Globalization: The Ideology and Self-Destructive Tendencies of Capitalism, Past and Present

by Doug Dowd
University of Modena, Italy

This is the text of a paper given at the American Sociological Association meeting in San Francisco, August 15, 2004.

Ideology is one of those “big words” whose very utterance can initiate heated debate; its usage here derives from that of Karl Mannheim in his classic treatise Ideology and Utopia (1936):

There is implicit in the word “ideology” the insight that in certain situations the collective unconsciousness of [ruling] groups obscures the real condition of society both to itself and to others and it thereby stabilizes it...[T]hey are simply no longer able to see certain facts which would undermine their sense of domination. (p. 36)

What follows is an analysis of the “real conditions,” the ideology, and the inability of those who rule to see “certain facts” of today’s capitalist socioeconomy. I proceed on the assumption that any such discussion requires putting the present in historical perspective and the searching out of critical similarities and differences between ongoing and earlier capitalist behavior.

The capitalist process has always been nourished and supported by an ideology which, although its core has remained the same, has prevailed within a constantly changing political, social, and technological structure. That core consists of capitalism’s need to satisfy three interacting and mutually nourishing imperatives:

1) exploitation,

2) oligarchic rule, and

3) continuous economic growth and development at home and over the globe.

That is, capitalism has never been, nor can it be, a merely “economic” system. To be sure, its essence resides in its economic relationships and processes; however, in that capitalism emerged from non-capitalist societies, for its political economy to supplant them and to thrive required substantial and suitable alterations of society’s cultural and political structures, of its guiding principles, of its “ruling ideas.”

Only then could economic criteria become society’s unfettered driving force, and thus allow business, rather than religious and/or military means and ends to dominate. As Tawney put it in his classic Religion and the Rise of Capitalism,

To found a science of society upon the assumption that the appetite for economic gain is a constant and measurable force, to be accepted, like other natural forces, as an inevitable and self-evident datum would have appeared to the medieval thinker as hardly less irrational or less immoral than to make the premise of social philosophy the unrestrained operation of such necessary human attributes as pugnacity or the sexual instinct. (p. 35)

Or, as though summarizing the 20th century, Marx and Engels put it this way in 1848 in the Communist Manifesto:

The bourgeoisie cannot exist without constantly revolutionizing the instruments of production, and thereby the relations of production, and with them the whole relations of society... Constant revolutionizing of production, uninterrupted disturbance of all social conditions, ever-lasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones. All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions are swept away, all new-formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned....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.

Great Britain became the first industrial capitalist society; the seeds for that evolution had been planted and began their sprouting over several centuries before they could blossom and came to fruition. Those processes had become irreversible already in 1776, as Adam Smith was composing his Wealth of Nations. It was he and, several decades later, his follower David Ricardo — in his Principles of Political Economy and Taxation (1817) — who provided the principles of political economy and the core ideology for the capitalism of their era — and, what should be seen as incredibly, ever since: the ideology of “the free market society.

Smith’s focus was upon Britain’s domestic political economy; Ricardo extended Smith’s reasoning to provide the rationale for capitalist “globalization” (if not with that label).

Adam Smith was a decent man, but as is common with proponents of change, he (as, later, with Ricardo) was also so “intensively interest-bound” in his vision as to give scant or no importance to the hard “facts which might undermine” them. Smith and Ricardo’s failure to foresee the horrendous underside of their policies is understandable; such forgiveness cannot be granted to contemporary economists and politicians. That each notch of “progress” is scored, always increasing tens of millions of ordinary people find themselves swamped in misery and despair and premature death. Einstein put it graphically a century ago:

Our entire much-praised technological progress, and civilization generally, could be compared to an axe in the hand of a pathological criminal. (see Folsing)

Withal, “free market capitalism” continues to be extolled, with what “goes wrong” seen as occurring despite, not because of its guiding “principles.” In recent decades, the cheerleader has been Milton Friedman (in his Capitalism and Freedome [1962]); here an apt summary of his “principles” by E. K. Hunt:

Milton Friedman advocates the elimination of

1) taxes on corporations,

2) the graduated income tax,

3) free public education,

4) social security,

5) regulation of the purity of food and drugs,

6) the licensing of doctors and dentists,

7) the post office monopoly,

8) government relief from natural disasters, 9) minimum wage laws,

10) ceilings on interest rates charged by usurious lenders...and nearly every form of intervention that goes beyond the enforcement of property rights and contract laws and the provision of national defense. (History of Economic Thought, p. 422)

Friedman’s crusade was a product of the “core ideology” having come under attack in response to the 1930s depression. The first shots of that crusade had been sent forth by the Austrian emigre’ Friedrich A. Hayek, in his Road to Serfdom (1946). The “serfdom” Hayek had in mind were the modest reforms of the New Deal.

By the 1970s, however, even those and the later modest reforms of the free market began to come under assault; led by Friedman, the ideas of his now dominant “school” see the 1930s depression as caused by governmental “mismanagement”; the giantism and powers of the Fortune 500, “from the viewpoint of the economy as a whole,” may be viewed with indifference. (see Hunt, 431)

As this century opened, the core ideology had become manifest in practice; the banner of mainstream economics blares: No governmental intervention in the economy, either at home or abroad — ignoring that there always has been, will, and should be governmental interventions in, not least, capitalist economies.

The question is not intervention or not, but what kinds and degrees of intervention, for whose benefit and at whose cost?

Smith’s opposition to state intervention was focused upon those responding to the entrenched special interests of his time; interventions which, more than any others, held back the application of existing and emerging technologies. Smith’s passion was for enhanced efficiency through industrialization. He was by no means naive concerning businessmen; he depended upon the “invisible hand” of “free market competition” to protect the society from their avarice,

an order of men whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who have, upon many occasions, both deceived and oppressed it. (p. 250)

Ricardo took Smith’s essentially down to earth arguments up to a high level of abstraction; in doing so he provided the basis not only for the policies of “free trade” but, as well, for the method of what became contemporary economic “theory”: airy abstractions within a framework of assumptions — paving the way for the mathematization of economics. At the center of the fantasies of that economics is its dependence upon the “rationality” of all economic participants, top to bottom. Here Veblen’s response:

The [economists’] hedonistic conception of man is that of a lightning calculator of pleasures and pains, who oscillates like a homogeneous globule of desire of happiness under the impulse of stimuli that shift him about the area, but leave him intact. He has neither antecedent nor consequent. He is an isolated, definitive human datum, in stable equilibrium except for the buffets of the impinging forces that displace him in one direction or another. Self-imposed in elemental space, he spins symmetrically about his own spiritual axis until the parallelogram of force bears down upon him, whereupon he follows the line of the resultant. When the force of the impact is spent, he comes to rest, a self-contained globule of desire as before. (Place of Science in Modern Civilization, pp. 73f)

Ricardo, writing when his nation’s industrial realities and probabilities were unique and uncontested, in effectively arguing for unfettered free trade, also set up a system in which Britain would remain in the lead; the rest would serve as hewers of wood and drawers of water: Any and all protections of either the stronger or the weaker economies would hold back efficiency, he argued, would be harmful to both weak and the strong. As it happens, all of those who became industrialized — the U.S. and Germany not least — did so with substantial tariff protections.

When Hobbes noted that “life is nasty, brutish, and short,” it was in an era when significant socioeconomic improvement was impossible for all but a very few; a century later, changing agricultural technologies were making some slight protection against disaster for the majority possible; instead, they were used as the rationalization for the commodification of the land in Britain: “the enclosure movement.” (see Mantoux, and the Hammonds). As the “free yeomanry” were driven off their lands and became powerless, their labor also became a thing, a commodity — opening wide the gates to the present, where everything and everyone is bought and sold.

As the industrial revolution took hold and flourished, so too did worker exploitation: Item: Between 1821 and 1851, the heyday of that “revolution, the average life span of British workers declined by 20 percent. (Hobsbawm).

That refers to the first and most critical of the three “imperatives”: exploitation. No more than “oligarchic rule and expansion was exploitation unique to capitalism; what was historically unique was

1) the power of business to exploit, to rule, and to seek and obtain expansion, and

2) the intensity, ways and means, and consequences of their efforts to deal with those “imperatives.” Whatever the costs of the lust for power in earlier history had been, when to that was added a bottomless craving for wealth and power, the gates to a quantitatively and qualitatively new Hell were opened wide.

The industrial revolution was capitalism’s first prolonged process of rapid national economic expansion; that is, of capital accumulation at home; but it depended upon the prior geographic expansion of colonialism. Although its processes were mild compared with what would follow, they were essential. Marx again:

The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the aboriginal population, the beginnings of the conquest and looting of the East Indies, the turning of Africa into a warren for the hunting of black-skins, signalized the rosy dawn of the era of capitalist production. These idyllic proceedings are the chief momenta of primitive accumulation. (Capital, I, 751)

As industrialization emerged, colonialism was transformed into imperialism, prodded into being by industrial capitalism’s greater needs and stronger technologies. As the ensuing expansion relentlessly sought access and control over beckoning resources and markets, imperialism became always more feverish, socio-politically more penetrating, and considerably more destructive than its 19th century parent.

The latter may be seen as intended consequences; those unintended were always more severe and widespread: Cultural and political upheavals and, following inexorably in their wake, war after war, yielding two world wars previously unimaginable in their scope and horror — and the seemingly endless chaos, convulsions, totalitarianism, and warfare of the first half of the 20th century.

And now? For a brief period after 1945, it seemed that the world, led by its new and professedly idealistic U.S.A., had seen the last of large-scale insanity. But it was an illusion. As always, those in the seats of power failed to foresee or comprehend the consequences of the “realities” they were bent upon producing:

1) an economy dominated by a few hundred companies,

2) mass media always more adept at selling goods and services and, as well, politicians and ideology and not least

3) U.S. global hegemony — achieved through the mating of a set of interdependent policies, so deft in their mutual support as to provoke notions of a vast conspiracy — but which is better explained as the mutually beneficial meshing of interests of that “power elite” seen as emerging already in place in the 1950s (by C. Wright Mills): the establishments of big business, the military, and politicians.

Thus were produced pressures by the U.S. for the world’s many regions to be formed into economic alliances umbilically nourished by the Cold War — with an important dividend: In militarizing both the U.S. and the Soviet economies, the former achieved ongoing economic buoyancy and political numbness while ensuring the socioeconomic ruin of the U.S.S.R.

In those same processes, the proliferation of consumerism both in and beyond the U.S.. with its real and imagined beneficial economic consequences for workers, resulted also in their substantial depoliticization) — as, along the way, both the social as well as the economic power of giant corporations spread and deepened, as they “transnationalized.”

Withal, the ways and means of the ongoing socioeconomic system have socialized a clearly high percentage of the peoples of the richer economies to believe that we have progressed greatly over anything in the past — despite that, except for a small minority of the world’s people the reality has been one of spreading hardship and despair.

As the 19th century ended, what would become the chaos, convulsions, totalitarianisms, and destruction for half a century were not and could not have been foreseen by the peoples of that time. That we are lurching toward something at least as catastrophic by now should be clear; note the already ominous rumbles of today’s “small wars” and associated terrorism in Central Asia, the Middle East and Africa, perhaps a billion suffering or dying from malnutrition, numerous stagnant economies, and, inter alia, a growing asperity between nations and a noticeable deterioration of the environment.

That same set of processes may be seen as due to the growing inability of the U.S. either to know how to prevail: where, when, and in what ways; in consequence, the economic, political, and military events of recent years may be seen, that is, as the beginning of the descent of U.S. hegemony. There are several good reasons to cheer that descent; but, remembering what has accompanied the descent of earlier empires, there are also compelling reasons to be fearful of what is to follow.

All too often, still today, what are usually seen as separate phenomena in the realms of culture, the economy, politics, warfare, and the environment are, of course, interdependent; as they now continue to fuse, the world seems again to be moving toward the “chaos and convulsions” that shattered the 20th century.

In the past century or more, all the relevant dimensions of the social process have enlarged and gained strength, neither only nor least in its technologies. In consequence, we may well be headed toward something worse than our predecessors, in keeping with the old saw, “the bigger they are, the harder they fall”

Our problems are “bigger” in several ways; seldom recognized, and for that reason all the more important is the crises of the 20th century were not resolved either by the wars of the its first half or by the U.S. dictated policies of the second half. “set of crises” Rather, those crises were stifled, camouflaged and contained, as though by socioeconomic “pacifiers.” In thus being prolonged. the burden of unresolved crises for the present and future have deepened, become more intractable than ever.

This is to say that the many changes in all corners of society that occurred between 1945 and now hve left fundamental principles and structures — those that led to the earlier disasters — - more than intact; it allowed their dangers to be intensified, have enhanced the capacity for social and environmental damage in and to all quarters of our existence.

Here only a few words meant to be no more than suggestive regarding the constituent elements of today’s “realities” whose nature and interactions threaten our very survival.

Culturally, the modern economic processes that have required and produced deepening and spreading consumerism, along with the always greater hold of the media and the deepening of selfish individualism have facilitated and imposed social processes that simultaneously homogenize and disrupt, overwhelm and entice — that is, groups of societies internally and externally fraught with rising hostility — some of the major elements of which are treated well in Benjamin Barber’s Jihad vs. McWorld.

Economically, the processes adopted and embraced for the revitalization and survival of capitalism, could succeed if and only if at the same time the global economy were restarted. That “globalization” required the maturation of the economic-military-political triad that has carried us to the present — ranging through the IMF and World Bank to the Marshall Plan/NATO/Cold War and our several economic/military/political interventions over the globe, beginning as early as 1943 in Italy, going on to reinstate the French in Vietnam in 1945 (see Young, Vietnam Wars, 1945–1990), thence to our support of the Israelis from 1948 on, simultaneous with the resumption of our earlier interventions in Central America (see Williams, Empire as a Way of Life) and so on — ad infinitum? In each and every one of these interventions, the economic, the military, and the political were always intertwined.

The global economy and the imperialism of the 19th century created and dominated by Great Britain differed in critical ways from that created by us. The earlier “globalization” came into being in the era of small companies and limited government; giant companies and muscular governments are the hallmark today, the dividing line between which has been effectively erased by the commodification of politics, its lobbying and its bought and sold politicians at all levels. On top of that, the pervasive financialization-cum-speculation of today’s economies has created a fragility well beyond of that anything earlier.

As happened in the first incarnation of capitalist global economy presided over by the UK, that of the USA is doing itself in. Among the many elements of that self-destructive process, the most critical have been

1) the free and easy “downsizing and outsourcing” of the leading economies that has weakened their own “middle class” consuming base;

2) the investment and production in weaker economies in order to take advantage of dirt cheap labor and no environmental constraints that has produced the currently accelerating processes in economies “of the South” — most notably China and India — that now mimic the role earlier played by the USA, Germany, and Japan in disrupting the UK’s global economy.

There are, however, major differences that are in no way encouraging; namely, that the UK remained a creditor nation up to its ruination during and after World War I; the USA, instead, is the history’s largest debtor nation, as measured in either absolute or relative terms.

In that it is generally understood

1) that the U.S. is “the consumer of last resort” for the entire world economy,

2) that its own consumers are a weakening force: Items in headline form the NYT: “Hourly Wages Not Keeping Pace With Rising Prices,” “A Growing Force of Nonworkers” (both July 18, 2004), “More Jobs, Worse Work” (July 22, 2004), and

3) that the rest of the world vitally depends upon a continuous increase of our imports from them which, in turn, requires that our people continually increase their average household indebtedness (already in excess of average household income) — all that suggests that something other than prosperity is just around the corner. Especially when the next matter is noted.

Politically, all the major economies have fallen into a dangerous lockstep with the U.S. as they depart steadily from the social democracies constructed after World War II; now, they are reducing health care and pensions at the same time that their citizens need at least what they had — which was considerably more than here. Now, “social democratic” leaders and citizens have become all too similar to the timid Democrats and consumerized voters in the U.S.

Meanwhile, the prizes for rapid growth are being won by China (and, not far behind, India). The gods must be having a good laugh at Uncle Sam. What we once saw, and probably always will see, as a looming ideological/military enemy has, in the past decade or so, emerged as a main prop for our economy. Within two or three decades, China is likely to have an economy to which we shall have to kowtow. Our Cold War defeat of Russia produced the first Mafia capitalist society; in China, globalization has produced the first totalitarian capitalist society. Spare us such victories. Economically, the U.S. was safer with the USSR and Mao (and had never been threatened militarily by either).

Although at present Japan holds more of our paper than any other country, China (now Japan’s top trading partner) is catching up fast. Both they and our other creditors know that at some point the multi-trillion dollar foreign debt of the U.S. has to cease its rise and, when it does, the fall will be precipitous.

Following the general rule financial markets’ rule — “Don’t panic!” — all the markets know that once a sell-off begins, all hell will break loose for themselves as well as others; they also knows that at some point it will happen. So, the other rule: Panic first! When it will happen, knows only “god.” That it will happen is known to all professional speculators.

Meanwhile, no government — least of all our own — has the personnel or the inclination that make it able or likely to undertake the policies needed to forestall that pending collapse; all the politicians have forgotten, if they ever knew, what happened to capitalism’s political economy as the 20th century evolved. They have cancelled that past and, as well, its military horrors.

Militarily, it also seems likely that the U.S., as with its hegemonic predecessor, is lurching into always spreading and deepening conflicts. A major difference is that in Britain’s time the conflict was between it and other imperialist powers; as this century unfolds the “troublemakers” have been and are becoming the once and/or still effectively imperialized societies.

Among other important contrasts are

1) that today’s bumptious societies are struggling to hold on to what has not already been destroyed of their cultures, as well as their economies, and

2) that the war will not be between massed armies and their naval and air fleets, but of the sort that surfaced first in Vietnam and that is now, in even more challenging ways, the daily stuff of news, and not only from Iraq: Gulliver v. the Lilliputians; arrogance vs. the will to survive.

With no winner, especially if and when China enters those conflicts militarily. Then warfare would surely take on more traditional ways; it is just as likely to become nuclear. We’ll all go together when we go, if that is any solace. Which takes us to Mother Nature.

Environmentally, it is unlikely that for the foreseeable future anything even approximating what is needed to avert catastrophe will be achieved. Moreover, as environmental damage increases and preventive measures lag (or, worse, in the U.S. are curtailed or abandoned), unless both of those tendencies begin a substantial reversal within a decade or so, we might well have reached the point of no return.

The constituent elements of environmental degradation are global in both cause and effect — with of course, the strongest nations, led by the U.S., contributing considerably more than their share of the degradation and, up to now, the poorer nations suffering disproportionately from the consequences. All that is so whether the focus is upon “earth, air, fire, or water.”

If the environmentally destructive socioeconomic processes of the U.S. have been and are still the chief villain in this impending catastrophe, soon to move to front stage will be China. Its “totalitarian capitalism” breaks all records not just for rate of growth but, as well, for rapidity of socioeconomic transformations. China has already moved from being a victim of others’ environmental crimes to self-harm — which, of course, will become global in effect — although, at least as regards fossil fuel CO2 emissions China has been able to reduce its total emissions in the same years as those of the U.S. have been growing at an annual rate of 2.5 percent. (Singer, One World)

China’s swift industrialization and associated consumerism — with a population nearing 1.5 billion — have been accompanied by a rapidly accelerating demand for almost everything, especially for oil, for which it depends upon imports. Because its neighbor Central Asia possesses the world’s most promising untapped oil resources, China of course must pay close attention to what is happening in Afghanistan, a military arena for Russia for several decades, and now for the U.S.A. It is unlikely that an amicable arrangement will be found to see who controls those deposits. And if it is not? No place to hide.

That linking of cultural with economic with political with military with environmental deterioration and threats carries with it considerably more potency than those presided over by the British a century and more ago: more potency for war, and for those two most awful of manmade disasters: war and the destruction of nature. Nor does the go-it-alone behavior of the U.S. help, as regards either the Kyoto Protocol (which we alone refuse to sign, of about 180 nations) or our preemptive war with Iraq.

In conclusion, it seems clear that, “led” by the U.S., the world is once more moving toward a severe crisis. The crisis metaphor, borrowed from bodily health, applies all too well to our time: A crisis is a moment when if the subject proceeds along the same path its condition will worsen irrevocably; to avoid that requires substantial alterations in behavior.

What an individual might do in terms of diet, activities, and the like, has its difficulties of course; they are considerably greater for the essential social transformations. There — that is, here and now for the world’s people — what happens in the social process is determined by an individual’s willpower and good sense but through ongoing power structures. For us now those are most critically the socioeconomic structures of globalized monopoly capitalism; that is, those who must change are those who have carried us to this present; sitting in the proverbial catbird seat, they are naturally inclined to view the status quo with favor.

They wear the blinders of their ideology and are driven by their passion for always more power, always more wealth: More of the same; always. They, even more insolent than their British predecessors, are totally unlikely to see or accept the need for major changes, if only because such changes would require their being unseated. In Britain’s day it would have been more than foolishly idealistic to speak of the need for a true global community; in our day, it is suicidal not to do so. However, as Peter Singer has argued,

It has to be said, in cool but plain language, that in recent years the international effort to build a global community has been hampered by the repeated failure of the United States to play its part... [as regards, for example] the Kyoto Protocol...the International Criminal Court...a stable United Nations, [or] aid to the poorer countries...When the world’s most powerful state wraps itself in what — until September 11, 2000 — it took to be the security of its military might, and arrogantly refuses to give up any of its own rights and privileges for the sake of the common good...the prospects of finding solutions to global problems are dimmed....and the United States risks falling into a situation in which it is universally seen by everyone except its own self-satisfied citizens as the world’s “rogue superpower.” (One World)

So it is that now, as in the past, if catastrophe is to be avoided, the burden falls upon those without power and, more’s the worse, without the habit of seeking it. It fell upon our predecessors a century and more ago, and they could not rise to the occasion. If we fail as they did, and at the moment that seems likely, what awaits us is most assuredly worse than what befell them — in all dimensions of life, here and there, ours and that of Mother Nature.

References

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August 25, 2004