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Globalisation or Imperialism?
JAMES PETRAS
The article details and criticises both the theoretical and empirical
weaknesses of the widely used concept of globalisation. The article sets out
and discusses three arguments concerning the phenomenon of
globalisation: first, that globalisation is a novel phenomenon; second, that
the state has become an anachronism; and third, that the technological
revolution is the main impetus behind globalisation. The article challenges
these contentions, and argues, to the contrary, that the concept of
globalisation obscures more than it reveals; that the macro-dynamics of the
world economy can best be understood through an analysis of the active role
of the imperial state and the opening up of overseas opportunities via
political power; and that developments associated with the new
information technology are subordinate to more important developments
grasped with reference to the concept of imperialism.
I. Introduction
Many writers argue that we have entered a new era characterised by
globalisation, the driving force of epoch-defining changes in the nature of societies
and economies across the world, resulting in the creation of an interdependent
system. This notion of globalisation has become a part of the everyday discourse in
academia and among policy-makers. It serves as a point of reference and a
framework of ideas for the analysis of macro and micro socio-economic
developments, and of the process that gave rise to them. The notion of
'globalisation' spans the ideological spectrum and crosses academic disciplines.
Even trenchant critics of the dominant discourse have been constrained to adopt
the term and, in the process, tacitly accept its presuppositions.
The very pervasiveness of the notion of globalisation points towards a problem.
Not only does it reflect the presence of a fundamental paradigm, a worldview that
structures the thinking and practice of most scholars in the field, it also suggests the
working of an ideology which obfuscates reality. Although globalisation is
presented as an economic process, a paradigm for describing and explaining
Q2
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GLOBALISATION OR IMPERIALISM?
process. Having accepted the idea that there is no alternative, the issue becomes
how best to adapt and to insert economies and societies into the process. The issue
becomes: what are the most favourable conditions available in order to strike the
best deal possible through direct pressure and negotiated concessions? The
solution is what Griffin and Khan, Casteneda and others see as the only 'realistic
option.' A second group of critics share a Marxist understanding of the nature and
macro-dynamics of the international capitalist system, although 'Marxism' here
takes diverse forms. These critics workfrom very different theories of the macrodynamics of post war capitalism and its propensity towards crisis. The general view
is that there is an alternative to the existing order and the globalisation process and
that it should be sought in political terms.
The writers associated with the Monthly Review*2 view globalisation as an
obfuscating myth, an analysis of an imperialist centred international economy.
Another group of left-wing scholars43 view globalisation as the latest phase in a long
historical process, representing an epochal shift in the nature of capitalism, and as
such a systemic (or political) response to the crisis that beset world capitalism in the
late 1960s and early 1970s.44 In this connection, we propose the concept of
imperialism as an alternative explanatory framework of international capitalist
expansion and the growing inequalities, and for describing and explaining the process
of the concentration of power, property and income in the international system.
NO
The term 'globalisation' not only serves as description and explanation of what
is going on. It refers even more so to a prescription - that certain developments,
particularly 'the liberalisation of national and global markets,' will produce 'the
best outcome for growth and human welfare' and that they are in everybody's
interest.45 In this connection, the notion of globalisation is clearly based not on
science but on ideology, a manifesto, as it were, of advanced capitalism in which it
serves as a shorthand reference to developments and outcomes that are deemed to
be highly desirable.46
In this connection, the problem is how to generate the requisite support and the
'political will' needed to implement the required reforms and policies. The World
Bank, in particular, has assumed responsibility in this area, arrogating to itself the
task of ensuring that governments all over the world adjust to the requirements of
Euro-American multinational corporations and their states.47
Another issue in this connection is how to differentiate between reality and
appearance. In appearance, there is an unfolding of trends that are leading towards
increased integration into one world system. In the process, the nation state is
weakened, hollowed out, forced to retreat from the process of national
development and surrender its decision-making power to a new set of
international institutions. The reality, however, is otherwise. The state in the Third
World actively intervenes to subsidise and attract capital, reduce organised labours
role, etc. The imperial state bails out banks, investors and speculators, provides
political pressure to open markets, and sends military expeditions to eliminate
alternatives.
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controlled by the US. Thus it is clear that European, not Japanese, capitalism
remains as the only competitor to the US for dominance in the world market. The
acceleration of US economic power and the decline of Japan in the 1990s is
manifest in the increasing number of US firms among the top 500, up from 222 to
244 and the precipitous decline of Japanese firms from 71 to 46 over the decade.
This tendency will be accentuated over the next few years because US-based TNCs
are buying out large numbers of Japanese enterprises as well as Korean, Thai, and
other firms.
Looking at the largest 25 firms, those whose capitalisation exceeds $86 billion,
the concentration of US economic power is even greater: over 70% are American,
26% are European and 4% are Japanese. As for the top 100 companies, 61% are
American, 33% are European and only 2% are Japanese. To the degree that the TNCs
control the world economy, it is largely the US which has emerged as the
overwhelmingly dominant power. Insofar as the very largest companies are the
leading forces in buying out smaller companies through mergers and the fusion of
capital we can expect the US-based TNCs to play a major role in the process of
concentration and centralisation of capital.
VII. Conclusions
An important issue involved in academic debates focuses on how to view recent
trends and developments in the world economy. As an economic process, impelled
by dynamics of a system, or as a political project, the intentional outcome of a
consciously pursued strategy.57 In this connection, it has been said, globalisation is
not a 'monolithic, unstoppable juggernaut, but a complex web of interrelated
processes', some of which, as Stalker notes, 'are subject to greater control than
others'.58 In the same connection, international expansion of Euro-US capital is not
as so many see it: a process without a subject and as such irresistible in its logic and
inescapable in its effects. To the extent that the international flows of capital and
commodities involves a process it has both a conscious direction and a political
agenda: to promote the worldwide interests of a new class of transnational
capitalists anchored in the US and Europe. This can best be understood as a form of
empire building - imperialism.
The advocates of globalisation theory argue for the interdependence of nations,
the shared nature of their economies, the mutuality of their interests, the shared
benefits of their exchanges.59 Imperialism emphasises the domination and
exploitation by imperial states and their multinational corporations and banks of
less developed states and labouring classes as well as international competition
and cooperation among the rival imperial states and enterprises. In today's world it
is clear that the imperial countries are hardly dependent on most of theThird World
countries they trade with. They have diverse suppliers; the economic units
operating are owned and operated in large part by stockholders in the imperial
countries; and the profits, royalties and interest payments flow upward and
outward in an asymmetrical fashion. Within the international financial institutions
(IFIs) and other world bodies, the imperial countries wield disproportionate or
decisive influence. On the other hand, the dominated countries are low wage areas,
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interest and profit exporters, virtual captives of the IFIs and highly dependent on
limited overseas markets. Hence the imperial concept fits the realities much better
than the assumptions that underlie the notion of globalisation.
The concept of globalisation relies heavily on diffuse notions of technological
change accompanied by information flows and the abstract notion of'market
forces'. In contrast, the concept of imperialism sees the transnational corporations
and banks, and the imperial states, as the driving force behind the international
flows of capital and tradable commodities. A survey of the major events, world
trade treaties, and regional integration themes quickly dispels any technological
determinant explanations: it is the heads of the imperial states that establish the
framework for global exchanges. Within that political shell the major transaction
and organisational forms of capital movements are found in the TNCs, supported
by the IFIs, whose personnel are appointed by the imperial states. Technological
innovations operate within the parameters that further this configuration of power.
The concept of imperialism thus gives us a more precise idea of the social agencies
of worldwide movements of capital than the notion of globalisation.
According to most advocates of 'globalisation' theory we are entering a new
epoch of interdependency in which stateless corporations transcend national
frontiers, spurred by the third technological revolution and facilitated by the new
information systems. According to this view the nation state is an anachronism, the
movements of capital are unstoppable and inevitable and the world market is the
determinant of the macro-micro political economy.
The result, according to globalisation theorists is a progressive, dynamic,
modernising world of prosperous nations. But the contrast between the premises
and promises of globalisation theorists and contemporary realities could not be
starker. Instead of interdependent nations we have dramatic contrasts between
creditor and debtor nations; multi-billion dollar corporations appropriating
enterprises, interests royalties and trade surpluses while billions of workers and
peasants reap poverty and miserable existences. Structurally we find that over 80%
of the major multinational corporations control their investment, research and
technology decisions out of their home offices in the US, Germany and Japan.60
TNCs are based on worldwide operations but their control is centralised.
Notwithstanding the resistance of the globalists, their basic premises, viz. the
claim of inevitability and the notion that it represents a novel development driven
by technological change, are suspect. And the same can be said in regards to the
denial of possible systemic alternatives to the dominant NewWorld Order. In this
and other regards we can point to a clear divergence between the grand claims and
meagre explanatory power of globalism as theory. In this context the concept of
imperialism can be seen as a more useful descriptive and explanatory tool for
grasping the dynamics of the process involved.
GLOBALISATION OR IMPERIALISM?
Johnson Chalmers, Blowback: The Costs and Consequences of American Empire, New York,
Metropolitan Books, 2000.
2
Peter Stalker, Workers Without Frontiers, Boulder, CO, Lynne Rienner, 2000.
3
Keith Griffin and Azizur Rahman Khan, Globalisation and the Developing World, Geneva,
UNRISD; Roger Burbach and William Robinson, 'Globalisation as Epochal Shift', Science &
Society, vol. 63, no. 1.1999.
4
Dharam Ghai.'Preface', in Stalker, Workers Without Frontiers.
5
Silvia Ostry, Governmentand Corporations in a ShrinkingWorld: Trade and Innovation Policies in
the US, Europe and Japan, New York, Council on Foreign Relations, 1990.
6
On this see, inter alia, Anthony Giddens, The Consequences of Modernity, Cambridge, Polity
Press, 1990; Griffin and Khan, Globalisation and the DevelopingWorld; various contributors to
Hans-Henrik Holm and Georg Sorensen, eds., Whose World Order? Uneven Globalisation and the
End of the Cold War, Boulder, CO, Westview Press, 1995; and James Rosenau, Turbulence inWorld
Politics, Princeton, Princeton University Press, 1990.
7
Peter Dicken, GlobalShift: The Internationalization of Economic Activity, New York, Guilford
Press, 1992, p. 1; Stalker, WorkersWithout Frontiers, pp. 3-10.
8
Griffin and Khan, Globalisation and the DevelopingWorld, pp. 59-66.
9
On these policy and institutional reforms, and the associated strategy of structural adj ustment,
what in the Latin American context is referred to as the New Economic Model, see, inter alia,
Henry Veltmeyer and James Petras, The Dynamics of Social Change in Latin America, London,
Macmillan, 2000; and Economic Liberalism and Class Conflict in Latin America, London,
MacMillan, 1997. The widespread experiment in neoliberal reforms in the 1980s and 1990s were
pioneered by the military regime of Agusto Pinochet who in the mid-1970s initiated what
McKinnon, one of the World Bank's architects of the SAP, saw as 'the most sweeping reforms in
history' (see Fernando Leiva and James Petras, Democracy and Poverty in Chile, Boulder, CO,
Westview Press, 1994).
10
Martin Wolf, 'Not So New Economy', Financial Times, 1 August 1999, p. 10.
11 Robert Gordon, 'Has the New Economy Rendered the Productivity Slowdown Obsolete',
http://faculty-web.at.nwu.edu/education/gordon/researchhome.htm,June1999.
12
Gordon, 'Has the New Economy Rendered the Productivity Slowdown Obsolete?'.
13
Gordon, 'Has the New Economy Rendered the Productivity Slowdown Obsolete?'.
14
Dale Jorgenson and Kevin Stiroh, 'Information Technology and Growth', American Economic
Review, May 1999.
15
Robert Gordon, 'U.S. Economic Growth Since 1870: One Big Wave?',American Economic Review,
May 1999.
16
Wolf, 'Not So New Economy".
17
Gordon, 'U.S. Economic Growth since 1870: One Big Wave?'.
18
Gordon, 'U.S. Economic Growth since 1870: One BigWave?'.
19
For alternative interpretations of these contextual conditions of the postwar development
process see, inter alia, Giovanni Arrighi, The Long 20th Century: Money, Power and the Origins of
Our Times, London, Verso, 1994; Stephen Marglin and Juliet Schor, The Golden Age of Capitalism:
Reinterpreting the PostwarExperience, Oxford, Clarendon Press, 1990.
20
Victor Bulmer-Thomas, The Economic Model in Latin America and its Impact on Income
Distribution and Poverty, NewYork, St. Martin's Press, 1996.
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21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
4g
Kevin Danaher and Muhammad Yunus, 50 Years is Enough, Boston, South End Press, 1994; Peter
Kenen, Managing the World Economy, Washington, DC, Institute for Internationa! Economics,
1994.
Jorge Castafleda, Utopia Unarmed, NewYork, Vintage Books, 1993.
Manfred Bienefeld, 'Assessing Current Development Trends: Reflections o n Keith Griffin's
"Global Prospects for Development and Human Security"' and Keith Griffin, 'Global prospects
for Development and Human Security', Canadian Journal of Development Studies, vol. XVI, no. 3,
1995.
These critics range from scholars of international relations or economic development such as
Bello, Korten, Rosenau to participants in a series of anti-globalisation forums and networks - the
San Francisco-based International Forum on Globalisation; the Bangkok-based Focus on the
Global South, the PCD Forum, the US-based 50 Years is Enough network for global economic
justice, the Third World Network, a n d The Centre for the Study of Globalisation and
Regionalisation at the University of Warwick.
Stalker, Workers Without Frontiers.
Peter Drucker, Post-Capitalist Society, NewYork, Harper Business, 1993.
William Robinson, Promoting Polyarchy: Globalisation, US Intervention and Hegemony,
Cambridge, Cambridge University Press, 1996, pp. 363-380.
T h e political dynamics of this process have been the central concern of a n u m b e r of studies
sponsored or published by, inter alia, the US Council for Foreign Relations (Ostry, Government
and Corporations in a Shrinking World), its scholarly mouthpiece Foreign Affairs a n d t h e
Washington-based
Institute for International Economics (for example, Kenen, Managing the
World Economy, Dani Rodrik, Has Globalisation Gone Too Far?, 1997).
Holm and Sorensen, eds. Whose World Order?
Linda Weiss, TheMyth of the Powerless State: Governing the Economy in a Global Era, Cambridge,
Polity Press, 1998.
Robert Boyer a n d Daniel Drache, eds., States Against Markets: The Limits of Globalisation,
London, Routledge, 1996.
O n this consensus see Jeffrey Williamson, ed., Latin American Adjustment. How Much Has
Happened? Washington, DC, Institute for International Economics, 1990.
Stephen Shepard, 'The New Economy: What it Really Means?', BusinessWeek, 17 November, 1997,
pp. 38-40.
World Bank, Global Economic Prospects and the Developing Countries, Washington, DC, 1992.
United Nations Research Institute for Social Development (UNRISD), States of Disarray: The
Social Effects of Globalisation, Geneva, 1994; World Bank, Global Economic Prospects and the
Developing Countries, Washington, DC, 1992.
Werner Sengenberger, Director of the ILO's Employment Strategy Department and the ILO's
Working Group o n t h e Social Dimensions of Globalisation and Liberalisation of Trade (see
Foreword to Stalker, Workers Without Frontiers, pp. xii).
Joanne Salop, 'Reducing Poverty: Spreading the Word', Finance & Development, vol. 29, no. 4,
December, 1992.
David Korten, When Corporations Rule the World, West Hartford, Connecticut, Kumarian Press,
1995.
Inter alia, Danaher andYunus, 50 Years is Enough.
Marshall Wolfe, Elusive Development, London, Zed Press, 1996.
CAMBRIDGE REVIEW OF INTERNATIONAL AFFAIRS
GLOBALISATION OR IMPERIALISM?
41
42
for the 21" Century, London, Zed Books, 1999; Harry Magdoff, Globalisation: To What End?, New
York, Monthly Review Press, 1992; A. Sivanandan and Ellen Meiksins Wood, 'Globalisation a n d
Epochal Shifts: An Exchange', Monthly Review, vol. 48, no. 9, 1997; Paul Sweezy, 'More (or Less) on
Globalisation', Monthly Review, vol. 49, no. 4, 1997; William Tabb, 'Contextualizing Globalisation:
Comments on Du Boff and Herman', Monthly Review, vol. 49, no. 6, 1997.
43
Richard Du Boff and Edward Herman,'A Critique of Tabb on Globalisation', Monthly Review, vol.
On the diverse approaches and theories related to the macro-dynamics and crisis tendencies of
capitalism in the postwar period see, inter alia, SamirAmin, Re-Reading the Postwar Period, New
York, Monthly Review Press, 1994; Robert Brenner, The Economics of Global Turbulence, London,
Verso, 2000; David Laibman, Capitalist Macrodynamics,
Welder and David Rigby, The Golden Age of illusion: Postwar Capitalism, New York, Guilford,
1996.
45
In this regard see, in particular, World Bank, Workers in an Integrating World, Oxford University
46
A major statement of this ideology can b e found in the World Bank's 1995 World
Press, 1995.
Development
Report. For a deconstruction of this ideology see Henry Veltmeyer, 'The World Bank's 1995
Report: A Capitalist Manifesto on World Labour', Transition, issue 26, January 1997.
47
On the World Bank's strategy a n d its underlying ideology, particularly as relates to t h e world's
workers, see Henry Veltmeyer, 'Challenging the World Bank's Agenda to Restructure Labour in
Latin America', Labour, Capital and Society, vol. 30, no. 2, 1997, pp. 227-259.
48
On some of the dynamics of this process see James Petras and Henry Veltmeyer, 'Latin America at
the End of the Millennium', Monthly Review, vol. 51, no. 3, July-August 1999, pp. 31-52.
49
50
James Petras and Henry Veltmeyer, Ascenso da Hegemonia dos Estados Unidos no Nova Milenio,
Sao Paulo,VOZES, 2000.
51
Paul D o r e m u s , William Kelley, Louis Pauly, Simon Reich, The Myth of the Global
Corporation,
Robinson, Promoting
53
54
Frontiers.
State.
alia, Arturo Escobar, Encountering Development: The Makingand the Unmaking of the Third
World, Princeton, Princeton University Press, 1995; a n d Gustavo Esteva a n d Madju Suiri Prakash,
Grassroots Post-Modernism:
York, Peter Lang, 1996. For a c r i t i q u e s e e Henry Veltmeyer, ' N ew Social M o v e m e n t s i n Latin
America: t h e D y n a m i c s of Class a n d Identity', The Journal
of Peasant Studies,
vol. 25, n o . 1,
October 1997.
55
Countries,
Washington,
DC, 1992.
56
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O n this point see, inter alia, the various contributions to Preet Aulakh a n d Michael Schecter,
Rethinking Globalizations: From Corporate Transnationalism to Local Interventions. New York,
St. Martin's Press, 2000.
Stalker, Workers Without Frontiers, p. 10.
Robert Keohane a n d Joseph Nye, 'Globalization: What's New? What's Not? (And So What?)',
Foreign Policy, no. 118, Spring 2000.
Doremus et al, The Myth of the Global Corporation, Chapter 5.