PART I HISTORICAL STRUCTURES

Transcription

1 PART I HISTORICAL STRUCTURES

2 Introduction The term 'political economy' has a long history. It was first coined by a French writer, Montchretien de Watteville, in 1615, when he used it to describe 'the science of wealth acquisition common to the State as well as the Family,.J Writing in the early period of the great transition from small primordial communities to national social formations, de Watteville's invention of the concept proved to be an expression of extraordinary vision. For it not only presaged the emergence of economics as a scientific discipline in the nineteenth century, but it also reflected this discipline's enduring preoccupation with national territorial accumulation. By 'national territorial accumulation' we understand a process of continuous self-expansion of capital within the territorial boundedness of the nation-state. Another expression for it would be 'economic growth of the nation'. But economic growth of a nation may conceivably be achieved (at least temporarily) through a sudden growth of income, say, from natural resources like oil, or rent income, or from financial investments in other parts of the world and so on. 'National accumulation' is a term preferred by Marxists which tries to encapsulate the growth of productive capacity and technological advance within a national territorial context. 'National economic development' is the nearest non-marxist synonym. Strangely enough in the mercantilist period in which de Watteville was writing and which lasted until Adam Smith's formal establishment of political economy in the nineteenth century, the term 'political economy' was not much used. Mercantilism, however, was a system of political economy par excellence. Mercantilism is best described as the striving after political power through economic means. In the seventeenth and eighteenth centuries the emergence of strong national states, each competing with the other, formed the backdrop of mercantilist policies designed to foster economic growth and so raise revenue - if necessary for the waging of war. The economy was put to the service of the polity. In 3

3 4 Historical Structures the circumstances of the time, it meant the encouragement of trade and manufacture, the pursuit of protectionist policies, and the stimulation of export trade rather than the improvement of land. International trade was seen to be a zero-sum game. The mercantilists thought of wealth in competitive terms, as something taken by one nation from another, an inherently differential gain like winning a race. The words of Thomas Mun, writing in 1664, summed up the attitude towards foreign trade: 'The ordinary means therefore to encrease our wealth and treasure is by Forraign Trade, wherein wee must observe this rule; to sell more to strangers yearly than we consume of theirs in value'. 2 By the same token a nation must try to produce at home, instead of buying abroad. Many writers, particularly those standing in a Marxist tradition (the so-called 'world system' writers - for example Immanuel Wallerstein\ also believe that capitalism is a negative-sum game, and that the rise of some nations is always accompanied by the fall of others. But it is also a view that is today shared by some conservative, nationalist elements in those advanced countries like the USA who see power and economic wealth slipping away from their nation and passing into the hands of Japanese or European nations. If for the seventeenth and eighteenth century mercantilist writers and policy-makers the economy was intended to serve the power and glory of the (nation) state, with the writing of Adam Smith in the nineteenth century this picture was entirely reversed. He wrote in An Inquiry into the Nature and Causes of the Wealth of Nations (1776): Political economy, considered as a branch of the science of a statesman or legislator, proposes two distinct objects: first, to provide a plentiful revenue or subsistence for the people... and secondly, to supply the state... with a revenue sufficient for the public services. 4 For Adam Smith the 'wealth' of a nation was different from that which it had been for the mercantilists. For Smith wealth consisted of real goods and services (not just the ability to maintain a large army), and a nation was rich or poor according to its annual production in proportion to its population. It is interesting that the world community has maintained this definition of wealth up to this day. This is evidenced in the universal use of the term gross domestic product (GDP) per capita. Also, for Smith, the nation was co-

4 Introduction 5 extensive with all its people, not just the upper classes or the body politic as had been the case with the mercantilists. The actors in the drama of political economy were households and firms. But the biggest difference, the great watershed between mercantilist and Smith's and subsequent (classical) economist thought, lay in that the mercantilists concentrated on the transfer of wealth from the nation to the rulers to enable them to wage war with the nation's enemies. In contrast Smith, and classical economists after him, concentrated on the production of wealth. In Adam Smith's work, economics became the science of statecraft. It was the task of the policy-makers and legislators to ensure the optimum conditions for production. But this was also the very point where Adam Smith became the founder of liberal economics, the view namely which preferred markets to politics and which emphasised the invisible hand of the market as the best regulator of the economy. In a politically uncontrolled economy, Smith argued, the efforts of each to better himself would lead to that distribution of capital, labour, and land which maximised their respective returns by maximising the value of the output to the public. In a celebrated phrase Smith said 'Each intends only his own gain', but in the end 'promotes that of society' although this 'was no part of his intention,.5 The subsequent development of liberal economics or, as it increasingly came to be known, neo-classical economics, as the study of production, distribution and consumption of wealth, was marked by an ever stronger emphasis on its scientific character, almost as if economic processes were taking place independent of human will. This led to some ambiguity and confusion over the continued prefix 'political' in the words 'political economy'. Neo-classical economists, unsurprisingly, preferred to drop the prefix 'political' altogether. Consequently, nowadays, when we look up the definition of political economy in a dictionary we often find a simple statement saying that it is economics as it used to be called in the days of the classical economists. When writers within this liberal tradition still sometimes use the words political economy, it is to indicate a much more narrow field of enquiry, namely the study of economic policy and the linkages between economic and political factors in public policy. Karl Marx, and Marxist tradition ever since, have used the term 'political economy' in an altogether different sense. After all, Karl Marx wrote a critique of political economy. While he accepted much

5 6 Historical Structures of Smith's and Ricardo's basic premises, in particular that labour is the source of all value, he questioned the alleged positive aspects of the functioning of capitalism (or the free market economy). He used historical materialism to demonstrate the historicity of capitalism. Marx developed a theory of class struggle and he wanted to demonstrate that the individual pursuit of self-interest leads not to enhanced public/collective good, but to recurring crises and the eventual breakdown of capitalism. What is important for our purposes is that Marx's generic concept of political economy was more general and not coincidental with the nation-state. Marx referred to the way social relations and power relations (which is another way of saying class relations) affect and organise the economy and, in turn, are organised by it. For Marx, in the historical evolution of human society these social or class relations have not always been contained within the boundaries of the nation-state. When a chief in a primitive society can command respect and tribute from the people (including a substantial amount of their production), then that is political economy for Marx. Or when a feudal lord has domain over land which means his tenant farmers have to pay him ground rent to use the land, then that is political economy too. In capitalist societies, the fact that an entrepreneur can hire free labour and make a profit out of the difference between what he pays his workers in wages and that which the products fetch in the market, that too is political economy. Marx tried to show that there have been different political economies which he called modes of production in different historical periods, and that the political economy that Smith and Ricardo were writing about was just one of a sequence of five historical modes of production (primitive - slave - feudal - capitalist - communist).6 The Marxist study of political economy involves a study of the historical laws of motion that govern the evolution of this sequence of modes of production and, at the time of Marx's writing, more in particular from capitalist to communist. International Political Economy These three different conceptualisations or models of political economy came to undergird the different perspectives on what the study of international political economy is all about, namely:

6 1. Realism; 2. Institutionalism/pluralism; and 3. Structuralism. Introduction 7 But whatever the perspective on the relationship between politics and economics, it was shaped and cast in cement by the historical experience of the nation-state. Statism came to prevail in international theory, even in the Marxist structuralist perspective. International society was generally conceived of as a society of states. The dominant motif of all three theories of international political economy became the need to explain the paradox between an economy that was clearly internationalising amidst a world political system that was continuing to be compartmentalised into separate nation-states. 7 And thus they elaborated their existing conceptual schemata to cover this historical contingency rather than to start afresh and invent new models. Realism The realist position is inspired by a mercantilist conception of political economy. It gives primacy to the body politic, conceives of the nation-state as actor, and imagines the world as a competition of units (nation-states) in an anarchic international arena dominated by the struggle for power among states. 8 In analogy with what Hobbes had to say about 'man eats man' (homo homini lupus), so the realist sees the world as a jungle of nation-states all out to further their own interests. The realist perspective focuses on interstate competition, and on the use of power by nations in interfering in international markets on behalf of their own states. Based on their analysis of continual interstate competition, the realist comes up with a normative theory of international order and stability rooted in conceptions of hegemony and balance of power (for example American postwar hegemony; and the balance of power between the USdominated and the USSR-dominated blocs). Institutionalism or Pluralism The second position is that of the pluralist or institutionalist perspective. This perspective is more in tune with Adam Smith's classical liberal economics. It recognises the increasing economic

7 8 Historical Structures interdependence between states, and sees this as grounded in what is regarded as the all-round growth-maximising and beneficial operations of the now world-wide free market system. It argues that increasing economic interdependence forces states to develop and pursue policies of rational self-interest which lead to greater economic cooperation between them rather than to conflict. Cooperation becomes necessary and institutionalised in intergovernmental regimes of governance and coordination. Thus, for example, the institutionalists argue that the postwar stable world-order owed not so much to American hegemony and a balance of power between the USA and USSR, but rather to development of viable international institutions, such as United Nations organisations, international treaties, regional blocs and so on. The perspective is sometimes referred to as 'pluralist' because it believes that cooperation can take place without the supremacy of anyone nation, but rather on the basis of a plurality of coordinated and interlocking interests between nations: a plural world order. The international political economy is seen to consist of the emergence, at an accelerating pace, of international institutions for the management of the internationalised economy.9 Structuralism A third perspective on international political economy is the structuralist perspective. This derives from a Marxist notion of political economy as described above. Structuralists basically apply the Marxist study of capitalist political economy to international relations. That is to say, the study of the relations between states is derived from, and subsidiary to, the concern with the development of capitalism on a global scale. It is argued that capitalism is a mode of production that has become trans-societal and which today spans practically all nations of the world. But although structuralists thus begin with a conception of the totality of the world system, they next look at states as constitutive units which have a structural relationship predetermined by the world capitalist economy. It is called 'structuralist' because it challenges the assumption that national societies constitute 'independent' units whose development can be understood without taking into account the systemic ways in which these societies are linked to one another in the context of an everexpanding network of material (economic) exchanges. In the view of

8 Introduction 9 the structuralists, it is the deep logic of the capitalist mode of production itself which yields the nodal positions (for example of core, periphery and semi-periphery) within the global structure which nations occupy. These intersocietal and trans-societal networks of material exchanges are either termed world-systems as in Wallerstein's theory, or global social formations as in Amin's terminology,1o or global formations as in Chase-Dunn's work. I I What is especially confusing about the three competing perspectives is that they may pair up, two against one, depending on the analytical question posed. For example, both realists and Marxists tend to regard the outcome of international economic relations as a redistributive, non-sum game. The gain of some nations is always at the expense of others. This contrasts with the liberals, who have a more optimistic view of the outcome of international economic relations: they see it as a positive-sum game in which eventually all participants will be better-off, even if the distribution of gains is not equal. On the other hand, liberals and Marxists in their turn line up together when it comes to giving primacy to the economy in shaping the body politic, in contrast to the realists who see the relationship the other way around. But when it comes to offering an explanation of social change, both realists and liberals have nothing to present: theirs is a theory of stasis and equilibrium, while here it is the Marxists who are alone in developing a theory of social change. 12 This incompatibility of conceptual frameworks has led over time to sterile inter-paradigmatic debates, and eventually to a polarisation of the field of international relations into separate subfields. Neo-realists focused on strategic studies, American foreign policy and the cold war; neo-institutionalists looked at international organisations, multinational companies and the developing international economy; neo-marxists on the core-periphery hierarchy in the world economy. However, in the 1970s a powerful wind of intellectual change began to blow across the fields of all social sciences and eventually swept across the study of international political economy too. Postmodernist knowledge theory began to break the hold of progressivist thinking over liberal and Marxist traditions; it opened up the space for human agency in structuralist analyses and thus made them less deterministic, and at the same time it made scholars more self-aware about the relationship between truth and power,

9 10 Historical Structures that is the rules of 'knowledge' that are never far from the social context in which they operate. The outcome was a critical social theory that proliferated as an 'agenda of dissent' in the field of international political economy. 13 Soon that agenda would yield the beginnings of new theoretical approaches. For example, in the trailblazing work of Robert Cox we find critical social theory applied to the problem of world order and historical transformation. Cox has managed to synthesize and transcend the neo-realist and neo-marxist approaches, re-integrate the separate subfields of international economic relations and strategic studies, and overcome the structure/agency dichotomy. Indeed, for a growing number of scholars in the field Robert Cox has become the founding father of a new international political economy.14 The Critical Theory of Robert Cox: Historical Structure Robert COX'SI5 main contribution lies in the development of a methodology for the study of historical change in international political economy. He begins by critiquing conventional international relations theory, neo-realism and neo-marxism alike, (1) for being altogether too obsessed with the relations between states, (2) for failing to develop conceptual apparatuses that may account for the many trans-societal linkages that are growing up today, and (3) for not being critically aware of their own historical roots. He next grapples with two problems. One is that of world order: what is it and how can it be described? The second is that of historical change, by which he means trans formative change in the organisation of human affairs. Put the two together and the problematic is: how do world orders change? What is interesting about Cox's theory is that he answers this question by a process of reversal: the question of change has to be understood from the vantage point of comprehending what makes for stability. At this point Cox makes his most important contribution to the study of international political economy: he injects Gramsci's notion of hegemony into the study of world order. Antonio Gramsci l6 had originally developed the notion of hegemony as a 'fit' between power, ideas and institutions to explain the stability of capitalist class relations and national social order. Cox now uses Gramsci's concept of hegemony to explain a stable world

10 Introduction 11 order, rather than - as in conventional international relations theories - single state dominance or bipolar state balance of power or some such. Cox deploys the concept of 'historical structure' to examine how and why the fit comes about, and why and how it comes apart. He defines a historical structure as 'a particular configuration between ideas, institutions and material forces'. It is no more than a framework of action which constitutes the context of habits, pressures, expectations and constraints within which actions take place, but which does not determine actions in any direct, mechanical way. 'Individuals may move with the pressures or resist and oppose them, but they cannot ignore them. To the extent that they do successfully resist a prevailing historical structure, they buttress their actions with an alternative, emerging configuration of forces: a rival structure.'17 Thus, we notice that the concept of historical structure is far less deterministic than most Marxist accounts of history, and that it leaves open the possibility that history can develop in a variety of directions. The task of the critical social scientist is to uncover 'plausible' alternative futures, instead of remaining trapped in some transhistorical essentialism in which either the present is forever (as for example in Fukuyama's End of History scenario) or the future is a foregone conclusion, as in orthodox historical materialism. On the question of what is the source of historical change, Cox argues that historical materialism unlike structural or (neo)marxism does in fact have a lot to offer to a theory of historical change. He submits that it is the foremost source of 'critical theory' for two reasons: firstly because it focuses on the principle of the dialectic as a source of transformative changes between grand, epochal, systems of human socio-economic organisation (modes.of production) - the principle of the dialectic refers to the search for contradictions in social life as the mainspring of social change. And, second, because it identifies changes in social forces shaped by production relations as a prime mover in these transformations. However, historical materialism has failed in three respects: first, in the lack of awareness of its own historical boundedness; second, in the pre-gramscian conception of a unidirectional connection between economic structure on the one hand and institutions and ideas on the other; and third, in the altogether too abstract and deterministic presentation of an unfolding history in which the progressive transformation of modes of production through the dialectic is a foregone teleological

11 12 Historical Structures conclusion. Instead, Cox recognises that ideas which have become institutionalised may hang on long after the material forces that gave rise to them have been transformed, and well after the hegemonic power that institutionalised and universalised them has demised, and while rivalling social forces, growing out of changed material conditions, struggle for ideological and institutional ascendancy. Thus, in line with most other contemporary postmodernist, poststructuralist thinking, Cox wants to break with the determinism of historical theory. He sees history as open-ended, and he wants us to realize that not only human structures and action but also theory itself is part of a historical structure, and therefore constitutes part of the problematic that we are researching. This is the kernel of Cox's meta-theoretical concept of critical theory. 'Critical theory is conscious of its own relativity but through this consciousness can achieve a broader time perspective and become less relative... ',18 that is it is less bound at its historical origin. It knows that the task of theorising can never be finished in an enclosed system but must continually begin anew, beginning not with abstract conceptions but with a description of historical experience, ferreting out the emerging contradictions between changing material conditions and associated social forces on the one hand, and the vested interests or overhangs from past institutions and ideologies on the other. Historical Structure and Stage Theory I have introduced the reader to Cox's work not with the pretense of doing justice to the innovative richness of this leading theorist, but because I want to borrow his concept of 'historical structure' to look back over the history of the relations between rich and poor countries both materially, and in respect of how these relations were time and again institutionalised and theorised, and how they changed. Writers standing in the structural Marxist tradition have tended to analyse the history of those relations in terms of a dialectical development of the capitalist world system in distinctive historical stages. Capitalism's inherent contradictions (the driving force of the dynamics of change) were thought to be worked out in different phases of expansion, punctuated by crises, in which state and

12 Introduction 13 interstate relations were time and again re-arranged as political structures that held in place a continuing exploitative economic relationship between 'core' and 'peripheral' areas. In each of the expansive phases of capitalism, the peripheral areas of the world were assigned a particular function at the service of the essential needs of accumulation at the centre, or core, of the system. Each phase of expansion, however, resulted in cumulative differences in productive capacity and income between core and periphery, leading to recurring crises of disequilibrium after which the relationship needed to be re-jigged. Thus (and very sketchily), in historical succession, the periphery is said to have served: first (in the mercantile period) as a source of primitive accumulation, financing the industrial revolution in the core; next, in the colonial period, it served as supplier of raw materials and foodstuffs; and, subsequently, in the neo-colonial period, it graduated to become modernising developmental states, providing the export markets for late industrialism's producer goods. In Chapters I, 2 and 3, I describe the dialectic unfolding of the relations between core and periphery from within this stage-theoretical perspective. However, I propose that we borrow Cox's concept of 'historical structure' to distance ourselves from the determinism that is implied in this perspective. Thus, rather than viewing these stages as inevitable steps in some unfolding, progressive logic of capitalist history, let us theori~e them as periods in which there was, each time, a 'fit' between material conditions, institutions and ideology including the reflections and 'theories' of the time. It was the 'fit' that created a momentary stability in the process of international capital accumulation (and which allows us to identify them as stages), until structural contradictions engendered by new developments in material production or by rivalling ideologies forced a process of crisis and change. When material, institutional and ideological elements once more fell into place, there came about a next phase of relatively stable international capital accumulation.