Chris Harman

Thinking it through

Developing neoliberals

(March 2004)

From Socialist Review, No.283, March 2004.
Copyright © Socialist Review.
Copied with thanks from the Socialist Review Website.
Marked up by Einde O’Callaghan for the Marxists’ Internet Archive.

My enemy’s enemy is not always my friend

Many activists at the World Social Forum in Mumbai were quite rightly celebrating the blow to the plans of the US and the EU at the Cancun meeting of the World Trade Organisation (WTO). For once, the world’s most powerful capitalist states suffered a setback in their schemes to write the agenda for the rest of the system.

But joy was often mixed up with confusion about what really happened. Many accounts of Cancun saw it as a revolt on behalf of the world’s poor led by the ‘G3’ governments of South Africa, India and Brazil. These, we were told, were a ‘New Bandung’ (the organisation of Third World countries which resisted US pressure to join in the Cold War 50 years ago).

There are some similarly glowing interpretations of the role of Brazil and Argentina in January’s negotiations in Monterrey in Mexico over the formation of the Free Trade Area of the Americas (known as Alca from its initials in Spanish). After the talks came close to breaking down, Heinz Dieterich, for instance, wrote of ‘a wall of dignity of the Latin American power bloc’.

But the reality refutes such claims. The Brazilian, South African and Indian governments have all embraced the neoliberal agenda. Far from Brazil’s Lula leading a revolt of the Third World against that agenda, Cardoso, the neoliberal who preceded him as president, said last month that there was no essential difference between their policies. It is this continuity which has led Lula’s Workers Party to expel three left wing deputies and a senator.

As Walden Bello has pointed out, the main beneficiaries of greater agricultural market access to Northern markets – the demands Brazil and the others pushed at Cancun – would be the monopolistic export industries. In Brazil this means the less than 1 percent of farms that own 46 percent of the total arable land, the old and powerful sugar cane oligarchy in the country, and the giant soya producers who are now collaborating with Monsanto and its GM seeds.

In South Africa 85 percent of the land and a similar proportion of industry remain under white ownership.

India’s Hindu chauvinist BJP government was fighting at Cancun on behalf of big firms like the sugar producers Triveni and Balrampur Chini Mills. They see greater access to overseas markets as a way of raising their prices – something which will make life even harder for the third of India’s population who live in acute poverty.

Brazil, as one of the world’s ten biggest economies, still has a powerful local capitalist class. This has tried to strengthen its influence by drawing under its wing capital in countries like Argentina and Uruguay through the Mercosur customs union. It sees this as allowing it to get more advantageous terms out of agreements, alliances and mergers with US or European multinationals.

The Lula government has been courting this class. Partly this means continuing with the neoliberal reforms of its predecessor. But it has also been keen to promote the specific interests of Brazilian capital, even if this means resisting some of the demands coming from the US. It counterposes a cut down version of Alca (which it calls Alca-lite) to the full US version. And it looks to the EU (with slightly higher investment in Brazil than the US) and East Asia (an increasingly important destination for raw material exports) as a counterbalance to the pressure from the US.

There is no contradiction between a policy of agreeing to IMF demands over debt servicing and cutbacks in welfare provision on the one hand, and fighting for the interests of national capital to be respected within the overall Alca framework of collaboration with US capital on the other. For this reason, those on the left who have lauded the stance taken by Lula and the rest are wrong.

But so too are those who claim that there is no element of ‘national independence’ left to the capitalist classes of places like Argentina and Brazil, or even India and South Africa – that they are ‘neocolonies’ or undergoing ‘recolonisation’. Sometimes this is mere rhetoric, and gives expression to a widespread feeling of betrayal of promises made by bourgeois and petty bourgeois nationalist politicians of the 1950s, 1960s and 1970s. It emphasises one essential point – that US capitalism stands at the top of a hierarchy of exploitation and oppression, and those lesser exploiters are trying to do deals with it. But it misses a wider understanding of what is happening in a way that overstates the strength of imperialism.

The imperialist hierarchy today is not one like that of the old European empires. They ruled their colonies through governors who obeyed orders without question. Today what we face is a pecking order of different states. Apart from a handful of exceptions, all have their own internal monopoly of armed force, their own taxation systems, their own allocations of government expenditure – and their own capitalists.

So states are always attempting to improve their position at the expense of others, usually through peaceful means, occasionally through military action. This provides nationally-based capitalists with the leverage to form alliances favourable to themselves with foreign multinationals – and in some cases to establish themselves as multinational players on the world stage.

There are elements of conflict as well as agreement between the rulers of medium sized economies and the great imperialist powers. If you don’t grasp this, you cannot explain Cancun or, for that matter, their refusal to vote for Bush’s war in the UN a year ago. But people like Dieterich are wrong to see such tactical disagreements as representing a strategic challenge to imperialism. That is a dangerous path that leads to sections of the left supporting their own government when it uses nationalist language to justify its own petty imperialism – as has happened with much of the Indian left in the past in conflicts with China and Pakistan.

The ‘Triad’ powers of North America, Europe and Japan can, of course, expect to dominate in the long run. But there is still some room for manoeuvre for lesser states and their national capitalisms. And occasionally, as in Cancun, this creates problems for the system as a whole.

This should not lead anyone to glorify the neoliberal rulers of Brazil, South Africa and India. They might quarrel over the size of their slice of bread, but they will defend to the end the bakery, however small their share in it. And they will do deals with the big imperialisms, especially the US, to take crumbs from the mouths of the poor when the opportunity arises again.

Today’s imperialist hierarchy is not like that of the old European empires

Last updated on 27 December 2009