Archive for February, 2006

Misadventures in Capitalism: Weekend Roundup

February 25th, 2006  |  Published in Uncategorized

Like Tom Frank always says, it pays for leftists to read the business section. This week's business pages were such a gold mine of capitalist irrationality, I couldn't pick just one story. The lowlights:

The Threat to a Free (Business) Press. (Article is behind the stupid Times Select paywall.) The Bush administration's ongoing attempts to silence journalists are one thing; the bourgeoisie has always been ambivalent about allowing the rabble to speak its mind. But you would think that allowing business analysts to report honestly about a company's revenue and profitability is a basic prerequisite to rational capital allocation. Times columnist Joseph Nocera is up in arms about the antics of Patrick Byrne, CEO of the profit-challenged, who is using the courts to silence journalists and research analysts who have written unfavorably about his company. The specifics of the case--including a demented speech in which Byrne refers to a nefarious conspiracy against his company, headed by a "sith lord"--are surreal and hilarious, but the underlying issue is a serious one. I mean, if the business press isn't immune to this kind of intimidation, then truly no one is safe.

The Blackberry vs. the Patent Trolls. This week saw another episode in the ongoing legal battle between Research in Motion, the Canadian company that makes the Blackberry handheld email device, and NTP, a company which is demanding money for what it says are patent infringments. Now, NTP is not a company which is protecting an investment in its technology--the sort of investment that patents are supposed to protect. In fact, NTP has never invested in or produced anything; it exists solely for the purpose of holding patents and suing people. RIM won a minor victory when a court refused to grant NTP an injunction; at the same time, the patent office has invalidated the NTP patents. Yet the Blackberry could still find itself shut down. Sadly, the judge seems ignorant of the real issues invovled, as he waxes bemused that the courts should be forced to decide on what ought to be purely a "business issue".

The Great Airline Ticket Swindle. When airlines advertise their ticket prices, there are required to list the full price--only certain government taxes and fees can be excluded. This makes price shopping with services like Orbitz and Travelocity easy for consumers. But now the Transportation Department looks set to allow all kinds of special surcharges to be tacked on to the listed price, from fuel surcharges to insurance. This despite the fact that virtually everyone--from individuals to travel agents to low-cost airlines--is opposed to the change. Only the big five, United, American, Northwest, Delta and Continental, are in favor. It's evident that this rule change serves no other purpose than to frustrate consumers and allow uncompetetive airlines to wrangle super-profits out of travellers. The situation that is being generated is what the economists call "imperfect information", and it's supposed to be a major hindrance to the functioning of a free market. But hey, who's keeping score anymore?

Selected Shorts. H&R Block saw its stock drop by two dollars when the tax preparation company announced that it had screwed up its own taxes. And no matter what Irwin Schiff tells you, if you don't pay taxes, you will go to jail.

Meanwhile, the housing bubble is still deflating. And don't let the hijinks of patent trolls and paranoid CEOs distract from the really imporant work that's taking place in the private sector: like the end of the living wage, and exciting new advances in spying-on-you technology.

David Horowitz, Defender of Civilization

February 24th, 2006  |  Published in Uncategorized

The ever-insighful Scott McLemee takes on red-batiter extroardinaire David Horowitz in this week's column at Inside Higher Education. It's an unusually humorous romp through a subject which is, already, inherently hilarious.

D. Ho, as they're calling him these days, is out with his book on "America's 101 most dangerous professors", and naturally communist brainwashers everywhere are incensed at being left off the list. Now normally, it's my opinion that the left is best served by ignoring people who make their reputations off of baiting the left--characters like Christopher Hitchens, Marc Cooper, and to a certain degree Todd Gitlin (who scored a totally unearned spot on the Horowitz list). But in the case of D. Ho, we are dealing with a figure so ludicrous that I'm inclined to just enjoy the silliness. It's true that by talking about him, we raise his profile, promote his book sales, and thereby perpetuate the phenomenon. But I don't think this has very real political implications (in contrast to more measured and reasonable figures), so objecting in these grounds is sort of like observing a personal boycott of Coca-Cola out of concern for Columbian trade-unionists: it may promote feelings of virtuousness, but has few implications in the real world.

So instead, I say, go on and enjoy the Network(s)!

Humor Break

February 23rd, 2006  |  Published in Uncategorized

Sometimes, thinking about the origins of totalitarianism is just getting me down, and I need some comic relief. Fortunately, I recently discovered something that, for reasons I can't explain, is funnier to me than almost anything else on Earth:

Chris's Invincible Super-Blog.

I admit, this is probably a niche-product. It's a comic book blog, and if you never read comic books, the whole thing will probably seem baffling. Moreover, Chris Sims is my age, which means we both came of age during the insane speculative mania that gripped the comic-book industry in the late '80's and early '90's. Those were the days when a comic that had sold for $1.00 off the rack would inexplicably go for $80 a year after it came out. And while the comics bubble may have inflated a lot of subsequently-dashed hopes of retiring on a speculative comic book fortune, it also produced some of the most hilarious, ill-advised comics known to civilization. And since they're the comics of my childhood, I remember them fondly (or at least, bemusedly).

I don't know why, but something about the combination of bad comics, and Chris Sims' perfect authorial voice, gets me laughing uncontrollably more than anything else I read. If I've still got your attention, here are some teaser, lines that just made my lose it:

What better way to examine Black History in comics than a look back at the history of the character with the uncanny ability to embody a stereotype whenever he appears.

At one point in the story, the Punisher passes by a guy buying a boogie board. We get a closeup of him, along with a thought balloon that reads: "The Punisher does not know that my mission is to guide him--to show him that he must fulfull the grand-master's last wish and become the western world's greatest ninja!"

Just look at it. It's got the Incredible Hulk fighting a character from a classic of European literature.

So what makes me so sure that this time I really have struck gold? Oh, I don't know. How about the fact that it's called Giant Super-Heroes Battle Super-Gorillas?

This would be the point where I tell you why the ISB has deep cultural significance and serious political implications, and why you can therefore feel virtuous about reading it. Fortunately, it has neither, so you can just enjoy the ride.

The State and the Stateless

February 23rd, 2006  |  Published in Political Economy

Arendt's Origins of Totalitarianism is generally remembered for its analysis of the totalitarian state itself. But what struck me on reading it was the discussion of the European milieu from which the totalitarian states emerged. Europe in the interwar years was characterized, says Arendt, by a historically unprecedented conjunction of two factors:

  1. Massive numbers of stateless people, who were no longer citizens of any sovereign state
  2. The generalization of the nation-state form across the entire world

What this meant was that there was no "uncivilized" space on earth left for the stateless to resettle: "[w]hat is unprecedented is not the loss of a home but the impossibility of finding a new one" (p. 293). In this context, stateless people became an insoluble problem: permanently outside the law, shuttled back and forth between states which all denied responsibility for them, and subject to arbitrary police domination wherever they found themselves. Such a state of
affairs, says Arendt, led toward the concentration camp.

The crisis of the stateless people developed from what, in contemporary parlance, we might call a "bug" in the Enlightenment conception of rights. As set forth in the "Declaration of the rights of man," human rights were grounded in nature, in an abstract humanity outside of history and social institutions. But it turned out that such rights could only be defined if people were assumed to be members of some political community--a people, a nation. The existence of stateless people vitiated this assumption and led to a form of unfreedom described most chillingly by Arendt:

There is no question that those outside the pale of the law may have more freedom of movement than a lawfully imprisoned criminal or that they enjoy more freedom of opinion in the internment camps of democratic countries than they would in any ordinary despotism, not to mention in a totalitarian country. But neither physical safety--being fed by some state or private welfare agency--nor freedom of opinion changes in the least their fundamental situation of rightlessness. The prolongation of their lives is due to charity and not to right, for no law exists which could force the nations to feed them; their freedom of movement, if they have it at all, gives them no right to residence which even themjailed criminal enjoys as a matter of course; and their freedom of opinion is a fool's freedom for nothing they think matters anyhow. (p. 296)

Notice what this quote assumes about the state. It assumes that if one is a citizen of a state, "the prolongation of one's life" can be due to right and not to charity; that one can have a "right to residence" in accordance with one's right to movement, and that one's freedom of opinion matters and is politically operational. Yet the development of the state today has tended to erode all of these assumptions in one or another way.

In the dismantling of the welfare state and the imposition of neoliberalism, we find an attack on the notion that a state has any duty to provide for its citizens. In the creeping irrationalism of political discourse, combined with the cacophony of media voices, we see the meaninglessness of "free" opinion. And in the status of illegal immigrants, we see a people whose movement is tacitly
tolerated, but who lack all rights to residence.

Arendt says elsewhere that the stateless benefit from committing crimes, for then the state must at least recognize them as an exception to the social norms, rather than as a human being outside of norms altogether. An analogous thing has happened to illegal migrants; witness the following news item:

Immigrants toiling illegally in New York state can sue for lost wages if they are hurt on the job, the state's highest court ruled Tuesday...

The Court of Appeals reinstated the state Supreme Court ruling, saying there was nothing in U.S. immigration law that prevented the worker from receiving lost wages since there was no proof he used fraudulent documents to get the job. The Immigration Reform and Control Act of 1986 "does not make it a crime to work without documentation," Judge Victoria Graffeo said in the decision, the AP reported.

Here of course, the worker becomes a person in the eyes of the law not by committing a crime, but by having a crime committed against them. But it is the nature of the crime that is interesting. Within the employment contract, the worker is within the law--only by being economically exploited do illegal immigrants count as people. It really is true, as the Marxist economist Joan Robinson once said, that the only thing worse than being exploited under capitalism is not being exploited under capitalism.

So to return to the theme I raised above: what sort of state are we moving toward? Philip Bobbitt has theorized a transition from the "nation state" model which collapsed after 1991, and the new "market state". The former aimed to maximize the well-being of its citizens (however those were defined), while the latter aims only to ensure the market conditions under which people can compete for advancement.

Thus the state no longer grounds itself in a people--so what does define the boundaries of a state? One major role of states is to print and defend national currencies. This is of particular importance for the United States, which has the luxury of printing the currency which is used as the global standard of bank reserves and key commodity transactions. As a consequence of "dollar hegemony", there is now a global dollar economy which is quite distinct, both in its membership and its territorial boundaries, from the collectivity of American citizens. What are the implications of this?

In much commentary on the imbalances of the global currency regime, it is implicitly assumed that if there is a contradiction between the the state and the nation, it will ultimately be resolved in favor of the nation: thus there will ultimately be a devaluation of the dollar and a fall in American consumption which restores "balance" to the global economy. But what if the state instead manages to disentangle itself from the nation? That is, what happens if we all become a kind of "stateless" people?

This brings us back to where we started. Many of Arendt's comments on totalitarianism are disturbing in their contemporary resonance. Of those Boer war-era "camps [which] correspond in many respects to the concentration camps at the beginning of totalitarian rule," which "were used for 'suspects' whose offenses could not be proved and who could not be sentenced by ordinary process of law" (p. 440), I hardly need to elaborate. But what is most pernicious about the cavalier use of the word "fascism", in reference to the present state of affairs, is that it stops our thinking at precisely the place where it should start. Now, more than ever, we must dig into the diverse historical preconditions and political elements which led toward the fascist turn--the state-form first among them--in order to see how these apply in our conjuncture. The result will be an analysis which is more than facile phrase-mongering; yet I fear it will be no less chilling for its subtlety.

The Structures of Imperialism

February 20th, 2006  |  Published in Imperialism, Political Economy

The war in Iraq has led to a rehabilitation of "imperialism" as a description of the American role in the world--both from the left, and from conservative defenders of the empire like Niall Ferguson. From my perspective, this is all to the good, as it moves us away from the delusional idealism that informed so many of the debates over so-called "humanitarian intervention" in the 1990's.

But a lot of the debate smacks of economism. That is, people are not distinguishing between the theory of imperialism, and the belief that U.S. foreign policy is directly determined by the interests of specific private corporations and industries. The widespread use of the military- and prison-industrial complex as an analytical framework is indicative of this tendency. These ideas, which are really aspects of one idea, illuminate something important: the positive feedback loop between the expansion of the state's coercive apparatus at home and abroad, and the increasing size and power of private interests which materially benefit from that expansion. But they can lead us down the blind alley of looking for specific economic interests behind each and every military action of the state. In the case of Iraq, the relevant interest is easy to find, which is why "no war for oil" is such a tempting and plausible rallying cry. But the framework breaks down when it is applied to any wider set of historical examples. To use my favorite case: the nation of Grenada is economically notable primarily for being the world's second largest producer of nutmeg; yet the Reagan administration plainly did not go to war against Grenada in the 1980's for nutmeg.

We need to take more seriously Marx's remark, in the Communist Manifesto, that the state is "an executive committee for managing the affairs of the bourgeoisie". This clause is usually taken as a statement of economic determinism: the actions of the state directly reflect the interests of capital. But we should pay less attention to the end of the phrase, and more to the beginning. As any student of bureaucracy and organizations knows, "executive committees for managing" are complex and contradictory entities with their own autonomous logics. It is certainly often true that the state rules in the interest of particular capitals; the economistic anti-war critique captures this. Yet just as often, the state must suppress particularist interests in order to ensure the orderly accumulation of capital in general.

What we need, then, is a theory of imperialism as a structure, and not as a set of interests. If imperialism signifies nothing more than a territorially defined hierarchy of wealth and power in the world system, we can ask what aspects of contemporary capitalism generate and reinforce such hierarchies. As a preliminary step, it occurs to me that we should differentiate some different levels at which the global economy is integrated.

  1. Primitive Accumulation. Capitalism could not take off without the existence of massive, concentrated stores of wealth, which could then be thrown into circulation as capital. The primitive accumulation of capital refers to the violent and lawless process by which this concentration occurred. The process of primitive accumulation also destroys pre-capitalist social formations and allows capitalism to expand into new areas. This type of global integration is central to Rosa Luxemburg's theory of imperialism. It has been picked up of late by David Harvey, who uses the term "accumulation by disposession" to encompass not only the process traditionally included under the heading of "primitive accumulation", but also things like the commodification of traditional knowledges through the patent system, and the privatization of public institutions.
  2. Export of Commodities. Capitalism has an innate tendency toward overproduction, because increases in productivity are not matched by equivalent rises in the wages of those who must buy the products. Capital thus always seeks new markets, and thus breaks down national barriers. Marx refers to this in the Manifesto: "[t]he cheap prices of commodities are the heavy artillery with which it batters down all Chinese walls, with which it forces the barbarians’ intensely obstinate hatred of foreigners to capitulate."
  3. Export of Capital. Capital ultimately needs not only new markets, but new investment opportunties to dispose of all the capital that is accumulated through repeated cycles of production. This leads to the export not merely of commodities, but of capital, as investment is made abroad and capitalist production begins to be globalized. The export of capital was central to early 20th century theories of imperialism, most notably Lenin's Imperialism: The Highest Stage of Capitalism.
  4. Currency Regimes. The globalizing process which is inaugurated in primitive accumulation, and intensified by the export of commodities and capital, necessitates a means of payment in global trade--a way of mediating between the diverse national currencies. Up until the 1970's, gold served this function. Since the collapse of the gold standard, however, a peculiar new system has emerged. The U.S. dollar has become the global reserve currency: global commodities like oil are priced in dollars, and national central banks hold reserves of dollars in order to back up their own currencies. This gives the United States, the only state which can print dollars, a unique power on the global stage. Specifically, dollar hegemony allows the U.S. to maintain structural budget and trade deficits without triggering massive domestic inflation. In order to maintain their massive trade surpluses, China and other countries buy up massive amounts of U.S. Treasury bonds, thus underwriting U.S. government spending. This system means, in essence, that "world trade is now a game in which the US produces dollars and the rest of the world produces things that dollars can buy." Yet no-one wants to upset this arrangement by selling their dollar reserves, since the resulting process of global rebalancing would destroy the production of our trading partners at the same time it demolished American consumption. The constitution of this regime of "dollar hegemony" or "super imperialism" has been documented in detail by Marxist-influenced economists Michael Hudson and Henry C.K. Liu. It is also a topic of concern among mainstream economists like Brad Setser and Nouriel Roubini.
  5. Energy. It is not arbitrary that current events appear to swirl around oil, rather than any other commodity. The productivity of the economy is highly dependent on oil--to a large extent, the increased efficiency of human labor in production has been a function of the availability of cheap energy, in the form of petroleum. If oil becomes more scarce (and therefore more expensive), this has follow-through effects throughout every sector of the economy, from transportation costs to electricity to agriculture (which is sustained by
    nitrogen fertilizer, a petroleum product). There has been a lot of concern lately at the possibility that we are approaching the condition known as "peak oil": the point at which the absolute quantity of oil produced in the world will begin to decline. Note that this is not the same as saying that we are "running out" of oil. The important variable is not how much oil is in the ground, but how fast we can extract it. Capitalism can only exist if it constantly grows, and growth in the economy is tied to growth in oil production. If the peak oil theorists are right that we are approaching peak oil--or have already passed it--then the effects on the global economy will be severe. Moreover, geopolitical contests over oil will certainly intensify. Attempts to integrate energy into the theory of imperialism have so far been somewhat halting--but some important initial steps have been taken by Alf Hornborg, Stan Goff, and Mark Jones.

It is important, I think, to recognize that these five aspects of imperialism are not stages which follow each other in a temporal sequence. Rather, they are overlapping structures of international capital which co-exist and interact. A theory of imperialism has to attend to all of them; moreover, we need an empirical and historically specific account which shows which aspects are subordinate and which predominant in the current conjuncture.

As a start, we might think about the territoriality and directionality of these processes. Imperialist structures 1-3 (dispossession, commodities, capital) are increasingly deterritorialized, in that the capitalist class is becoming transnational, and accumulation by dispossession happens within countries as well as between them. At least in the case of (2) and (3), they are also bidirectional--the need to break down barriers to commodities and capital by now applies almost as much to the subordinate economies of the post-colonial world as it does to the old imperial center, and neoliberalism is breaking down many of the barriers which the first world used to protect its economies from the third world.

Dollar hegemony has the clearest directionality of any of these processes: it is the structure which allows the United States to consume more than it produces, and thereby to materially exploit the rest of the world. For that reason, I think dollar hegemony has to be central to any concept of imperialism which maintains the political and moral force of Lenin and Luxemburg. Yet this picture is complicated by a deterritorialization noted by Henry Liu: "Another unique distinction about dollar hegemongy is that it produced an incongruity between the dollar economy and the US economy." In other words, dollar hegemony benefits a class of finance capitalists that is not American, per se. I have not thought through the implications of this, but it might be a clue to resolving the paradox I discussed yesterday.

Then there is oil, the commodity which underpins so much of global finance, yet one which is by its nature territorial. It is the wild card here, and I think we need an account of oil's role in imperialism which gets past economism. If dollar hegemony is the structuring logic of contemporary imperialism, oil would seem to be its "determining last instance"--the commodity whose fate will ultimately determine the future shape of the system.

Stop the Global Cartoon Race!

February 19th, 2006  |  Published in Uncategorized

First, it was the infamous Danish cartoons.

Then, the Iranians decided to prove that Muslims are the equals of the West in all matters of offensive cartoonery. An Iranian newspaper hit on the idea of a contest for cartoons about the Holocaust.

Not to be outdone, an Israeli citizen has attempted to outmaneuver the Iranians by proving that when it comes to anti-Semitic cartoons, no-one can outdo the Jewish people themselves.

This all puts me in mind of nothing so much as this old Monty Python sketch.

Clearly, we are in the midst of a great global cartoon race. If this pernicious competition is not stopped, the cartoon scientists of the great humor powers will soon devise a cartoon so offensive that it will instantly annihilate any civilization that comes in contact with it. People of Earth, I implore you: we must support global cartoon disarmament!

Chaotic Motion

February 19th, 2006  |  Published in Imperialism, Political Economy

Recently, I've been reading and rereading a fascinating essay by Gopal Balakrishnan in the New Left Review. It's a long review of a recent book, Afflicted Powers by the Retort collective in San Francisco. The book is an attempt to think through the meaning and logic of the contemporary period of warmaking, and to critique and update Marxist theories of imperialism in light of recent developments.

Balakrishnan enumerates several different themes in the book, many of which strike me as tangentially or episodically interesting at best. But I can't stop thinking about the last piece of Retort's analysis, on "the spectacular".

The concept comes, of course, from the situationist Guy Debord. In late modern capitalism, Debord argued, the manufacture of images and appearances--the spectacle--has taken precedence in all realms of social life. This is simply an extension of the logic of commodity production, as Debord explained:

This is the principle of commodity fetishism, the domination of society by “intangible as well as tangible things,” which reaches its absolute fulfillment in the spectacle, where the tangible world is replaced by a selection of images which exist above it, and which simultaneously impose themselves as the tangible par excellence.

As appropriated by Retort, the spectacle is the principal structuring logic of modern politics, and it intervenes between political actors and "facts on the ground" in such a way as to erode historical knowledge and make "strategic interests" indeterminate. This introduces a jarring reversal in the left's discourse about imperial power. It has always been the virtue of anti-imperialist analyses that they can break through liberal critiques which attribute wars to incompetence or individual evil; anti-imperialism achieves this by positing a rational logic of capital accumulation behind war's inhuman illogic. But Retort's analysis would suggest that today, our leaders are in fact confused, incompetent, impotent; it could not be otherwise. Balakrishnan:

A major, probably irreversible, sociological transformation of baby-boom capitalism is at work here. The plebeians refuse to die in wars, the rich refuse to pay for them. The spectacle has resulted not only in weak citizenship at the bottom, but also faulty intelligence at the top. With an eye on the mounting chaos in occupied Iraq, it is not difficult to conclude that the Republican administration’s attempt at grand strategy is now heading for the shoals. ‘The dimension of spectacle has never before interfered so palpably, so insistently, with the business of keeping one’s satrapies in order.’

This view is only confirmed the more one looks at the developments overseas. Christian Parenti's recent book, The Freedom, details the madness of an occupying army attempting to rebuild a country that does not want them, and that they do not understand. The army appears to be breaking under the strain, as recruitment falters. The debt burden continues to mount, and it is impossible to determine how long the Bank of China will continue to fund our adventures. Moreover, even Rumsfeld acknowledges, in a quote used by Balakrishnan, that "we lack metrics to know whether we are winning or losing the war".

All of this is perplexing and disturbing enough. But Balakrishnan goes on to add another layer of uncertainty. It is one thing to say that our leaders have lost the ability to connect military means with their ultimate, capitalist ends. But why, he asks, do we continue to act as though the role of military power in the constitution of interstate power dynamics were obvious and unchanging?

What role does military power play in determining a state’s position within international ranking systems; why and to what extent is it still a decisive dimension of state power? The inability of existing theories even to pose these problems speaks to a deeper crisis of the classical categories of geopolitical rationality.

This is certainly relevant to the various theories of imperialist succession, in which China eventually displaces the U.S. as the hegemonic power. It is generally assumed, in such accounts, that China will have to generate an autonomous military capability in order to accede to first status; the main danger in this transition comes from the potential irresponsibility of a declining U.S. which still has the capacity to start a global conflagration. But perhaps this perspective is too reliant on old schemas of interstate politics.

There is a paradox here. On the one hand, war is increasingly everywhere--the line between soldier and civilian, homeland and battlefield, is steadily being eroded. Yet the purpose and meaning of military power in late capitalist society has never been less clear. Where does that leave us?

A chaotic system is described deterministically by a mathematical equation. But tiny variations in the initial conditions can lead to tremendous nonlinear variation in the system's motion. This is the puzzle of our epoch: it appears that the transition from Clinton to Bush, along with the catalyst of 9/11, has utterly rearranged the logic of the international system. Thus, while a determinate logic must exist in principle, it is, in practice, unknowable.