Chris Harman


theory and practice

(Part 1)



The mass media discovered a new phrase in 1999 – “anti-capitalism”. It first entered British headlines with the protests against financial institutions of the City of London on 18 June. It flashed across the world, on a much bigger scale, with the protest against the World Trade Organisation in Seattle on 30 November. They were painfully discovering something very real. Ten years after the supposed final triumph of market capitalism with the fall of the Berlin Wall and the collapse of the USSR, a growing number of people were rejecting their system.

The tens of thousands who demonstrated in Seattle, Paris, London, Washington and a score of other cities across the globe were the most visible expression of this anti-capitalist feeling. But it was to be found on a much wider scale: among the tens of thousands of supporters for the ATTAC organisers in France and the near 1 million who voted for the Trotskyist list there in the European election; among many of the supporters of Ken Livingstone in the London mayoral election, especially among the 15 percent of people who voted left of Labour in the London Assembly election; in opinion polls which showed the word “capitalism” had unfavourable associations for 58 percent of people in Poland, 63 percent in former East Germany and 51 percent in Italy; in the long student strike in Mexico; and in the series of strikes and protests which have flared up in different parts of Latin America. The anti-capitalism of the protesters is the tip of much bigger, half-submerged iceberg of discontent against the system.

It is this tip on which the media have concentrated their efforts-if only in an effort to denigrate it. But in doing so they have, as with the anti Vietnam War and student protests of the late 1960s, provided a focus for larger numbers of people trying to articulate their own discontents.

The starting point of any account of the new anti-capitalism has to be the Seattle demonstration. There is no need to describe here the demonstration. This has been done well already in this journal and elsewhere. [1] Suffice to say that Seattle was the result of the coming together of a whole number of previously disparate groups of people. Each began to understand that gatherings like that of the World Trade Organisation represented a threat to the things in which they believed. Luis Hernandez Navarro, a journalist on the radical Mexican daily La Jornada, describes those present: “Ecologists, farmers from the First World, unionists, gay rights activists, NGOs supporting development, feminists, punks, human rights activists, representatives of indigenous peoples, the young and not so young, people from the United States, Canada, Europe, Latin America and Asia”. [2] What united them, he says, was rejection of “the slogan ‘All power to the transnational corporations!’ present on the free trade agenda”.

There was a large element of spontaneity to the protest. Many people simply heard about it and decided to get there. But more than just spontaneity was involved. Many protesters arrived as members of local groups who had been preparing for many months for the event. And the fact that the event was a focus at all was a result of the combined efforts of a core of activists who saw the WTO as the common enemy of the different campaigns. This had involved the best part of year of intensive organisation for the event, with groups getting in touch with each other through the internet. But behind that lay a longer process of propagandising. Noam Chomsky, supposedly an anarchist, is quite right to stress this element of organisation: “The highly successful demonstration at the World Trade Organisation provides impressive testimony to the effectiveness of educational and organising efforts designed for the long term, carried out with dedication and persistence.” [3] Paul Hawken talks about “thought leaders” who motivated many of the protesters:

Martin Khor of the Third World Network in Malaysia, Vandana Shiva from India, Walden Bello of Focus on the Global South, Maude Barlow of the Council of Canadians, Tony Clarke of Polaris Institute, Jerry Mander of the International Forum on Globalisation (IFG), Susan George of the Transnational Institute, Daven Korten of the People-Centred Development Forum, John Cavanagh of the Institute for Policy Studies, Lori Wallach of Public Citizen, Mark Ritchie of the Institute for Agriculture and Trade Policy, Anuradha Mittal of the Institute for Food and Development Policy, Helena Norberg-Hodge of the International Society for Ecology and Culture, Owens Wiwa of the Movement for the Survival of the Ogoni People, Chakravarthi Raghavan of the Third World Network in Geneva, Debra Harry of the Indigenous Peoples Coalition Against Biopiracy, José Bové of the Confederation Paysanne Européenne, Tetteh Hormoku of the Third World Network in Africa. [4]

Other names might be added to the list if it is cast wider than those directly involved in mobilising for Seattle. Noam Chomsky himself would be one. Others would include the group of writers in France associated with the periodical Le Monde diplomatique and, overlapping with it, the organisation Attac and the group of intellectuals Raisons d”Agir around the sociologist Pierre Bourdieu. In Britain you would add Guardian columnist George Monbiot, the organisation Jubilee 2000 and the college-based People and Planet, in Belgium Eric Toussaint, Gerard de Sléys and Nico Hirtt, and in Canada Naomi Klein, author of the best-selling No Logo.

Some of the names are old time campaigners from the 1970s or even 1960s. This is true of Chomsky and Susan George. Others, like Naomi Klein, have come into prominence in the course of the 1990s. What they have in common is that, from different angles, they produced bitter critiques of the set of ideas that has determined government policies around the world in the 1990s – what is usually called today neo-liberalism (sometimes, in continental Europe, simply liberalism, however confusing this may be in the Anglo-Saxon countries).



Rejecting the neo-liberal barrage

Neo-liberal doctrines first found expression in Thatcherism and monetarism in the 1980s. [5] Today they run through the “Third Way” notions embraced by European social democrat leaders like Tony Blair. They are the ideas embodied in the policies of the main international agencies such as the IMF, the World Bank and the WTO. They underlie all the programmes for “economic reform” and “modernisation” pushed by politicians and mainstream economists, and what is presented as “common sense” by newspaper columnists and television news presenters.

The fundamental idea preached by neo-liberalism is that the state should play no economic role in modern society. There has to be a return to the economic orthodoxy which prevailed before the slump of the 1930s-the “laissez-faire” doctrine preached by Adam Smith in 1776 (in reality more by popularisers and vulgarisers of his views like Jean-Bapiste Say). That orthodoxy was known as “economic liberalism” – its rebirth is “neo-liberalism”. At the centre of this is the “freedom” of the capitalist from “interference”. It has come over the years to encompass reducing taxation on corporate profits and high personal incomes, privatisation of state-owned industries and services, a bonfire of regulations on private firms, an end to controls on the flow of finance across frontiers, and the abolition of attempts to control imports through tariffs (taxes on imports) and quotas (physical restrictions on imports).

Attempts at state intervention from the late 1920s onwards, it is claimed, led only to inefficiency and waste. The economic collapse of the old Eastern bloc, and the stagnation and poverty of Latin America and Africa are testimony to the disasters state controls can bring. The way to overcome poverty and “backwardness” is to follow an unremitting agenda of breaking down remaining controls, through the activities of the World Trade Organisation, the International Monetary Fund and the World Bank.

This “freeing” of the “enterprise” from “artificial” control will, it is claimed, lead to a betterment of the lot of humanity as a whole. The free flow of capital to wherever it is wanted will lead to goods being produced where it is most efficient. Accumulated wealth will no longer be tied down in “inefficient”, “rust belt” industries. Privatisation and “internal markets” will stop “bureaucratic” controls or “trade union monopolies” impeding “dynamic” rises in productivity. Particular regions of the world will be able to specialise in what they are best at doing. In the process the rich might be getting richer. But this does not matter. Wealth will “trickle down” to the poorest as an increase in worldwide output benefits everyone.

“Neo-liberal” views are usually associated with “globalisation” theories. These hold not only that the world should be organised according to the free flows of capital, without any intervention of governments, but that this has already come about. We live in the age of multinational (or sometimes transnational) capital. States are archaic institutions, unable to stop firms moving production at will to wherever it can be done most efficiently. Governments should not try to stop this, for to do so would lead to “siege economies” like that of North Korea or even Cambodia under Pol Pot in “Year Zero” – but anyway, governments cannot because firms will always outwit them. All that governments that care about their people can do is to provide firms with the best possible environment for operating-low taxes, “flexible labour markets”, weak unions, minimal regulation-in the hope of luring investment from elsewhere.

Some neo-liberals of a supposedly social democrat persuasion, like Tony Blair’s court sociologist Anthony Giddens, accept that there was a time when state intervention could play a beneficial role. But, they contend, the emergence of a global economy has changed all this. Whatever may have been the case in the past, the imposition of state controls today means inefficiency, and inefficiency leads to impoverishment. “Globalisation” and “neo-liberalism” become two closely connected concepts.

In certain very influential versions of “globalisation” theory, the ability of capital to move has become absolute. We live, they claim, in a world of “weightless” production. Computer software and the internet are much more important than “old fashioned metal-bashing” industries, and firms can escape the control both of states and their workers by switching production overnight from country to country. The advanced countries are “post-industrial” and the old working class is no longer a significant force, since manufacturing industry is moving to newly industrialising and Third World countries. What remains is a two thirds, one third society with, on the one hand, a very large middle class with sufficient “human capital” skills to continue to get premium incomes and, on the other, a rump sub-proletariat of the “socially excluded”, who at best can get temporary, “flexible”, unskilled jobs at wages kept low by competition with Third World products.

Meanwhile in the Third World and newly industrialising countries, it is claimed, people have no choice but to offer themselves at the best possible terms to the multinationals. All governments can do is encourage people to embrace the world market. Agriculture has to be tailored to turning out the products multinationals can sell on world markets. Workers have to toil to produce for the wages and under the conditions that suit. Taxes to pay for health, welfare and education have to kept to a minimum.

The critics of neo-liberalism and globalisation have exposed hole after hole in these doctrines. They have shown that embracing markets does not usually lead to any improvement in Third World countries. For two decades most of the peoples of Africa and Latin America have seen their conditions deteriorate, not improve. The turning over of vast tracts of land to the production of a single crop (“monoculture”) for multinationals does not raise revenues (since world prices are driven down as the same crops are produced in the same way in several other countries). The revenues that are earned are eaten up by interest payments on loans, and ecological degradation all too often follows.

Those who migrate to the towns after leaving the land live in the worst slum conditions and can at best get jobs toiling ten, 12 or even 16 hours a day in the most unhealthy conditions – and usually cannot even rely on keeping those jobs given the ups and downs of global markets. Meanwhile workers in the advanced countries may have higher living standards, but hardly “benefit” from a system which imposes on them longer, more unsociable working hours (the average US male works a full month a year longer than 25 years ago) and a stagnating or even falling real standard of living (only in the last couple of years have American real wages risen back anywhere near the figure they were at in the mid-1970s).

At the same time, the critics have shown how the refusal of governments to regulate firms means that ecological devastation now threatens not only particular spots on the planet, but the global ecostructure as a whole.



The WTO, the IMF, the multinationals and the impact of Seattle

The high priests of neo-liberalism demand the dismantling of all state economic activity, all barriers to the free movement of goods, finance and capital, and all obstacles to the exercise of property rights. The World Trade Organisation (WTO) sets out to enforce such demands. It threatens economic sanctions against any states that do not open up services like telecommunications to foreign investment and competition. It forbids them to ban products from other countries that threaten health or the environment. It prohibits as “intellectual piracy” the production of things like pharmaceuticals and computer software without raising the price massively to the pay royalties to multinationals holding patents on them.

The International Monetary Fund (IMF) goes even further with its Structural Adjustment Programmes by dictating that national governments reduce spending on health and education and privatise as much of the economy as possible.

Alongside compulsion, the proponents of neo-liberalism put great effort into persuasion. A proliferation of meetings, conferences and think tanks run by representatives of the multinationals draw up schemes for shaping government policies around their requirements, and then feed these into the discussions of the IMF, the World Bank, the WTO, and intergovernmental organisations like the Organisation for European Co-operation and Development (OECD) and the European Commission. Typical was the way the European Round Table of industrialists has pushed these institutions to back “reforms” in educational systems [6] (including student fees), the way the World Water Council has schemed to push through privatisation of water supplies [7], and the Transatlantic Business Dialogue, a working group of the West’s 100 most powerful chief executives, collaborates with representatives of the US and European Union to draw up World Trade Organisation agendas. [8] Such gatherings have been important in manipulating “public opinion”. Through newspaper columns, news items, television commentaries, “think tank” reports, academic sponsorship and university departments the latest neo-liberal schemes are propagandised on a massive scale.

This, of course, suits multinational corporations. They have used the propaganda against “over-regulation”, “obstacles to trade” and “protectionism” to batter down impediments to expanding into new, profitable areas of investment and marketing, whether these impediments come from trade unionists, rival nationally-based capitalists, small producers or environmental concerns. And, for the best part of a decade, it seemed that the neo-liberal propaganda was having things all its own way. That was why it saw Seattle as such a big setback.

The success of the Seattle protests was, in part, a result of sustained counter-propaganda by campaigners like those listed above. Through books, seminars, newspaper columns tucked away on the inner pages of otherwise neo-liberal papers, the occasional television documentary and academic counter-papers they sought to expose the falsity of the neo-liberal claims. Their efforts paralleled those of us on the Marxist left. Like us, they found themselves very much in the intellectual wilderness at the beginning of the 1990s, swimming against seemingly overwhelming currents which declared the collapse of the Eastern bloc was the collapse of any alternative to free market capitalism. But by the time the decade ended they had found a huge new audience for what they had to say. If our audience had doubled or quadrupled in size, theirs had grown ten- or even a hundred-fold.

This was not, of course, just a result of their own efforts. The 1990s failed utterly to live up to the promises of the neo-liberals. The “new world order” collapsed into a war against Iraq at the beginning of the decade, and wars against Serbia and Chechnya at the end, with dozens of civil wars in the Balkans, the Caucasus, central Asia and Africa in between. The “economic miracle” neo-liberal advisers had promised the countries of the old Soviet bloc turned into economic collapse in the former USSR and south east Europe on a scale unknown in the history of the capitalist system. The world’s second economic power, Japan, could not find its way out of the recession that developed in 1991-1992, and Western Europe experienced continual unemployment of around 10 percent. In the US most people were worse off after eight years of economic “recovery” than they had been a quarter of a century before. In Africa, famine seemed as common as the civil wars which it helped fuel. In Latin America there was no recovery from the “lost decade” of the 1980s. And then the one apparent success story for capitalism in the first half of the 1990s, east Asia, suddenly went into crisis in 1997, producing huge splits within the neo-liberal camp, with renowned financiers like George Soros and former doyens of the IMF like Jeffrey Sachs bitterly turning on those they blamed for the mess in east Asia and the former USSR.

On top of this, the greenhouse effect, a threat to the world’s climate and its ability to support human life grasped by only a small minority of concerned scientists in the mid-1980s, was recognised as a major problem by all major governments by the end of the 1990s – even if they were not prepared to take adequate measures to deal with it.

The importance of the “thought leaders” mentioned by Paul Hawken lay in presenting critiques of effects of neo-liberal practice, in showing it was a front for corporate greed, to many different groups of people disillusioned by its impact. They were able to do so because they were usually not just involved in the theoretical critiques, but also in the practical work of building the oppositional movements. In this way they played a part similar, for instance, to that played by the historian Edward Thompson in the building of the anti-missile movement in Britain in the early 1980s. But whereas the anti-missile campaign was concerned with one single issue, the question of confronting neo-liberalism tended to unite different one-issue campaigns into a multi-faceted challenge to something people began to see as a single system. Seattle was important because it was the culmination of this trend, the point at which the many began to be seen as one, in which quantitative addition became something qualitatively new.

But in doing so it also began to raise important questions, which those who played such an important role in building the new movement are having to debate. These questions concern the alternatives to be posed, the forces that can bring them about, the tactics needed to mobilise them and, underlying these issues, the relationship of neo-liberalism and globalisation to the wider system.



The debates at Seattle and after: reform or abolition

The issue that arose inevitably in the various teach-ins and discussions at Seattle itself was whether people should fight to reform or abolish the World Trade Organisation.

The mainstream view inside the American trade union federation, the AFL-CIO, was to propose a “social clause”, which would incorporate in future trade agreements core labour standards, including prohibitions against child labour and prison labour, against discrimination, and against violations of the right of workers to organise unions and bargain. The WTO’s enforcement powers, now used to protect the ability of transnational corporations to move investments and production freely across borders, could then be used to protect workers” rights as well. [9] Steven Shrybman put a similar argument from an environmentalist standpoint: the aim should be to transform the WTO so that is “as concerned about climate change as it is about the growth of transnational drug companies”. [10] Some activists even suggested that the World Bank and the IMF could be reformed, through an “alternative vision” that “calls for more opening and accountability by institutions such as the World Bank and transnational corporations”. [11]

By contrast, people like Third World economist Walden Bello insisted that “reforming the WTO is wrong”. [12] This did not necessarily involve calling for its abolition, but for “a combination of active and passive measures to radically reduce its power and make it simply another international institution coexisting with and being checked by other institutions”. [13] The call for abolition grew in response to the WTO’s dismissal of the concerns of Seattle protesters.

Similar arguments arose during the great French protest at Millau in June 2000. Speakers who stood for the “dismantling” of institutions like the WTO were accused by the proponents of limited reform not only of “utopianism” but also, in practice, of “lining up” with free traders who wanted no regulations whatsoever. [14] The argument over reform or abolition is related to another argument-over what would be the aim of any alternative to the present trade regime.



Social clauses, child labour and union rights

The US unions argue that “social clauses” would prevent workers in Third World countries being driven into conditions of near-slavery and, at the same time, deter multinationals from moving production overseas merely to cut labour costs and worsen working conditions. As journalist William Greider puts it, “Trade reform can reward and nurture those nations struggling to break free from the ‘race to the bottom’.” [15] People like Greider address themselves to getting trade reform through governments, but some of the same arguments arise in the “No Sweats” and “Fair Trade” movements that have swept through many American campuses in the last couple of years. The movement is motivated by moral outrage at the conditions facing Third World workers producing for firms like Nike and Starbucks [16], and aims through consumer boycotts to force them to ban child labour and “pay a fair wage”. [17]

This approach is being criticised by various other activists on two different grounds. First, that it underestimates the ability of the multinationals to find a way round both government regulations and consumer protests. David Bacon, for instance, points out:

The Clinton administration, which at first was unwilling to discuss any labour protection, has now seen a certain reality: addressing the worst of the abuses in foreign factories (whether in real or just PR terms) is a way of deflecting domestic pressures. But the White House has no interests in addressing the fundamentals of poverty, and the role US policy plays in perpetuating that. In fact, if anything, Clinton’s new-found interest in labour standards is a way of enabling the implementation of those same policies. So the Labor Department proposes a garment code of conduct which prohibits enforced and unpaid overtime after 60 hours, or the labour of kids under the age of 14, in Central American sweatshops... The corporations which violate the code are demonised, and the ones that don”t are considered okay.

The proposals for standards and codes of conduct leave unasked a basic question: Where does the poverty come from which forces workers through the factory door? What policies are pursued by the US government which perpetuate that poverty? [18]

Naomi Klein is not so outspoken in her criticism of “social clause” and “fair trade” demands as David Bacon. She sees that focusing on the behaviour of certain firms like Nike or Starbucks can make people put “the entire system ... under the microscope”. But she warns that “when one logo gets all the attention, others are unquestionably let off the hook ... Chevron has been awarded contracts that Shell lost, and Adidas has enjoyed a massive market comeback by imitating Nike’s labour and marketing strategies, while side-stepping the controversy”. [19] Further, she writes, “Even when the codes fail to stamp out abuses, what they do manage to do, rather effectively, is obscure the fact that multinationals and citizens do not actually share the same goals when it comes to deciding how to regulate against labour and environmental abuses ... Beneath the talk of ethics and partnerships, the two parties are still engaged in a classic class struggle”. [20]

But the debate is not only over the effectiveness of social clauses. There is also a wider argument-about whether they are in principle right. Some activists argue their only impact can be to help keep poor countries poor. David Bacon, for instance, claims:

The social clauses the AFL-CIO proposes reflect the institutional needs of unions in a wealthy industrial country. Unions and labour in other countries see other needs as well, especially the need for economic development.

Peasants of farmworking families in the Philippines and Mexico, for instance, overwhelmingly agree that they would prefer that their kids had the opportunity to go to school rather than work. But simply prohibiting child labour doesn’t provide that opportunity. It just cuts the income the family depends on to survive. [21]

Bacon, as we have seen, suggests that the real cause of poverty lies in the global policies of imperialism, rather than just in the existence of child labour and restrictions on workers’ rights. But his argument still comes close at points to that used by the likes of New Labour minister Clare Short, who has embraced neo-liberal doctrines with the untrammelled enthusiasm of the recent convert. Restricting the conditions under which firms exploit people, they claim, destroys jobs and makes things worse for them. Bacon also seems to imply that activists in the advanced countries should identify with governments and government-run unions of the Third World countries rather than their workers:

While labour rights are important, there’s a bigger struggle going on over who controls the economies of developing countries ... US unions need to negotiate a common agenda with labour in developing countries, and recognise and respect differences of perspective and opinion. Saying, for instance, that the All China Confederation of Trade Unions is not a legitimate union body because it doesn’t agree with the AFL-CIO’s trade agenda is a form of national chauvinism. [22]

So on the one side there are calls for clauses in trade agreements which at best are likely to be ineffective – at worst they can cover up for most multinationals and be used by Western politicians for their own foreign policy agendas (as when some right wing Republicans in the US call for trade sanctions against China). On the other there are arguments remarkably like those used against limiting child labour in Britain a century and a half ago by the free market economist Senior – that doing so slows down the growth of industry and increases poverty. [23] The fact that people like Bacon are talking about “economic development” by the Third World, and not First World, ruling classes and states does not alter anything fundamental.

One position leaves decision making with the governments of the advanced countries which dominate the WTO, and which would use any “social clause” as a tool to advance the schemes of their own multinationals. The other easily ends up justifying exploitation by Third World firms and governments of their own workers as the only way to achieve “development”. The way each side can mount plausible arguments against the other suggests that neither is looking to the root cause of the problem they are trying to address – a root cause that goes deeper than either trade or the attempt at industrial development in Third World countries.



Are debt campaigns enough?

There are similar arguments within debt campaigns such as Jubilee 2000. The campaigns have worked wonders in highlighting the obscenity of the people of the poorest countries pouring money into the coffers of the wealthiest banks. But their very success has raised a series of questions. Do they put forward “moderate” demands in order to try to influence governments, or do they stand for all-out debt cancellation? And do they stick with the single issue of debt, or do they expand their agenda to deal with issues of the wider system? Susan George, who has probably done more than any other single person to highlight the burden of indebtedness on the world’s poor, explains the problems:

Many good people demand cancellation of all debt as the only way to go: I fear this solution would be a trap ... If Southern debtors can unite to declare partial or total repudiation, I applaud. But I fear such action unlikely ...

If joint action from the South is not forthcoming, should we then organise campaigns in the North calling for unilateral debt cancellation by our own governments? ... Debt cancellation would, however, work to the advantage of the very system now spreading unprecedented hunger and poverty throughout the Third World. How?

First, it risks rewarding the worst and most profligate governments ...

Second, cancellation would turn recipient countries into financial pariahs for the foreseeable future ... Cancellation would make forgiven debtor countries somewhat more flush at the beginning. Soon afterwards, however, in the absence of massive new aid ... they would be pushed into autarchy, unable to import basic necessities, their credit worthiness zero.

Third, cancellation, if less than 100 percent, would be a mirage or downright damaging to Third World majorities. [24]

Many countries are unable to pay back much of their debt already. Partial cancellation would simply mean them paying back 100 percent of, say, half the existing debt, instead of, as at present, 50 percent of 100 percent of it.

George does not make these points in order to discourage criticisms of what the banks are doing. Rather, she tries to broaden the agenda, to include the issue of “total resource” flow to Third World countries, and the behaviour of their “elites” as well as of the First World banks and multinationals. She shows very persuasively that simply focusing on debt does not provide the solutions people are looking for.

The strength of her argument is demonstrated in practice by the experience of Jubilee 2000. Its very success in highlighting the crippling effect of debt on Third World peoples is leading to discussion among its activists. Some of its leading figures had believed they had to pursue a “moderate” approach if they were to “win” governments to their point of view. They looked to backing from the likes of former IMF hatchet man Jeffrey Sachs (although he still endorses the neo-liberal policies pursued, for instance, by the president of Ecuador, Jamil Mahaud, who was driven from office by a near-uprising of indigenous peoples in January 2000 [25]). They also congratulated the Cologne 1999 G8 summit of the leaders of the major industrial countries for promising debt relief. But the failure of governments to deliver is causing much rethinking. As one activist tells, “I regret we gave the G8 credit for what they promised ... But it has been wonderful working for J2000. The campaign has made people question the roots of poverty”. [26]



Poverty, development and ecological destruction

Intertwined with the arguments over trade and debt there is a third argument – over exactly what development should take place in the poorer countries of the world. Many of the leading Seattle activists concerned with “Third World” issues have no doubt about what is needed. The countries of the Third World, they say, should be able to industrialise so as to “catch up” with the advanced countries. This is the rationale behind the position of David Bacon. It is also accepted by William Greider, who writes favourably of “industrial development in low wage economies” [27], and by Juliette Beck and Kevin Danaher, who want to “protect young, domestic industries until they are internationally competitive”. [28] Danaher goes so far as to see South Korea as a possible role model, because “during the 1960s, 1970s and 1980s ... despite many years of government repression, the country did very well economically”. [29] Walden Bello accepts very much the same position, identifying with the strategy of industrialisation for Third World countries based upon control on imports, and associated with the United Nations agency UNCTAD and its longtime leader Raul Prebisch – although he does suggests its “model of integration into the world economy ... must be questioned”. [30]

Other activists, however, want to question the whole industrialisation approach, looking for “viable alternatives to the dominant economic growth, export-oriented development model”. [31] This is particularly true of those defending the rights of indigenous peoples, or from environmental campaigners such as the Indian activist Vandana Shiva.

Such challenges to the dominant notions of “development” originate in a recognition that the industrialisation in the Third World – and for that matter in the First World and the former Communist countries – has brought with it innumerable evils, destroying people’s old patterns of life, impoverishing many and polluting the environment. As Susan George correctly notes when calling for a search for a new economic model, the “ruling paradigm” of development means that “many are losing their land, having to leave their villages, watching their children waste away, working 14-hour days for next to nothing or not working at all, drinking polluted water, suffering from hunger and avoidable disease, being imprisoned or tortured or murdered if they speak out or try to change their lot”. [32]

But those rightly challenging the old “paradigm” rarely go on to provide convincing alternatives of their own. The geneticist Mae-Wan Ho, for instance, combines with her devastating scientific critique of the techniques used to obtain genetically modified organisms a call for a return to “traditional forms of agriculture”. Vandana Shiva shows the destructive effect on people’s lives of the agricultural approach encouraged by the giant multinationals but fails to recognise that “traditional” methods of peasant agriculture themselves rested on terrible oppression of huge numbers of peasants and landless labourers, of the low caste and of most women. There were Indian intellectuals who identified with the peasant masses sufficiently in an earlier generation to recognise these things-notably the writer Premchand, whose stories and novels never shy away from the realities of class, caste and religious bigotry. [33] By contrast, Vandanda Shiva extols “women working in the fields conserving biodiversity, producing our food, cooking the food”. [34]

“Traditional methods” by themselves could not possibly have produced the food needed to keep abreast of the rising Indian population over the last three decades. Vandana Shiva’s response to a question about feeding such a growing population after her recent Reith lecture was simply to talk of “non-sustainable population growth” and to blame it on “non-sustainable development”:

You look at the data. Indian population had stability until 1800. Colonisation, dispossession of land started to make our population grow. Highest growth rates of population in England is after the enclosures of the commons ... Population growth is a result of non-sustainable development. [35]

In fact, poverty was a widespread feature of the Indian countryside long before the British arrived: the Indian economic historian Irfan Habib has documented the impoverishment of much of the rural population in Mogul times, when “famines initiated wholesale movements of the population”. [36] And in England there were certainly periods of bitter hunger long before the enclosures – for instance in the first decades of the 14th century. Nostalgia for the past is nostalgia for what were class societies, even if not capitalist class societies, in which life for the mass of people was one of near-endless toil, accompanied all too often by hunger, and every few years by famine. [37]

More to the point, “traditional agriculture” cannot provide an answer to how to feed a world population that is generally expected to double over the next three decades. However much they have relied on fertilisers and pesticides, however much they have been accompanied by the spread of capitalist relations in agriculture (and therefore the driving of many small peasants from the land), and however great the long term damage to environmental sustainability, the methods associated with the “Green Revolution” in India over the last three decades have produced an increase in output sufficient for the country to provide a minimal diet to the population without reliance on imports. Grain production did increase by 3.2 percent a year in the 1980s (faster than the growth rate of the population) as against 1.8 percent a year in the 1970s (less than the population growth). [38] Even Vandana Shiva has to recognise, in passing, “the narrow gains of the Green Revolution”. [39] If the mass of the population have gained little or nothing from these (some statistics suggest a small improvement in median calorific intake and a small decline in poverty, others no change in either) it is because of the unequal, class-based distribution of increased supplies of food, with the benefits going to the richer sections of the population (either directly as more food for themselves or indirectly as a source of income for buying luxury imports from abroad).

A sustainable model of development has to at least match the increased food output achieved in recent decades as well as ensure its equitable distribution – indeed, more than match it, if the majority of the population are ever to rise above the minimum of 2,000 or so calories a day they get at present. That cannot be done by relying on “traditional” methods. It requires the application of scientific research and the investment of capital – although in a different way than at present. Indeed, one criticism of the pattern of development in India at present must be that there is a decline in the share of total investment going to food production and insufficient scientific research into ways of achieving sustainable increases in food supplies.

Those who rightly attack the existing models of “development” often imply that there has to be a massive move to “local production” or “local use”. But reliance on local production of food can have effects as bad in their own way as reliance on production for a fluctuating world market. For local production has always historically been accompanied by local famines when weather conditions or plagues of insect pests have damaged local harvests. The movement of foodstuffs internationally which is possible with modern technologies means that famines in any part of the world could be a distant memory. If they are prevalent in much of Africa, it is not because it is wrong for people in one part of the world to consume food produced elsewhere, but because the international distribution of food is carried out for considerations of profit, not human need.

There are whole countries whose economies have become dependent over decades, or even over centuries, on the production of food crops for distant markets-for instance Cuban sugar or Central American and Caribbean bananas. The people of these countries would go hungry if the rest of us were to refuse, overnight, to buy their products. We live in a world system that has developed not just in the last couple of decades, but at least from the 16th century onwards. The answer to the horrific faults of the system is not to cut individual countries or localities off from the rest of the world, but to use the wealth that exists on an international scale for all of the planet’s people.

Finally, those who attack the capitalist model of development often use a very bad argument. They claim that what is wrong with it is not that it makes people toil endlessly, but that it is not “labour intensive” enough. So, for instance, the Environment Research Foundation lists as one of the faults of present agricultural methods that “jobs are lost as machines replace human labour and draft animals”. [40] This is to accept that somehow human drudgery is a good thing, and that people suffer because there is not enough labour to go round. But that is to see things completely upside down. In a sane society, the more machinery there was the easier it would be for everyone to get a livelihood without excessive toil. If existing society is not like this, it is because there is something fundamentally askew with it. It does not mean that methods that require more work are better than those that require less. As Brendan Behan once commented, “If work is such a good thing, why don’t the rich grab it all for themselves?”



Neo-liberalism, globalisation and capitalism

Underlying all the other debates is another fundamental issue. What are we fighting against? Is it a long established economic system? Or is it just a series of institutional and ideological changes that have occurred in the last decade or so, and which go under the names “globalisation” and “neo-liberalism”?

Sometimes these phrases are simply code words for a wider system. The attack on globalisation and neo-liberalism is then a way of opening up an attack on capitalism as a system and the various ideologies used to defend it. “Corporate greed” is used as synonym for the profit system, “the transnationals” for the capitalist firm, “globalisation” for the way international capitalism crushes the hopes of ordinary people. All this then serves to open people’s eyes to the wider inhumanity of capitalism.

But often critics of globalisation and neo-liberalism present them as forces in their own right, without reference to any wider system. So, for instance, Ignacio Ramonet writes in Le Monde diplomatique, “Enough of accepting globalisation as an inevitable fate ... People are calling for a new generation of rights – collective rights – in the face of the damage done by globalisation”. [41] Vandana Shiva argued in a BBC Reith lecture that it was “globalisation” and “the new global economy” that were having a terrible effect on the lives of ordinary people and producing “disasters” in countries like India, “especially in food and agriculture”. [42] For Pierre Bourdieu “globalisation” and “neo-liberalism” are the enemy. “The main issue”, he says, “is neo-liberalism and the retreat of the state. In France neo-liberal philosophy has become embedded in all the social practices and policies of the state”. [43] Some leaders of ATTAC in France go as far as to say their movement is not “anti-capitalist” but merely wants to stop short term financial flows disrupting national economies. [44]

Susan George’s latest book, The Lugano Report, does refer to capitalism in its full title. [45] Yet she wrote after Seattle of people mobilising against “the harmful consequences of globalisation”, as if this were something separate from, and intrinsically worse than, capitalism. At points Viviane Forrester’s best-seller, The Economic Horror, sees things like unemployment not as products of capitalism, with a long history, but as “secondary effects” of “globalisation” [46] – and therefore, presumably, a product of the last decade or so: “A genuine revolution was and is at stake, and has managed to establish the neo-liberal system, to embody it, to activate it and make it able to invalidate any logic other than its own ... Without any spectacular or even visible upheaval a new regime has taken over”. [47]

From this, it is easy to draw the conclusion that “neo-liberalism” and “globalisation” are negative features imposed on what would otherwise be a tolerable system. Eric Toussaint, for instance, does this by contrasting a previous stage in capitalism’s history with that which exists now: “Although the Fordist social consensus in the North, the developmentalist consensus in the South and bureaucratic control in the East did not do away with the use of force by those in positions of power – far from it – each of these paths gave rise to genuine social progress”. [48]

Cassen, the director of Le Monde diplomatique, accepts a somewhat similar case when he pushes for a return to a “protectionist” model of a national economy organised along capitalist lines. So does Colin Hines when he preaches reliance on “local production” carried out by “local” business people and firms. [49] The impression is that a workable and at least partially humane model of capitalism has been subverted by neo-liberals at the behest of multinational corporations. But their efforts alone cannot be sufficient to explain the horrors so graphically described in the writings of the critics of globalisation and neo-liberalism.

Most of these horrors are as old as capitalism itself and not simply a product of the last couple of decades. The reduction of people to commodities, the reliance of the most hyped products on sweatshop labour, the long hours of work that destroy the lives of women, men and children, the destruction of people’s livelihoods as peasants are driven from the land and workers suddenly thrown out of jobs, the desolation of the environment-none of these are phenomena that have just arisen in the last 20 or 30 years. You can read about them all in writings 100, 150 or even 200 years old-in the journalism of Cobbett, in Charles Dickens’ Hard Times, Mrs Gaskell’s North and South, Émile Zola’s Germinal, Upton Sinclair’s The Jungle, Engels’ Condition of the Working Class in England, and in the chapter The General Law of Capitalist Accumulation in Karl Marx’s Capital. They are characteristic effects of capitalism throughout its history.

What is so impressive about the best of the writing of today’s critics of globalisation is precisely what it shares with so many of these earlier writings-a damning, emotionally moving onslaught on the dehumanisation of the system, on the subordination of people’s lives to blind forces beyond their control, on the wrecking of the environment in which they have to live. They show that beneath the fine phrases of the neo-liberal “modernisers” lie the grim realities of broken lives, and of ecological destruction that threatens the very survival of humanity.



Neo-liberalism and globalisation theories: seeing the world upside down

There is an important respect in which most of the critics of neo-liberalism and globalisation theory do not go far enough. For they accept many of these theories” own contentions about the way the global system is going. These theories do not merely prescribe absolutely disastrous remedies to the problems facing the great majority of the world’s people. They also rest on a completely superficial understanding of the world system.

Marx long ago pointed out that the way capitalism functions all too easily hides from people what is really happening. Those who buy and sell on markets see only the interplay of goods on those markets, not the human activity that lies behind this interplay. Those whose incomes come from dividends and interest, or playing on the money markets, believe money itself has a magical ability to grow which has nothing to do with the toil of people in factories, fields, mines and offices. Capitalists who live off the labour of workers believe they provide work for them. Unemployment is seen as resulting from some shortage of the total work that needs doing, rather than from the absurdity of a system driven by the blind competition between rival owners of the means of making a livelihood.

Marx called this upside down view of the world encouraged by capitalism “the fetishism of commodities” – comparing it with the religious notion that god created humans, not humans god. Its world is one in which the toil, sweat and exploitation involved in the creation of new wealth hardly exists.

Neo-liberal and globalisation theories carry this upside down view of the world to its extremes. Like the mainstream “neo-classical” or “marginalist” version of economics to which they are related, they see things from the standpoint of the financial and trading capitalists. It is a standpoint which virtually ignores what is happening in the real world of production and exploitation.

This is most clearly the case when it comes to describing what has really been happening to the structure of the world economy over the last quarter of a century. Transactions cutting across state boundaries have played an increasing role. But this has been many times more marked in the case of financial transactions than with the material organisation of production. I have provided a lot of empirical evidence for this in two other articles I have written in this journal. [50] Here I will only summarise a few points.

While international financiers move trillions of dollars a day across national borders, multinational corporations continue to do most of their production in one or, in a few cases, two countries. The directing personnel of the major multinationals similarly almost invariably show a “national bias”. Far from being indifferent to what the state does, each multinational relies on “its” state to fight for its interests when it comes to influencing interest rates and currency levels, and in international economic and financial negotiations. And, if it comes to the crunch, the multinationals based in a particular country will even want that country’s government to intervene to nationalise any big company whose bankruptcy threatens their common interests (this happened with the US Savings and Loans institutions under Reagan and Bush, with Scandinavian and Japanese banks in the course of the 1990s, and recently with the Korean giant Daewoo).

The multinationals are also far from “weightless”. They cannot simply move huge productive facilities from one country to another at the drop of a hat. “Metal bashing” is still central to nearly all of them. Cars, trucks, steel for girders, bridges and vehicle bodies, refrigerators, washing machines, pharmaceuticals, even computers and microchips still have to be manufactured in very expensive plants which cannot be moved at the stroke of a pen from one place to another. The industries that can be moved easily-in particular clothing manufacture using cheap sewing machines-are the exception, not the rule. In 90 percent of industry any shift in production takes place over years, not days (Ford, for instance, intends to spend at least two years shifting production from Dagenham to Germany). And when shifts occur it is overwhelmingly from one advanced country to another. In the early 1990s three quarters of worldwide overseas investment was concentrated in these countries, with another 16.5 percent going to the ten most important newly industrialising countries. This left the Third World with only 8.5 percent of the total.

A recent set of figures showing the relative size of the economies of the Americas and of individual US states are revealing about where the core of the world productive system lies. If the economy of the whole western hemisphere is 100 percent, then the US as a whole accounts for 76 percent of this. By contrast, the biggest of the Latin American countries, Brazil, is only 8 percent (less than California at 10 percent); Canada is only 6 percent (only the same as New York state); Mexico is only 4 percent (the same as Illinois and less than Texas, at 5 percent); Argentina only 3 percent (the same as Ohio and less than Florida at 4 percent). Chile, Peru, Ecuador, Colombia, Guatemala, Uruguay and Venezuela together only add up to 3 percent. [51]

Poverty exists in vast areas of Latin America, Africa and Asia, not only because capital pays low wages when it invests there, but also because investing there at all rarely fits in with its demand for endless profits.

If firms cannot dispense with geographically rooted production facilities, they cannot dispense with workers either. Despite all the hype about “globalisation” the number of manufacturing workers in the advanced industrial countries is much higher than half a century ago and has barely fallen over the last decade. The number of industrial workers in the 24 leading economies was 51.7 million in 1900, 88 million in 1950, 120 million in 1971 and 112.8 million in 1998. In the US the number was 8.8 million in 1900, 20.6 million in 1950, 26 million in 1971 and 31 million in 1998. [52]

The manufacturing figures are only part of the story. Very large numbers of “service” sector jobs are indistinguishable in terms of the conditions of their workers from “industrial” jobs. This always applied to groups like dockers and refuse workers. It applies to transport workers and delivery workers-groups which will becomes more important, not less so, if e-commerce takes off (since they are required to deliver goods even for the most “weightless” company). And the growth of fast food chains and call centres is adding by the day to the numbers employed in factory-like conditions.

None of these groups are intrinsically powerless if it comes to confronting the multinationals. Ford Britain stopped all of Ford Europe when it last struck in 1988. Single General Motors plants have had the same effect across North America. More recently postal workers and security guards have shown their potential power in France.

Regretfully, critics of neo-liberalism all too often fail to understand such fallacies of globalisation theory. So Viviane Forrester writes:

The world where work and the economy merged, and where the many were indispensable to the decision makers, has been as if blotted out ... The brand new world dominated by cybernetics, automation and revolutionary technologies ... has no real links with “the world of work” for which it has no more use. [53]

Naomi Klein’s tone is often similar, as when she writes that many multinationals base themselves on “a system of footloose factories employing footloose workers”, with a “failure to live up to their traditional role as mass employers”. [54] She writes of General Motors “moving production to the maquilodoras [the manufacturing belt along the south of the US-Mexico border] and their clones around the globe”. [55] This gives the impression that there is a huge haemorrhage of jobs from the US to Mexico. But Klein elsewhere gives the maquilodora workforce as 900,000 [56] – less than one twenty-fifth of that of the US. GM’s workforce in the US remains 200,000, many times greater than the number working for it in Mexico.

David Bacon, who often employs Marxist terminology, makes the same mistake in seeing the movement of capital to Third World countries as being the major cause of job losses in the US: “The difference in the standard of living between wealthy and poor countries ... is the cause of the loss of US jobs as corporations relocate production”. [57]

In fact, the major cause of job losses in all advanced industrial countries is restructuring to force up productivity within existing industrial complexes, not movement overseas. Where there has been relocation of industry, it has usually been relocation within the US, not across national borders. The biggest defeats suffered by British workers – that of the miners in 1985 and the print workers in 1987 – were not a result of production moving abroad.

These are not minor weaknesses in the argument of Forrester, Klein or Bacon. One of the functions of neo-liberal and globalisation theories is to give the impression that the system is not merely out of control but beyond any possible challenge from those who work within it. The argument that firms can move at will is an excuse for governments bowing down to their dictates, and for union leaders refusing to sanction strikes against them. Their argument is, “We can’t beat them, so we have to join them.” It is a mistake for opponents of neo-liberalism to fall for that claim.



Globalisation, neo-liberalism and war

There is a final feature of the modern world about which neo-liberalism and globalisation theories have nothing to say, yet which should be of enormous concern to their critics. This is the propensity to war.

The logic of globalisation theories is to suggest that firms do not care in which state they operate and/or how powerful that state is. Free trade and the free movement of capital, they claim, mean the end of war. Or, as they have claimed, “No two countries with a McDonald’s have ever gone to war.”

The reality of the world in recent decades has belied such claims. Wars have erupted with horrific regularity, suddenly throwing into confusion the internal life of whole regions of the globe – the war of the West against Iraq, the succession of wars and civil wars in Africa, the wars in former Yugoslavia, the war of the West against Serbia, the wars of Russia against Chechnya. On top of that there have been the mini-wars or threats of war between India and Pakistan, Greece and Turkey, China and Taiwan, Ecuador and Peru. Many of these countries have indeed contained McDonald’s – Croatia and Serbia, India and Pakistan, Ecuador and Peru, Greece and Turkey, the NATO powers and rump Yugoslavia.

Such clashes between armed states are as much part of the present system as Structural Adjustment Programmes and negotiations over free trade. This is because the destiny of particular capitalists is still to a high degree tied to the power and influence of particular states. Firms like Boeing, Monsanto, Microsoft, Texaco and General Motors would not be where they are if they did not have longstanding ties with the US state in general and the US military in particular. But the power and influence of a state depends on its potential for slogging it out militarily with other states – or at least joining a system of alliances which can do this.

The beginning of the 1990s saw the US-led coalition blast Baghdad in order to safeguard its influence over Kuwait’s oil supplies. At the end of the 1990s another US-led coalition blasted Belgrade in order to preserve the “credibility” of NATO – that is, to assert strategic control by a US-dominated alliance over the south eastern flank of Europe, and access to the oil-rich regions of the Middle East and Caspian. Whatever the excuses used in the propaganda barrages that accompanied the wars, the rationale in the US State Department for such actions was that they showed the US to be capable of enforcing its power anywhere in the world. They asserted a hegemony which would prevent Third World governments doing damage to the interest of US capitalists, and which would ensure that the European states and Japan bowed to American leadership in trade, investment and debt negotiations.

Thomas Friedman, a journalist close to the US State Department, summed up the relation of big business to military power:

The hidden hand of the market will never work without the hidden fist. McDonald’s cannot flourish without McDonnell Douglas. The hidden fist that keeps the world safe for Silicon Valley’s technologies to flourish is called the US army, air force, navy and Marine Corps. [58]

Most of the time governments and neo-liberal apologists try to conceal such connections, and try to give the impression that when they go to war it is for some concern over human rights. It is not a pretence for which opponents of neo-liberalism should fall. The IMF, the World Bank, the World Trade Organisation, the Pentagon and NATO are only different aspects of the same system. You cannot fight against one and support the others.



The origins of neo-liberalism

Neo-liberalism and globalisation theories are ideologies which conceal the real workings of the world we live in, including the real relations between firms and states, and between industry and finance. An effective critique of them cannot remain simply at the level of showing their inhumanity. It also has to locate the degree to which they conceal the contradictions in their own system and the possibilities of fighting back against it.

This is connected with one other point – the question as to why neo-liberalism has been able to become so powerful. Many of its opponents tend to see this as resulting from multinational conspiracies and ideological sleights of hand. The conspiracies are real enough – if by a conspiracy you mean a secret meeting of interested parties to manipulate things to their own advantage. Capitalists always have done this and always will. As Adam Smith noted more than 200 years ago, “Whoever imagines that masters rarely combine is as ignorant of the world as of the subject”. [59] But that is not in itself sufficient to explain the hold of neo-liberalism today, when only 30 years ago quite different doctrines had equal force in ruling circles. No better are explanations in terms of the sheer hold of its ideas, as when Pierre Bourdieu talks of “the effect of a shared belief ... The work of the ‘new intellectuals’, which has created a climate favourable to the withdrawal of the state and so submission to the values of the economy”. [60]



Marx and anti-capitalism

There is no other choice if you really want to understand these things than to return to Marx. Many critics of capitalism are put off Marx, first by the distorted account of his thought that prevailed during the height of Stalinism and then, in certain intellectual circles, by the convoluted academic Marxism of the 1970s. Yet Marx laid the groundwork for an analysis of the system which provides a key for understanding – and fighting against – all the dehumanised features emphasised by the critics of globalisation and neo-liberalism today.

The young Marx began as a liberal democrat opponent of the half-feudal oppression that characterised continental Europe in the late 1830s and early 1840s. But he soon came to realise that the new capitalist way of organising society that was emerging alongside the old, and which had already triumphed across the North Sea in England, was characterised by forms of exploitation and oppression of its own. He began to grope with understanding how this new, emerging system functioned and how to fight it, much as Seattle’s “thought leaders” are groping with same problems posed by the worldwide system of multinational capitalism today.

His starting point was the phenomenon he called “alienation”. What he was beginning to discover about the functioning of this then-new system led him to undertake a critical reading of its most eminent proponents-political economists like Adam Smith and David Ricardo. His conclusion was that although the system vastly increased the amount of wealth humans could produce, it also denied the majority of them the benefits of this wealth:

The more the worker produces, the less he has to consume. The more values he creates, the more valueless, the more unworthy he becomes ... [The system] replaces labour by machines, but it throws one section of workers back to a barbarous type of labour, and it turns the other section into a machine ... It produces intelligence – but for the worker, stupidity ... It is true that labour produces wonderful things for the rich – but for the worker it produces privation. It produces palaces – but for the worker, hovels. It produces beauty – but for the worker, deformity ... The worker only feels himself outside his work, and in his work feels outside himself. He feels at home when he is not working, when he is working he does not feel at home.

The worker works in order to live. He does not even reckon labour as part of his life, but rather a sacrifice of his life ... What he produces for himself is not the silk that he weaves, not the gold that he draws from the mine, not the palace that he builds. What he produces for himself are wages, and the silk, gold and palace resolve themselves for him into a definite quantity of the means of subsistence, perhaps into a cotton jacket, some copper coins and a lodging in a cellar. And the worker who for 12 hours weaves, spins, drills, turns, builds, shovels, breaks stones, carries loads, etc. – does he consider this 12 hours weaving, spinning, drilling, turning, building, shovelling, stone-breaking as a manifestation of his life, as life? On the contrary, life begins for him when this activity ceases, at the table, in the public house, in bed.

It is not difficult to see how Marx’s words apply to the young women clothing workers of Indonesia or Central America described in Naomi Klein’s writings, sewing expensive designer clothes they will never be able to afford to wear for a dollar a day, or to the people in India losing their land as it is turned over to agro-industry producing crops of which they will never get a share, or to US steel workers thrown out of their jobs because “too much” steel is produced worldwide. But Marx did not simply record this state of affairs. Others had done so before him, and many were to continue to do so long after he was dead. He also set out, through a quarter of a century of grinding intellectual labour, to try to understand how the system had come into being and how it created forces opposed to itself.

He located its origin in the monopolising by a minority class of “the means of production” – of those products of past labour such as tools and equipment to which people need access if they are to make an adequate livelihood. This left the majority with no choice but to hawk their labour (or, more accurately, their capacity to labour, their “labour power”) to the members of the minority. The alternative was to starve. But this put the members of the wealth-owning minority in a position to pay less for the labour than the value of the goods the workers could turn out. They got a portion of the workers” labour for free. Out of this “surplus value” arose profit, dividends, interest and rent.

At the same time, the firms owned by the members of the minority were in competition with each other. This led each to try to expand more rapidly than its rivals. It could only do so by continually maximising the amount of surplus value in its possession by driving its workers as hard as it could. The result was the absurdity of economic growth which has nothing to do with improving the economic wellbeing of the great mass of people. As Marx put it in Capital:

Accumulate, accumulation! That is Moses and the prophets!! Save, save, i.e. convert the greatest possible portion of surplus value or surplus product into capital. Accumulation for accumulation’s sake, production for production’s sake: by this formula classical political economy expressed the historical mission of the bourgeoisie. [61]

In this way a whole system arises which imprisons the mass of people:

The rule of the capitalist over the worker is the rule of the object over the human, of dead labour over living, of the product over the producer, since in fact the commodities which become of the means of domination over the worker are ... the products of the production process ... It is the alienation process of his own social labour. [62]

The individual capitalists are the human agents who enforce this process on the mass of people. But they have no choice if they are to remain capitalists. If they do not make profits comparable to those made by rival capitalists they will be driven out of business or bought up by their rivals. To this degree the capitalists are as much prisoners of the system as the workers – except they are hugely privileged prisoners. So while “the worker, as its victim, stands from the beginning in a relation of rebellion towards it and perceives the process as enslavement”, the capitalist “is rooted in the alienation process and finds in it his highest satisfaction”. [63]

These capitalists preside over a whole world of “alienated labour”, a world in which the products of human activity take on a life of their own and dominate them. This is a world of endless pressure to work and periodic unemployment, of overproduction and starvation, of the driving of people from the countryside into cities, and of a denial of jobs to them when they get there. There is no end to this process. The more powerful capital becomes, the more people become dependent on labouring for it if they are to get a livelihood. Every time they sell to capital their ability to labour, it extracts more labour out of them and becomes more powerful still. Even if they are in an advantageous position and manage to force up their wages for a time, this process does not stop: “If capital is growing rapidly, wages may rise; the profit of capital rises incomparably more rapidly. The material position of the worker has improved, but at the cost of his social position.” Wage labour is still “forging for itself the golden chains by which the bourgeoisie drags it in its train”. [64]

In a famous passage in The Communist Manifesto, Marx and Engels describe how the system spread out from its original bases in Western Europe to encompass the world:

The need of a constantly expanding market for its products chases the bourgeoisie over the whole surface of the globe. It must nestle everywhere, settle everywhere, establish connections everywhere.

The bourgeoisie has through its exploitation of the world market given a cosmopolitan character to production and consumption in every country. To the great chagrin of reactionists, it has drawn from under the feet of industry the national ground on which it stood. All old-established national industries have been destroyed or are daily being destroyed. They are dislodged by new industries ... that no longer work up indigenous raw material, but raw material drawn from the remotest zones; industries whose products are consumed, not only at home, but in every quarter of the globe ...

In place of the old local and national seclusion and self sufficiency, we have intercourse in every direction, universal interdependence of nations.

The bourgeoisie, by the rapid improvement of all instruments of production ... compels all nations, on pain of extinction, to adopt the bourgeois mode of production; it compels them to introduce what it calls civilisation into their midst, i.e., to become bourgeois themselves. In one word, it creates a world after its own image. [65]

While this was happening, something else also occurred in Marx’s picture. Big capitalists drove small capitalists out of business or took them over, leading to what he called the “concentration and centralisation of capital”. This was a long, drawn-out process, and new small capitalists were continually emerging, especially in new sectors of production neglected by old, entrenched firms. But over time the trend was clear. Despite the way pro-capitalist economists continually harp on about the role of small business, the system was increasingly dominated by a handful of large firms.

This led to never-ending uncertainty for workers. However secure their livelihoods might seem to be, there was never any guarantee that the capitalist who employed them would not find it profitable to sack them and move his business elsewhere – or at least claim he would do that unless they agreed to put up with harsher working conditions or wage cuts. Nor was there any ultimate certainty that the firm would not be driven out of business by a rival that had started up elsewhere with more modern equipment or with workers prepared to accept lower wages.

It was not only existing workers who suffered. As capital grew stronger, it gained the power to subvert all areas of production not previously subject to it. Marx described in Capital how the rise of capitalism at each stage led to the transformation of relationships in the countryside. The old peasantry was destroyed, to be replaced on the one hand by a small minority of capitalist farmers, and on the other by a vast number of people whose only way of making a livelihood was to labour for others. He quoted extensively from contemporary witnesses to what was happening on the land in England, Scotland and Ireland. The accounts of the depopulation of villages, the destruction of houses and the impoverishment of the remaining population could come from Third World countries today. [66] So, for instance, he describes how the incorporation of the Scottish Highlands into the wider capitalist economy involved a twofold process changing the very appearance of the land: first the driving out of the peasant crofters to turn the land into sheep-runs, and then the replacement of sheep by deer as forests were allowed to expand on what had previously been productive land. [67]

But Marx also points to something else. The world of alienated labour is not static. The continual accumulation of past labour and the continual expansion of production means that more wealth is produced than ever before in human history:

The bourgeoisie, during its rule of scarce 100 years, has created more massive and more colossal productive forces than have all preceding generations together. Subjection of nature’s forces to man, machinery, application of chemistry to industry and agriculture, steam navigation, railways, electric telegraphs, clearing of whole continents for cultivation, canalisation of rivers, whole populations conjured out of the ground-what earlier century had even a pre-sentiment that such productive forces slumbered in the lap of social labour? [68]

Yet every such increase in wealth also serves further to oppress those whose labour creates it. As Marx put it, “human progress” resembles “that hideous pagan idol who would not drink the nectar but from the skulls of the slain”. [69]

But the potential is there to seize control of this wealth and reorganise production so as to satisfy people’s needs in a way only dreamt of in the past. Capitalist accumulation is the supreme expression of human alienation, but it also prepares the ground for a revolutionary overthrow of alienation, for the creation of a society that does away with the want and toil which have been the lot of most of humanity since at least the New Stone Age.





1. See, for instance, J. Charlton, Talking Seattle, International Socialism 86 (Spring 2000); C. Kimber, Socialist Worker, 12 December 1999; J. St Clair, Seattle Diary, New Left Review 238 (November-December 1999); What Happened in Seattle and What Does it Mean?, in K. Danaher and R. Burbach (eds.), Globalize This! The Battle Against the World Trade Organization and Corporate Rule (Monroe, Maine, 2000).

2. K. Danaher and R. Burbach (eds.), op. cit., p.41.

3. Ibid., on cover.

4. Ibid., p.27. See also the account by Susan George in Le Monde diplomatique, January 2000.

5. There are theological divergences within the neoliberal camp between monetarists and some other neo-liberal economists. For an account of some of these, see my The Crisis in Bourgeois Economics, International Socialism 71 (Summer 1996).

6. For details, see G. de Selys and N. Hirtt, Tableau noir, resister â la privatisation de l’enseignment (Brussels, 1998), pp.24-56.

7. See, for instance, Blue Gold of the 21st Century, Le Monde diplomatique, English edition, March 2000.

8. For details, see G. Palast, Tony Rushes In Where Bill Fears To Tread, The Observer, 21 May 2000, Business section, p.6.

9. This summary of the AFL-CIO position is provided by David Bacon, who disagrees with the approach, in K. Danaher and R. Burbach (eds.), op. cit., p.124.

10. Ibid., pp.161-162.

11. Ibid., p.201.

12. Ibid., p.104.

13. Ibid., p.118.

14. According to Paul McGarr, who reported on Millau for Socialist Worker.

15. K. Danaher and R. Burbach (eds.), op. cit., p.144.

16. For an account of the conditions the workers face and the growth of the No Sweats and Fair Trade campaigns, see N. Klein, No Logo (London, 2000), pp.206-221, 325-379, 397-419.

17. Deborah James formulates this as “pay a fair wage in the local context”, in K. Danaher and R. Burbach (eds.), op. cit., p.189.

18. Ibid., p.127.

19. N. Klein, No Logo, op. cit., pp.421-422.

20. Ibid., p.435.

21. K. Danaher and R. Burbach (eds.), op. cit., p.125.

22. Ibid., p.126.

23. See Karl Marx’s account of Senior’s arguments – and his devastating refutations of them – in Capital, vol.1, in K. Marx and F. Engels, Collected Works, vol.35 (London, 1996), pp.233-243.

24. S. George, A Fate Worse Than Debt (Harmondsworth, 1994), pp.239-240.

25. See the interview with Jamil Mahaud in Hoy (Quito), 21 July 2000.

26. Interview in Socialist Worker, 19 August 2000.

27. K. Danaher and R. Burbach (eds.), op. cit., p.144.

28. Ibid., p.101.

29. Ibid., p.198.

30. Ibid., pp.164-170.

31. Indigenous People’s Seattle Declaration, reproduced ibid., p.90.

32. S. George, A Fate Worse Than Debt, op. cit., p.270.

33. For instance, Premchand’s The Gift of a Cow (London, 1987), The Temple and the Mosque (New Delhi, 1992), Deliverance and Other Stories (New Delhi, 1990). Deliverance was made into an excellent film by the Indian director Satyajit Ray. A more recent attempt to depict the miserably reality of “traditional” rural life in India is Shrilal Shukla’s novel Raag Darbari, first published in Hindi in 1968 and translated into English under the same title (New Delhi, 1992).

34. The quotes are from Shiva’s Reith lecture of 12 May 2000, Poverty and Globalisation, to be found on For Ho’s views see her often very informative Genetic Engineering: Dream or Nightmare? (Dublin, 1999), pp.143-145.

35. V. Shiva, Poverty and Globalisation, op. cit..

36. I. Habib, The Agrarian System of Mughal India (London, 1963), p.328.

37. In Vandana Shiva’s case the nostalgia is, perhaps inadvertently, narrowly religiously and caste based. Her book Stolen Harvest (Cambridge, Massachusetts, 2000) is sprinkled with quotes from Hindu religious texts, asserts that India is a “predominantly vegetarian society”, and backs bans on cow slaughter. In fact strict vegetarianism is confined to the minority of the population who are upper caste Hindus or Jains, while middle (“backward”) and lower (“scheduled”) caste and “tribal” Hindus, as well as Christians and the 100 million or more Muslims, all eat meat when they can afford it. And state-enforced bans on cow slaughter in India are invariably discriminatory measures directed by Hindu communalists against the Muslim and Christian minorities.

38. The figures are contained in World Bank, Trends in Developing Economies (1992), p.226.

39. V. Shiva, Stolen Harvest (Cambridge, Massachusetts, 2000), p.103.

40. Statement in K. Danaher and R. Burbach (eds.), op. cit., p.138.

41. Le Monde diplomatique, English edition, January 2000.

42. V. Shiva, Poverty and Globalisation, op. cit..

43. Interview in Socialist Review 242 (June 2000), p.18.

44. Pierre Tatatowksy, speaking at a fringe meeting at the National Union of Students conference in Blackpool, April 2000.

45. S. George, The Lugano Report: Preserving Capitalism in the 21st Century (London, 1999).

46. V. Forrester, The Economic Horror (London, 1999), p.38.

47. Ibid.

48. E. Toussaint, Your Money or Your Life: The Tyranny of Global Finance (London, 1999), p.254.

49. This is his argument in C. Hines, Localisation: A Global Manifesto (London, 2000).

50. C. Harman, The State and Capitalism Today, International Socialism 51 (Summer 1991), and Globalisation: A Critique of a New Orthodoxy, International Socialism 73 (Winter 1996).

51. The figures are contained in the IMF report on the US economy of June 1999, available from the IMF website,

52. C.H. Feinstein, Structural Change in the Developed Countries in the 20th Century, Oxford Review of Economics (2000), no..1, p.53.

53. V. Forrester, op. cit., pp.18-19.

54. N. Klein, No Logo, op. cit., p.223.

55. Ibid.

56. Ibid., p.205.

57. K. Danaher and R. Burbach (eds.), op. cit., p.126.

58. Quoted in Introduction, A. Arnove (ed.), Iraq Under Siege (London, 2000), p.11.

59. A. Smith, The Wealth of Nations (London, 1986), p.169.

60. P. Bourdieu, Acts of Resistance (Cambridge, 1998), pp.6-7.

61. K. Marx, Capital, vol.1 (Moscow, 1986), p.558.

62. K. Marx and F. Engels, Collected Works, vol.34, p.398.

63. Ibid., p.399.

64. K. Marx, Wage Labour and Capital (London, 1996), p.44.

65. K. Marx and F. Engels, The Communist Manifesto, Phoenix edn. (London, 1996), pp.8-9.

66. K. Marx, Capital, op. cit., pp.630-652.

67. Ibid., pp.681-684.

68. K. Marx and F. Engels, The Communist Manifesto, op. cit., p.11.

69. K. Marx, The Future Results of British Rule in India, in K. Marx and F. Engels, Collected Works, vol.12 (London, 1979), p.222.


Last updated on 15.7.2002