Paul Mattick 1950
Source: Resistance, Vol. 9, No. 1 (June-July 1950), pp. 3-4 and 15;
Transcribed: by Zdravko Saveski.
The Nazi war against Europe, which was to lead to a German-dominated Europe capable of opposing American supremacy and the Russian bid for world power, was brought to an end by America's determination to maintain the multiple power system in Europe and Asia. Down with Germany, however, went the whole of Western Europe, which lost its potential capacity to play an independent role in world politics. Though belatedly, there was then established politically what had since long been an economic fact, namely, that America was capitalism's strongest power.
Although the individual nations can no longer play as independent forces in the international power game, this does not induce them willingly to sacrifice their national interests to the specific power goals of Russia or of the United States. Small businesses do not declare bankruptcy just because the future belongs to big business; they are forced into bankruptcy. Nations, too, that is all the people whose social and economic position depends directly on the institution of the national state and, of course, all those subscribing to the national ideology as a way of thinking and behaving whether they profit thereby or not, will not of their own accord fit themselves into a larger frame of economic and political activity, just because it suits the great powers. Though it is quite clear that at present, and with regard to Russian imperialism, the "interests" of the Western nations coincide with those of America, enabling an extensive military and diplomatic collaboration, these common endeavors do not affect the intra-European rivalries, nor the economic frictions between Europe as a whole and the United States. Temporary "friends" against Russia, they still remain enemies among themselves. Lend-Lease, loans, and the European Recovery Program do not alter this situation, as no amount of American "generosity" could compensate for Europe's losses accompanying the American ascendancy. The latter's help is recognized for what it is, an instrument of control.
Emerging out of the second world war the recognized strongest power, America rules, and cannot but rule, the nations weaker than herself. Aside from the direct rule of the defeated countries, the economic and military dependency of the Western nations allows for a variety of political and financial controls, which are employed in accordance with the desired degrees of submissiveness and the American "defense" requirements. Favors are granted or denied, concessions made or withheld, aid given or declined, just as the shifting needs of American policy demand, conditioned of course by problems at home and the internal struggles affecting foreign policy.
The direct results of warfare in Europe and Asia -- the areas destroyed, the manpower slaughtered, the factories smashed, the transport deteriorated, the neglected installations of all sorts, the sunken ships unreplaced, the economic dislocations due to shifts both in populations and boundaries, the years of war and preparation for war, with their one-sided destructive direction of the economies, the invading armies, friend and foe alike, the ruins and the hunger, the total disorganization of total war -- all set Europe and Asia back far below their pre-war level of production, which had already failed to secure competitive strength and to maintain social stability. Even if in some countries the pre-war level of production has been reached again, and has in others been excelled, the glaring discrepancy between American production and that of other nations remains in force, and is still widening in favor of the United States. No palliatives, such as currency manipulation, credit-liberalization, and tariff-reduction can bridge this fundamental gap.
Though it is clear that the Russian-American power conflict commits the United States to the attempt to secure the continuation of Western Europe in its present socio-economic form, this situation itself forbids any basic change in the existing industrial, trade, and political relations between the American and the European continent. A restoration of the European nations' former competitive position, even if it were possible, would only give them greater freedom of action and make them less reliable allies of the United States. The maintenance of their dependency forces America to keep ahead of their development. The price of supremacy, however, includes continuous support of the European nations. Of course, the need and the will to adhere to this scheme of things is not enough to guarantee its "permanency." A deep economic depression in the United States may lead to a revision of her present foreign policy. If it has to "benefit" half of the world, deficit-financing will reach its limitations sooner, since these limitations are set by actual American production and her pattern of distribution. Financial and trade policies may be changed, so as to serve exclusively American interests, regardless of all external political repercussions. A new "isolationism" may precede a third world war, though it seems more likely that a new war will precede another deep depression.
For the moment, however, it is merely a question of method, whether the Western nations are propped up by direct aid, or by indirect means, such as tariff-reductions, credit and monetary policies. The question of method is, of course, of some significance in the determination of what particular social group shall support how much of the "burden on the backs of the American people." It also concerns convenience, as it is a manipulatory device affecting internal frictions as well as the political set-up in other nations. But whatever its form, American aid can solve neither the European nor the American problems. It only indicates the present-day fruitlessness of war and victory.
It has often been pointed out "that the needs of the Western European economies have outgrown the confines of the Western national states, and that only a continental market as large as the whole or most of Europe is large enough to realize the full benefits of modern productive techniques and to achieve a rate of growth comparative to that of the United States." According to Paul G. Hoffman, who heads the Economic Cooperation Administration, the "end of Europe's recurring crisis" requires the formation of a single large market within which quantitative restrictions on the movements of goods, monetary barriers to the flow of payments and, eventually, all tariffs are permanently swept away." The blessings of such economic 'integration", Hoffman said, may be observed in the example of the United States, where "a single market of 150,000,000 consumers has been indispensable to the strength and efficiency of the economy." This should make it obvious, he continued, that the creation of a permanent, freely trading area, comprising 270,000,000 consumers in Western Europe would have a multitude of helpful consequences," since it would, "accelerate the development of large-scale, low-cost production industries, and would make the effective use of all resources easier, the stifling of healthy competition more difficult; . . . and would make it possible for Europe to improve its competitive position in the world and thus more nearly satisfy the expectations and needs of the people."
One might consider the unmentioned fact that a single market of 150,000,000 consumers did not prevent a decade of depression in the United States. And one may consider that without the European wars, as an expression of the European decline, America's special position in the world would not be so special, and Mr. Hoffman would not be in Paris instructing the Marshall-aid receivers in "healthy" competition. But aside from this, there simply is no way of improving Europe's world-competitive position without destroying the "healthy" intra-European competition upon which Mr. Hoffman insists. Although it seems "logical" that general and "free" competition may improve the intra-European situation, it will not improve Europe's competitive position vis-a-vis Russia or the United States. But what seems "logical" is no longer possible. The quest for intra-European competition merely expresses the United States' desire for a Europe sufficiently weak so as not to compete with American interests, yet "healthy" enough to get along with little or no American aid.
It is quite difficult, however, to preach laissez faire in Europe, while adhering to monopolistic practices in the United States, to try to overcome European nationalism in the name of American nationalism, to deny to other governments what one's own government is doing. For this reason, perhaps, Mr. Hoffman admitted that the European integration if not accomplished through adaptations of the existing institutions may require new central institutions." What these central institutions could be is not made clear in this twentieth-century afterthought to a nineteenth-century suggestion. But their functions may be surmised from the practical requirements of economic integration. They would have to concern themselves in authoritarian fashion with anti-authoritarian measures, oppose centralization centralistically, interfere against interferences, free competition by decree, formulate laws that make the "economic laws" work, turn visible Adam Smith's "invisible hand." However, since nothing is eaten as hot as it is cooked, it all comes finally down to the rather prosaic desire to save the American "tax-payers" some money. It might even come to less, for if one has to talk, and if it has to sound "reasonable", what is there to say but that the solution to all economic problems lies in competition and accumulation, even though these activities led to the state of affairs now to be resolved in their name.
Economic integration is an opposite to competition. It is not possible to adhere to both simultaneously. Where there exists some sort of competitive capitalist "integration", of shorter or longer duration, it serves the more effective competition of group against group, and leads to greater devastation and dislocations than any "disintegrated" form of competition. Commenting on the proposition of an integrated European economy, Sir Stafford Cripps was quick in pointing out that Britain could not partake in it in any manner that would prejudice the full discharge of her responsibilities as leader of the British Commonwealth and the sterling area." And this the less so, as this leadership has itself become quite precarious, indicating the possible end of the sterling bloc. What, then, is there to be integrated? The Benelux nations, already cooperating in some limited fashion to secure their interests against England and France? The Scandinavian countries, depending upon "friendly" relations with the Russian power-bloc? The wreckage of Western Germany, a permanent no-man's land in the "cold war" between "East" and "West", Fascist Spain and Portugal, stagnating in a cesspool of unsolvable internal and external contradictions? Impoverished Italy, unable to sustain herself no matter what economic policy may rule? Insecure France, clinging more than ever to national sovereignty and imperialist exploitation? It really needs no deep reasoning, but merely observation, to recognize the impossibility of a meaningful economic integration of Western Europe.
As far as the United States is concerned, two world wars made it clear that the desired "integration" is not identical with real unification. If America was opposed to a German Europe, and is now opposed to a Russian Europe, she will be opposed to a European Europe just as much. If it seems that she is now inclined to accept a situation contrary to her own interests, and if her own propaganda even suggests European unification, it is because of the certainty of the impossibility of its realization. But even if the American concern for a United Europe could be taken seriously, the European conditions themselves exclude its formation. The 1949 Conference of the Council of Europe in Strasbourg merely established once more that despite the fact that no nation can solve its problems in isolation, there exists no real possibility to come to mutual understanding and a common policy. The European dilemma was seen as a rather permanent affair, because of the world-wide industrial changes at its base, because of America's unique position in the world, and because of the extending Russian autarchy.
Even if it were realizable, a single, unified market would, as was repetitiously pointed out, mean little if anything with regard to Europe's downward trend. Any "integration" actually reached would blow apart again in the deepening crisis. The more difficult the economic situation becomes in general, the more violent the separate attempts to escape the decline. The frantic exhortation of professional coordinators, Marshall Plan planners, and visionary statesmen for the quick institution of complimentary economic policies and reasonable world relations are immediately contradicted by their own inability to resolve the basic rivalry between the "West" and the "East", which reaches deep into the European economic and political life, pointing to strife and civil war rather than collaboration and good will. And it cannot be otherwise, as the economic and political relations represent social and class relations that are vitally affected by all major changes within the world economy. If the defense and conquest of positions of power and privilege, and the struggles for and against exploitation, change the economic and political scene nationally as well as internationally, these changes, in turn, send men into new actions of defense and conquest in that all-comprehending fratricidal struggle called the capitalist economy.