Uneven Development and the Long Downturn: The Advanced Capitalist Economies from Boom to Stagnation, 1950-1998’, New Left Review, I/229.

Callinicos, Alex, 2005 ‘Imperialism and Global Political Economy’, International Socialism, 108

Callinicos, Alex, 2017 ‘The Neoliberal Order Begins to Crack’ International Socialism, 154 accessible at http://isj.org.uk/the-neoliberal-order-begins-to-crack/#footnote-10080-23

Cox, Judy, 2004 ‘Can capitalism go on forever?’, International Socialism, 100

Davis, Bob and Hilsenrath, Jon, 2017 ‘Whatever Happened to Free Trade?’, Wall Street Journal, March 29th accessible at https://www.msn.com/en-us/money/markets/whatever-happened-to-free-trade/ar-BBz11mw

Davis, Mike, 2001 Late Victorian Holocausts: El Niño Famines and the Making of the Third World (London, Verso)

de la Dehesa, Guillermo, 2006 Winners and Losers in Globalization (Oxford, Blackwell)

Donnan, Shawn,2017 ‘US trade chief seeks to reshore supply chain’, Financial Times, February 1st accessible at https://www.ft.com/content/8dc63502-e7c7-11e6-893c-082c54a7f539

Donnan, Shawn and Sevastopulo, Demetri, 2017, ‘White House civil war breaks out over trade’, Financial Times, March 10th available at https://www.ft.com/content/badd42ce-05b8-11e7-ace0-1ce02ef0def9

Engels, Friedrich, 1844 Outlines of a Critique of Political Economy, Deutsch-Französische Jahrbücher accessible at https://www.marxists.org/archive/marx/works/1844/df-jahrbucher/outlines.htm

Ferguson, Niall, 2005 ‘Sinking Globalization’, Foreign Affairs, March/April Issue

Foroohar, Rana, 2016 ‘We’ve Reached the End of Global Trade’ Time Issues Issue, October 12th accessible at http://time.com/collection-post/4521528/2016-election-global-trade/

Fukuyama, Francis, 1989 ‘The End of History?’ The National Interest, Summer

Harman, Chris, 1999 A People’s History of the World (London, Bookmarks)

Harman, Chris, 2009 Zombie Capitalism (London, Bookmarks)

Hirst, Paul and Graham Thompson, 1999 Globalisation in Question (Cambridge, Polity)

Hobsbawm, Eric, 1995 [1987 first impression] The Age of Empire 1875 – 1914 (London: Weidenfeld and Nicolson)

Hoogvelt, Ankie, 1997 Globalization and the PostColonial World (Baltimore, John Hopkins University Press)

IMF, 2014 World Economic Outlook 2014, International Monetary Fund accessible at http://www.imf.org/en/publications/weo?page=27

Kidron, Michael, 1970, Western Capitalism Since the War (Penguin), accessible at http://www.marxists.org/archive/kidron/works/1970/westcap/

KPMG, 2016 Demystifying Chinese Investment in Australia (University of Sydney) accessible at http://demystifyingchina.com.au/reports/demystifying-chinese-investment-in-australia-april-2016.pdf

Kunstler, John Howard, 2005 The Long Emergency: Surviving the Converging Catastrophes of the Twenty First Century (New York, Atlantic Monthly Press).

Maddison, Angus, 1991 Dynamic Forces in Capitalist Development: a long-run comparative view (Oxford University Press)

Mason, Edward and Robert E. Asher, 1973 The World Bank Since Bretton Woods: The Origins, Policies, Operations and Impact of the International Bank for Reconstruction (Washington DC, Brookings Institution).

Newsinger, John, 2005 The Blood Never Dried: A People’s History of the British Empire (London, Bookmarks).

OECD, 2017a FDI in Figures, Organisation for Economic Cooperation and Development, April accessible at http://www.oecd.org/daf/inv/investment-policy/FDI-in-Figures-April-2017.pdf

OECD, 2017b Is Investment Protectionism on the Rise? Organisation for Economic Cooperation and Development, March accessible at http://www.oecd.org/investment/globalforum/2017-GFII-Background-Note-Is-investment-protectionism-on-the-rise.pdf

Ortiz-Ospina, Esteban and Max Roser, 2016 International Trade. Published online at OurWorldInData.org. Retrieved from: https://ourworldindata.org/international-trade [Online Resource]

Pilger, John, 2002 The New Rulers of the World, London, Verso also video at http://johnpilger.com/videos/the-new-rulers-of-the-world

Pollard, Sydney, 1985 ‘Capital Exports 1870 – 1914: Harmful or Beneficial?’, Economic History Review, xxxviii.

Pozo, Gonzalo, 2010 ‘Reassessing the permanent arms economy’, International Socialism, 127 accessible at http://isj.org.uk/reassessing-the-permanent-arms-economy/

Roberts, Michael, 2016 Debating the Rate of Profit accessed on the blog at https://thenextrecession.wordpress.com/2016/11/10/debating-the-rate-of-profit/

Romei, Valentina, 2014 ‘China and US battle for trade leadership’ Financial Times, Jan 10 accessible at http://blogs.ft.com/ftdata/2014/01/10/china-and-us-battle-for-trade-leadership/?mhq5j=e1

Saul, John Rawlston, 2005 The Collapse of Globalism, Atlantic

Tooze, Adam, 2017 America’s Political Economy: Debating the Republican Protectionist Turn accessible at https://www.adamtooze.com/2017/03/19/trump-trade-ii/

Toye, John and Richard Toye, 2003 ‘The origins and interpretation of the Prebisch-Singer thesis’. History of Political Economy. 35 (3): 437–467.

Upchurch, Martin, 2009 ‘The IFIs and Labour Reform in Post Communist Economies’, Globalizations, 6, 2: 297-316

Wallerstein, Immanuel, 1974 The Modern World System: Capitalist Agriculture and the Origins of the European World Economy in the Sixteenth Century (New York, Academic Press)

Wolf, Martin, 2017 ‘Asia’s dynamism at risk in US and China’s competing visions for global trade’, Financial Times, May 4th

Womack, James., Jones, Daniel and Roos, Daniel, 1990 The Machine That Changed the World (Free Press)

Woods, Ngaire, 2006 The Globalizers: The IMF, the World Bank and their borrowers (Cornell University Press).

WTO, 2016 International Trade Statistics, 2015, World Trade Organisation, available at  https://www.wto.org/english/res_e/statis_e/its2015_e/its15_charts_e.htm

 

 

 

 

[1]   Donnan and Sevastopulo, 2017

[2]   Wolf, 2017

[3]   Donnan, 2017

[4]   Fukuyama, 1989

[5]   Ferguson, 2005

[6]   Saul, 2005

[7]   Hirst and Thompson, 1999

[8]   Davis and Hilsenrath, 2017

[9]   See Maddison, 1991 for data.

[10]   World production figures since 1950 can be unreliable, due to vagaries in data collection, but estimates of proxy growth in PPP (purchasing power parity) from 1950 collated by the Institute of Institutional Economics suggest that world growth rates were approximately 2.5 per cent annually from 1950 to 1980 and 2.65 per cent from 1980 to 2000 ( see https://piie.com/publications/chapters_preview/348/2iie3489.pdf).

[11]   WTO, 2016

[12]   IMF, 2014

[13]   Foroohar, 2016

[14]   OECD, 2017a

[15]   OECD, 2017b

[16]   See Cox, 2004 for a review of debates on the relationship between capitalism and imperialism.

[17]   Engels, 1844 p1

[18]   Newsinger, 2006 p 48

[19]   Davis, 2001 p 311

[20]   Bairoch, 1982, p 269-325

[21]   Hobsbawm, 1995, p. 51

[22]   Hobsbawm, 1995, p. 51

[23]   Pollard, 1985 p 492

[24]   Panitch and Gindin, 2004 p 47

[25]   Callinicos, 2005 p117

[26]   De la Dehesa, 2006 p31

[27]   Mason and Asher, 1973 p 29

[28]   Arrighi, 1994 p 9

[29]   Angus, 2016

[30]   Harman, 1999, p 557

[31]   Hoogvelt, 1997

[32]   See Toye and Toye, 2003 p. 437-467 for a detailed explanation of the Prebisch-Singer hypothesis.

[33]   Wallerstein, 1974

[34]   Kidron, 1970, p11

[35]   See, for example, Harman, 2009

[36]   For a review of the ‘permanent arms economy’ debate see Pozo (2010) in this journal. For ongoing   assessment of the data on the fall in the rate of profit in the post war period see Michael Roberts (2016).

[37]  Woods, 2006 p10

[38]  Pilger, 2002 also for quotes go to video at http://johnpilger.com/videos/the-new-rulers-of-the-world

[39]  Upchurch, 2009

[40]  Callinicos, 2017 citing Brenner, 1998, p182

[41]  Womack et al, 1990

[42]  Romei, 2014

[43]  KPMG, University of Sydney, 2016

[44]  Kunstler, 2005 p1

[45]  Although Trump’s ‘Pittsburgh’ reference was critiqued by the Mayor of Pittsburgh see http://edition.cnn.com/2017/06/01/politics/pittsburgh-mayor-donald-trump/index.html

[46]  See http://www.independent.co.uk/news/uk/politics/theresa-may-donald-trump-nhs-us-trade-deal-brexit-torture-a7548156.html

 

[47]  See blog from Adam Tooze, 2017

[48]  Ortiz-Ospina and Roser, 2016

Bristol, Colston and Slavery

Bristol’s main concert venue, the Colston Hall, is finally to be renamed. The venue, along with streets, schools and other urban paraphernalia takes the name Colston from Edward Colston, a Bristol based slave trader who died in 1721. An intermittent campaign has been ongoing over a number of years to rename the hall in respect of the Africans who were taken in ships that had set sail from Bristol to the Caribbean. trade_routesIndeed it is estimated that between 1698 and 1807,  a total of 2,114 ships set sail from Bristol to Africa and then to America and the Caribbean carrying over half a million slaves. The trust which operates Colston Hall, has now relented in face of pressure, which included ordinary people campaigning for justice, the Mayor of Bristol Marvin Rees, as well as Massive Attack, the Bristol band who refused to play in the hall while it carried the slave trader’s name.

Edward_ColstonColston would have profited from the slave trade enormously and rose to be a deputy governor of the Royal African Company, the main organising body of the slave trade. He died too early to see the windfall paid to the slave owners by the British government when the Caribbean trade was abolished in 1833. £20 million was given in compensation to 46,000 British slave owners, representing 40 per cent of the total government expenditure for 1834. It is equivalent of about £17bn in today’s money and exceeding by a considerable margin the bankers’ bailout paid after the financial crash of 2008.  Less well known is that the slaves themselves received nothing. Worse still, under a clause of the 1833 Abolition of Slavery Act they were ordered to provide 45 hours of unpaid labour each week for their former masters, for a further four years after their ‘liberation’.

Such injustice continues to infuriate many in Bristol in the black community and beyond. But Bristol as a civic whole remains reluctant to face up fully to its slave-based past. It remains a city where you can almost touch and smell the history of slavery by walking along the dockside and gazing upwards to the rich merchants’ houses in Clifton. In 2006 I was at a 600 strong debate in Bristol which considered whether or not the city should apologise for its role in the slave trade. The chair, A.C Grayling, a liberal ‘philosopher’ was reluctant to take any motions from the floor which would have placed Bristol alongside Liverpool (in 1999) in making a formal apology. Many speakers from the floor said that as the trade took placed in the past, we should not be responsible for what happened. When finally given a show of hands the audience voted against any apology.

This mistaken approach now needs to be corrected. An apology , of course, is essentially symbolic. But this is just the point, the symbolism of making such an apology means that the public of Bristol can face up to its past in an honest fashion. Edward_Colston_1895_statueThere are other Colston memoralia and civic amenities such as schools and streets and statues that now need to be a focus of a campaign of reconsideration of the past. There is a clear argument to compensate the descendants of slaves in some form or another as well. It will not recompense for the barbarism committed against the sons and daughters of Africa, whose descendants now live in the city, but it will help promote a much-needed anti-racist message in these troubled times.

Is A Robot After Your Job?

 

robot7Earlier this month MEPs in the European Parliament debated a call for comprehensive rules for how humans will interact with artificial intelligence and robots. The fear expressed by the politicians is that advances in AI could elevate robots to the status of an electronic ‘person’ with rights and privileges in law. It is surprising that such a prospect has taken so long to enter public discourse as ever since the birth of the computer seventy years ago commentators have been writing on the prospects of technological singularity – the point at which intelligence would become ‘non-biological’, and creativity would be unbounded by human limitations. Machines would dominate production through processes of self-improvement, re-writing their own software to outstrip the functional capabilities of the human brain. The scenario of singularity signals a complete collapse of human employment.  Researchers at Oxford University have already calculated that almost half of all jobs in the US are at risk from new forms of automation in the coming decades, while journalist Paul Mason has written a best seller on the nirvana of a new ‘post-capitalist’ society. While most routine jobs would disappear, the destruction would also overlap into professional work. Doctors may be replaced by smart phone apps. that diagnose a patient’s symptoms and robots that perform operations. The collection of big data and its processing by algorithms (machine learning) may also enable correlations of behaviour, genetic disposition, or symptoms to predict a person’s health. Even IT specialists would not be safe, as much of the ‘knowledge’ which enables them to hold down employment may be transferred to a central cloud computer accessible by all from any location.

The restraints of limited mobility and flexibility of robotic ‘arms’ have been eased by new technologies which enable a humanoid robot to grip and to turn with less pre-programming. Artificial-Intelligence-AI-larger-graphic.pngAdvances in algorithmic programming utilise the principles of neural networks that enable AI to discriminate, to ‘remember’ past decisions and to make finer judgements. In the early days of development such ‘thinking’ was measured by the degree to which the robot or computer passed the ‘Turing Test’ (after the celebrated British computer scientist Alan Turing). The test is based on the proposition that a machine would be able to think if it could hold a conversation that was indistinguishable from one with a human being. Image recognition technology has improved, as well as text to speech (and vice versa). Robots can now be programmed remotely from the cloud computer, an advance that is equivalent to the launch of the first ‘free standing’ Progamma101 personal desk top computer by the Italian firm Olivetti in 1965. Combined with the falling cost of robots in the product market it is not surprising that their numbers are on the rise. The International Federation of Robotics estimates that there were 1.5 million robots in operation worldwide in 2014.robotchina According to a report in the Financial Times China now absorbs an increasing proportion of the total, spurred by rising labour costs and shortages with a falling ‘payback’ period for investment of 1.5 years. But we should not get carried away with the rise of the robots, while their numbers may well rise to over 2 million, this compares with a worldwide workforce of 3 billion. In the country with the highest density of robots (South Korea) there are still less than 500 for every 10,000 workers.

The False Dawn of Singularity?

If we adopt a socio-technical approach to examining AI and robots we may see that claims of total singularity may well prove to be a false dawn. For more complex tasks, robots still need to be minded by humans lest they break down or miscalculate precision movements. Efforts by a leading robotics manufacturer to create an affordable ‘plug and play’ robot capable of mimicking human movement for widespread use in industry also appear to have stalled. A simple way of understanding the problem is to imagine a robot attempting to catch a tennis ball in flight. Not only the speed and angle of flight need to be finely calculated in a split second, but also the weight of the tennis ball (which a human would have remembered from previous experience) will determine how hard the robot needs to grip the ball once caught to avoid the ball bouncing back out of the hand. Such a seemingly simple task for a human is a logistical nightmare for a robot. Mercedes-Benz, which is a lead player in developing autonomous cars, has now begun replacing its robots with humans in its factories due to this very lack of flexibility in the robotic machine. Moves are now afoot to develop ‘cobots’ which operate side-by-side with humans to enable flexibility and creativity to flourish. While algorithms might replicate past human behaviour in robotic form they are a long way off from ‘consciousness’ and the ability to ‘think’ at the level of a human. Returning to the ‘Turing Test’ the ability of robots to ‘think’ as humans do is only a remote possibility. Turing also identified a ‘halting problem’ whereby a computer using AI may never ‘know’ when it is ‘right’, and so will continue to compute. The algorithms they feed from remain subject to human input in programming and coding and repeat the mistakes and false assumptions that humans may have made in the past, but may consciously check against in the present. So, for example, the algorithm-fed robot Beauty.AI only chose women of light skin when asked to judge an international ‘beauty contest’, suggesting an unconscious (or even conscious) racist agenda among those humans creating the algorithm.

A further obstacle we need to address is that of economics and the related political implications of choices made by employers. Computers are a relatively small proportion of capital stock, and  investment in computers has been declining since the height of the ‘IT Revolution’ of the 1990s. The overall impact on productivity, growth and jobs appears less dramatic than might otherwise be assumed. Evidence published in 2015 by Michaels and Graetz from a dataset of companies in 17 countries gathered between 1993 and 2007, suggests that while productivity increases with robotic innovation and some semi-skilled and lower skilled jobs are abandoned, “there is some evidence of diminishing marginal returns to robot use – ‘congestion effects’ -so they are not a panacea for growth……this makes robots’ contribution to the aggregate economy roughly on a par with previous important technologies, such as the railroads in the nineteenth century and the US highways in the twentieth century.” Neither do robots do away with the contradictions within capitalist accumulation. This is because as capital-bias and labour shedding takes place proportionately less new value is created (as labour is the only source of new value) relative to the cost of invested capital, added to which, as the economist Michael Roberts reminds us, worker resistance to the dystopia of permanent joblessness would surely ensure that the road to ‘full automation’ if it is ever constructed, would be a very rocky one.

Indeed, the ‘full automation’ and post-capitalist schools of thought assume an ever-increasing thirst for new digital technology and a limitless supply of the necessary hardware and software. Yet these assumptions also need to be questioned.  Predictions of the coming of singularity have been based on extrapolations from co-founder of Intel Gordon Moore’s ‘law’, by which the number of transistors that can be inserted into a computer doubles every two years, both lowering the cost and vastly increasing computing power. However, this depends on a finite supply of rare earth metals, and Moore has himself acknowledged that there will also be a physical limit to how many transistors you can squeeze into an integrated circuit. As reported by the OECD in 2016 “…the introduction of new technologies is a slow process due to economic, legal and societal hurdles, so that technological substitution often does not take place as expected”. For example, the development of autonomous or driverless cars is subject to regulatory concerns over insurance liability, which will act to slow down or even impede development. A sober analysis of the economics of singularity has been undertaken by William Nordhaus at Yale University. Using econometric methodology on both the supply and demand side for digital technologies and AI he attempts to predict when singularity might occur. He argues that two ‘accelerationist’ mechanisms could develop, either from accelerating supply or from accelerating demand, and then applies a series of time-linked tests to both hypothetical scenarios, focusing on the key input variables such as wages, productivity growth, prices, intellectual property products and R&D. Five of his seven tests for the likelihood of singularity proved negative (including that for ‘accelerating productivity growth’ and ‘rising wage growth’)  while the two that proved positive (including a ‘rising share of capital’) indicated that singularity, if it did occur, would be at least 100 years away. And as previously positioned, a rising share of capital may simultaneously lead not only to decreasing rates of productivity growth, but also trigger a crisis of profitability in the longer term.

We might suspect that the coming of singularity may falter, be delayed, or never happen because of the economic, social and political factors that stretch beyond the technology itself.  Despite these limitations, the prospects of Irving John Good’s 1965 musings of a ‘last Ultraintelligent’ machine ever being constructed, which will “surpass all the intellectual activities of any man however clever……..(so that) the intelligence of man would be left far behind”, will no doubt continue to fascinate many. The dream of singularity would, however, be faced with a simultaneous collapse of the underlying dynamic of capitalism. The only surviving ‘human’ industrial sectors might be defence and space exploration, to guard against terrorist or foreign hostile cyberattack, and against attack on humans by the super intelligent machine!

 

BA Cabin Crew to Join Christmas Strikes?

 

badisputeChristmas strikes are on the agenda in Britain this year. Strikes at Crown Post Offices and on Southern Rail are likely to be combined with airport disruption as baggage handlers employed by Swissport, pilots on Virgin Atlantic and cabin crew at British Airways all enter dispute. The strikes are for different reasons, embracing safety concerns on the railways, union recognition at Virgin Atlantic, and pension changes and office closures at Post Offices. The potential strike of cabin crew at BA on Christmas Day and Boxing Day, however, is over a complex mix of new pay and conditions for BA’s ‘mixed fleet’ of new staff introduced after the 2010/2011 cabin crew dispute. The earlier cabin crew dispute involved 22 days of strike action, a fiercely fought social media campaign by both sides, and the suspension and dismissal of union activists because of SMS messages and Facebook postings.

In many ways the BA dispute also represents a continuing case study of the deterioration of pay and working conditions under a new business model. The mostly female cabin crew at BA have been well organised in a union for many years, and had built up reasonably good terms and conditions which befitted BA’s ‘quality’ business model as the once ‘World’s Favourite Airline’. On flights the crew had considerable autonomy in organising the distribution of work within the aircraft, using seniority as the command structure without reference to any such thing as a flight manager. Crew often lived far from the main Heathrow hub, and flew into work on concessionary BA flights. On being allocated to flights and meeting fellow crew (often for the first time) the self-organisation of staff duties worked well, with full consideration of safety and customer needs.

However, the newer ‘lower cost’ business model which sparked the 2010/2011 dispute has changed the relationship between BA management and its cabin crew. Crew are now part of a ‘mixed fleet’, with those newly recruited on much lower terms and conditions. Basic salary for new crew is £12000 per year, topped up by £3.00 per hour payment for every hour in flight, giving an average salary of between £16000 and £17000. A new management hierarchy has been introduced to supervise duties in-flight, made more important by the high turnover of cabin crew (30 per cent of whom have worked less than a year in the job). While Heathrow remains the major BA hub it means that most of the new crew cannot afford to live in the London area, and their union Unite reports staff sleeping in their cars overnight between shifts rather than travelling home. Mixed fleet staff are now used on both short and long-haul flights, with new expectations to have a quick turnaround, either ‘there-and-back’ in a day on short haul, or with a brief overnight stop on long-haul before returning to the UK. Not surprisingly, levels of tiredness and stress are high, with the union reporting 89 per cent of new crew experiencing stress or depression. As a result of the ‘top-up’ flight payment staff are also fearful of taking time off sick, and more than two thirds claim they have come in to work while feeling ill.

However, Unite the union has been very successful in recruiting new mixed fleet members, with numbers of members increasing from 174 to 2600 in the last five years. They are now ready to challenge BA for better terms and conditions. The story is similar to that of other ‘new’ business models such as that of Uber taxi drivers or Deliveroo food delivery cyclists, who have taken on employers determined to drive up profits with super-exploitative work practices. Indeed, BA profits now stand as £1.4bn, with CEO Willie Walsh receiving a basic salary of £8.8m. The business model clearly works for some, but for staff and customers it’s a risky business.