The Crisis of the Globalist Project & the New Economics of George W. Bush

Mar 09

Capitalism constantly erodes man and woman's being-in-nature
(creature) and being-in-society (citizen) and, even as it drains them
of life energy as workers, it moulds their consciousness around one
role: that of consumer. Capitalism has many "laws of motion", but one
of the most destructive as far as the environment goes is Say's law,
which is that supply creates its own demand. Capitalism is a
demand-creating machine that transforms living nature into dead
commodities, natural wealth into dead capital.

Walden Bello, McPlanet Conference,
Berlin, 27-29 June 2003

 

I would like to thank the Heinrich Boll Foundation,
ATTAC Germany, and all the other organizers of this conference for
inviting me to this very important meeting. What I would like to do in
this introductory talk is to discuss the key elements of the global
conjuncture. I would like to paint, in broad strokes, the global
political and economic context in which we must situate our
environmental activism.

Let me begin by taking you back to1995, the year the
World Trade Organization was born. The offspring of eight years of
negotiations, the WTO was hailed in the establishment press as the gem
of global economic governance in the era of globalization. The nearly
20 trade agreements that underpinned the WTO were presented as
comprising a set of multilateral rules that would eliminate power and
coercion from trade relations by subjecting both the powerful and the
weak to a common set of rules backed by an effective enforcement
apparatus. The WTO was a landmark, declared George Soros, because it
was the only supranational body to which the world’s most powerful
economy, United States, would submit itself. In the WTO, it was
claimed, the powerful United States and lowly Rwanda had exactly the
same number of votes: one.

Triumphalism was the note sounded during the First
Ministerial of the WTO in Singapore in November 1996, with the WTO,
International Monetary Fund (IMF), and the World Bank issuing their
famous declaration saying that the task of the future was the challenge
now lay in making their policies of global trade, finance, and
development "coherent" so as to lay the basis for global prosperity.

THE CRISIS OF THE GLOBALIST PROJECT

By the beginning of 2003, the triumphalism was gone.
As the fifth Ministerial of the WTO approaches, the organization is in
gridlock. A new agreement on agriculture is nowhere in sight as the US
and the European Union stoutly defend their multibillion dollar
subsidies. Brussels is on the verge of imposing sanctions on Washington
for maintaining tax breaks for exporters that have been found to be in
violation of WTO rules, while Washington has threatened to file a case
with the WTO against the EU’s de facto moratorium against genetically
modified foods. Developing countries, some once hopeful that the WTO
would in fact bring more equity to global trade, unanimously agree that
most of what they have reaped from WTO membership are costs, not
benefits. They are dead set against opening their markets any further,
except under coercion and intimidation. Instead of heralding a new
round of global trade liberalization, the Cancún ministerial is likely
to announce a stalemate.

The context for understanding this stalemate at the
WTO is the crisis of the globalist project-the main achievement of
which was the establishment of the WTO-and the emergence of
unilateralism as the main feature of US foreign policy.

But first, some notes on globalization and the globalist project.

Globalization is the accelerated integration of
capital, production, and markets globally, a process driven by the
logic of corporate profitability.

Globalization has had two phases: the first lasting
from the early 19th century till the outbreak of the First World War in
1914; the second from the early 1980s until today. The intervening
period was marked by the dominance of national capitalist economies
characterized by a significant degree of state intervention and an
international economy with strong constraints on trade and capital
flows. These domestic and international constraints on the market,
which were produced by the dynamics of class conflict internally and
inter-capitalist competition internationally, were portrayed by the
neoliberals as having caused distortions that collectively accounted
for the stagnation of the capitalist economies and the global economy
in the late seventies and early eighties.

As in the first phase of globalization, the second
phase was marked by the coming to hegemony of the ideology of
neoliberalism, which focused on "liberating the market" via accelerated
privatization, deregulation, and trade liberalization. There were,
broadly, two versions of neoliberal ideology—a "hard" Thatcher-Reagan
version and a "soft" Blair-Soros version (globalization with "safety
nets.)" But underlying both approaches was unleashing market forces and
removing or eroding constraints imposed on transnational firms by
labor, the state, and society.

THREE MOMENTS OF THE CRISIS OF GLOBALIZATION

There have been three moments in the deepening
crisis of the globalist project. The first was the Asian financial
crisis of 1997. This event, which laid low the proud "tigers" of East
Asia, revealed that one of the key tenets of the globalization—the
liberalization of the capital account to promote freer flows of
capital, especially finance or speculative capital – could be
profoundly destabilizing. The Asian financial crisis was, in fact,
shown to be merely the latest of at least eight major financial crises
since the liberalization of global financial flows began in the late
seventies. How profoundly destabilizing capital market liberalization
could be was shown when, in just a few weeks’ time, one million people
in Thailand and 21 million in Indonesia were pushed below the poverty
line.

The Asian financial crisis was the "Stalingrad" of
the IMF, the prime global agent of liberalized capital flows. Its
record in the ambitious enterprise of subjecting some 100 developing
and transitional economies to "structural adjustment" was revisited,
and facts that had been pointed out by such agencies as the United
Nations Development Program (UNDP) and United Nations Conference on
Trade and Development (UNCTAD) as early as the late eighties now
assumed the status of realities. Structural adjustment programs
designed to accelerate deregulation, trade liberalization, and
privatization had almost everywhere institutionalized stagnation,
worsened poverty, and increased inequality.

A paradigm is really in crisis when its best
practitioners desert it, as Thomas Kuhn pointed out in his classic The
Structure of Scientific Revolutions, and something akin to what
happened during the crisis of the Copernican paradigm in physics
occurred in neoclassical economics shortly after the Asian financial
crisis, with key intellectuals leaving the fold-among them Jeffrey
Sachs, noted earlier for his advocacy of "free market" shock treatment
in Eastern Europe in the early 1990s; Joseph Stiglitz, former chief
economist of the World Bank; Columbia Professor Jagdish Bhagwati, who
called for global controls on capital flows; and financier George
Soros, who condemned the lack of controls in the global financial
system that had enriched him.

The second moment of the crisis of the globalist
project was the collapse of the third ministerial of the WTO in Seattle
in December 1999. Seattle was the fatal intersection of three streams
of discontent and conflict that had been building for sometime:

– Developing countries resented the inequities of the Uruguay Round agreements that they felt compelled to sign in 1995.

– Massive popular opposition to the WTO emerged
globally from myriad sectors of global civil society, including
farmers, fisherfolk, labor unionists, and environmentalists. By posing
a threat to the well being of each sector in many of its agreements,
the WTO managed to unite global civil society against it.

– There were unresolved trade conflicts between the
EU and the US, especially in agriculture, which had been simply been
papered over by the Uruguay Round agreement.

These three volatile elements combined to create the
explosion in Seattle, with the developing countries rebelling against
Northern diktat at the Seattle Convention Center, 50,000 people massing
militantly in the streets, and differences preventing the EU and US
from acting in concert to salvage the ministerial. In a moment of
lucidity right after the Seattle debacle, British Secretary of State
Stephen Byers captured the essence of the crisis: "[T]he WTO will not
be able to continue in its present form. There has to be fundamental
and radical change in order for it to meet the needs and aspirations of
all 134 of its members".

The third moment of the crisis was the collapse of
the stock market and the end of the Clinton boom. This was not just the
bursting of the bubble but a rude reassertion of the classical
capitalist crisis of overproduction, the main manifestation of which
was massive overcapacity. Prior to the crash, corporate profits in the
US had not grown since 1997. This was related to overcapacity in the
industrial sector, the most glaring example being seen in the troubled
telecommunications sector, where only 2.5 per cent of installed
capacity globally was being utilized. The stagnation of the real
economy led to capital being shifted to the financial sector, resulting
in the dizzying rise in share values. But since profitability in the
financial sector cannot deviate too far from the profitability of the
real economy, a collapse of stock values was inevitable, and this
occurred in March 2001, leading to the prolonged stagnation and the
onset of deflation.

There is probably a broader structural reason for
the length of the current stagnation or deflation and its constant
teetering at the edge of recession. This may be, as a number of
economists have stated, that we are at the tail end of the famous
"Kondratieff Cycle". Advanced by the Russian economist Nikolai
Kondratieff, this theory suggests that the progress of global
capitalism is marked not only by short-term business cycles but also by
long-term "supercycles". Kondratieff cycles are roughly fifty to
sixty-year long waves. The upward curve of the Kondratieff cycle is
marked by the intensive exploitation of new technologies, followed by a
crest as technological exploitation matures, then a downward curve as
the old technologies produce diminishing returns while new technologies
are still in an experimental stage in terms of profitable exploitation,
and finally a trough or prolonged deflationary period.

The trough of the last wave was in the 1930s and
1940s, a period marked by the Great Depression and World War II. The
ascent of the current wave began in the 1950s and the crest was reached
in the 1980s and 1990s. The profitable exploitation of the postwar
advances in the key energy, automobile, petrochemical, and
manufacturing industries ended while that of information technology was
still at a relatively early stage. From this perspective, the "New
Economy" of the late 1990s was not a transcendence of the business
cycle, as many economists believed it to be, but the last glorious
phase of the current supercycle before the descent into prolonged
deflation. In other words, the uniqueness of the current conjuncture
lies in the fact that the downward curve of the current short-term
cycle coincides with the move into descent of the Kondratieff
supercycle. To use the words of another famous economist, Joseph
Schumpeter, the global economy appears to be headed for a prolonged
period of "creative destruction".

ENVIRONMENTAL CRISIS AND CAPITALIST LEGITIMACY

I have been talking about moments or conjunctural
crystallizations of the crisis of the globalization project. These
moments were manifestations of fundamental conflicts or contradictions
that were unfolding unevenly over time. A central smoldering
contradiction was that between globalization and the environment. I
would now want to devote a few words to how the environmental crisis
has proven to be a central factor unravelling the legitimacy of the
globalization project, indeed of capitalism as a mode of economic
organization itself.

Both before and after the World Summit on
Environment and Development in Rio de Janeiro in 1992, the sense was
that while the world environmental situation was worsening,
consciousness of this fact was leading to the creation of the global
institutional and legal mechanisms to deal with the problem. The Rio
Summit’s agreeing on Agenda 21, a global program for environmental
improvement that would have counterpart country programs, seemed to
mark a major step forward in terms of global cooperation.

The late eighties and early nineties were, moreover,
a period when a number of multilateral environmental agreements were
inked and appeared to be making headway in reversing the global
environmental crisis, like the Montreal Protocol putting controls on
the production of CFCs to preserve ozone layer, and the CITES Treaty
putting tough controls on trade in endangered species. Also, with the
coming to power of Bill Clinton and Al Gore in 1992, an environmentally
correct administration seemed to be in place.

Several moves stalemated this process.

First, the establishment of the WTO. As Ralph Nader
put it, the WTO placed corporate trade "uber alles", meaning
practically all dimensions of economic and social life except for
national security. In other words, laws protecting natural resources
and the environment needed to be changed if they were seen as imposing
standards that were seen as unfair to foreign trading interests. In a
series of landmark cases—the tuna-dolphin case between the US and
Mexico, the turtle-shrimp controversy pitting the US and Asian
countries—it seemed that national environmental laws were being
subordinated to free trade. The thrust seemed to be to bring
environmental protections in different countries to the lowest common
denominator rather than to bring them up to the highest standards.

Second, the aggressive push by corporations to
exploit advanced food technology and biotechnology alarmed
environmentalists and citizenries all over. The EU’s ban on
hormone-treated beef from the US-enacted in response to popular demand
in Europe- continued despite the WTO’s viewing it as illegal. Likewise,
genetic modifications in agricultural production coupled with
resistance to ecolabelling on the part of US firms such as Monsanto
triggered a consumer backlash in Europe and other parts of the world,
with the precautionary principle being invoked as a powerful weapon
against the US corporations’ criterion of "solid science". Also, the
aggressive effort by US biotech firms to extend patenting to life forms
and to seeds led to strong resistance by farmers’ groups, consumer
groups, and environmentalists to what was denounced as the
"privatization" of the aeons-long interaction between nature and
communities.

Third, the strong resistance of the US industrial
sector to acknowledge the fact of global warming, at a time when the
speed of the melting of the polar ice caps was accelerating, was
perceived as a brazen attempt to put profits ahead of the common
interest. This perception could only be reinforced by the successful
corporate effort to stalemate a collective global effort to effectively
deal with global warming during the Clinton administration and finally
to kill it when the Bush administration refused to sign and ratify the
already weak Kyoto Protocol on climate change.

The aggressive anti-environmental posture of US
corporations was one of the factors that led to a great distrust of
business even within the United States, with 72 per cent of Americans
surveyed by Business Week in 2000 saying that business "has too much
power over their lives", leading the country’s prime business weekly to
warn: "Corporate America, ignore these trends at your peril".

At the same time, developing countries felt that the
US was using environmental arguments to slow down their development
with its position that the greenhouse gas emissions of developing
countries needed to be also subject to substantially the same
restrictions imposed on the developed countries before Washington would
sign the Kyoto Accord. Indeed, such suspicions were not unfounded,
since Bush administration people were targeting China, whose rapid
development was seen as a strategic threat to the US. Environmentalism
was being deployed in the US’s effort to maintain its geo-economic,
geopolitical edge.

By the early 2000s, then, the global consensus
represented by the Rio Summit had unraveled, and it all but collapsed
under the massive corporate greenwashing campaign that was unleashed at
the World Summit on Sustainable Development (also known as Rio+10) in
Johannesburg in September 2002. "Sustainable development", a vision
that attempted to reconcile economic growth with ecological stability
fell by the wayside, and Herman Daly’s apocalyptic image of an economic
system marked by hyper-growth outstripping in record time an ecological
system created over aeons seemed closer to realization as US, European,
and Japanese capital worked closely with a pollution-friendly
government to make high-growth China both the workshop and wastebasket
of the world.

A few years ago, many agreed with economist Herman
Daly that ecological deterioration is due to the inexorable drive of
the man-made system of production to fill with geometric speed the
limited space created over eons by nature. From this perspective,
slower growth and lower rates of consumption were the key to
environmental stabilization, and this could be achieved through policy
choices supported by the public.

Increasingly, this analysis is giving way to the
more radical view that the main culprit is an unchecked capitalist mode
of production that unceasingly transforms nature's bounty into
commodities and incessantly creates new demands. Capitalism constantly
erodes man and woman's being-in-nature (creature) and being-in-society
(citizen) and, even as it drains them of life energy as workers, it
moulds their consciousness around one role: that of consumer.
Capitalism has many "laws of motion", but one of the most destructive
as far as the environment goes is Say's law, which is that supply
creates its own demand. Capitalism is a demand-creating machine that
transforms living nature into dead commodities, natural wealth into
dead capital.

Environmentalism, in short, has regained its radical
edge over the past decade, moving the critique of globalization to a
critique of the dynamics of capitalism itself.

THE NEW ECONOMICS OF THE GEORGE W. BUSH

The interlocking crises of globalization,
neoliberalism, capitalist legitimacy, and overproduction provide the
context for understanding the economic policies of the Bush
administration, notably its unilateralist thrust. The globalist
corporate project expressed the common interest of the global
capitalist elites in expanding the world economy and their fundamental
dependence on one another. However, globalization did not eliminate
competition among the national elites. In fact, the ruling elites of
the US and Europe had factions that were more nationalist in character
as well as more tied for their survival and prosperity to the state,
such as the military-industrial complex in the US. Indeed, since the
eighties there has been a sharp struggle between the more globalist
fraction of ruling elite stressing common interest of global capitalist
class in a growing world economy and the more nationalist, hegemonist
faction that wanted to ensure the supremacy of US corporate interests.

As Robert Brenner has pointed out, the policies of
Bill Clinton and his Treasury Secretary Robert Rubin put prime emphasis
on the expansion of the world economy as the basis of the prosperity of
the global capitalist class. For instance, in the mid-1990s, they
pushed a strong dollar policy meant to stimulate the recovery of the
Japanese and German economies, so they could serve as markets for US
goods and services. The earlier, more nationalist Reagan
administration, on the other hand, had employed a weak dollar policy to
regain competitiveness for the US economy at the expense of the
Japanese and German economies. With the George W. Bush administration,
we are back to economic policies, including a weak dollar policy, that
are meant to revive the US economy at the expense of the other center
economies and push primarily the interests of the US corporate elite
instead of that of global capitalist class under conditions of a global
downturn.

Several features of this approach are worth stressing:

– Bush’s political economy is very wary of a process
of globalization that is not managed by a US state that ensures that
the process does not diffuse the economic power of the US. Allowing the
market solely to drive globalization could result in key US
corporations becoming the victims of globalization and thus
compromising US economic interests. Thus, despite the free market
rhetoric, we have a group that is very protectionist when it comes to
trade, investment, and the management of government contracts. It seems
that the motto of the Bushites is protectionism for the US and free
trade for the rest of us.

– The Bush approach includes a strong skepticism
about multilateralism as a way of global economic governance since
while multilateralism may promote the interests of the global
capitalist class in general, it may, in many instances, contradict
particular US corporate interests. The Bush coterie’s growing
ambivalence towards the WTO stems from the fact that the US has lost a
number of rulings there, rulings that may hurt US capital but serve the
interests of global capitalism as a whole.

– For the Bush people, strategic power is the
ultimate modality of power. Economic power is a means to achieve
strategic power. This is related to the fact that under Bush, the
dominant faction of the ruling elite is the military-industrial
establishment that won the Cold War. The conflict between globalists
and unilateralists or nationalists along this axis is shown in the
approach toward China. The globalist approach put the emphasis on
engagement with China, seeing its importance primarily as an investment
area and market for US capital. The nationalists, on the other hand,
see China mainly as a strategic enemy, and they would rather contain it
rather than assist its growth.

– Needless to say, the Bush paradigm has no room for
environmental management, seeing this to be a problem that others have
to worry about, not the United States. There is, in fact, a strong
corporate lobby that believes that environmental concerns such as that
surrounding GMOs is a European conspiracy to deprive the US of its high
tech edge in global competition.

If these are seen as the premises for action, then the following prominent elements of recent US economic policy make sense:

– Achieving control over Middle East oil. While it
did not exhaust the war aims of the administration in invading Iraq, it
was certainly high on the list. With competition with Europe becoming
the prime aspect of the trans-Atlantic relationship, this was clearly
aimed partly at Europe. But perhaps the more strategic goal was to
preempt the region’s resources in order to control access to them by
energy poor China, which is seen as the US’ strategic enemy.

– Aggressive protectionism in trade and investment
matters. The US has piled up one protectionist act after another, one
of the most brazen being to stall any movement at the WTO negotiations
by defying the Doha Declaration’s upholding of public health issues
over intellectual property claims by limiting the loosening of patent
rights to just three diseases in response to its powerful
pharmaceutical lobby. While it seems perfectly willing to see the WTO
negotiations unravel, Washington has put most of its efforts in signing
up countries into bilateral or multilateral trade deals such as the
Free Trade of the Americas (FTAA) before the EU gets them into similar
deals. Indeed the term "free trade agreements" is a misnomer since
these are actually preferential trade deals.

– Incorporating strategic considerations into trade
agreements. In a recent speech, US Trade Representative Robert Zoellick
stated explicitly that "countries that seek free-trade agreements with
the United States must pass muster on more than trade and economic
criteria in order to be eligible. At a minimum, these countries must
cooperate with the United States on its foreign policy and national
security goals, as part of 13 criteria that will guide the US selection
of potential FTA partners". New Zealand, perhaps one of the most
doctrinally governments to free trade, has nevertheless not been
offered a free trade deal because it has a policy that prevents nuclear
ship visits, which the US feels is directed at it.

– Manipulation of the dollar’s value to stick the
costs of economic crisis on rivals among the center economies and
regain competitiveness for the US economy. A slow depreciation of the
dollar vis-à-vis the euro can be interpreted as market-based
adjustments, but the 25 per cent fall in value cannot but be seen as,
at the least, a policy of benign neglect. While the Bush administration
has issued denials that this is a beggar-thy-neighbor policy, the US
business press has seen it for what it is: an effort to revive the US
economy at the expense of the European Union and other center economies.

– Aggressive manipulation of multilateral agencies
to push the interests of US capital. While this might not be too easy
to achieve in the WTO owing to the weight of the European Union, it can
be more readily done at the World Bank and the IMF, where US dominance
is more effectively institutionalized. For instance, despite support
for the proposal from many European governments, the US Treasury
recently torpedoed the IMF management’s proposal for a Sovereign Debt
Restructuring Mechanism (SDRM) to enable developing countries to
restructure their debt while giving them a measure of protection from
creditors. Already a very weak mechanism, the SDRM was vetoed by US
Treasury in the interest of US banks.

– Finally, and especially relevant to our coming
discussions, making the other center economies as well as developing
countries bear the burden of adjusting to the environmental crisis.
While some of the Bush people do not believe there is an environmental
crisis, others know that the current rate of global greenhouse
emissions is unsustainable. However, they want others to bear the brunt
of adjustment since that would mean not only exempting environmentally
inefficient US industry from the costs of adjustment, but hobbling
other economies with even greater costs than if the US participated in
an equitable adjustment process, thus giving the US economy a strong
edge in global competition. Raw economic realpolitik, not
fundamentalist blindness, lies at the root of the Washington's decision
not to sign the Kyoto Protocol on Climate Change.

THE ECONOMICS AND POLITICS OF OVEREXTENSION

Being harnessed very closely to strategic ends, any
discussion of the likely outcomes of the Bush administration’s economic
policies must take into account both the state of the US economy and
the global economy and the broader strategic picture. A key base for
successful imperial management are expanding national and global
economies—something precluded by the extended period of deflation and
stagnation ahead, which is more likely to spur inter-capitalist
rivalries.

Moreover, resources include not only economic and
political resources but political and ideological ones as well. For
without legitimacy—without what Gramsci called "the consensus" of the
dominated that a system of rule is just—imperial management cannot be
stable.

Faced with a similar problem of securing the
long-term stability of its rule, the ancient Romans came up with the
solution that created what was till then the most far-reaching case of
collective mass loyalty ever achieved till then and prolonged the
empire for 700 years. The Roman solution was not just or even
principally military in character. The Romans realized that an
important component of successful imperial domination was consensus
among the dominated of the "rightness" of the Roman order. As
sociologist Michael Mann notes in his classic Sources of Social Power,
the "decisive edge" was not so much military as political. "The
Romans", he writes, "gradually stumbled on the invention of extensive
territorial citizenship". The extension of Roman citizenship to ruling
groups and non-slave peoples throughout the empire was the political
breakthrough that produced "was probably the widest extent of
collective commitment yet mobilized". Political citizenship combined
with the vision of the empire providing peace and prosperity for all to
create that intangible but essential moral element called legitimacy.

Needless to say, extension of citizenship plays no
role in the US imperial order. In fact, US citizenship is jealously
reserved for a very tiny minority of the world's population, entry into
whose territory is tightly controlled. Subordinate populations are not
to be integrated but kept in check either by force or the threat of the
use of force or by a system of global or regional rules and
institutions-the World Trade Organization, the Bretton Woods system,
NATO-that are increasingly blatantly manipulated to serve the interests
of the imperial center.

Though extension of universal citizenship was never
a tool in the American imperial arsenal, during its struggle with
communism in the post-World War II period Washington did come up with a
political formula to legitimize its global reach. The two elements of
this formula were multilateralism as a system of global governance and
liberal democracy.

In the immediate aftermath of the Cold War, there
were, in fact, widespread expectations of a modern-day version of Pax
Romana. There was hope in liberal circles that the US would use its
sole superpower status to buttress a multilateral order that would
institutionalize its hegemony but assure an Augustan peace globally.
That was the path of economic globalization and multilateral
governance. That was the path eliminated by George W. Bush's
unilateralism.

As Frances Fitzgerald observed in Fire in the Lake,
the promise of extending liberal democracy was a very powerful ideal
that accompanied American arms during the Cold War. Today, however,
Washington or Westminster-type liberal democracy is in trouble
throughout the developing world, where it has been reduced to providing
a façade for oligarchic rule, as in the Philippines, pre-Musharraf
Pakistan, and throughout Latin America. In fact, liberal democracy in
America has become both less democratic and less liberal. Certainly,
few in the developing world see a system fueled and corrupted by
corporate money as a model.

Recovery of the moral vision needed to create
consensus for US hegemony will be extremely difficult. Indeed, the
thinking in Washington these days is that the most effective consensus
builder is the threat of the use of force. Moreover, despite their talk
about imposing democracy in the Arab world, the main aim of influential
neoconservative writers like Robert Kagan and Charles Krauthammer is
transparent: the manipulation of liberal democratic mechanisms to
create pluralistic competition that would destroy Arab unity. Bringing
democracy to the Arabs is not so much an afterthought as a slogan that
is uttered tongue in cheek.

The Bush people are not interested in creating a new
Pax Romana. What they want is a Pax Americana where most of the
subordinate populations like the Arabs are kept in check by a healthy
respect for lethal American power, while the loyalty of other groups
such as the Philippine government is purchased with the promise of
cash. With no moral vision to bind the global majority to the imperial
center, this mode of imperial management can only inspire one thing:
resistance.

The great problem for unilateralism is
overextension, or a mismatch between the goals of the United States and
the resources needed to accomplish these goals. Overextension is
relative. That is, it is to a great degree a function of resistance. An
overextended power may, in fact, be in a worse condition even with a
significant increase in its military power if resistance to its power
increases by an even greater degree. Among the key indicators of US
overextension are the following:

– Washington’s continuing inability to create a new
political order in Iraq that would serve as a secure foundation for
colonial rule

– its failure to consolidate a pro-US regime in Afghanistan outside of Kabul

– the inability of a key ally, Israel, to quell, even with Washington’s unrestricted support, the Palestinian people’s uprising

– the inflaming of Arab and Muslim sentiment in the
Middle East, South Asia, and Southeast Asia, resulting in massive
ideological gains for Islamic fundamentalists—which was what Osama bin
Laden had been hoping for in the first place

– the collapse of the Cold War Atlantic Alliance and
the emergence of a new countervailing alliance, with Germany and France
at the center of it

– the forging of a powerful global civil society
movement against US unilateralism, militarism, and economic hegemony,
the most recent significant expression is the global anti-war movement;

– the coming to power of anti-neoliberal, anti-US
movements in Washington’s own backyard—Brazil, Venezuela, and
Ecuador—as the Bush administration is preoccupied with the Middle East

– an increasingly negative impact of militarism on
the US economy, as military spending becomes dependent on deficit
spending, and deficit spending become more and more dependent on
financing from foreign sources, creating more stresses and strains
within an economy that is already in the throes of stagnation.

In conclusion, the globalist project is in crisis.
Whether it can make a comeback via a Democratic or Liberal Republican
presidency should not be ruled out, especially since there are
influential globalist voices in the US business community—among them
George Soros- that are expressing opposition to the unilateralist
thrust of the Bush administration. In our view, however, this is
unlikely, and unilateralism will reign for sometime to come.

We have, in short, entered a historical maelstrom
marked by prolonged economic crisis, the spread of global resistance,
the reappearance of the balance of power among center states, and the
reemergence of acute inter-imperialist contradictions. We must have a
healthy respect for US power, but neither must we overestimate it. The
signs are there that the US is seriously overextended and what appear
to be manifestations of strength might in fact signal weakness
strategically.

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